Market Update

Regarding this blog - KGL - Highlands Pacific - Sheffield

Good afternoon

I have had some complaints recently - so I would like to take the opportunity to express again, that this is a very superficial blog only! This is no research, no proper analysis - I am only expressing my very personal views here, written somewhere in between during my normal workday - when and if I work, and if there is any worthwhile news ! Whoever does not like it, obviously should not read it!

Nickel is trading at 9 A$/lb now..but nickel producers are not moving! some profit-taking in base metals otherwise....and more and more people talking about the effects of Brent trading at 80 US$+....and about the fact, that most producers have done their home work and have cut costs substantially. 

KGL Resources - I do not follow them as closely as I used to these days...but the resource estimate, announced today,  validates good old Simon Kidston, who has always been a believer in this asset: 384.000t of copper at 1,53% copper, basically all underground and at a cut-off grade of 1% for underground - material. This is an increase of 18% in t, and by 43% in grade - the latter being very important for the potential viability of the project. Exploration is nowhere finished, nor ar the main ore bodies closed off. This is still not a definite goer - only time will tell...but for the patient investor, this thing is a hold with some light at teh end of the tunnel. Certainly the best state this company is in for many years!

Highlands Pacific - this is a very different animal! They had their AGM today. The resources they have are massive - but they are all in PNG = at the end of the world - and HIG is only a minority holder! They currently own 8,6% of the Ramu Nickel Project, which is producing 34.000t of nickel and 3.300t of cobalt for the long term ( 30 years + ), and an asset, from which HIG is getting dividends now. They own the Star Mountains gold/copper project, and  they also hold 20% of the Frieda River project, which has 13 millt of copper, and 20 mill oz of gold in resources - but which is a many years away from production. IF the EV-story does what many believe it could to the long term demand of copper, assets like this one could be very vaulable a few years down the track. An interesting stock to watch, and I have no doubt, that the underlying long term value of this company is much higher than the current 81 Mill A$. But when this value will be realized, is anybodys guess!  Given the current interest in nickel + cobalt, I think the stock could be in for a bit of a run this year, following 9 month of consolidation.

Sheffield - their Native Title hearing was concluded today, with a  decision expected within the next 4-6 weeks. The company is also talking directly to the Aboriginal groups to get a deal done, potential before that. 

Have a nice, long weekend!


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