How to Grow a Mining Company?

How to Grow a Mining Company?

right buy mors welcome back another week of greatness boys jeez what are we there’s a bit of everything today all me uranium mates on Twitter just fast forward the chapters if you want to go straight to uranium there’s a bit on the word on the decline about Paladin potentially acquiring someone they’re acquiring someone inade not it’s Vision it’s I was going to say that in the chapter suspense ruined maybe uh JD lium we’re going to talk more about lithium pbra minerals is lost son you are mate I guess so yeah I think you’ve done every pilra mineral segment since show Inception I’m going to put is that right yeah I think you’re our resident pill gang Gora expert I’ll take it mate we’re going to go to uh South America as well we’re going to talk about sqm on the other the other type of uh lithium briany General consensus lithium is real [ __ ] at the moment they’re getting hammered it is but some uh people with deeper Pockets can take a longer term view so we’ll see that is right now Trav one man that can digest a fuckload of words and find things that other outlets will not even begin to understand or even find they might have I tweeted about it that you know if an article yeah what do you know it pops up on the internet not the Kora West gold yeah it’s s along but is the sailing smooth I think it’s Rocky and like we know that ramus is agitating this steal today we find out another party has been bidding for Cora since this deal has been arranged and so there’s look there’s agitation coming from all angles we’re going to speculate and go into the waves on what’s going on that plus mate royalty drama update on the iGo regious royalty as it relates to Tropicana and the South 32 can we did say the other week it went quiet but I can hear noise now right let’s ring JD pbra minerals what’s going on in the bloody the the OG one of the OG spods besides green bushes P2000 mate it’s P2000 this is the next growth step every company needs a good growth story Maddie you know this and I think for me the the two companies that really come to my mind at pilra and Genesis so Genesis had this whole 3,000 oun perom plan for a long time 3,000 per 300,000 yeah and then the you know the next day after they actually came out with the 5-year plan Aspire 400 400 yeah and it’s very similar for for pbert it was you know eventually p680 then p1000 is what we’ve been talking about for a long time now we’re dou yeah and they haven’t even finished p1000 we’re not even there yet but they’re going straight on through we’re talking about P2000 the PFS came out for this one so we’ll run through a couple of the Highlight numbers as the name suggests MD 2 million tons perom is the target here spot that is a that’s bloody big that’s going so that’s going to be bigger than that is bigger than grain bushes it is enormous they want to move 110 million tons perom what including the waste rock yep freaking that is Hu how many how much of that is ore sorry to put you on the spot how much of that is or they want I think 10 million tons to go through the processing plants yeah wow so I’ll get into that in a bit more in in a moment the other high level number are an npv of $2.6 billion IR of 55% they would hit that 2 million T perm number by 2029 sort of Circa 1.6 by 28 so is that so that MPV number that’s saying the capital to take it from one to 2 million incremental npv yeah but and but is that the npv of just the extra 1 million ton of spot so just think of this as a a potential growth project might be easier to think of it as a complete different mine that has a quote unquote $1.2 billion capex it is going to be a bit higher than that and yeah your net present value of the cash flows you’d receive from that cash gone out the door would be as they say $2.6 billion bearing in mind the assumptions they put forward that’s really interesting mate because I mean like obviously the conundrum for for pilra is like what what’s the best use of our capital is it the organic growth that we’ve got by just you know bringing on more tons lowering our cost basis and and doing that at pil gor or is it acquiring something else and having two assets two Productions but if you these numbers are really like compelling IR 55% that’s PFS granted you know but um but you’d have a lot the lot it’ be heavily helped by the fact that the unit the operating cost would be much lower because you’ve got the existing the existing million tons I’ll run through a couple of the other numbers so 10year average 1.9 million T perom then it pulls back down the one .2 billion in capex does not assume the the pre strip for building the mine itself so we’re talking 300 plus I’ve seen some numbers actually from analyst go up to $2 billion in capex and here are the big talking points on operating cost like you say they’re Maddy a midpoint of 600 so a range of 550 to 650 Aussie dollars fob so if you compare that with what they did in the most recent quarter that was 675 per ton Aussie dollars now on the pricing side of things spaman concentrate 6% pricing us 1500 and for 5.2 which is what they’re actually turning out 1300 which is what nearly 50% above what it’s at at the moment yeah a bit a bit less than 50% yeah pretty close but yeah so we’ll chck up a chart now and you can see the MPV sensitivity to the price holding all the other assumptions constant so the price ranges for those listening in goes from 1,000 for 6% on the low side to $25,000 the MPV goes from 900 million up to 5.9 billion so that is that’s torque in a chart essentially you can see as the price goes up the the MPV goes up more essentially so PS PLS have deemed that P2000 would still be a creative at a 1,000 more or less where we are MADD spaman price right now and that would return us 900 million although that would stretch the the payback period from the current assumption at 1500 3 years to you know quite quite a bit more than that they didn’t actually specify what the number would be yeah so is it is this a a new mining area or is this just um lifting the production out of their existing mines so there would be a new mine that would be built essentially y it is all you know part of the known reserves that they came out with in the upgrade in I think August of last year so it’ put pull the Mind life down from 34 years to 23 years okay so I mean thoughts on the the lithium deck and the and the growth plans does anything sort of come to mind from you fellas more broadly I think 1,500 given in the context of what we’ spoken about last week that was in and around the consensus although we’ve seen it the low side gold is talking about a bit over 500 bucks