NZC (ASX) Ann: Nzuri Raises $6M to Advance Kalongwe Copper-Cobalt Project

Originally posted by columbo ↑

Hi @mineralised, first of all, thank you and several others (@Chrimata, @africadale, @Maigret1, @binwood etc.) for your high-quality and very informative posts.

I was wondering about your comment "Huayou has not been allowed to increase their stake at this price, they are maintaining the share they had in % terms and that is very important." Did you mean it's important Huayou's stake cannot go up? [Or did you mean the converse, i.e. that it is important they maintain at least current levels?] I ask because looking at AVZ, it is not immediately clear Huayou plays such a positive role for them. It might appear as if Huayou acquired a significant stake to control AVZ rather than to help move things along as quickly as possible...

The new DRC mining law will be signed into law today. (Although it probably will be challenged in court.) Supposing the new mining law is written in stone, do you have a sense of what the timeline will be for NZC (i.e. time to production now that the new mining code is known) and what the impact of the new mining law might be for NZC?

Please feel free to suggest to DYOR if these questions are too pedestrian, but I would appreciate your feedback.

Cheers, Columbo

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It is a foregone conclusion that they would like to buy as much as they can at 25c, but it is important that we don't need to give them as much as they like and show self sufficiency to a degree. Tembo obviously agreed and put cash in. Note that Tembo did not participate in the raise before this one along side Huayou. They did not participate in the raise before that either, from memory they converted some outstanding notes. They did jump into this one.

Aside for shaving some of the cream off the top the main impact the mining code has on Nzuri are the changes around debt financing, it will be more expensive debt now. This makes attracting strategic interest and generating competitive tension more important.

Timeline: I still think the flashpoint will be just prior to executing financing/off-take (with a competing offer submitted to a board meeting with Huayou attending) and we will never see Kalongwe developed. However management (And tembo when I last spoke to them ages ago) either have a very good poker face or are intent on taking this into production. Quite intriguing to see how this will go the closer we get.