Market Update

General - Panoramic - Northern Star - Genex - Strike - Tiger

Good afternoon

The link to this years´s conference in Zurich, on the 23rd of February:

http://www.schroeder-equities.com/conference/

Surprisingly little happening on the currency-front today...the US$ just a touch down, which could have been much worse, given the government shut-down in the US, and a basix approval from SPD to build a grand coalition again in Germany.

Metals are strenthening a bit, again, as is gold. The IMF raised it´s global growth forecast by 0,2% to 3.9% - best growth in 7 years.

Panoramic - Quarterly out - not much to report, as they have not be in production. The company has received various financing proposals - but one thing is for sure: Those are getting better, with cobalt, as well as nickel and copper continuing to trend higher. Also, there are bits and pieces within the feasibility study, which the company can still improve. On the exploration front, PAN still have very significant upside to improve on the 8.3 year mine life at Savannah. On the negative side, head office as well as the maintenenace costs of savannah are eating away the cash - about 6 Mill$ p.a.. At some stage, the company has to jump and decide, what to do. My opinion still is, that nickel wll go higher, especially after 2019/2010, when all major car producers will have mny new models on the market.The latest major car producer to announce plans for EV´s has been Ford, which will invest 11 bill US$ until 2022 to advance their EV-offering. But PAN definitely don´t want to be a "nickel bank" - at some stage this year I am expecting a go-ahead to re-starting Savannah. At todays prices, the NPV of Savannah is after tax 210 mill A$, just under 50ct/share - the fortunes of nickel can substantially improve this number - not too hard to see a doubling of NPV, when you put nickel at 15.000 US$/t into the equation - and at those kind of prices, their second mine, which is also mothballed currently, would certainly come back on as well. As you know - I declar my interest!!And certainly, Peter Harold will present in Zurich 23.2.

Northern Star - have increased their shareholding in Echo resources to just uner 20%, which would be threshold of having to make a full takeover bid. EAR are a very reasonable story - but at nearly 200 mill A$ market cap, you are certainly taking a view on positive exploration!

Tiger Resources - I guess there might be a few shareholders left in Switzerland. The companies asset in Congo has been sold for 260 Mill US$ to Chinese interests, which should leave about 20 Mill US$ for shareholders. Not a great deal, for what has been a disappointimng operation, probably mismanaged! Interesting to see, though, that the Chinese are still buying resources assets!

Strike - the first parts of the massive drill rig have arrived...drilling of Jaws is getting closer! this will hopefully be the company maker for STX - a miss would see the share price half, I fear!

Genex - as I have been writing last time - the option exercise is not doing anything good to teh share price! Understandably, some option holders are financing the exercise ( 20ct ) with sales in the market. This detracts from the fundamentals, which are still very positive. The planned hydro pump power station is still dramatically cheaper than all batteries , and the current Quarter should see two major pieces of good news: An off-take agreement, and very favourable financing for Australian government agencies. Both would represent major derisking, and I guess trigger substantial, institutional interest in the story. The options will expire in about 4 weeks - great time to accumulate stock. GNX will also present again at our conference on the 23rd of Feb.

Have a nice evening

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General - Panoramic - Foran ( sorry, again! ) - Chalice

Good afternoon

ECB is signalling, that an end to Quantitive Easing might get closer ...this is driving the Euro higher - well, a little bit. And it´s good for metals, which are having a pretty good day so far. A big trade worth 500 Mill US$ though erased coppers gains within the first 10 min of US-trading, while zinc ( big rise in cancelled warrants ), tin and nickel are very strong today.as is gold, trading at 1334.60$ currently. Cobalt with yet another high - if I see it correctly, it´s trading at 80.000 US$/t or 36 US$/lb!!

European equities are having another good day...

Lithium stocks got another hammering today. Some of them, like Galaxy and Pilbara, are now trading 20% below recent highs - another weak day, and I will be tempted to get back in. The expansion news from SQM ( and from Orocobre the other day ) are certainly negative - but these Brine-Projects need a long time to ramp up. SQM´s project for example will only have ramped up fully at least 5 years from today...and for now, lithium prices are still very sexy. So while these expansion plans are definitely negative for longer term valuations, they will not have such a massive impact for the next few years.