next year and around 600 the year after woodmac was saying we’d bottom out by 2028 which is actually when these guys would would kickart at $11,000 and then up to 2,000 over the years after that I mean forecasting commodity prices are a bit of a fool’s erand right but like I think I think um it feels a bit high on the high side personally but you know I would say that I also just think like the reason there’s no m&a in lithium world at the moment is because no one [ __ ] knows what the long term like you need stability to get deals done and there’s no no like lithium market pricing stability at the moment like that’s it’s still evolving rapidly so you know hence um yeah look looking within rather than outside has being the the deal play Dynamics mate I reckon um I reckon the the the conundrum for for pilra like you know do we do we buy or do we you know Advance our own resource faster given it a you know you’ll you’ll deplete your resource faster doing that way you’ll you’ll lose um some some of the optionality that can come down in later years and all that sort of stuff but you know you experience the benefit in the in the nearer term yeah the conundrum for them is do we do a land grab approach and and buy something else and have two great assets or or do we do we do this and and if if lithi if lithium long-term prices are elevated it’s a pretty compelling proposition to to allocate your marginal Capital at your your internal growth in some to yeah you what what’s worked for pilra before it is developing a a project that is like as you said has that that talk to the lithium price if they put their Capital into their organic growth opportunity at pil gangora and then who knows what the lithium price is going to be if it’s going to behave like a nickel and have fraking spikes and troughs and [ __ ] everything imagine if they’re pumping out 2,000 ton they don’t have to two 2 million ton of spot and there’s a big price at some point they are just going to do exactly what they did on the previous cycle and just produce a bucket load of cash it doesn’t have toen for long they’re never going to have that opportunity that they did last time to pick up the asset which had real synergies to to their asset so you know they took full advantage of that at the time but it’s pretty remarkable how opaque the lithium Market still is despite how many people now are closely looking at it I mean we’ve heard a bit in very in the very sort of recent past about people being blown away by the the scale and the the standard of the lepidolite operations in China and a lot of people were saying they’ve got to be offline at these sorts of prices but they’re not and they’re just churning away getting getting better and better so it’s it’s pretty remarkable yeah I think we still don’t know everyone says they got to be offline based on are they just saying the mining they lose money mining it but you know as we’ve mentioned before being fully integrated to their all the bloody the cattle and byd converters uh they might be they don’t have to ship it anywhere it’s all bloody right there so what’s what was the capex again JD 1.2 1.2 yeah 1.2 Aussie Aussie yeah that’s right 1.2 Aussie and that would get you an extra like million ton of SP million ton of spod so like when you think of it that way you can kind of justify why you know some of the the premium developers have really you know um you know felt felt the breadth of a of a decline in their valuations because how does you got you got to if you buy undeveloped project then you’ve got to wait all the years to permit and develop it and then you’ve got to build all the capex on top of it you’re not going to get you’re not going to get those sort of numbers by by doing that triple but you do get more market share which can you know help with your PR you know like your ability to influence the market and price how much are they how much capex are they saving with the existing infrastructure camps facilities just everything just a bolt on extra capacity yeah I mean to be clear there there’s a few other things that are that worth mentioning on the kind cost fronts so this is much more of a a bulk mining strategy they’re talking about building this new plant that’s going to be designed to handle all with greater dilution so they’re trying to send the high grade stuff to the Pilan plant and this new one it’d be more energy intensive the you know I think more of a bigger float circuit yeah I think it was all going to be all float wasn’t it similar yeah it’s and yeah more energy intensive per unit because of the uh 0.9 to 1.2% um lithium that they’re going to be working with there and then there’s that sort of 300 plus million that’s not included in that 1.2 billion in capex there’s also new maintenance facilities at pil gangura as well as at the Port um port in Headland and that isn’t included either so that’s why some people have said up to 2 billion is what’s going to be spent but there was a a little mention down the end that they had received $400 million in non-binding LS of support from government agencies so cheap cash and I’m sure they will jump at the opportunity if they can get their hands on that to help them given that their High $1 billion cash reserves right now but they’re still spending money to get to P 1000 so their cash balance is going to be closer to 1 billion than two billion by next December which is when the the full feasibility study is going to come out and they’re going to make a decision on this yeah I was having I was having quick read through and like look the the thing that sticks out about especially when you’re talking about something of this scale to keep it going the bottlenecks is P2000 will require new ballfields relying on successful water exploration holy Snapp and duck [ __ ] does that have wa water balls written all over it we got Silverstein up there we got wa water BS probably I don’t know who else would be able to do that to guarantee enough water for an extra million ton of spod besides jro James and the team at wa waterballs so so I reckon they’re probably on the plane already I think you’re dead right scoping the ground and sniffing the water they’ve got you know billions of dollars in earnings riant on wa water BS just doing what they do best bringing in the bringing home the chocolates you’d say tell you what if any bloody ones going to bring them home it’s wa waterballs so is is it too much to say that James is going to net them $2.6 billion effectively yeah yeah yeah I see it that way yeah good work James save the world once again it’s in the fine print of the uh the the PFS contingent on James James Jer contingent on jro James jam on