@Quanta, thanks for your opinions and reminding me to send these ideas to TMT management. I have done it this morning. I sent an email with the main opinions and ideas by the links of this thread to Ian Prentice (MD) and Michael Fry (Chairman). It's as below.
Hi Ian and Michael
My family superfund is ashareholder of Technology Metals Australia P/L. I have started a discussion thread in Hotcopper after making someresearch about Atlantic’s Windimurra Project and other vanadium projects in theregion.
It is “Opportunitywith Windimurra Vanadium Project which seems in trouble” (Link to thepost). I can guess that you all know what the opportunity could be. However ifyou would like to have a look at the thread you can see what the othershareholders think and discuss.
Windimurra Projectwill not be able to start the production next year as they don't have thehigh-grade ore to feed their plant.
It is well known by the Vanadiumexplorers of Meeline Suit and vanadium experts of the same area that Windimurra’shistorical production problems was because of poor recovery rates, resulting inlower than expected ore grades and low high-grade ore volumes, resulting tothe higher operating costs. (See the P.S. note for details)
According to my research WindimurraProject still has the same problem as they could not find an economicallyviable high volume high-grade ore in their own leases yet.
I have also heardthat the recent drilling for finding high-grade ore at Windimurra project isfailed again.
I don't know whythey insist to find high grade ore in that area. All people involved invanadium business in that area know that there is no high grade ore (incomparison to TMT's high grade) at Windimurra and in close vicinity toit.
If they don't wantto end up in disaster again they will have to choose one of these options;
- They willhave to buy high grade DSO from one of the close explorers (TMT or AVL), or
- They willhave make a JV with TMT or AVL and relocate the Windimurra plant tothe Gabanintha location of TMT or AVL.
I don't think TMT or AVL would be happy to sell their high-grade ore toWindimurra project as their own project would be worthless if they would do that.They would also end up high production cost andremain dependent to other explorers deposits in the long term.
Then the second option is being more viable option to both Atlantic and TMT or AVL as they have the high gradevanadium. All it means that Windimurra Plant can't start the productionand sentenced to stay idle indefinitely unless they relocate it to a high gradeand metallurgically rich deposit site like Gabanintha.
I am very surprisedthat why a smart billionaire investor like Anthoni Salim andhis advisers can't make the right move and save the huge money(over $600m) they have already invested in Windimurra.
The solution is very simple in my opinion; AJV between TMT and Atlantic
- WindimurraPlant needs high grade ore to work efficiently,
- otherwise itwon't work and plant will be shut down again, and
- $600m will bewasted
- Closeprojects; Venus Metals, Surefire Resources and Neometals ore aren't differentthan Windumurra's ore.
- The onlychance in the close vicinity could be Santa Fe's (SFM) Watsons Well deposit asthe high-grade magnetite layer could be overturned and located at the top oflow grade layers (Normally high grade layer is always at the bottom). HoweverSFM does not show any signs of drilling the deposit.
- I don't thinkA Salim would waste his $600m by wrong decisions
- His Atlanticshould be in negotiations with TMT asap if they haven’t done it already.
- Because TMT is at least 6 months ahead of AVL, TMTwould be the best choice to make a JV for Atlantic.
A JV between TMT & Atlanticwould create a win-win situation both for both companies.
TMT shareholders wouldn't be happy bya takeover by Atlantic as TMT’s market cap is not reflecting its real value atthe current situation. I believe a JV would create a Win-Win situation for bothcompanies. In today’s conditions, Atlantic is not the side who is holding thepower and advantage, instead TMT would be holding the power and advantage inany negotiations.
Kind regards
Xxxxxx Xxxxxx
P.S:
A posters in Hotcopper, who hasnickname “mustpow” apparently who knows the problems of Windimurra plantexplained the problems in detail; (Linkto posts)
“Windimurra cannot succeed long termwhen vanadium prices revert to the mean. To provide clean kiln feed, therecovery rates are too low. They increased the recovery of concentrate but thenat the cost of impurities, particularly silica. Even the cleanest con theyproduced had heaps of silica, which results in increased reagent consumption.The landed cost of reagents and, more critically, the cost of gas plus the lowhead grade and poor recovery makes it one of the highest cost producers. It canonly ever be a swing producer… reagents consumables and energyare also important. Originally, windimurra used waste sodium oxalate fromLocal alumina industry as its source of solubilising agent for the roasting.Because of high silica in the kiln feed, the reagent consumption is horrendousand so the use of conventional sodium carbonate is very costly. They also had acheap supply of ammonium sulphate which was a waste product from the nickellaterites then operating in the eastern goldfields. The Amsul used in the hydroplant to make the ammonium metavanadate. All spare amsul is now diverted tofertilisers so they have to pay full price now.”