Chalice - their Quarterly was out today. cash + investments are worth 45.5 mill versus market cap of 47 mill A$ today...so their interesting, canadian project is only valued at about 1.5 mill$. This is a joke. Tim Goyder is a pretty smart guy - he hates to waste money, and the massive drilling program planned has a very good chance of delivering tangible value, in my opinion. This stock is very low riks, hence has got good upside from any success with the drill-bit.

Foran Mining - are continuing their run, hampered only by a few stale bulls, who have bene holding for a long time, and by some profit-taking from my fund, as the holding has reached the internal limit of 5% of the fund...but that´s no major selling, just taking a few of the top. The other day, a new analyst report was published, calling the stock to 1.80Can$, based on pretty conservative price assumption for copper and zinc. It´s not hard to see a 3$ valuation for investors, who are bullish on the sector, as am I.! This is not my official valuation, though - any company with financing and building an operation ahead of it, got to be valued at a significant discount. But even a 50% discount still let me arrive at valuations very much higher than the current 54ct! Good fun ahead - and if the current exploration delivers, the stock will really spring to life. Some results should be expected before the end of February! The next trigger after that could be another announcement re the technica agreement with Glencore, as they have 60 days from about mod December to finiah a comprehensive review of the project. I am very happy to stick to such a large holding within my fund!

Panoramic - will be interesting to see their Quarterly shortly...I would expect some sort of progress-information on their final feasibility, which is currently being refined. Perhaps we also get some indications on a the financing, which will enable PAN to bring Savannah back into production. The terms for long term offtake agrements have been strengthening throughout the year, and the ferocious appetite shown by Japanese and Chinese companies for battery metals will affect nickel sulphides as well. So I see no urgence to push the button, and would much prefer the company to eveluate all possible avenues, including offtake with battery manufacturers etc.. Enough Nickel is still around these days - but by the early 20ties, that will be a different story. My hope is for a development decision let´s say by the 3rd Quarter, to be back in production by mid 2019. That wold give them production until at least 2028 - and most probably, for long thereafter. Also in PAN I am maintaining a large position in my fund. At the current level of nickel just below 13.000 US$/t, and an exchange rate of 80ct A$/US$, this thing can be financed, and produce profitably - but every other 1000 $ in the nickel price should increase earnings by roughly 50%. That´s fantastic leverage ! The stock should be able to test the recent high at 50ct again over the next few month - but in the longer term, I am hoping for a lot more here!

Have a good weekend, and enjoy the snow! Much better than 45 degrees in Eastern Australia!

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Geschäftsführer: Wilhelm Schröder

General - Graphex - Venturex - Gascoyne - Chalice - Oceana -

Good afternoon

great Industrial Production numbers in the States the other day...the show will go on!

Apple paying 38 bill$ in tax by repatriating it´s cash...and will invest 30 bill in the US, though over 5 years.

Goldman´s loosing it´s lustre...commodity-and bond-trading very disappointing! Total return over 5 years for investors has been 88% - in good old Macquarie Bank, it has been 188%!!

4th Quarter growth in China 6.8% vs expected 6.7% - defying the doomsayers once again.

Following two days of consolidation, metals pick up steem again today, as European equities are just a little green.

SQM killed some prospects for Australian lithium miners, at least in the longer run. They reached agreement with the Chilean authorities, which will enable them to tripple production of lithium carbonate to potentially 220.000t p.a.over 5 years. That´s a big number!! On the positive side, this decision should alleviate some fears, that not enough lithium would be around to satisfy the rising demand from EV´s. I have no doubt, that this story will take the heat out of lithium stocks.

Cobalt is making new highs this week. A little surprising to me, as especially Glencore have announced plans to significantly increase their production.