you Jimmy oh good on you James buddy uh tra what’s going on in the oh talk about the most boring document you could find the um what is it agree well I find it boring think [ __ ] you’re here uh that’s what we all have our place what is it a great a it’s an information circular this one information C it’s it’s all about the the titles of these documents are a bit you know funky because it’s um under a a Canadian plan of arrangement instead of what we’re used to which is a you know an Australian scheme of arrangement where you’ve got the scheme implementation deed the scheme booklet these are just different words but the same same stuff you are you are the master of control left butt wait [ __ ] 100% you know what I hate when people upload PDFs and they’re like not searchable oh infuriating I reckon they’re going to do that a bit more often right good night if you do that listen to the cow goly boy right so what did you what did you find there must be something interesting in there some really mate really interesting stuff so West gold dropped a bunch of docks to the market this morning one of them was the um you know the the plans Arrangement agreement so think of think of this like the scheme implementation deed in Australian m&a context amazingly this this document hadn’t surfaced until today on West Gold’s ASX announcements but it did appear um like quite a while back on Kora side of if you bothered to log on to Sedar and we did an episode [ __ ] ha horrible God I was on there today last time we mentioned how bad cedar was I got like a few different DMS from Canadians being like we still hate Cedar too oh God Cedar plus now by the way um anyway s do so um when we last talked about that uh document in specifically um you know we found we peeled apart the interesting parts of that one and for good measure I even did a computerized check to make sure the two docks were the same and there’ been no changes check this out they’re the same no no differences which anyway n the more the more interesting document is the 948 Page information circuli by Kora I assume this is the equivalent of a scheme booklet in um Australian m&a so it’s a chunky document to to say the least and there are few sections um of the of scheme booklets that are particularly interesting to to the deal nerds out there one of them is um the section sort of background to the transaction you can often get a good timeline of events of how the deals unfolded um which is interesting to [ __ ] no one but me oh no I’m I’m getting interested I’m War warming up to it wait for it mate so you could you know the the the spice that’s been in this deal the merch in Mayhem I had to read this background bit to see if it matched up with my hypothesis beforehand and boyed I find some incredibly interesting things in this one Jen to start with a bit of bit of background for those who are maybe unfamiliar with the deal to date I’ll just give the the high level um spice so Kora and West C have agreed to merge with each other and since that agreement ramus has gone to the takeovers panel to try and agitate the deal and all of this comes off the back of well we know that even before this West gold and ramus were maybe in talks to merge late last year and then Rus and Kora nearly merged early this year when media speculation blew that up which now led to Cora and West gold merging so okay without that other way the the the merchant in mym that isn’t in the merchs love it the nitty-gritty T hour here to start with one of the spicy items is the potential overlap of uh of of Engagement with West gold in what might have been an exclusivity period um for Kora so the information circular uh does not suggest that the board of um of of Kora or its advisers acted inappropriately At All by the way of course but we do learn that West did throw in two non-binding indicative offers to Kora when Kora was in exclusivity with Rus first on the 13th of March and then on the 22nd of March and note that that which they’re allowed to do yeah yeah it’s they can give them an offer they can throw it in on solicited um the obligation when you’re bound by exclusivity is um yeah not not not to entertain it not to entertain it unless it’s unless it’s um this fiduciary out but um yeah so now note that the latter date there the 22nd of March when the second one came in that’s just one day after remelius increased their offer to Kora 2 so ramus up their bid on March the 21st westold throws in another bid March the 22nd and then later that day on the 22nd exclusivity with remelius Caesar oh so R R I didn’t know that bit I didn’t know ramus put a second up the bid that’s why you read these dos man yeah right [ __ ] how good’s that very interesting right so Kora say they were not able to respond to the offer letters from West gold since they were Bound by exclusivity and it wasn’t until 2 Days Later March 24th when when West gold revise their bid yet again that Cora got their advisers in line to assess the Merit of a deal with westold of course of course they waited till then so now if if if you find this timeline pretty fascinating I reckon Rus does too and um you know comment we’ve made in the past is that the deal structuring appeared very thoughtful in a way that you know we doubt it was whipped up in a in a few weeks like the timeline kind of suggests um and hence the agitation you know we’ve seen uh from Rus with the takeovers panel yeah right who who’s kora’s advisor so they’ve got I think Cormac and Dez Jordans okay yeah and Argonaut were West correct yeah yeah yeah right okay okay continue take me on this journey further so I’m in it gets crazier right I I thought the spice would stop there but I kept reading and to my surprise we learned that someone else wants Cora too on page 35 so another party has offered Cash Plus spinco shares to Cora since the arang agreement was signed with West gold and it gets Wilder that other third party has increased their bid since too and on both occasions the board of Kora has not engaged deeming these unsolicited bids to be you know incapable of becoming a superior Superior proposal so technically not triggering their fiduciary out so someone else wants Kora that have put two bids in they put two bids in y and after after the arrangement agreement with West and they refer to it as another third party it’s not remelius this this is another third party that’s you know agitating this this deal now to the extent where they’re literally increasing consideration does and it says and cash is the interesting Cas cash and I mean there’s a there’s a spin out as well right so there’s which is in my I always look at these spin outs as a jobke keeping exercise