Sibanye-Stillwater don't have much places to go if they already get to 19.99% ownership of NCZ. This is a complex transaction that effectively opens a quite different company to the familiar NCZ of old. To stay invested in this, you now have to understand how Century works and also how you think Mt Lyell will work in the future.....
Am I understanding this transaction as basically NCZ presenting a fait-acompli raise, and investment of sophisticates and Sibanye-Stillwater, and asking its existing shareholders to participate in a non-renouncable entitlement offer around 15.5c for any whingers about this dilution?
Seems to me that Sibanye-Stillwater has got itself a blocking stake and major foothold in NCZ without paying any price premium or having to go to the bother of buying on-market. Probably says a bit about NCZ's weak negotiating position. Sibanye-Stillwater also get more copper and zinc assets in Australia so pretty low jurisdictional risk but high cost operations compared to South Africa.
Operationally this is interesting as well, as I am struggling to see what Sibanye-Stillwater (essentially a large South African and US PGM and gold producer) is doing? I get that they are maybe thinking about the future and going down the battery metal route (as evidenced by their investment in Finland). Their acqusition of DRDGold and its tailings operations might mean that they
might know what they are doing about tailings recoveries? Obviously the Tasmanian State Government is keen to reduce enviro liabilities and allow a total tailings retreatment and site rehab effort at Mt Lyell to take place, and are at least being realistic in that some serious money and profits will have to be on the table to attract a rehabilitation effort. The best form of rehab is an operator who are there and making a profit. Don't want people in there for a quick smash and grab and high grade whats left....
I would expect that there will be a lot of gold and some copper in the myriad of Queenstown tailings piles and waste dumps/rock piles and remnant ore locks accessible from open pit and/or underground. The whole thing is going to be a very fun game of tic tac toe with water on site and scheduling re-treatment and tailings dams and void strategies to recover metal. The underground mine also has many technical challenges and opportunities. Perhaps our Queenstown residents can tell us the last time ore was hoisted up the shaft? What level of the the underground mine is dewatered, and what is possibly underwater? Other geotechnical rehab required to stabilize the underground workings? Is there any ore accessible from open pit ops, and what infrastructure is in the way? What condition is the existing copper sulphide concentrator in, and are there still rail logistics to Burnie?
https://www.drdgold.com/our-business/ergo/process/metallurgical-processThis link shows the trials and tribulations of recovering gold and other metals from existing talings, looks like quite a challenge and reading this the one thing that screws everything up is excessive water - something that might be a revelation to them when they arrive in Queenstown.
I think there has got to be a certain amount of geographic diversification and reduction of political risk in Sibanye-Stillwater's investments and future direction that is part of the story here as well.
