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Pretty sure I was right.




Neither here nor there but these things interest me.


Angola is less risky than DRC in my opinion. The HUGE positive for MNB is the JV partner. They are huge, they have strong Govt connections and I have been told they even loan money to the Angolan Govt. With them on board I don't see any problems politically whatsoever.


I'm still researching. There has to be a missing piece to this jigsaw. It's just way too cheap and normally the market isn't this much out of whack in terms of value.

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Angola would like Israeli investments

Luanda: Angola wants Israeli investments, says Dr. Aguinaldo Jaime, head of the Restructuring Commission of the National Agency for Investment, the government's fund for private-sector investment. Jaime, a man in his 50s with a degree from the London School of Economics, hosted a group of Israeli journalists two weeks ago to discuss Angola's advantages for foreign investors. The fund, known as ANIP, encourages investments in Angola in sectors including diamonds, oil and minerals. The government decided that mineral mining, which needs heavy investment, does not create enough jobs, said Jaime.


Israeli gems and property baron Lev Leviev plays a large role in Angola's diamond industry.


But the Israeli private sector has virtually no presence in Angola, and this is unfortunate, said Jaime. A few Israeli companies do operate in the country, the largest being the LR Group, a Herzliya-based outfit that once supplied weapons to the Angolan government and in recent years shifted to communications, construction and agriculture.


Most Israeli operations are in partnership with the Angolan government, as opposed to the private sector, said Jaime. Angola has great potential and it's politically stable, he added.


The country, on western Africa's Atlantic coast, was a Portuguese colony until 1975. The civil war that broke out after the country gained independence left hundreds of thousands dead, millions wounded and the infrastructure in shambles. The war ended nine years ago, and since then the country's socialist government, led by President Jose Eduardo Dos Santos, has been trying to change Angola's image and bring in international investors.


Angola faces tough problems. It lacks proper infrastructure, its workforce is largely unskilled, and its bureaucracy is complicated. It ranks high in terms of poverty and corruption, evidenced by the tremendous wealth accrued by a few tens of thousand government officials, former military officials and the president's associates and family.


On the other hand, its advantages include a large amount of land and a low population density - only 10 million residents live on 1 million square meters - as well as significant natural resources including diamonds, oil, iron, water, fish and wood.


Angola is aware that it has a reputation for corruption, but it's no different than any other country, said Jaime. The country is trying to fight the phenomenon and create a transparent work environment. Jaime admitted that the country had a massive "parallel economy" - a black market - and said this helped lead to the conclusion that the private sector needed to be boosted.


So the government passed several laws designed to encourage investment. One is a 10-year tax exemption and a permit to take profits out of the country for anyone who invests more than $1 million. Another law, designed to tackle bureaucracy, enables businessmen to receive all the permits to start a business within the course of a day.


The government is also working to speed up the process of issuing entry permits - currently, it can take weeks.


Angola has one of Africa's five strongest economies, after Egypt, South Africa, Nigeria and Sudan, said Jaime. This is expressed not only in oil production - Angola is sub-Saharan Africa's second-largest producer - but also in the fact that Luanda is getting a stock exchange by the end of the year. The figures shows that the government's policy of encouraging investment is paying off - investors from around the world contact the fund every day, said Jaime.

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TSX listed Stonegate Agricom has just released pre-feas results dor their Paris Hills Project (Market Cap 90m undiluted):


-14 year mine life with 10m tonnes produced over LOM


-134m Capex to production


-4 to 5 year payback


-$73/t cash costs (Not including transport component - add at least $20 for transport minimum)


-NPV at 8% discount is 180m


- Underground Mine



MNB pre-feas for Cacata/Chivovo due within days. Following my estimates DYOR:


- min 10 year mine life (15+ likely)


- <100m capex (50m MNB share)


- 1 to 2 year payback


- cash costs <$50/t (including transport component)


- NPV circa 300m for MNB share???


- Open Cut Mine


MNB market value is 30m fully diluted.

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  • 4 months later...

A bit of volume sneaking through today and yesterday. Up off the 15c lows. Possibe double bottom?


Pre-feasibility study released on Cacata since my last post.