for certain people so they’re like look we want take the cash and keep your jobs and you know is that and that spin out is is that similar to what’s happening with westgard with the the non beta hunt asset yeah I assume they’re just matching whatever the the um yeah the other spin is my guess but soft issues in check yeah JD you can’t put a price on that either you can’t put a cash on that and this whole section right it’s like it’s it’s written in a way where this date this happened this date this happened and when it gets to these um you know subsequent proposals they don’t say anything about the dates that these subsequent proposals were received all they say is they happened after the um Arrangement agreement was signed so the the deliberate decision in this document to not include the dates I find very very very interesting um which means they’re still ongoing well I I just I don’t know well let’s say the second one came like a few days after this went out to the market right that’s a completely different thing to if it happened you know if both of these bids came in the first week after the arrangement agreement that would that would indicate that someone is still really wanting to agitate this deal versus um you know someone tried early and then they just you know couldn’t couldn’t get pasted that’s that’s the I think about it but yeah um mate we should we should bloody guess who do we think who do we think finally here we’re finally at the point this is what we’ve been waiting for the rampant speculation SE it’s cash it has to be a big yeah multinational yeah or like if it’s who would like Australian listed do like be able to offer cash for something like this like [ __ ] well nor probably not even Northern Star how much bloody levered up they are to the C gly bloody expansion they unless I think I think they’ve got revolving facility in place and like both you know Northern Star Evolution would probably be able to you know between cash and debt I don’t know I mean Evolution’s already geared to the tits maybe not but I just think it it doesn’t quite doesn’t feel like either of them though no what about I know the the scuttlebutt was going around I don’t know if I started it about AGN early on having a look like you know they might whether they want to you know they got a bit in fosterville come over here as well don’t know don’t know I discounted him at the start I remember I first said probably not of the scale for a goldfields to look at like a scale and quality considering like you know Ag and Invincible on that are pretty pretty high quality assets I think I don’t know about Granny Smith I sh it’s there’s bloody Gold Everywhere there too and grer but considering that Bea Hunt is a suas of a goldfields tourament didn’t know that and right near say knes it’s like and the cash thing I’m like yeah it’s got to be go Fields has like I don’t know a tourament tidy up don’t know and there’s a read through as well on you say right near St Ives but it must mean they’re kind of short answers or well like I I remember uh I know one of the uh it was one of the plays near St Ives astral and I remember there like bloody investor pres was just showing an empty ROM pad on at s IES so they’re saying right bloody Goldfield should buy us so we can fill up the bloody ROM pad because they’re just down the road they’re need w w Dam so it’s like I don’t I don’t think sa Ives is like I think they need dirt right effectively right and you know invincibles kicking goals good like [ __ ] good grade I don’t think ban will be as as good a grade but you know they got what are they proven up seven seven years or something there and it’s like [ __ ] it’s on that tenament don’t know might might might just be easy well and if it’s C like the fact that it says cash it has to be big company it’s got and the other point you know the other thing I point to as well is like whoever it is they took their time getting their bloody ducks in right like this you know Kora was on the table for a while there was media speculation about ramus and then West jumped in and then you know that these guys have waited for the arrangement agreement with West cold to be signed and in effect before even you know putting in their first bid now who who is notoriously a bit [ __ ] slow there’s all these layers of approvals goldfields big big companies yeah what now now this would only come to now how would this actually progress Beyond this point of not doing anything they would there’s a risk that this Kora vote will could get voted down for the West gold merger because they need 66% of the votes yeah there’s more than just that because um both both kurora and westold in this deal um their boards are subject to a fiduciary out so if if a better deal comes on the like becomes available all of a sudden the board recommendation can can you know can swing as well but but that bid would have to be pretty um pretty unconditional you know very minimal diligence you know that like the break fee is pretty astronomical in this deal so the economics would have to be super [ __ ] compelling um plus you know what what are the tax implications given there might be you know rollover relief in one versus um you know you know got to pay tax if you get cash in the other so like all of these things matter and if the board is pretty motivated to just get the deal done with West gold for whatever reason they’ll you know we see this all the time they’ll stand behind some element of conditionality or whatever like remember the battle fur like you know you can have a better deal on the table or whatever but boards can can often just find a way to stick behind their initial decision I can’t I just can’t get my head around if that is the case and it is goldfields why the [ __ ] haven’t they done it before ages ago considering it is a sub leas on their tournament so like that’s um like I just why wait till now which bits not adding up to me well I know that a lot of you know in recent years corar have have made the economics better by buying back royalties that were um you know inhibiting the the cash flow Dynamic [ __ ] [ __ ] light on Higginsville there was and was there some on ban as well I think so yeah yeah yeah and like look it was a nickel mine um and it’s you know sort of become a gold mine with um bit exploration so but if these goldfields mate they haven’t actually haven’t done a deal in Australia of any description in a very long time like this would be this would be um yeah a real indication of of what their plans are because they just like they’ve just been absent for a long time you know well they W they really went quite after that y deal [ __ ] itself