-Interesting action for the just ended week. It seems to me that a fund has started to accumulate. Wednesday the SP rose by close to 20%. The buyer really wanted to get his whole lot of shares. Hard to estimate but I would think it was above 1 million. This must have caught some fence sitters by surprise: a number of investors have been wondering at what price it would make sense to buy in. The Wednesday buyer may have provided a reply.
-I also revisited the PFS figures, some other Ancmts and relooked at COB’s CEO comments.
I strongly believe the LOM will reach 20Y ( Among other. new areas identified in the 22 Nov Ancmt) : in that scenario the NPV would rise by 50% to around A$ 770M.
Another point is the Recovery Rate: in the PFS the mgmt. conservatively put 85% but 88.5% has already be achieved in test work: the mgmt. is aiming for 90% but if we are conservative and just go for 88.5% this would add A$ 87M or 17% to the NPV.
The mgmt indicated it will also be working as reducing significantly the Tailing Cost as well as the Power cost and use in the coming months.
Since there is of course no indication of success on that last front yet , I’ll let it aside for now.
In summary there are strong chances that the Post Tax NPV will jump from A$510+M in the PFS to more than A$ 850M.
This makes COB very attractive and the attraction is even greater as it is located in Australia far away from DRCongo. Furthermore even if Nickel and Copper prices were to tend lower it would have 0 impact on COB’s ability to deliver as Cobalt is the primary output of its Thackaringa mine. Customers want and need a secure supply of Cobalt. With 0 political risk, 100% traceability, O exposure to other minerals prices COB can fulfill all customers' requirements for Cobalt. I am still looking for another company with the same characteristics (with an output of 3 to 4000 tons of equivalent Metal/ y like COB).
COB Price at posting:
57.0¢ Sentiment: Buy Disclosure: Held
