Market Update

General - Genex - Gold Road

Good afternoon

there is very little indeed to report today....

Indonesian reports, that a few nickel smelters have been closed , led to some short covering of heavily shorted nickel stocks like WSA and IGO ( both have 16% of their capital shorted! ) yesterday - only to give it all up today, despite nickel looking a little stronger, as well as the other base metals.

Goldfields have hedged 75% of their Australian production for the balance of this year - this is one of the larger hedges I ahve seen recently. Dacian also announced a few days ago to have hedged 25% of the 2019/2020 production. 

Van Eck came out with several substantial shareholde notices today, following Friday´s reweighting. SBM down from 16% to 9,6% - SAR down from 17.6% to 11%, Perseus no substantial shareholder at all anymore, i.e. below 5%. Good, that we have this thing behind us. 

Gold Road - came out with an update of their development plans for Gruyere in JV with Goldfields. Costs for GOR will rise by 2%, and the JV has signed a power purchase agreement with APA, which is building a 180km conenction pipe line to the large WA-pipeline. The project is planned to produce gold in the 1st Quarter of 2019.

Genex Power - respected broker Baillieu took up coverage today with a good report. They value ths stock at 26ct/share, with upside of 15%, once in production. This valuation is entirely based on the Solar Stage I project, which is only 50 MW. Solar Stage II is 270 MW, and Pump Hydro is 250 MW. In my opinion, the valuation is probably a bit rich just based on Solar Stage I, and should probably be rather 50-60 Mill A$ = around 21-22ct/share. The analyst argues, that a valuation of the two larger projects is impossible at this stage due to too many moving parts. The main question remains financing....the Australian press is full every day of articles surrounding the power/gas crisis we are having in Australia, and the government remains under intense pressure to deliver solutions. Still, I think it will be some time, before GNX will be able to announce a comprehensive financing package, because of the size and complexity involved. The governments announcement to build the necessary power line at it´s costs the otehr week is a good indication, taht they are doing everything they can to enable this project!!

have a nice evening