nice jump - is ann coming?, page-24

szaba

"bought some more this morning because it is looking like great value prior to Arckaringa farm in Ann. If that Ann is delayed beyond September it will likely be bad news on that front"

I'd be careful about expecting too much from the announcement.
Don't forget all the hype and excitement about the Exxaro deal and when it was finally announced the SP has dropped from $1.65 29th May to $1.10 today.


Clearly people are expecting a lot from Arckaringa but as I see it why would a company pay $300M for say 10-50% of something that has had very minimal drilling and is very high risk.

Companies are cancelling big projects in Australia due to high costs and this would certainly fall into the the high cost high risk class.



A deal may well get done but I suspect it will require LNC to share some of the Exploration costs and it will be a lot smaller than people are hoping for.


If Arckaringa is that good and over 50 companies are desperately trying to farm in to it, then why are they not just buying LNC shares at these supposed heavily discounted prices and getting the exposure that way?


Also if there was a fire sale of LNC assets tomorrow you might be surprised just how low an amount they get.
My current valuation is still well below the current SP.


I agree that one decent deal could change everything but until I either see that deal finalised or the company becoming cash flow positive its just too risky for me.