Hi
@Kazza1DT he has stated they are looking to drill out a 30 to 50 MT resource only. In order to get there, DRE have 14 MT already at 3 Kms of the 43 KMs and although not guaranteed, I am assuming it is a fair expectation that this will be met even if Yin was the best starting point?20-30Mt represents a +20 year mine life for 1-1.5Mtpa operation which is industry standard. Yin puts you about half way there assuming some extensions at depth/strike and some MRE that falls out of a mining reserve. Yin has value as a concentrate only operation (if only selling to China worse case) or to HAS in the future. Yin may not be big enough for a full stand alone hydromet, MREC operation? There is uncertainty about what other deposits will be discovered at Magaroon, certainly some small ones, maybe some large ones, hopefully high TREO- NdPr robust ones... nothing is guaranteed.
On this basis alone, coupled with the second mover advantage referenced on several occasions in terms of having an economical product the current MC is fair value on a standalone basis?Current MC is the best measure of DRE's value. However, that MC reflects a certain binary outcome of more discoveries and commercial development value uplift, verses exploration disappointment and long period of 'stranded asset' risk and associated downside. Explorer developers are always a risk-reward punt, the share price can end up higher or lower over time.
C3/C6 are still unknowns at this stage but possible upside.Within the likely size range of carb orebody targets, undrilled carbs obviously have upside for anything up to Mt Weld good or better. That portion of C3 drilled to 160m and infilled to 80m has limited upside or economic potential imo... others disagree.
HAS may offer potential processing opportunities but DRE having gained the economic viability from their initial flow sheets, DRE are not tied to their success and have other potential partnering options and what happens to HAS is not necessary relevant?Makes no economic sense for HAS to pay DRE for Yin ore until they have run out of 'free' ore of similar value they already own themselves. DRE could partner with ILU or LYC unless those companies have their own 'free' ore or better opportunities than DRE to fill production capacity. Unless ILU-NTU deal falls through, those partners look full and not short-medium term options. Overseas players may want to build monazite cracking plants and buy DRE mon-con (eg Energy Fuels in USA, new entrants like Medallion Resources, or other countries building out a supply chain). China would happily buy DRE mon-con...
Elon Musk development work is currently the biggest potential risk to mine life and future value at this stage. I saw the term binary used and agree with the outcome if it comes into play but would expect that timing is key.Substitution is a big risk obviously, at the very least likely limits the price level of NdPr before EV companies choose substitutes over a combo of price and supply risk costs. IMO, Re-magnets will continue to be used ex-China and the degree of western RE-mag substitution will depend on a combo of RE prices, China supply risks and the quality and speed of new non-RE-mag developments.
DRE will probably be valued largely on Mangaroon RE's until their other exploration plays reach similar levels of economic development potential imo. Reality is market doesn't usually pay much for exploration projects that are one step under 'new mine potential excitement' type results. You seem to understand explorer/developers and your investment hangs on exploration success or failure. TBH, if the amount you are in the red is causing undue anxiety you probably went too hard. Taking losses is not easy however...
Having fallen from above 10c to 6.5c, DRE is less over-valued, maybe undervalued and the risks of quickly going further into the red are low unless the general market falls badly. There is clearly potential from all this drilling for some good results if not an outright new discovery of merit. Maybe you should hang tough until the next price run on good results then look to take some off the table, even if it's still for a modest loss? Being stressed from over-invested in a speculative stock is not a good place to be. From my experience it's only after buying too much and price falls that anxiety kicks in to let you know you're over-invested in a stock. It's difficult on the way up when it's all upside and bulls to not feel over-confident and go too hard... we've all made the same mistake.
Good luck
(20min delay)