I've been watching RUM for some time as I am interested in the Potash and Phosphate minerals as a way to get exposure to increasing requirements for yield per hectare globally as protein consumption increases and as we continue to degrade arable land.
The deal with CEN will surely go through in some guise at some point. It simply doesn't make sense that there are two $200-400m plants + infrastructure built side by side on adjacent tenements.
Whilst investing early is the way to achieve multi bagger returns I am keeping my powder dry and watching as it is still very early days for RUM.
I was surprised at just how expensive the capex is to build the plant and infrastructure for RUM and all of the inherent execution and financial risks around this are keeping me on the sidelines after seeing so many mining companies blow investor funds during the transition from explorer to producer.
IMO the JV with Toro is a little ambitious. I think RUM will have their work cut out progressing, developing and funding their current projects in the medium term let alone spending energy, time, and money on new projects right now (although I do understand the Central Processing Hub idea with satellite deposits).
An associate who used to be the MD for Michael Hill Jeweller and is currently a Director on a number of NZ listed companies said to me once that the biggest mistake investors make is investing several years too early... I will take his advice here with RUM and keep a watching brief.
Cheers John
RUM Price at posting:
13.5¢ Sentiment: None Disclosure: Not Held
