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This stock is a 10 bagger on the Cacata project alone IMO. Add in Kanzi (NPV 900m!) and the potential for integrated downstream fertilizer manufacture from Mongo Tando and Chibuete then you will see this stock has huge potential. However, for the moment focus on Cacata;


Cacata (50% MNB)


Targeting production early 2014 at 1mtpa (500k MNB share)


$100m capex ($50m MNB), expected to be 50:50 debt/equity funded, has already held prelim discussions with South African banks.


Predicted operating cost less than $50/t, sale price $200/t, $150 margin!


Potential 150M EBIT (75M MNB share)


after tax NPV 700M (350M MNB share)



And this is just the first project. Kanzi is larger than Cacata and 100% MNB.


You can buy MNB for a 32M market cap fully diluted. Not for much longer I suspect. Best phosphate play on the market IMO

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Plains creek in Guinea-Bissauhas claim $60/t operating costs.


360m Capex. Including 80km slurry pipeline will cost 60m.


OECD risk rating of 7 for Guinea-Bissa. (Angola 6)


Still have to spend 40m USD to buy remaining 50% of the company holding the asset. Plus the 360m capex and I would say they have near 400m to spend to bring the project to production over the next couple of years. The modelling they have done has the NPV at 180M at 12% although is too conservative at $100/t phosphate price.

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Formerly Portuguese Guinea, Guinea-Bissau won independence from Portugal in 1974 after a long struggle spearheaded by the left-wing African Party for the Independence of Guinea and Cape Verde (PAIGC). For the next six years post-independence leader Luis Cabral presided over a command economy.


In 1980 he was overthrown by his army chief, Joao Vieira, who accused him of corruption and mismanagement. Mr Vieira led the country towards a market economy and a multi-party system, but was accused of crony capitalism, corruption and autocracy. In 1994 he was chosen as president in Guinea-Bissau's first free elections.


Four years later he was ousted after he dismissed his army chief, thereby triggering a crippling civil war. This eventually ended after foreign mediation led to a truce, policed by West African peacekeepers, and free elections in January 2000.


The victor in the poll, Kumba Yala, was ousted in a bloodless military coup in September 2003. The military chief who led the coup said the move was, in part, a response to the worsening economic and political situation.


Mr Vieira won the 2005 elections but his rule was brought to a bloody end in March 2009, when renegade soldiers entered his palace and shot him dead, reportedly to avenge the killing hours earlier of the army chief, a rival of the president.


The country's vital cashew nut crop provides a modest living for most of Guinea-Bissau's farmers and is the main source of foreign exchange.


Guinea-Bissau is also a major hub for cocaine smuggled from Latin America to Europe. Several senior military figures are alleged to be involved in the trafficking of narcotics, prompting fears that the drugs trade could further destabilise an already volatile country.



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I am cautiously confident that its just a case of market oversight. Probably not helped by the fact that Angola turns investors away before they take a second look. Several people I have talked to about Angola baulk at the mere sound of it. Yet they wouldn't have a clue about the nature of the investment climate. And then the fact that Cabinda is a enclave probably does not help.


What is your opinion M?


I think the SS/Pre-Feas results on Cacata will be a big wake up call.


I mean CAPEX of 50m (50/50 debt equity) for 40-50m free cashflow per annum for 10+ mine life is worth at least 250m MINIMUM.


Current Market Cap 30m fully diluted and they only need to issue 25m equity for that above free cashflow.


What are we missing?

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