Chris, agree that I'd like the whole sector to remain hot, but we shouldn't really be mentioning TON in the same category as us. They are bulk tonnage, low quality, and may not even be built if they can't secure offtakes (which, to be honest, it's more likely that they won't, but am more than happy to be proven wrong). Their grade is occasionally high, but their flake distribution is poor (SYR is in the same boat), and that's what's going to hurt their sales. High grade just means they can potentially save money on getting the concentrate (i.e. opex), but flake distribution is what's going to determine their sale price, or whether they even sell at all. It's fun to occasionally compare the prices between a Jaguar and a Hyundai, but anyone who has driven in both will tell you there is a world of difference between the two. As there is a world of difference in our graphite deposits. (for sake of Sergei, to compare the graphite markets, I'm stating that KNL is the Rolls or Jaguar, just in case there was any confusion as to who were the Hyundais)
"Even the grades and flake distribution from Merelani are going to be good."
I may have mistook your statement Chris, but I read that to mean that you anticipate Merelani being good, but not as good as Epanko? If no, then my apologies. If yes, then please read on....
I think you will find that Merelani flake distribution is going to be better than good, and better than Epanko. Epanko is a world class deposit in terms of it's flake distribution, but it's going to play second fiddle to Merelani. If you are bored, spend some time on google looking up some historic information. Here are a couple of links to assist if you really want to drill down into the detail (play on words intended):
As a suggestion, some search terms should include:
Merelani (obviously)
SAMAX (miner who previously had Merelani)
John Park (a current KNL board member, and previous director of Samax, who assisted to build and oversee the Merelani mine)
This link is "The Geology and Petrology of the Merelani Tanzanite Deposit, NE Tanzania"
https://www.google.com.au/url?sa=t&rct=j&q=&esrc=s&source=web&cd=41&cad=rja&uact=8&ved=0CB0QFjAAOCg&url=https://scholar.sun.ac.za/bitstream/handle/10019.1/1093/olivier-b-2008.pdf?sequence=3&ei=dGLfU_EwjOfwBb26gJAC&usg=AFQjCNG1PVBF3WxN8KovU7mTOuCnmF5mTw
For those who are genuinely wanting to get ahead of the pack, here is a report titled "The Merelani Graphite Project - Tanzania" from sciencedirect.com
For those who aren't observant, let me draw your attention to one of the two authors, and perhaps then pay attention to who is on our board, and who has been mentioned previously in this post. (for the really slow, I'll spell it out. It's J-O-H-N P-A-R-K).
http://www.sciencedirect.com/science/article/pii/0892687594900779
(PS that report will cost you money to download, but if you want to make many, many tens or hundreds of $thousands, then it's well worth the $39.95 if you know how to read geological writings.)
Those who have no lives and read the first link may notice little titbits like "The graphite flakes can range up to 2mm in length". (page 71 of the link, which is actually page 51 of the report). And for the really orgasmic inducing $signs in your eyes like Scrooge McDuck, page 57 has a little comment "Larger graphite flakes of up to 6mm have been observed ..".
To highlight for those non affiliated with the stonemason order, a micron is 0.001mm.
500 microns is f*cking good graphite.
2mm is 2,000 microns, which is ... (insert your own descriptive word here)
6mm is 6,000 microns, which is ... (insert a better descriptive word than you used in the previous line).
PS I'm joking about the stonemasons line. I'm not joking about anything else.
For those who can genuinely think in longer timeframes than the average trader, then I make this comment. On an NPV basis, KNL will still be a Disallowed (to use an official trading term) for anyone purchasing at today's share price. You won't see those 10 bags this week, or this year, but you will once we have two mines operating and producing an excellent cashflow. And even though graphite is aplenty in this little 3rd rock from the sun, there isn't a published deposit I can find that can compare to what we are about to have (in terms of flake quality). It's taken a while to get here, and it might take us a little while longer yet, but it will be well, well worth the wait. And that is why I haven't sold my holdings in the 50s, and why my sentiment is genuinely meant when I say "buy".
