RE:Long?
aioros wrote: I must be honest, I would like to lay a few questions as I am having a few doubts about this project lately
1. What is the reason behind Vale's sale of the Tres Valles project?
2. If it was going to produce positive results, wouldnt Vale have hold on to the project if so?
I've read that on Vale's website: "Transaction is consistent with Vale's strategy of focusing on world-class assets". Focusing here on World class assets, which Tres Valles is probably not.
3. Warrants. Eventhough they bring the company cash, isnt it negatively viewed, especially when it dilutes SP and we end up taking a hit?
4. https://www.bloomberg.com/news/articles/2022-02-12/giant-miners-to-see-record-profits-slip-as-cost-pressures-bite
If major players in the mining industries, including Rio and Vale, wouldnt TVC have even a tougher time breaking through?
Id appreciate any input as I am interested as much as you are in betting on TVC driving SP up soaring.
Here are your answers:
1.. Vale's sale was in circa 2012 or a decade ago. At the time they had a CEO change, some issues and sold this off as to small ro move the needle even though they had spent over $250 Million in 2012's $'s. If I recall they moved to focus on iron ore.
2. See number 1 above, Vale has been out of this for 10 years+.
3. Massive dilution has already occurred, the .70 warrants/Oct 2022 are probably dead. I see significant resistance above 0.32-.55 range base on bought deals. This is a long term play, but you can buy way below everyone else right now. Market cap of C$9 M, surev$80M in debt but the mine is complete and they are going to start producing.
4. This is a working mine that is very important to the local town of Salamanca, they have projected costs of $1.66. Block caving is one of the most efficient mining methods. Buff if CAPEX is spent in construction which is complete. The easy money is to be made now. This is a high grade deposit in 1.51% so reduce costs. They already have drill results of 2% grade at Don Gabriel.
I doubt there is a better risk to reward here of any stock on the TSX Venture. They just need $5-10M to get going, not a huge sum. Again they about to mine 101 Million pounds at 85% proven not probable reserves, a big difference.