EDITOR: | August 6th, 2015 | 11 Comments

Northern Minerals Limited: Jien Mining transaction receives another green light

| August 06, 2015 | 11 Comments
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  • Tim Ainsworth

    Chinese control now complete, will it lapse into the same catatonic state as Orion next door, controlled by the same interests?
    Economics are hardly compelling at 3/4x current pricing.

    August 7, 2015 - 8:19 AM

  • Bill Keenes

    As long as it doesn’t evolve into the same shambles that Lynas is, then all will be good.

    August 9, 2015 - 2:50 AM

  • Chris

    More than likely Northern Minerals won’t even make it into production so I don’t think their is any chance the company will turn out anything like Lynas.
    Higher production cost compared to what the company will be able to sell a 53% concentrate into China.
    A$37.5/Kg COP operating at steady state nameplate capacity.
    That does not include tax, royalties or any interest payment on loans and it will take a while to achieve steady state production.

    Current basket price sitting at US$34/Kg REO equivalent.
    Considering the company will only be producing a Y rich 53% concentrate I believe a discount of around 25-30% would apply.
    47% of the concentrate will need to be treated as waste and obviously their will be losses during separation into individual REO so applying anything close to REO pricing would be ridiculous.

    So more than likely the company will be able to achieve around US$25/Kg for a 53% concentrate.
    That’s A$33/Kg at today’s exchange rate.

    The companies business plan is not viable in today’s REE market.

    August 9, 2015 - 6:00 AM

  • Caterpillar

    I believe NTU included a rather large air strip in their latest study, so I expect an invasion of Chinese slavelike labour coming in for starters. This will not be a normal, “economical” project by any western standards, it’s just geopolitical artistry by China, completely outplaying ROW.

    August 10, 2015 - 7:13 PM

  • David

    Really “Chris”?

    Do you honestly think you know the ‘real’ economic costs to put NTU in Production better than NTU and Jien Mining do?

    I hardly think so…..

    August 11, 2015 - 7:00 PM

  • Roger

    Chris and Caterpillar,
    Check out the share price and market cap of NTU.
    Not bad given that the market is at the bottom.
    It is easy to be negative and bag companies out.
    Well done NTU!

    August 11, 2015 - 8:41 PM

  • Tim Ainsworth

    Looking forward to the updated DFS, currently valuing Dy in concentrate at USD684kg, to reflect values more in line with the current Ganzhou ion rare earth concentrate price of USD26.58, presumably including the new 27% concentrate tax, as reported by:

    “BEIJING Asian metal 7 Jul 15 – Although Ganzhou rare earth industry association has increased ion rare earth concentrate prices to RMB220,000-230,000t 35,442-37,053 last week, the current mainstream price for ion rare earth concentrate is stable at around RMB165,000t USD26,582t”

    August 11, 2015 - 10:28 PM

  • Bill Keenes

    I am sure that Jien Mining know much more than you.

    Jien have now completed their due diligence and optimization work (which has not yet been made public) on NTU and have still decided to proceed with their investment of AUD$49.5M.

    The market is always right …. and presently 5 Lynas shares won’t buy 1 NTU share, and I predict NTU is soon to become #1 in the rare earth sector as measured by market cap.

    Here is a link to a report from a US perspective on Dysprosium submitted September 2014:
    http://www.rand.org/content/dam/rand/pubs/rgs_dissertations/RGSD300/RGSD337/RAND_RGSD337.pdf

    therein it states: “xenotime deposits which allows for cheaper processing and separation”

    The best is yet to be come for NTU and will I suspect will be revealed once the results of Jiens optimization work are made public.

    August 12, 2015 - 1:56 PM

  • Chris

    Bill
    Rather naive to believe NTU will be a success simply because an Australian subsidiary of a Chinese nickel company has provided some funding.

    A$49.5M in exchange for two board positions and 33% of shares on issue once the transaction is complete.
    Taking I to account Australian Conglin Investment groups 3 board positions and 45% of shares on issue currently, two Chinese interests will own the company.

    I guess we will find out wether or not that translates into retail shareholder value or not. Personally I don’t believe it will.

    August 12, 2015 - 6:46 PM

  • Tim Ainsworth

    “Jilin HOROC Nonferrous Metal Group Co., Ltd. engages in nonferrous metal production and processing, energy material development, and financial capital business operations. Its product portfolio includes nickel sulphamate, nickel sulfate, ferronickel carbonyl powder, iron carbonyl powder, cobalt sulfate, electrolytic nickel, nickel chloride, nickel carbonate, nickel matte, nickel acetate, nickel fluoride, copper sulfate, nickel hydroxide, molybdenum and salt concentrate, industrial sulfuric acid, nickel cathode, and silver and gold concentrate products. The company also engages in mining, dressing, and smelting aspects.”

    Only relationship to RE I can find is their 16% assist in land banking Orion Metals (89% Chinese), whose last QR is a great read for insomniacs, and I guess that came out of their “financial capital business operations”.

    August 13, 2015 - 1:08 AM

  • Steve

    What is your point Tim? I read divestment?

    August 13, 2015 - 9:14 AM

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