-$180/t phosphate revenue assumption (current spot + premium for Cacata ore = $210/t)


-10 year mine life (800 000t/pa)


- 157m CAPEX (78m MNB share)


- Payback 2.1 years, IRR 40%


- Cash costs $57/tonne


- NPV 311m 10% pre-tax (155m MNB share)



Peter Richards: "The next step for Cacata is commencement of the BFS, during which we expect to further optimise and reduce the capital estimate by using a contract mining, contract road haulage model, and further reduce the operating cost estimate by using grid power versus the current model of diesel generated power. This has the potential of placing Minbos within reach of achieving its goal of being in the lowercost quartile of global phosphate rock export producers.ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ÂÂ

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Scoping study on Kanzi due this quarter. A few of my estimates MNB has 65% of Kanzi:


10 year mine life at 1.5 to 2 MTPA


CAPEX 150 - 200m (MNB share is 65%)


Cash costs 50 -60/t (Kanzi much closer to port than Cacata so transport component lower, however resource deeper with a strip ration of 4-1 rather than 2-1 for Cacata)


NPV get a minimum of 360m (230m MNB share) using worst case figures and an NPV over 1 billion (650m MNB share) using best case figures ( see below)






NPV 360m @12% discount (worst case figures)


Revenue $180/t

Output 1.5MTPA

OPEX $80/t

CAPEX $200m

tax 35%

royalty (3% to JV partner who will look after all state royalties)

Free Cash circa 100m/pa





NPV 1 000m @10% discount (better case figures)


Revenue $200/t (current spot)

Output 2.0 MTPA

OPEX $50/t

CAPEX $200m

tax 35%

royalty (3% to JV partner who will look after all state royalties)

Free Cash circa 195m/pa



Highly likely people waking up to the massive potential of Kanzi now that ownership issues have been resolved. Could explain 20% increase in price and high volume today. DCF valuation shows Kanzi as an attractive project based on worst case figures and an absolute gem on (what I believe) are more realistic inputs. Plus having a Cacata and Kanzi operating simultaneously will bring synergy.


Receiving alot of industry attention culminating in appointment of corporate advisor recently. The end game for this company (as communicated in presentations and by the company directly to me) is a huge DAP/MAP plant fed by the massive Western Limb deposits.

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  • 4 weeks later...

Cacata ore will recieve a premium over the Moroccan benchmark not only because it will be a higher concentrate %, but the cadmium levels (10ppm) are below the UN's recommended cap of 27ppm and much lower than the largest source of phosphate on the merchant market - the cadmium laced Moroccan deposits.


The low MER (ratio of aluminum, iron and magnesium content to phosphate) will aslo ensure that Cacata ore will attract a premium over the Moroccan benchmark.

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  • 1 month later...

Patterson's annual fertilizer book has MNB as the top Phosphate pick. Last years picks which I did not rate at all (CNL and UCL) are rightly not even included in this years report.


No other ASX listed hopeful will beat MNB to production, in fact I don't believe any other play will get near to production in the next five years with the possible exception of RUM.


Still waiting on Kanzi SS.


Strategic partner update must be close. Plenty of interest in Cacata from the industry.

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Yara did the met testwork on Cacata. In April they stitched up a large offtake agreement with IC Potash. Coincidence they did the testwork or are they looking to shore up there phosphate supply through MNB?


A large offtake by Yara or similar would pave the way for a large debt funding package.


You would hope that on such an agreement project would be valued at least 50% of MNB share of Cacata NPV - $80m. Say an extra 35m shares issued as part of deal implies share price 50c on 170m shares fully diluted.

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Updated DCF valuation. Cygnet has discounted the post tax NPV atrrubituble to MNB by 50% to get $50m.


Post tax NPV for Kanzi comes out at $576.2m (375MNB) assuming:


paramaters in scoping study

10% discount rate

corporate tax 30%

royalty 3% to Allamanda


So apply Cignets method of discounting NPV by 50% for country risk gives a value of 375/2 = $187.5m. Add on the 50m form Cacata gives 240m for both projects.


Shares on issue 135 + 6 (director options) + 22 (.14 raising) = 163m


value per share fully diluted $1.50


Say post raising we settle at 15c. We will be sitting at 5% of combined post tax NPV of both projects. Absurd.


As I said to get to Cygnets 50% we will need to trade at $1.50.


If both these projects are off the ground we are talking combined 90m free cash p/a on scoping study parameters.


Bump output up 25% on each project (CAPEX allows for this in SS) and use $200/t and its 125m free cash p/a.


What value will the market put on 90-125m free cash p/a? My guess is probably 5x....450-625m or $2.7 to $3.8 per share.


Even adding another 50% (ontop of 163m) shares gives $1.84 to $2.56 targets.

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