Author Topic: ALS.TO - Altius Minerals  (Read 1460388 times)

petec

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Re: ALS.TO - Altius Minerals
« Reply #6320 on: August 09, 2018, 07:55:28 AM »
Uralkali say that water inflows to their 1.1mt Solikamsk-2 mine have risen 8-fold this year. This creates 2 problems: the inflows are within 10% of the maximum rate Uralkali can pump at, and there's nowhere to pump that amount of water. They've applied for an emergency permit to discharge into the Kama Reservoir but "the possibilities of reducing water inflow have been exhausted". It sounds like the only hope is that the inflows slow. I don't know why they've increased or why they might slow.

The water is fresh so it risks dissolving the support pillars and creating sinkholes. Solikamsk-1 (1mt) is right next to S-2 so the worst case is S-2 floods this year and takes S-1 with it. Only Nutrien and Mosaic (owners of the Altius royalty lands) have spare capacity so this could give them an opportunity to increase volume into a tighter market.


mugwump

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Re: ALS.TO - Altius Minerals
« Reply #6321 on: August 09, 2018, 09:48:59 AM »
recapping the royalty cos reporting today
qtr data only

franco stock price $72
net income/share  29 cents

royal gold stock price $83
net income/share  41 cents

altius stock price  $10
net income/share  12 cents

it's readily obvious that altius is the best value of the
three reporting royalty cos this qtr

linealdin

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Re: ALS.TO - Altius Minerals
« Reply #6322 on: August 09, 2018, 08:24:58 PM »
Conference call for Q2 is worth a listen.

An initial royalty deal for Lithium Royalty Corp has been signed, with a second deal in advanced discussions.

Generally a target rich environment for royalty/equity deals. Juniors just canít find support from the equity markets. Altius expects several smaller royalty deals to be closed in the second half of 2018. Market turmoil helps Altius.

Many deal sheets flying around for Blue Sky Renewable Energy Royalties.

News for the Adia Resources diamond spinout will come in the next few weeks.

A couple of mentions of the Labrador Trough being a source of low alumina iron ore. Alumina content is becoming a big issue.

First Quantum seems to have continued with the West Cork copper project (implied by Daltonís remarks).
« Last Edit: August 09, 2018, 09:13:42 PM by linealdin »

linealdin

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Re: ALS.TO - Altius Minerals
« Reply #6323 on: August 09, 2018, 08:40:51 PM »
https://finance.nine.com.au/2018/08/09/20/39/rio-mulls-float-of-canada-iron-ore-holding

Rio Tinto considers a public listing on the TSX of its 59% equity position in IOC.

Rio Tinto was previously unable to sell its stake in IOC for US$3.5 billion to UD$4 billion. An IPO would be a kind of a sale to the general market.

The market cap of the spinout of the 59% stake would indicate the market value of LIFís 15% equity position (undervalued).

linealdin

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Re: ALS.TO - Altius Minerals
« Reply #6324 on: August 09, 2018, 09:27:13 PM »
The contrarian aspect of making project finance deals with juniors right now: Look at the TSX-Venture Index. We are in a trough, not that far from the bottom of early 2016. Venture juniors are beaten up and discouraged. Altius should be making deals on very good terms.

TSX Venture Index at 700 currently, up from the low of 489 in January 2016, but still far from the high of 2370 in 2011.

« Last Edit: August 10, 2018, 02:55:48 AM by linealdin »

linealdin

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Re: ALS.TO - Altius Minerals
« Reply #6325 on: August 10, 2018, 04:00:23 AM »
https://finance.nine.com.au/2018/08/09/20/39/rio-mulls-float-of-canada-iron-ore-holding

Rio Tinto considers a public listing on the TSX of its 59% equity position in IOC.

Rio Tinto was previously unable to sell its stake in IOC for US$3.5 billion to UD$4 billion. An IPO would be a kind of a sale to the general market.

The market cap of the spinout of the 59% stake would indicate the market value of LIFís 15% equity position (undervalued).

LIF should probably add its 15% equity stake to the potential public listing. The market currently disregards the value of that equity stake. LIFís market cap is more than justified by its royalty revenue and its dividend payouts alone.

I think that 15% equity could be assigned a value approaching C$1 billion in a successful public listing. LIFís current market cap is C$1.5 billion. Would create a lot of value.

Waratah Capitalís old proposal to divide the equity stake from the 7% royalty was very wise.
« Last Edit: August 10, 2018, 04:04:31 AM by linealdin »

linealdin

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Re: ALS.TO - Altius Minerals
« Reply #6326 on: August 10, 2018, 04:14:26 AM »
Iím glad First Quantum has taken exercised its option but the West Cork copper deal didnít bring back much value to Altius. First Quantum acquires 90% of the property with US$6.25 million in exploration expenses and staged cash payments of just US$1.05 million (backloaded over 7 or more years) to Altius and its minority Irish partner. Terrible deal with a major operator.

Altius only really benefits if First Quantum builds a mine and starts paying the 2% royalty.

The farm-out deals with juniors like Sokoman offer much better terms and near-term upside. The 19.9% equity stakes in the juniors can be monetized when discoveries are made.
« Last Edit: August 10, 2018, 04:30:57 AM by linealdin »

linealdin

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Re: ALS.TO - Altius Minerals
« Reply #6327 on: August 10, 2018, 04:54:57 AM »
Dalton talks up Chapada during the conference call. Itís not just a mine. Altius now considers it a mining district because of all the deposits Yamana has discovered on the 700 square kilometer property.

I believe there are multiple Chapadas on that land package. The implications of that are incredible.

linealdin

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Re: ALS.TO - Altius Minerals
« Reply #6328 on: August 10, 2018, 05:09:22 AM »
With the frothy market for royalties and multiple new royalty companies on the scene (I think of BaseCore Metals still hunting a deal) shouldnít Altius be able to exercise the C$5 million for 0.5% royalty on Excelsiorís Gunnison and immediately flip it for C$10 million? Basically buy it for another party?

Altius may have its doubts technically about in-situ copper mining but others may have differing views. The option is very cheap considering the rise in the copper price since Callinan made the original deal with Excelsior.

bizaro86

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Re: ALS.TO - Altius Minerals
« Reply #6329 on: August 10, 2018, 07:54:55 AM »
Iím glad First Quantum has taken exercised its option but the West Cork copper deal didnít bring back much value to Altius. First Quantum acquires 90% of the property with US$6.25 million in exploration expenses and staged cash payments of just US$1.05 million (backloaded over 7 or more years) to Altius and its minority Irish partner. Terrible deal with a major operator.

Altius only really benefits if First Quantum builds a mine and starts paying the 2% royalty.

The farm-out deals with juniors like Sokoman offer much better terms and near-term upside. The 19.9% equity stakes in the juniors can be monetized when discoveries are made.

The upside of doing deals with bigger companies is if an economic deposit is found, they are more likely to be able to build the mine without a bunch of drama.

That extra upside pays for the lower upfront proceeds, imo.