that was going to be what seven seven odd billion I think that deal was and when that fell through I think they they [ __ ] made a couple hundred two was it something like 400 million or 200 million from the break fee from it yeah well they actually made a bit of coin out of it I think I think I think there might have been some leadership churn a lot of a lot of their like corporate team is here in Perth as well yeah yeah the yeah like the tech services and the blood the the right the the engine room is here so and but to your point on you know the Cora vote so that the the the deal with West gold is conditional on 66% um of shareholders voting for it via plan of arrangement so yeah the votes yeah but like the threshold here in Australia for a scheme is 75% so 66 slightly lower but you know it’s not there’s no this isn’t a [ __ ] short thing and if you’re a Cora shareholder now that you see someone else has been putting bids in you’re actually a little bit uncertain whether you are extracting maximum value with the West CO bid you know you might you might be sitting there thinking maybe there’s actually a better deal on the table um from someone else but who like what how are they going to weigh up right where you can get cash from big company at a premium or is there that thing in the head will take it’s take the West gold script and there’s going to be a they’re going to be like this 400,000 ounce producer now bit of a this everyone talks about the potential rate and do they think they might make more out of that is that the way up yeah but you shouldn’t be your base case as a as a diligent board should not include a scenario where your shares [ __ ] rate like if you’re if your board is making a decision on a [ __ ] proposed rate like put a [ __ ] like fire yourself now you don’t deserve to be a director of a public company yeah what do you think JD what would you take the cash or the potential reate I think kind of on the same train of thought people get married to a deal they get quite you know they have a lot of Buy in they’ve worked hard on a deal for a long time and they just kind of want to see it through I think basing basing anything on a potential rate is kind of you know it it just more often than not just doesn’t work out right so yeah the bigger worry you’d have as a COR shareholder is like if the deal blew up it it just takes time for another deal to materialize eventuate more information gets cleansed is your latest production numbers are they good or bad your shares fall off like like you know time kills deals and all that sort of stuff and maybe extract it it’s not like you you end the wst gold deal and this other one becomes a short thing it doesn’t just work just doesn’t work that way so no not with not with the big cars yeah yeah right oh well we’re Wai and wait and see we might they might it might just go through we’ll never know maybe I think that is the the more likely outcome I don’t know oh that’s a I just think it’s a big vote to get over the line Westco traded up today ramus traded down today whatever that means West back up to oh two bucks oh two bucks 10 when I was going to invest in my fake pod and they’re two bucks 60 now so so [ __ ] another would have been another win for Matt you want to make money mate yeah every time yeah every time buddy either way there’s going to be a shitload of [ __ ] what do you call them shitload of bloody uh you know Mutual DD site visits that either probably are happening or have happened and I’d say Brooks those Brooks King airs would have just been full of all of them if you any m&a that requires site visits that is Brooks written all over it wouldn’t you want one of the bloody most successful companies in wa history they are JD they are Brooks The Brooks group one of the OG they’re still around I thought you were going to talk about one of the gold companies I was like Brooks The Brooks group wouldn’t you want them flying you to get you a deal it’s just the most hassle-free easiest way to get it done right yeah just one ring you’ve got you’ve got the whole thing sorted you fly it you know go to camp about so you want to go to the merch and you want to you know zip up there for a little while they could do multiple um they could do multiple m&a jobs they could do a drop off at C gy take back off drop the rest off at cam Baler pick them all up it’s just it’s inconspicuous as well right because if you’re big you got big wigs rocking up on site bloody you know just getting that’s it rocking up in anything other than a a Brooks jet everyone’s like oh what’s going on here you know and Brook Brooks uh guarantee your anonymity but no one will know you’ve gone private you’re not in the terminal you want to keep it undercover go with Brooks that’s it perfect right Ro speaking of royalties geez holy snapping duck [ __ ] this one could turn ugly the tell you what this is going to be very fruitful for some lawyers in western Australia Rio RIS and South 32 yeah what a force to be reckoned with all over a little bit of bloody throwing handbags at each other over the Tropicana royalty yeah mate this is um we we’ve talked about this a bit in the past but kind of like the the too long like the quick recap is there’s this there was this historic database of wmc’s way back in the day which um was utilized by iGo early days and there was a royalty attached to the use of that database if it led to a discovery um and now there was a discovery that was was had it was Tropicana right and um Tropicana uh was it was actually it was discovered by I think Anglo or Shanti were the they were they actually the ones that made the discovery not IG but that you know that whether or not this database was accessed maybe there was a a drill sample that was a you know nearby but not actually part of the the same tenure maybe it was 100ks away who like I don’t quite know all the details but there’s some ARG because South 32 Only clued onto the that they’ve inherited this royalty um it appears like last year and they are claiming that they owed a bunch of money in relation to it for all of the years that tropican has been in production and it kind of gets a bit worse because when iGo sold their 30% interest in choana to Regis there was you know this clause in that agreement which you know basically meant that Regis would indemnify iGo of any future royalty potential payments that could be you know tied in relation to this agreement from the date of that that that deal was affected so it was enough it was like enough of a a thing to be diligence item in that transaction to the extent that it was like literally you know written down there so so iGo might have had some fear that