I haven’t done a complete DD on CHK, so I am not in a position to comment with any confidence. I had a look at them a while ago and remember thinking that there was quite a bit of equity out there (half a bill, with more to come, following their Cobalt X acquisition, etc).
Saying that, I like their strategic approach - acquire a niche project: the Mt. Cobalt stockpile & use this tailings play to fund exploration of their other tenements - specifically EPM26379 (Mt. Cobalt East tenement?) (keep in mind that most of the Co is associated with Ni here). They have the potential to quickly transition to a near-term producer - assuming everything goes to plan. Acquiring the Lady Jenny processing plant is a potential game-changer (so many punters chasing the low-grade Aussie laterites seem to have completely ignored the huge capex involved with these projects).
Re: cost of the Lady Jenny plant - I note they have put a number on it: 'not exceeding $1m (cash/shares)'. I have no intel on the current status of the plant (condition, etc) or the costs involved in upgrading/ upscaling it. Further dilution down-the-track. They seem to be prioritising the purchase, however, one should also note their disclaimer that 'there can be no guarantee that it will obtain rights to Lady Jenny on any particular terms, within any given timeframe, or at all’.
I am jumping the gun here. They still need to advance the stockpile to JORC compliance. They are targetting a JORC resource of 6,000t @ 0.6% Co, with a 3-year timeframe to treat the ore at Lady Jenny. Near-term catalysts would be metallurgical testing of the stockpiles, conversion of the resources to reserves (and a better understanding of the economics of the tailings play) & acquisition of the Lady Jenny Plant. I haven't checked their cash position, but a $7.62m (diluted MC - prolly higher) makes them appear cheap and worth a punt - especially given the macro environment for cobalt. Worth watching.
