OK I’ll have a quick go. In an ordinary situation RNU is a good company. We have the resources, plans, MOUs etc.
The way the world has changed since Biden got in makes this a great company with incredible opportunities. The USA, Japan India and Australia have joined forces in a number of ways, militarily and strategically. They have joined forces to provide vaccines for Papua New Guinea, discussed the issue surrounding China. Part of the strategic plan is around minerals, specifically Rare Earths and the EV minerals, Lithium, graphite, Cobalt etc. The Morrison’s governments plan to support companies involved with these minerals to value added is potentially the best thing that could ever happen to RNU. I bet this focus has come from talks with our group of four. So we start with $1.3 billion but I imagine it could be a lot more if US money backs this also, it’s pressure to secure these minerals may be enough.
Unbelievable that this company is in the perfect position take full advantage of this. If we were any earlier we would be too far away to take it up. Any later and we would already have to have found the funds and maybe this would not be favourable, CR’s and risky loans. Morrison will want shovel ready projects to highlight his policy. I’m sure bringing on a new mine and it value-adding processor fits the bill perfectly. Jobs and investment in SA will not hurt him either.
We have a world class graphite resource.
Potentially Copper/Cobalt resource
Potentially a Rare Earths resource
All of these could benefit in some way from the governments policy.
If we want to look big and even think about the $5 mark that Mr Buffett was throwing around is it totally out of the question that RNU goes further upstream. Could we actually be involved in making anodes or even batteries. Our management seem dynamic and bold enough to at least think about it much further down the track. I imagine maybe as a minor partner in a larger JV operation. If going vertical to spherical graphite makes us cost effective against anyone who says going a step or two further vertically can’t be cost effective also.
perfect place at the perfect time. Most will be very lucky to get one of these opportunities in there life.
RNU Price at posting:
12.5¢ Sentiment: Buy Disclosure: Held