you know South 32 would come knocking one day if they blood literally put it in the in the docks there and Regis must have gotten comfortable enough to indemnify them that there would be nothing owing at that point in time this could get real ugly in so many different ways but what we understand at the moment is um yeah I mean there’s some South there’s some Supreme Court sort of um stuff that’s happened lately but but this royalty as we understand it relates to 100% of production at Tropicana but sits entirely within iGo and now now reges so imagine paying like full tote on on the royalty um even though you only own 30% only 30% [ __ ] so and cuz did IG get it out of Western mining is that how why South 32 got the claimer is South 32 got it from BH so West Western mining becomes BHP BHP spins out South 32 along with its royalty portfolio so it ended up there now what happened was iGo had an agreement to utilize this database from that was Western mining had an exclusive ride back in Independence group days when they ipoed you know sort of 20 years ago and um and that that there was just this you know database use agreement with Western mining that let the music in exchange for royalty how did the 30% get in Independence group’s hands so the stake that was a farming agreement from Ango ah right yeah yeah I get you and I think I think part of that farming talked about using the using the database yeah right interesting if my memory is correct [ __ ] geez so that is going to be that’s a what is it 100 million bucks no how much is it worth potentially that you the cash retrospective and then what it’s kind of worth going forward it’s all we’re talking hundreds of millions of dollars not just one yeah this is hundreds of millions of dollars so South 32 think oh [ __ ] we’ll spank five bucks on lawyers and drag it out and we might get a 100 might get three might yeah yeah might get more and yeah even more of a consideration it’s like you saw the Australian report about you know gold Road potentially merging with Regis and talks being back on or maybe not if that’s true well like what do you like imagine the discussions around a com a business combination with with reges when there’s this unknown potential liability it’s like a bit of a contingent liability yeah so oh God raes are reges are gone from the penous to the [ __ ] house and back and forth at the moment they they cleared the hedging so that was a win but then you know mcfiles sort of look like it was going to fizzle a bit and then now this as well so fizzle or do blew up could it’s still there but it just didn’t look like the growth project would be growing anytime soon I think that’s right of the capex so and then couple it with potentially now involved in this because this could go on for [ __ ] years yep blood hey lucky we still be here he [ __ ] how good is it right the UBS thanks for hanging in there I don’t want to P I could have just pulled Rank and put it at the top but I’m a team man so right Paladin in trading hul today regarding a potential acquisition so word on the decline from numerous sources is that they’re after fision uranium so reported bloody everywhere nothing El they must be listed elsewhere Vision where are they yeah bloody um TSX yep I think it’s TSX [ __ ] over there um tell us a bit about the M oh mate well so their vision capped at one bill Aussie Paladin a four Bill Aussie so you know Paladin much bloody much bigger nothing you look at the charts nothing to indicate last week that there was any possible thing going on with vision the price was Bloody unaffected you’d say so they’ve got the that’s good to see the Triple R deposit which is part of the PS project not the PS we just talked about before uh pretty sure it stands for Patterson’s Lake South with Patterson Lake being where the highgrade uranium is under about 50 m under the lake where this bloody uh uranium starts will bring up bloody you have HS of pictures it’s got a video and there’s all sorts of good [ __ ] going on here so 93 million in Reserve at around 1.4% u308 ramps up to about 10 million per amum over a 10year mine life so it’s not a bad no no slouch not not an not a bloody cigar lake or nextg size but much bigger than what we look at for boss and everything so uh now have a look where it’s located right next to nextgen’s Arrow deposit in the west of the adabas Basin three k away yep right there God how did I not bloody look into this too many oh this it’s been a rapid year rapid six months for me in this uranium Learning Journey but and you know what happens you learn it all then it [ __ ] Fizzles out and something else comes up I need to figure out what the next thing is and start researching now cuz I’m getting I was too late on this anyway bit of self- critiquing there so okay let’s let’s put them side by side because this is [ __ ] interesting doesn’t have the same amount of pounds and grade as nextgen’s Arrow but it’s going to be a [ __ ] lot quicker to get to it nextg you look at nextgen’s bloody long section here they got a sink of production shaft that’s about 6 or 700 meters deep this vision’s PLS highgrade section is it’s about 50 M below the freaking Lake um and they’re just accessible by decline so it’s not a 50 M below the lake but how low below surface oh about Bloody I think it looked about 150 from where that soft cover is so bit of a bit of a process to get through that like it’s like a t they’re going to need a tunneling machine that they’ve shown here to get and support it with like concrete segments so it’s actual like a tunnel and job till they get down to the fresh rock and then they need to they need to freeze the water in the like the Sandstone section below the lake which you know you got to put a refrigeration plan in and drill the holes in and pump the [ __ ] in to freeze it similar to same as what they do it cigar like so it’s yeah not not not a brand new thing but it’s the bloody the permitting and the E Eis sort of things that’s real interesting so they uh vision submitted their draft environmental impact statements so AIS for review to the province Province key word province of C skatan in March this year and so they’re hoping that review is going to be concluded this year so if you compare that approval process to NextGen and Dennison as well so NextGen submitted their draft Eis in June 2022 the first one that was the provincial one but then they had to submit then there’s a they had a federal Eis as well so need both of them to get licensed so and that that was under the Canadian environmental assessment Act of 2012 so and two years later NextGen is still submitting responses to the like there’s 49 uh review comments