On the TNG website they have the Breakaway Research report that reads very well. However, it shows TNG has a risked value of $153.6 million or 28c per share. This is based on offtake agreements, getting funding for Mt Peake and many other assumptions. In recent days the shares have been trading around this level.
The capex needed in the PFS for Mt Peake alone is $560 mill. That is a lot of money for an explorer to find with a market cap circa $100 m and $5 mill in the bank. The NPV for revenue LOM is $2.6 bill. Lead times for development and off take would be at least 3 to 5 yrs with a shot gun start. I suppose you have to start somewhere and it is not easy.
It will be interesting to see if the MoU partners put there money up or take an equity stake. Some of them are not end users or trade commodities. TNG are hoping to get their DFS by the end of this year. I am sure that will be positive. And next year that will be looking to finance development and proceed to construction.
What weighs on my mind is TNG advertising the Breakaway valuation and it is subject to Mt Peake getting finance.
The point I am making is that the shares are likely to languish without positive news. I am sure plenty of you are thinking about being patient.
You may think the shares are justifiably worth more with the risks and lead times. In June the updated Breakaway report called TNG a speculative buy at 17c.