Oz Minerals with a very good Quarterly yesterday - production at the better end of guidance, and costs at the lower end. The company generated 90 mill A$ in cash, despite spending 90 Mill$ on growth ( mainly Carapateena ). Prominent Hill mine life has been extended to 2029 by adding underground reserves. More importantly, they lifted guidance for 2018 and -19 by a total of 15.000t over the two years, but gold production has been lowered by 20.000oz - obviously, the upgrade of copper is much more significant. For copper fans, OZL is one of the few, significant pure exposures in Australia - and it´s a well managed company. I am a shareholder through my fund Nestor Australien.

Graphex - while I had hoped for a fixed agreement with the Chinese JV-partner, to finance the mine, by now, the company updated yesterday - good news and bad. The bad news is, that the financing has not been fixed yet. The good news is, that the Chairman of the ( very significant ) Chinese JV-partner wants to visit Tanzania and meet with government, before making a decision. This meeting is planned for late January. This I do regard as good news - it shows the high importance of the planned graphite production to the Chinese, and it will put pressure on the government, to strongly support the project. Like in many, African countries, China is playing a significant and growing role in Tanzania. I still believe, that this is a great story, and very cheap. GPX will also present on our conference on the 23rd of Feb in Zurich. If we are lucky, the final financing will only be completed after the conference - but I would not bet on that!

Venture Ex - great little toy for the speculators, given it´s 2ct share price!...but also with increasing substance: They announced some excellent drilling for zinc and copper at their Sulphur Springs project, which edges closer to a development decision by mid-year. Largest shareholders are Northern Star, and a well regarded, Perth-based resources fund. Not sure, whether I would buy the stock today - but on a setback, I think they are worth a very good look.

Chalice - have announced a large and increased exploration program for the Canadian gold project, which I like. Not having found suitable investments for their large cash holding, they are now finally getting agressive on exploration! The company is trading just a few % above cash backing...

Gascoyne - they are now putting their- recently raised - money to work, and announced 75.000m of drilling , split between their main gold asstes. I would be pretty surprised, if we would not see some good numbers coming out of it! GCY will also present in Zurich, just before going into production in June. We should have some fun with it over the next 6 month, as every 100.000 oz in additional reserves increase mine life by 1 year or 15%, which has a big effect on the NPV.

Oceana - announced some excellent numbers for the last Quarter. 166.200 oz at AISC of 564 US$/oz are certainly very classy! Didipio continues to be a real money-spinner, thanks to the excellent and substantial copper production as by-product. Waihi in NZ had a strong Quarter, as had Macraes. Perhaps most importantly, the relatively new operation Haile produced nice results, as recoveries shot up, and the process plant performed at design capacity. For 2018, OGC expect lower production from Waihi ( mining lower grades ) and Didipio, as the mine progresses underground and production will be mainly from stock-piles. Macraes and especially Haile should see higher numbers for this year.

Have a nice evening

Schröder Equities GmbH

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Tel. +49-89-4613440-0

Fax +49-89-4613440-10

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website: www.schroeder-equities.com

eingetragen im HR München, HRB 166985

Geschäftsführer: Wilhelm Schröder

General - Perseus - Middle Island - Breaker

Good afternoon

To register for our conference on the 23rd of February, please click on this link. Please note, that companies have been confirmed, but the itinery is only tentative at this stage. The attendance is free.

http://www.schroeder-equities.com/conference/

the week started with a bang! Metal prices are very strong today ( nickel is about to break through 13000!! )- 1-2% up, and gold is holding above 1340 US$, leading to very strong prices for the larger gold miners today. Most of them have broken out on the charts, notably Evolution and Perseus. The market seems to punt on further Euro-strength....but coalition talks in Germany have hit a snag....not 100%& sure, that we will have - finally - a new government!