left for the federal technical review uh to get the federal AIS approved but in regards to fision in 2022 they the impact oh this is very boring words but the impact assessment agency of Canada reviewed vision’s PLS project and issued a ruling stating that under the current impact Assessment Act of 2019 on pretty much a bloody loyer here PLS did not require a federal impact assessment so because the one of the reasons was their Mining and Mill capacity was well below 25,000 tons a day and the provincial assessment with skatan was going to be suffice so they’ve effectively got half the amount of leg work to do in the permitting process as NextGen does next door which is [ __ ] as we know in good old Canada that is a pain in the ass so that’s a that I found that very very interesting so the capex is pretty similar so they’re about this was their 2023 study so it’s probably I now 1.15 billion capex 535 million of that is processing infrastructure and tail management surely there’s some synergies with nextg boys 3ks away imagine the fraking imagine the corporate cost that could cut out just that alone far out you could fum the whole thing but what’s Paladin up to here so they they’ve they’re obviously thinking well we could potentially take this Vision uh you know potentially merge with them whether bloody old Johnny Quakes says he’s voting now if the offers Paladin Shar so there’s [ __ ] mate qu old big Quakes he has some pull on Twitter I can tell you that now he hasn’t I haven’t contacted him yet I’m not at that level yet but they um like let’s say Paladin take Vision they got like a more they provide a funding a Funding Solution to get this bloody PLS project going um but then they’re right in the Fring District next to Arrow let’s say it gets over the line Paladin nextg a uranium Powerhouse to start competing with the likes of kamiko and that imagine that 40 million pounds a year coming out of that area if they got arrow and PS gun is this what they’re up to thinking real big real long term and then imagin if Paladin that Pro forer then takes over dplr on the return of John bourch off let’s wait and see if this is even a deal yet you got to PL mate mate if you worked underground you would know you got to think five steps ahead you got to think of every outcome to get that cut on the deck yeah yeah so who knows I mean the Johnny borof bits stretching the Friendship a bit but we’ll see if it’s tonight we’ll hopefully find out if it is Vision thereafter um when they say they’ll be out of Wednesday yeah could be a couple days we’ll get the information from hopefully fion tonight trading no they’ll be in h to I reckon um oh yeah but if they’re in Hal yeah we don’t know if they’re in halt yet or let’s say there’s like a just Advanced discussions things docs aren’t signed yet like you’re not yeah like depending on where they are they’re not going to come out a Hal just for the sake of it tomorrow they’ll wait till everything’s you know in a row before coming out of H yeah yeah but we’ll know tonight if it is Vision if vision’s in see what you’re saying vision’s don’t know if vision’s in or I thought you were saying we’ll know the terms of the deal what I care about is like is it a good deal or not right are they paying too much or are they pay like what are they paying I hate to break it to quaky but Paladin had 50 bucks in cash us and 125 in undrawn debt as of the last quarter and given that we know what their trading was and the in the implied price somewhat recently I find it very hard to believe if it is you can do Equity raise M should be big [ __ ] big cap rise at 4 billion bucks JD yeah I’m just saying I don’t think that would be what they would do yeah don’t know I reckon they’d raise a [ __ ] ton of equity for it if they could yeah you would raise Equity if you mix it up if you use your overvalued script exactly um yeah or raise raise Equity at a discount your overvalued script the Imp like yeah like whether you use your script or whether you raise Equity to buy it with cash the effect is you’re still diluting your own shareholding yeah I mean surely the script but if they give him a bloody solution to then be a more a big more attractive vehicle to [ __ ] combine with nextg in the future Jesus buddy mate it’s it’s got to be interesting can’t [ __ ] wait so Paladin used to have a growth project but of course they they had to fix their balance sheet so they sold they didn’t they sell their second project and that’s what Lotus today I’m not sure yeah and I think I think all of that used to be in Paladin ah right um and now and now what Lotus a Pack huh now they’ve got to now Paladin’s got to buy um buy something for a growth project yeah well this this looks a [ __ ] looks a lot easier than nextg Arrow not the not the quality but hey get there [ __ ] quicker yeah save gone down bloody 500 M so yeah going to be bloody interesting oh je uranium stuff just keeps coming to me on the episodes I freaking love it far out bloody Twitter and Google and fraking everything it’s between she’s it’s heating up there is articles everywhere about Australia’s nuclear [ __ ] old dutton’s put a rocket up him so L I love it I don’t really care what happens I just love talking about it ah good bit of a different Tech tanii thanks Maddie good stuff Maddie this this one was a bit different but it really stood out to me I was I was really interested with what was going on here reading through it on the weekend so Tiani is super pissed off with Chile and and The Regulators specifically in Chile so they are 22% shareholder of sqm so so you’re saying tan is pissed off because they don’t have control of something they are pissed off because they are getting abused as minority shareholders well now you know how iGo feels I think you’re right Maddie so us 4 billion is what they paid for their their interest in sqm back in the day but it came with a whole bunch of uh restrictions attached to that as we ran over when we spoke about the uh aou deal hitting a bit of a a speed bump probably five or six weeks ago now now I think tanii in this case have got every right to be pissed off so essentially the state-owned copper Miner cadelo has tied up a deal with sqm over the attak assets one of the best Brine and one of the best lithium assets Full Stop in the world so the the state lithium ownership has been a Cornerstone of borich the the president’s leftwing agenda there he wants more State ownership of lithium assets going forward and sqm’s Mining rights over the atakama asset were coming up for expiration in 2030 so in return for signing an extension which they’ve now been given they actually had to give majority control of