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Twobees

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Everything posted by Twobees

  1. As a buy and hold on this one, I don't have a problem with these sort of low cost acquisitions. This one is in an area associated with fancy yellow diamonds. The Botswana one not far from Orapa. I don't think they will take any focus away from Lulo. Will provide a better look in company presentations, i.e rather than being a one tenement company in Angola.
  2. Market seems to have suddenly got interested. Since around the 20th September anyhow. Not exactly sure why.They did announce a big gem discovery at that time and another a week later. Also a good diamond sale and talk of a major holder completing their exit. They have had plenty of large gems and good sales previous to this though and the market didn't care too much. I still value this at around the late 30's/early 40's SP wise based on the alluvial discoveries to date. Find more valuable alluvials upstream of L46 and the current $160m (undiluted) MC might be O.K. Pipes are still a longshot imo and don't deserve to have any value placed on them. Present excitement looks like fear and greed to me.
  3. Some nice gains there Arty. Hows the trigger finger
  4. Only short term driver for possible SP gains I see, would be confirmation of further alluvial finds (with big stones) in terraces upstream of L46. And they wouldn't be big gains -50c? They may wait until the pipe licence is issued before they announce any such results. I do expect the SP to hold in the late 30s/early 40s though as big valuable stones keep popping up in the alluvial areas already being mined. Any large SP gains will only come about through positive results of LDD of a pipe and that is still some time away. Narrow diameter drilling may show positive geochemistry but that wont be enough. The only exception to that would be a positive discovery of undiluted PK/RVK in a pipe close enough to the surface for large scale bulk sampling with earth moving equipment. I think that would be a longshot.
  5. Now that the paperwork is all in place for the alluvial mining company, some key facts could be put to the test. The most important would be whether the terraces upstream of 46 have diamond bearing gravels. If they do and they also contain the big gems, then this would be very significant. In the GE image below, the terraces are the lighter coloured (treeless areas) on the eastern side of the river and extend up the the end of the concession. The middle of the terraces average around 5m above the river bed level. Looking at the image, it is reasonable to see how it was Initially hoped that the pipe source could be found relatively easily if you assumed the following: With the large number (up to 10,000) of artisanal miners on the ground back then, they would have tested the entire length of the river on the concession and settled on the most productive ground (the white dug up areas on the map around the camp). However the discovery of diamonds around 46 (and just recently the discovery of very large gems) essentially makes this assumption incorrect. The 46 gravels were no deeper than those elsewhere. Maybe the upstream areas were to far away from the road/town. Maybe with the war there just wasn't the time to investigate those areas. The negative implications of this new info is that a quick zeroing in on the pipe source/s will be harder. The positive could be a big increase in the alluvial potential. The big mystery of where all the diamonds in the Cuango River (supposedly the most diamondiferous river in the world) came from remains. The fact that the alluvial diamonds start directly after the Lulo/Cacuilo joins it, makes the odds of LOM's concession being the source look good. As the pipes were covered over relatively quickly after eruption (unlike the SA pipes) make the following assumptions look reasonable: (1) The productive pipe/s must be directly on the river/old river meanderings (the Cacuilo River lies pretty much directly over the fault) otherwise there would not have been enough time for that many diamonds to have been washed downstream into the Cuango (2) There are diamonds in most of the pipes in the concession and they all shed enough to provide for the Cuango diamonds given the limited erosion time. Not finding and diamonds in the upstream terraces would tend to favour (1) and narrow the pipe search from 46 downstream. Finding diamonds diamonds upstream could bring (2) into play.
  6. Further confirmation today of the alluvial prospectivity of the L46 area. Added bonus of the likelihood of fancy pinks as well. Makes the current MC/options look a decent buy. I expect the SP to remain in the late 30c/ low 40c range after conversion. Wouldn't expect too much more than that due to the usual limited resource alluvial considerations. Even with further large high value finds, the market will continue to apply the alluvial discount. No other news likely until an economic pipe is found (next year at the earliest) - this remains a longshot at this stage imo and I expect the market to agree. Anyone expecting gazetting to make any difference will be disappointed. Further CR should not be necessary with the ramp up in mining. Especially now that they they know where to dig to find the big ones. After conversion my average will be around 34c. That's not too bad imo, as I have been buying since 2010. Not many mining specs would manage that. Those trading should have done much better of course. In hindsight I would have been one of them. Hopefully however, the long term hold strategy may still work out o.k. The downside (at present MC) looks to be covered by the alluvials, and that, for me is the all important factor.