Institutions are starting to reweight into the miners - as can be seen in share prices of BHP ( up 25% since early Dec ); RIO up 23%; and Glencore up 25%. Star performer has been Teck - they are up by a staggering 35% in less than 6 weeks, as are good old Anglo American! History seems to repeat itself - in the early stages of a big recovery in resources, the large miners are early movers, before insto´s start going down the quality-ledder! As you know - there is sooo much upside in smaller names, if this continues. Just look at at West African Resources, Gascoyne in the golds, Paringa/Prairie in the bulks, Panoramic/Foran in the metals, or Syrah/Graphex in the battery-stuff....or you buy Nestor Australien - I am holding significant positions in all of the above stocks!

Perseus - were the star performer today, having announced first ore to the plant at their new Sissingue Mine in Ivory Coast. The mine is planned to produce 80.000 Oz - not that large - but at 625 US/oz AISC incl royalties! First gold will be produced shortly - ahead of plan, and within budget. Well done! Looks like they will bring it on easily, unless somethinmg inforeseen happens in the next few days. The company seems to be very confident, expecting ramp-up to full production until 31.3.2018! The mine should deliver more than 70 Mill A$ in cash p.a., once in full production and at current metal/currency prices. That is increasing hopes, that PRU will be able to bring on the next, much larger mine, Yaoure, without any additional equity. Much depends on timing here - the longer Sissingue and Edikan ( which should be in a cash-sweet-spot as well ) are hammering the cash home, before a development decision for Yaoure has been made, the better the financing prospects! PRU have underperformed for a long time - they look great on the charts now, and have written 60ct all over it! 300-320.000oz yearly production and a market cap of only 450mill A$ give you fantastic leverage, with great exposure to the new, significant ( 215.000oz production planned ) Yaoure Mine!

Middle Island - this minnow is making some progress towards production by trying ore sorting, which seems to gain a lot of tarction in Australia. Ore sorting equipment is mainly coming from German speciality manufactures, and has originally been developed and is used in diamond production. Caravel have done some promising work in Australia as well with their copper project, and it´s being used by 2 smaller, privately owned gold mines. Test results, using MDI´s ore, have resulted in a 200% grade improvement, which would dramatically lower capex, and operating costs, if it works on large scale. obviously, there is aonther layer of production - the sorting itself - but if it works properly, cost savings would still be very substantial.

Breaker Resources - announced some more metallurgical results today. They might not be as eye-catching as exploration results - but in many regards, they are even more important. Breaker has fantastic recoveries of up to 99% of contained gold. Importantly, a large chunk of the gold - on average over 50% - look like being recoverable with very simple gravity methods, which has led them to think about a fast-track and cheap start-up operation using this method only, and to treat the rest at a later stage. Capex would be much smaller than for a CIL plant, and operating costs would be very low. This way, the company could overcome this boring period of doing a feasibility study, then large financing, and construction of a CIL plant. This process would take I guess 2.5-3 years - a pure gravity operation would take ( my guess ) 12 month from now, and less than half the capex. Not sure, whether I would buy Breaker today - but they are definitely a strong hold!

Have a nice evening!

Schröder Equities GmbH

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Geschäftsführer: Wilhelm Schröder

General - Sheffield - Prairie - Foran - West African - Genex

Good afternoon

sorry, firstly yesterday´s daily...I forgot to publish it:

markets are pretty quiet so far today...but metals are still trading a touch higher, except for nickel, which is oscillating just below the 2017-high of 13.000$/t. The US$ is weakening again today, helping gold higher as well. The European central Bank indicated some response to the strong, European economy could be taking place...I think that´s overdue! But the very strong Euro is putting pressure on metal prices late in the day - and same on European equities - so forget the above, earlier comments!

It looks increasingly weak for bonds...the long overdue slaughtering finally happening?????

I continue to like Catherine Deneuve! Alongside 99 other, mainly french ( surprised? ) female actors, she is calling for the right to misbehave...good on her! It was about time to hear a different voice, amidst all this sexual correctness!

