Future of LMA Being with Avion since 2008, it is very gratifing to see the LMA progress over the years.
For the oldtimers on this board, I think it is worth repeting the business model Areva wanted to emulate - Cameco and its Senterra Gold operations. Similar to Cameco, selling its share in Senterra, it is now Areva< turn to sell its highly prospective gold operations.
Here is a trivia questions - what a UN led sanctions, the sussession of South Sudan, the protracted negotiation between LMA and the Sudanese government, the Areva interest in selling its shares in LMA and a recent visit of the Sudanese industry minister to China, have in common ?
Well, if you correctly guess, all of the above is interellated and depending of how geo-politics are played, one day in not so distant future we (the LMA share holders) may end up being owned by the Chinese.
Why is that ? Let's connect the dots. The VNS current potential between $US 4 and 3.5 billion ( that is 10.7 million ounces x $350/400 ) can only multiply if the remaining 13 locations, including Hudaett, are explored and put in production. So let's say the entite VMS project is worth $US 35 billion.
You are now the Sudanese government. You need to replace and replenish the lost oil revenue stream from South Sudan with similar revenue stream. What do you do:
One, start granting mining conssesions, Guess what the Khartum is doing in the last 18 months - exactly that.
Two, identify the largest project in the country. Bingo, the Khartum picked VMS project with La Mancha as the golden goose.
Here is the intricate question - if you need $$$$ and you need it now, would you go with a small but reliable joint partner, such as LMA, or opine for a bigger player? I can assure you that this is not a hypotetical question. Just look what happened with Kinross" attempt to develop its former Red Back mine, Tobiassi in Mauritania. Surpise, surpise, Kinross run into some financial difficulties...
If you are in Kharum, you surely will be looking for a solution. Guess what happpned last November or shortly after Areva announced its intention to seel LNMA operatio? The Sudanese mining minister was dispatched to China. I will let you guess what was discussed there.
So, the moral of the story? The previous e-mailed wished a repetition of the Red Back acquisition. Well, watch out what you are wishing for. AK