  7. This mornings announcement of a 68.1 carat Type 11A D colour gem from the L46 alluvials is pretty significant. Means a whole new area has been probably been confirmed for these incredibly valuable big stones. It is also an area untouched by previous artisanal miners. IMO, means the current MC is pretty much guaranteed based on just the alluvials alone and with risk free blue sky on the possibility of a pipe find. I will definitely be converting my options now based on this find.
  8. The EM suryey neither positive or negative with possible hints of a large orebody below. LDD will provide the answers but that is at least 12 months away. My guess is that the SP will hold around here or the late 30's in anticipation of further big finds in the alluvials this year. It would not be unreasonable to think they could pull a further $100m out of the gravels around BLOCKS 6/8. Would only take 5 gems like the last one to do it. Would like to see them run some dirt around L46. A good sized gem (around 10ct I think) was confiscated from an illegal miner a while back, supposedly from this area. Also the general stone size in the limited tonnage from this area was good. Find some big ones from this area as well and the market will be thinking about another $100m.
  9. Looks like the heavy rain has arrived. Latest sales announcement indicates no further mining from blocks 6/8 until after April. In recent years this has often been well past April. So probably no further big gem announcements before options expiry. Gazetting wont help, as the retail punters would have already priced it in and I don't believe the instos are interested in this stock for reasons outlined in previous posts. The EM survey may help - but it may also be a disappointment. And again no drilling anyhow for a while. You would think that the sheer size of the cashflow to date would keep the options in the money. I am pretty sure another one or two big gem finds would have taken the SP into the 50's. Pity that probably now not happening for a while. So maybe the SP will drift in the low 40's - maybe back down into the late 30's?
  10. Regarding the Lulo special distribution - Yet another reason why foreign diamond industry investors will continue to look elsewhere to invest. Endiama and Rosas & Pétalas not only not putting anything in to justify their 60% holding but taking out money desperately needed for pipe exploration and expansion of the alluvial operation. They are completely insightless. Its a wonder they had the nous to include LOM in the distribution. It may all work out O.K at Lulo due to the quality of the ground. But investors looking at other leases will give them a wide berth. Likely that Instos will give LOM a wide berth as well.
  11. Have read statements by the Chairman of the board for Endiama, Carlos Sumbula to the effect that Angola was appealing to foreign investors to invest in the diamond mining sector in Angola. Also recent statements by them about all the concession holders sitting on leases and doing nothing with them. They just don't get the fact that their own greed is the cause of the lack of investment. You have Trans Hex($26m MC) battling miserably along over at the Somiluana Mine on the Luana River with a 33% stake, while Endiama holds a 39% stake and three local companies the rest. Nothing wrong with a 33% stake if the other partners put up their 66% share. However they put in/do nothing - just sit back and let TSX shoulder all the capex and put out their hands for the rewards. The result is TSX have no money to ramp thing up unless they go into more debt, so it just limps along. The Angolans don't have much insight if they cant see that foreign investors will look at this and say, no thanks, we will go elsewhere (Botswana for example). They can appeal all they like. Its not going to happen unless they get real.
  12. I like your strategy. It has definitely proven to be the correct one on this stock. The usual bull from the spruikers on the other site. Take overs just around the corner, $5+ SP imminent, 259 now almost a dead certainty. To make it worse, these "investors" are such complete amateurs they probably even believe their own crap. If the company does find the source, they will claim that they knew this outcome was always going to happen. The usual scenario of confusing poor risk analysis with intelligence. 239 is nowhere near being a dead certainty. Even if the upcoming survey gives a positive indication of a decent orebody, there is no guarantee that that the pipe will be commercially diamondiferous. There is a real possibility that 259 or other close pipes have spat out a few big gems (but not enough to be commercially viable) and the rest of the stones in the alluvials have come from numerous other pipes upstream (again, not enough from any particular pipe to be viable). What the latest 404 carat find has done is reduce the risk of further large dilution. Especially if they find a couple more - it will enable some serious exploration to take place. However the alluvials where these big are coming from is a limited resource.
