A fantastic synopsis as always
@Scarpa.
I too have been pondering of late whether we are currently in an over brought position, seeing as the MC is so close to the PFS NVP, etc.
And like you, I am a current holder of AVZ, riding it all the way up from 2c to 38c and back again...buying at all levels. One thing I consider different about ADN to most other mining companies is that share prices usually move up during the discovery phase and peak once the market has a fair idea of the quality and quantity of the resource they have. Pricing then drifts down again during the Orphan period while the company navigates financing, Offtakes, licences, plant construction and commissioning.
What I believe is different in ADN’s case is that while the low cost capex and timeline to production remains the same since the PFS was released, other more lucrative income streams and product applications are being revealed. Same timeline to production and similar cost to get there (50 million now vs 30 million initially) is what we are being told presently.
The profit margins of the cement alone are circa 5X of the initial DSO figures we were working from. And according to JM, the initial potential demand would tie up all of our product for the first several years....and doesn’t include global demand. Then there’s Natural Nano tech whose profit margins are probably too unbelievable for the market to even price in presently.
So as it stands right now, I believe the market is trying to find its feet on the value add of the cement opportunity, of which we may be cleared to enter once the Australian Standards Clearance is given next week.
Looking at the environmental impact of a Wet Processing facility, it appears to me to be a fairly simple process of separating the Kaolin Halloysite out by using water, gravity, various sizes of mesh sieves, magnetic separation, and potentially bleach or ozone treatment for increased brightness.
Comparing this to the processes of other minerals such as gold, silver, nickel, copper or iron ore, I think its fair to say its very low impact on the surrounding environment. ADN’s mining licence approvals should be one of the easier ones for the SA govt to approve.
Here is some info I found on Wet Processing:
https://atef.helals.net/mental_responses/misr_resources/kaolin-wet-processing.htmObviously all deposits are different and I believe ADN’s resource shows very low levels of impurities, so a further tick there.
As you mentioned, I too believe the DFS will massively increase the NPV which may bring today’s SP back into line somewhat.
The real kicker though is what may eventuate from Natural Nano tech during the plant construction and commissioning phase. There may be a stupendous income stream that eventuates from the The Uni’s 1.5 million dollar pilot plant which will completely remove that flat share price period during construction.
Plus of course any other complimentary acquisition the JM has also mentioned a number of times now...and HPA alliances.
Regarding raising 50 million to build an “all singing, all dancing” processing facility, at our current SP of 32c is only an extra 150 million shares to the register, and less if there is a debt facility component included. These numbers only get better as the SP increases.
IMO ADN is absolutely that 1 in 100, life changing investment that deserves a long term hold.
In closing, and to really build the excitement, here is a little glimpse into the potential of our not so distant future...
It almost brings a tear to my eye
(20min delay)