Sheffield - had a big jump today. There had a been a large seller of 3 Mill shares, who seems to be done...also, just before Christmas, there had been a corporate deal in the mineral sands space, which would value SFX 10% higher than today, based on resources. But this transaction had been done on a project without feasibility study - SFX has had a feasibility study done, is in Western Australia ( and not in Madagascar! ), and is fully debt-financed...subject to mining approval, and has offtake agreements in place for nearly all production ( which is not an easy thing in this very concentrated industry ). A recent research report values SFX at 1,92 A$, using a 1400 US$ price flat for Zircon. One of the largest producers in the world, has just increased prices to 1425 US$+. SFX is still not done on the aboriginal land approval deal...that could take another 2-3 month, but potentially much less. I have not seen any mining approval fall over in Australia for years, based on this Native Title Agreement, and clearly, SFX are very confident of having this completed in the near future. Given the top quality of the project, I think it´s very worthwhile to accumulate stock at current levels, to expect a rerating on Native Title Agreement.

Prairie Mining - have steadily increased in price , and look like tehy might be making a new 4-year high in London today. There has not been any news, but the market is aware of more information to be released shortly with regards to the Chinese feasibility study, and possibly financing of the Jan Karski Mine in Poland, one of the two major coking coal assets being developed by PDZ. I have long believed, that PDZ is significantly undervalued - it looks like their time has come! Theoretically, the stock is worth 2-2.50A$ vs the current 60ct.

Foran Mining - finally, this little baby has broken out! Long overdue, given the great copper/zinc prices! And the company has just finished raising 5 mill$ at 49ct. Turnover has been strong ( at least vs recent history! ), and I think they are gaining recognition. Even after the rise - the PEA ( which arrives at a NPV above 500 mill Can$ at todays metal prices ) tells us, that the stock could still go up by multiples. But only for small players, and for investors with stamina, I think! The company is only capped at about 60 Mill$ today. I declare my personal interest!

And now to today! :

Germany finally has made a big step forward to a grand coalition between the Social- and Christian Democrats. That has fired up the Euro ...US$ has also broken significant support on the Charts. This could be a real trend change - unfortunately hurting us here in Europe, as the A$ is falling with it....Good for gold, which has shot right up to 1332 US$ currently - and also a new, recent high in A$ terms of currently 1690 A$/oz. Metals otherwise are only up a fraction - some profit taking following a few, very strong weeks.

Credit Growth in China has slowed down by more than expected, also helping to put a lid on the base metals today.

Market share of Electrical Vehicles in China increased to 1.9% in 2017, from 1.2%. Apparently, and according to Macquarie, it was substantially higher in december - but subsidy-changes from the 1st of January probably played a big role here.

West African Resources - started the new year with some more, spectacular drilling results. 4m at 74g; 9m at 17g; 16m at 15g; 3.5m at 30g; 10m at 54g - the resource is now well established down to 500m . A large part of teh drilling was infill drilling, to increase the confidence level from inferred- to indicated resources as part of the feasibiliyt study, to be published by mid-2018. A new resource will be announced late in the current Quarter. This stock is still one of my largest holdings - expected AISC of 650 US$/oz for teh first few years, at more than 200.000oz production p.a., are making this ( Burkain Faso-based ) project a no-brainer, in my opinion. The only question is, how much it´s worth...well I believe certainly more than today, and I am hoping for 60-65/ct share. The company is fully financed to finish the feasibility study, and ongoing drilling after that. he limited availability of serious, new projects are making WAF a strong coroporate target, in my opinion. Neighbouring B2Gold could be a buyer, as could Iamgold, who are already producing in Burkina. But there are several other, potentially interested companies, I believe, for this stand-out project.

Genex - the share price is not doing anything in the moment. reason is the option excercise - another 15 mill options could/should be exercised at 20ct before the end of February, dampening the stocks performance. But the current Quarter should slo see very important announcements: I am hoping for substantial progress on the financing side, as well as an offtake agreement at a guaranteed minimum price with one of Australia´s large power-distributors. Still - alongside Strike, Panoramic, Foran, Finders, West African, Prairie Mining and Paringa - one of my largest holdings in the fund!

Have a nice weekend!
WS

Schröder Equities GmbH

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Tel. +49-89-4613440-0

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eingetragen im HR München, HRB 166985

Geschäftsführer: Wilhelm Schröder