  13. Might have to wait for the the hard rock mine for the 1000+ carat one. SP gone into the 40s anyhow initially. Think it will hold somewhere in the 40's-50's provided they find a couple more like this - and you would have to like the odds of that happening in the next month or two.
  14. If its a gem related announcement tomorrow- any ideas on the price jump if its in this league Arty. http://www.bbc.com/news/world-africa-34867929 Maybe mid/late 40's. Seems possible they may hit more in the next couple of months? If so then into 50s -60's? Possible these monsters are part of the diamond population at the yet to be identified pipe? If they hit more in the gravel, then possible rerate due to revenue increases. And the size of gems pointing to an even smaller search radius for the source pipe.
  15. There looks to be an alluvial field right next to this pipe, so finding diamonds in it is significant. However the grade is not. No sign of any enriched near surface RVK from any of the pipes so far found to be diamondiferous. So not following the Catoca model. That is a negative, as it means no quick preliminary judgements about economic viability. And with the huge number of pipes in the field, it means we could all be old men before they manage to investigate them with LDD. Without with what looks like a high value alluvial field, you wouldn't want to be in this thing. The pipes are just an outside chance providing a bit of blue sky imo Keeping the current MC or increasing it will depend on them doing enough alluvial mining to indicate what the alluvial field could be worth. Now becomes important to find out if the field around E46 contains high value gems. Also the other terraces further upstream.
  16. Latest announcement says the wet front end there by December. No mention of the infield screening plant. Presume that will be part of the 40,000bcm per month ramp up next year. Still doubt they will be able to mine around the BLK 8 area in summer or do much 259 bulk sampling unless the wet season fails (unlikely imo). Will probably be able to mine in some of the dryer areas around the plant where stones size and quality is not up with the BLK 8 area still reasonable. SP somewhere in the 40s until mid next year seems reasonable considering the quality of the diamonds. E259 unlikely to have been investigated to any meaningful degree until then but will provide some blue sky factor.
  17. Regarding the alluvials; Still no word on when the plant front end capable of handling the wet summer conditions is likely to arrive/ be installed. A recent update said it was " in progress and funded" but no details given. No further updates on the field screening plant arrival/installation. Their Phase 2 plan of 20,000bcm/month needs the wet front end and screens if higher grade areas are going to be mined from Dec 15 to June 16. However you would still have to doubt whether they can get into those areas of bigger diamond size populations during the wet anyhow. The blk 8 area is low lying and I don't think the L46 area is much better - it hasn't been prepared anyhow and is a fair way upstream. Doubt they will have enough stockpiles to keep them going from the BLK 8 alluvial area as plant has recently been diverted for E259 evaluation. Current MC will only be maintained if regular high value diamond sales can be achieved through the wet. If they cannot, then more dilution (and free options) at a lower MC via the HNW investors a real possibility. The only kimberlite material from E259 to date has been Sandy RVK. This is unlikely to be diamondiferous (as per E251). If it had diamonds in it they would have announced it by now. They will need to find undiluted RVK or PK with the excavators but it may be too deep for that or they may hit the water table. Drilling would settle the issue but they have no drill rigs available. So E259 still a longshot at this stage imo.
