Haha, I agree. Usually I don't get the funds together fast enough to participate in these macro drops, was actually looking to diversify a little by buying something else (maybe cobalt?). But in the end, BGS was again the best discount. Only $5k more but still happy to get in on Friday.
Lot of depressing commentary on these forums this week (no surprise) but it is funny how the market price tends to change sentiment and not the other way round. I do like opinions and judgements that do not fit with mine though because it means I have to go and privately research it completely to retick the boxes. So far this is where i'm at:
- No, Sangar is not full of mica.
- No, southern Mali is not anti mining and unsafe for miners (sovereign risk read what is happening over at EMH in Eastern Europe, nasty stuff).
- No, we don't need a refinery to make the project work.
Reading Paragon's arguments re spod oversupply and it just seems a bit half baked to be honest. As Greg had stated at the Indaba conference, we already have interest for spodumene concentrate for 2020 delivery. Most of the spod producers have locked up supply for the next 5 years. PLS has got an offtake agreement with Great Wall for it's 5mtpa product! I'm glad they made money for their clients but they would have made much more by simply buying into PLS/AJM/TAW etc - would have made 200%+ in a year.
Anyway, looking at the bloodbath last week it is clear to me BGS got the short end of the straw.
BGS fell the most out of the above companies on Monday AND Tuesday. SYA is in a similar boat and they did fall almost as much, but had two big recovery days immediately after. We haven't. PLS looks a bit overdone too tbh. AJM and KDR recovered exceptionally well. Overall we got smashed, much more so than everyone else and with no real reason. Maybe option conversion? Idk.
BGS and SYA are at similar stages of development, but the difference in sp performance for this week alone is startling. BGS and AVZ are both in African third world countries and BGS is a more advanced project, still almost double the drop in comparison.
Makes me wonder what would've happened if the Sangar results were only good instead of great.
As for the transport situation, remember that our target for improving cost is based upon 100% truck route. Macky Sall has stated that the first stage of rehabilitation of the Dakar Bamako line could begin this year. If this happens, very likely we can leverage the trainline from Bamako, possibly from day one of operations and reduce our truck freight to only 150km, no crossing of national borders. Massive savings there.
At the same time, said the Deputy Minister, it was also necessary to imagine a rapid transport system to ensure good mobility. As part of the railways always, it reveals that with the visit of President Emmanuel Macron of France, the problem of DakarBamako-Ferroviaire (DBF) is in the process of being definitively resolved. The option taken is to rehabilitate the Dakar-Bamako line with a dry port at Tambacounda. DBF will then be equipped with modern rolling stock for an effective re-launch of rail activities pending a much larger project in the direction of the standard gauge railway. The objective, he says, is to launch the rehabilitation works before the end of 2018 and thus DBF will regain its high-performance corporate clothes, able to support its operating expenses and also making a profit.
BGS Price at posting:
47.5¢ Sentiment: Buy Disclosure: Held
(20min delay)