the asset to cadelo so cadelo now have 50% plus one share there and the mine itself has as an extension sqm have the extension for another three decades so up until 2060 there right so what’s so what’s pissed off Tian so Tian being the Min minority shareholders have been pissed off that this hasn’t got to a shareholder vote that they haven’t been able to vote on whether this was the deal that they wanted and the regulator has sort of approved that no vote needs to happen and sqm weren’t in you know a perfect position either the the mining permit that they had was coming up for expiration and you know they’re in a rock and a hard place there this is the flagship asset but given their sort of colorful history and how they got their hands on certain assets and certain people involved in their company maybe they Jew a bit of a a whack but tanii on the flip side has now said they’re going to go legal and I think it just gets a bit messy from here I I can’t imagine they have too much you know sort of weight in in Chile there I think the sqm being a Chilean company with the asset in Chile I I just can’t imagine tan are going to get too far but one of the big takeaways is this sort of throwaway term tier one jurisdictions for me every Junior loves to throw this around in their presentations but Chile for a long time has been deemed tier one and I mean to be clear they haven’t had the mind take them off taken off them like we’ve seen in other countries but if you are developing anything now going forward you’re going to want a super super long-term mining lease building any sort of project because of this threat that hey when it comes up after you’ve sunk all that capex and everything they can just take it off you or they can just rejig the terms very unfavorably well you look you only look at the the cost curve for like the atakama now lowest operating cost for the cost curve uh for for the operating but then you go to the what they make out of it that they’re at the other end of the cost because of the royalty they give Chile yeah yeah and it should get even better because cadelo bring in this production qua which they have to get them up to 300,000 ton as opposed to what it currently is below 200,000 T So tier one jurisdiction yeah I don’t know bloody T would you class would you class like adabas Basin as a tier one jurisdiction considering how hard it is to permit [ __ ] I don’t class that as tier one if it’s [ __ ] hard to get a mine there I mean tier one’s just not a not a great expression you know everything’s sort of on a on a bit of a a scale and you’re right I I don’t think um Canada and more broadly where where they kind of are there in more specifically rather where they are in Canada could be damed tier one because it just takes so long to get things moving it’s a PowerPoint title yeah absolutely yeah and I think here with regard to this one on the margins it just makes foreign direct investment in Chile that little bit bit harder and I think this is quite a specific situation I don’t think they would go to a company like BHB and try something like this on for size I think the fact that sqm were the holdest there are chal and Company with historic sort of ties with government and whatnot has made them the the right target yes Jade you’re all over lithium at the moment good to see you keeping the dream alive for all the all the bag holders I thought it was more the the the sort of geopolitical touch to it like you never see Chinese companies kick up a real fuss it is something you don’t really see and tii were pissed off and you don’t you just don’t see that especially in in other countries them step out of line and say they’re unhappy with things they just kind of get down to it it’s pretty unusual because they’re not like the you look at um uh [ __ ] Kamala like they’re a you know minority like they’re not the operator they’re they’re usually not an OP they’re a lot of times they’re not the operator as as well so the Chinese groups yeah yeah I mean they’ve got a lot of Downstream interests which have led led to them picking up minority stakes and assets across the world but I mean they they own their fair share as well yeah so they’re used to it yeah yeah I guess so anyway uh that’ll be it for today gentlemen is that correct that is a wrap that is a wrap what a show what a show couple of Partners to think what you’re now what can you predict what uranium thing I’m going to talk about tomorrow something new will come up I don’t know what I Reon you’ll have a story on why is Paladin buying fion when is publicly open for m&a and they’re like directors of selling share so presumably it’s [ __ ] for sale why are they buying fion instead of Boss well maybe they’ve got negative view on Boss that’s a story that is the story done we could we could run with that I’m going to copy that for tomorrow Bey thanks all the bloody Partners who we have in the show wa water boards getting p1000 to P2000 and Brooks Airways flying everyone everywhere flying everyone inconspicuously to do a deal that’s it uh We’ve also got JD verify I like him get wet Solutions JSI underground Silverstone don’t forget about Silverstone the 2000 as well by the way CR insurance and our great friends at cadr and God I love spark get on board the information contained in this episode of money of mine is of General nature only and does not take into account the objectives financial situation or needs of any particular person before making any investment decision you should consult with your fin finial advisor and consider how appropriate the advice is to your objectives financial situation and needs

We’re back swinging this week with all sorts of news.
Firstly, we dive into Pilbara Minerals (PLS) huge expansion plans, before getting into some juicy news on the pending Karora (KRR.t) Westgold (WGX) deal.

It’s then over to uranium land with Paladin (PDN) announcing a potential deal, rumoured to be Fission (FCU.t).
We wrap things up with Tianqi’s disgust at the Chilean regulator following SQM-Codelco Atacama deal.

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CHAPTERS

0:00:00 Introduction
0:01:59 Pilbara look to go all out
0:14:10 Karora reveal takeover offers
0:32:39 Regis/IGO vs South 32
0:37:48 Paladin rumoured to buy Fission
0:48:19 Tianqi disgusted with Chilean regulator

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The hosts of Money of Mine (MoM) are not financial professionals. MoM and our Contributors are not aware of your personal financial circumstances. Before making any investment decision, you should consult a licensed financial, legal or tax professional.
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