  18. Arty, where are we at with the fear and greed?
  19. Am presuming they have some decent size samples from E259, and enough of them, from various parts of the pipe, to justify the recent bullish management comments. For example would need to look a lot better than these below from 251. Would need at least 2-4cpht to avoid a sell off would be my guess.They need to start quoting pipe in figures in cpht to avoid confusing investors as that is the industry standard for pipes. Grades there looked to be around .3ct per 100 cm. Halve that at least to convert to cpht. Letseng gets around 1.7 cptht at approx $2500 per ct. Lom seem to be getting around $1600 per ct from the alluvial diamonds around the pipe. Hard to extrapolate that to what the actual pipe values might be, but a guess would be similar to Letseng. LOMs diamonds look exceptional quality, so that part is taken care of to a large extent. Grade is the issue - would need at least Letseng grades of 1.7cpht or better to cut the mustard. Would still be speculative as they would be near surface samples only. These could either be enriched RVK, sandy diluted RVK, PK or various combinations with no indication of whats at depth. Market will discount all these unknowns. Counterbalancing that will be that they could have multiple Letsengs and an alluvial operation for cash flow. A good move would be to move up to E46 and try and do the same up there. Big issue for holders from now on will be the time gap between what may look good from initial figures and proving up with LDD on a low grade deposit. Usually means downward trending SPs in most mining stocks. Often better to sell and come back later. However if they find a couple of possible Letsengs from preliminary testing, a buy and hold might be the best option as the big diamond players would be looking closely. Notice they haven't been quoting grades for the alluvial operations around BLK 8. Probably because its so near the pipe that its not really alluvial anymore, so no typical alluvial concentrating/reconcentrating but getting closer to the actual pipe grades, i.e low.
  20. Photo showing vegetation differences around the area of a pipe. http://diamond1872.blogspot.com.au/2010/11...g-gemology.html
  21. Couple of photographs of Orapa when still a vegetative anomaly. file:///C:/Users/Home%20PC/Desktop/First%20Diamonds%20In%20Botswana%20by%20Dr%20Leon%20Daniels.pdf
  22. Care needed by anyone thinking of entering at these prices. All the latest action is based solely on what MIGHT happen if the pipe currently being investigated is proved up.The fact is it takes lots of LDD to to prove up a pipe, and at this stage the company does not have the drill rigs on site to do it. Even if they did, it would take a year of drilling to get an idea of how big the resource might be. All they have atm is excavation equipment that may show the pipe is shedding diamonds. That will not give enough indication as to whether the pipe will be economic. So any comments to the effect that the latest management remarks constitute a wink wink is just the usual spruiking crap. Nevertheless good to see management getting in there and getting it some some more publicity. Despite this being an exciting diamond area with lots of potential, the big investors have just not been interested. I thought with other commodities and O&G being down for the foreseeable future, this would have seen some smart diamond money entering over the last year, but I got that wrong. As a result, in hindsight, this would have been a good trade rather than a buy and hold. Not to say it doesn't deserve its current $57m MC. Just that if the past is any indication, the current buying is probably not smart buy and hold money, but the usual trading pattern. How good does the E259 kimberlite look? Posted these comments and images below back in Dec 2012 before it was recognised as a pipe. "Have bookmarked the positions of the BLK8 pit and the subtle magnetic image on GE. Have used the 2003 image as it shows it up better - being mostly unburnt?. (To see older images on GE, hit the tab with the clock and use the slider to go back and forth). Positions should be pretty accurate. Shows BLK8 just sitting at the edge of what could be a faint photo feature ?" "Seems to be other smaller vents around the main ( "?") one in the BLK8 area. Have marked them in the image below. Am presuming they are all (including the main feature) vegetation anomalies as seen from the aerial perspective, i.e the initial eruption ultimately causing rounded areas of differing soil types supporting this variation in ground cover. Quite speculative though, as the old river courses meanderings would create mimicking features in some cases? Anyhow, I wouldn't be telling the geos anything they haven't considered already, thus the haul road built to this specific area." They ended up going with 251 which had a big impressive Magnetic image, but the size of that image turned out to be mostly barren sandy RVK and a couple of vents that did not link to a decent orebody at reasonable depth. Anyhow, as far as I am aware, no big economic pipes have been found from MI. Venetia, Jwaneng, Marsfontein and Mwadui are all examples of kimberlites that dId not provide an anomalous response. Panda, the most valuable at Ekati had no signature due to the thick overlaying clay sequences. Following the alluvial trail seems to be the best method. E259 looking the goods (i.e sole source) would be a better bet except for the photo below which shows other areas of alluvial activity upstream. Means it is not the only pipe shedding diamonds. To even further muddy the waters, the company has stated that there are areas of diggings all along the Cacuilo River upstream, including E46. Raises the possibility that many pipes may be shedding the diamonds, none of which in itself is economic. Another area of concern is the fact that they still don't have the plant front end capable of handling the wet summer conditions. Unless this is in operation by the time the wet starts, they wont be able to process the higher grade/more profitable areas. Still trading this one Arty?
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