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Devils_Shadow

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« on: January 10, 2018, 07:45:01 PM »
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« Last Edit: November 16, 2018, 05:32:50 PM by Devils_Shadow »


DeepSouth

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Re: NZC.ASX - Nzuri Copper
« Reply #1 on: January 11, 2018, 07:18:42 AM »
Figured I should start a thread since i mentioned the name elsewhere. Current price is 46c

http://nzuricopper.com.au/wp-content/uploads/2017/12/171130-Resource-Rising-Stars-December-2017-Final-1.pdf

Briefly, Nzuri copper (NZC) trades on the ASX. Gives exposure to copper (a Tesla consumes 5-7x as much copper as a conventional car) and cobalt (not enough cobalt in the world for more than 35% EV penetration), both benefiting from EV adoption (Cobalt benefits much more than Copper given its major use is in EVs and 70% supply comes from Congo, but both base metals should do well).

Nzuri has arguably the highest grades, lowest cash costs/t, lowest capital intensity/t in the world amongst the cobalt resources. The company is named on copper but might as well be named on Cobalt. It has roughly similar $ amounts of both.

Jurisdiction is Democratic Congo which is a risk (it is anything but Democratic btw) but the geology and the team are just exceptional. 90%+ shareholding tightly held with a PE controlling the majority of it. A proper full stage, fair payability driven NPV is many multiples of the current EV. Project IRRs are ridiculously high (top 1% of projects globally).

A multi billion Mcap listed Chinese entity just bought a minor stake here (this event is an important risk reducer as Chinese are the biggest investors in Africa so nobody screws around with them). Advanced stage of development: 12-18 months away from first production (unlike most other Cobalt projects which are years away). Some exploration upside as well with drilling results due shortly (sits a few Kms from the Kamoa Kakula discovery, arguably the copper find of the century, led by the maverick resource billionaire Robert Friedland - ya the same guy who studied arts with Steve Jobs, and whose apple orchard inspired the Apple name).

I think this is a multibagger and will be one of the best performers this year. DYODD

Just flipped through the latest deck. IRR may be very high due to projected low capex and short ramp up but this is a preproduction asset in a high risk jurisdiction with <10 year life, <50MM lbs production, in the middle of the copper cost curve.

MrB

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Re: NZC.ASX - Nzuri Copper
« Reply #2 on: January 11, 2018, 07:31:34 AM »
Figured I should start a thread since i mentioned the name elsewhere. Current price is 46c

http://nzuricopper.com.au/wp-content/uploads/2017/12/171130-Resource-Rising-Stars-December-2017-Final-1.pdf

Briefly, Nzuri copper (NZC) trades on the ASX. Gives exposure to copper (a Tesla consumes 5-7x as much copper as a conventional car) and cobalt (not enough cobalt in the world for more than 35% EV penetration), both benefiting from EV adoption (Cobalt benefits much more than Copper given its major use is in EVs and 70% supply comes from Congo, but both base metals should do well).

Nzuri has arguably the highest grades, lowest cash costs/t, lowest capital intensity/t in the world amongst the cobalt resources. The company is named on copper but might as well be named on Cobalt. It has roughly similar $ amounts of both.

Jurisdiction is Democratic Congo which is a risk (it is anything but Democratic btw) but the geology and the team are just exceptional. 90%+ shareholding tightly held with a PE controlling the majority of it. A proper full stage, fair payability driven NPV is many multiples of the current EV. Project IRRs are ridiculously high (top 1% of projects globally).

A multi billion Mcap listed Chinese entity just bought a minor stake here (this event is an important risk reducer as Chinese are the biggest investors in Africa so nobody screws around with them). Advanced stage of development: 12-18 months away from first production (unlike most other Cobalt projects which are years away). Some exploration upside as well with drilling results due shortly (sits a few Kms from the Kamoa Kakula discovery, arguably the copper find of the century, led by the maverick resource billionaire Robert Friedland - ya the same guy who studied arts with Steve Jobs, and whose apple orchard inspired the Apple name).

I think this is a multibagger and will be one of the best performers this year. DYODD
Good luck mate!

DeepSouth

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Re: NZC.ASX - Nzuri Copper
« Reply #3 on: January 19, 2018, 10:47:25 PM »
Not hating on the property but an NPV10 is meaningless. A controlled small cap company with a preproduction small mine in the DRC - discount rate should be closer to 30% after making your own conservative ramp up/capex estimates.

One of the issues with small cap miners like this is your capital will never be returned to you. If things go to planned, they'll reinvest cash flows in new projects to grow production and grow scale continually until the commodity market crashes next cycle where they'll most likely have weak liquidity and face raising capital into a downturn. Management is key in mining and there are very few managers who should be trusted with minority shareholder capital.

For example: the US coal reorgs were a pretty unique opportunity in 2017 because they're owned by smart creditors who want to return all cash flow to shareholders while cash flow is coming in hot. Those are the type of mining situations to focus on as there are very few companies that will reliably compound capital over a cycle.