General - Cassini - Gascoyne - West African

Good afternoon

volatility is back! Over the last 7 trading days, the S&P had an average , daily trading range of 3,5%! Absolutely incredible…Let´s see, what the current Thursday has in store for us - but it looks pretty certain to be a correction of yesterday´s 4% up-move! At least by late afternoon, we are down 2.5% , and a little less in Europe

Gold has been stable to slightly up all morning - but now, as the US awakens, it´s up quite strongly to 1563 US$/Oz, and is through 2500 A$/oz, once again…The US$ is pretty weak again - probably investors are seeing the chance for more rate cuts to come over there in the States! US 10-year bonds hit a new low in yield, at 0,92%!

Base metals are not looking as strong as earlier in the morning, but they are still up…Vale is closing it´s nickel refinery in New Caledonia, which is a High Pressure Acid Leach ( HPAL ) operation, trying to produce battery-nickel from laterites. It never worked properly over many years of trying ( and spending ) hard…approx 25.000t of nickel have been produced in 2019. Very good news for the Australian sulphide-producers, which supply into the same market, batteries et al. Not that many people would be thinking of buying a car in the moment - but that will change some time in the 2nd Quarter, I guess, once corona has quietened down a bit! Copper, perhaps surprisingly, in A$ is trading exactly at the 6-month average today…not nearly as bad, as one would think. Good news for Evolution, Newcrest, and certainly the pure producers.

The release of the new James Bond film has been postphoned into the autum! 007 is another victim of the corona virus - he must be getting old!

GM is the latest to announce a majore push into EV´s this year and next. McKinsey believe, that the German market will be seeing the most registrations of any country incl China in 2021…

Cassini Resources - at longterm prices of 7,50 US$ for nickel, 3$ for copper and 70ct currency, large retail broker Ord Minett values Cassine at 30ct in an initiation report. Nickel payability at 71% seems quite conservative, and every 1% more is supposed to add 2,5ct/share to their valuation. I think recent off-take deals are above 75%….With nickel at 6,50 US$ and an exchange rate of 65ct ( today is 65.8ct ), they value the company at 19ct/share. As I said before - the financing of thie potential mine remains very tricky. While OZ Minerals have the cash/cash flow to finance their share, Cassini would find this next to impossible, without the help of OZL. But without OZL providing/arranging financing for Cassini, the project will not proceed. So the ball lies in OZL´s field: If they want to go ahead and bring this mine into production, tehy will need to take out Cassini, or organize financing for them. OZL have many JV´s, and they have made clear, that an unfriendly takeover will not be on the cards. But at what price would a transaction be deemed friendly by the board of Cassini??? This is not a project to die for - even though it´s probably a good project, with very long mine life , and a lot of optionality. In my opinion, 20ct/share would be an appropriate level for Cassini shareholders to accept a deal. But first, OZ Minerals will have to commit to a full feasibility study, which they would have to finance on CZI´s behalf , to be paid back from production. If OZL goes ahead with it, I think that´s the time to buy Cassini!

Gascoyne - I am hearing, that the company is slowly but surely getting back on it´s feet. No doubt, that fresh equity will play a role here as well - but the gold price has come to the rescue of them, and apparently, they are close to originally planned production levels. That would be very good news indeed for a few shareholders over here! I will keep you posted - nothing is imminent, but I understand, that some large shareholders have indicated, that they would be willing to back a recapitalisation. I would expect, that potential equity backers will want to see a few month of steady production, before they commit. While usually, there is nothing left for shareholders of miners in receivership, this one could well be different!

West African Resources - Australian insto Colonial ( that´s their old name ) bought another 10 mill shares over the last few month and now hold just under 9% of the company. The first gold pour in early April? Just about the only , completely unhedged gold producer ( soon ) in Australia, of reasonable size, and despite the large financing! 300.000 oz at roughly 500 US$/oz AISC - that´s what I call money printing at a gold price of 1660, and translating into A$ at a currency of 0,66 A$/US$!! The debt, though, is in US$, so the leverage to the currency in the short term is not all that material. But debt will be gone easily after the first 12 month of production, if all goes to plan!

Have a nice evening

WS

General - Apollo Consolidated - Carawine - Tietto - Horizon Mining - Chalice - OZ Minerals

Good afternoon

sorry…forgot to push the button yesterday! So this is yesterday´s report, followed underneath by today´s edition….

crazy world…Wall Street up by 5% yesterday, and looks strong again today, as the world seems to be gearing up for fiscal and monetary support….doing anything to keep the economies going - and not to forget: markets! And this afternoon, the FED has acted: 0,5% cut, the same as earlier by the Australian Reserve Bank.

Gold got to be a beneficiary of this….more money printing, more spending….not to talk about uncertainty! And following the rate cut just now, gold is moving strongly…1628 US$/oz currently!

I cannot buy more for my fund, but I have leaded up privately on Evolution, Apollo Consolidated, Tietto, Carawine, Oklo, Osino - to name the most prominent ones. I want to use the opportunity to introduce or reiterate a few , relatively new names to you.

Apollo Consolidated - run by Nick Castleden, whom I have known for years - but only very recently became a shareholder at current levels. AOP just completed a placement at 21ct to bring their cash holding to about 16 mill A$ - gearing up for a lot of exploration. The main asset is the Lady Rebecca Gold Project, about 150 km North East of Kalgoorlie - not far from Breaker´s asset, and about 40 km from Saracen´s Carusoe Dam Mine. Lady Rebecca recently announced it´s maiden resource of 27 millt at 1,2g gold/t, including 11.7 millt of indicated resources at 1,5g., for a total resource of 1.035 mill ounces so far The project has been driven as a high grade deposit, and only recently got more attention for the lower gardes, surrounding the higher grade halo´s. The market cap of 60 Mill A$ ( incl 16 mill A$ in cash ) makes them rather cheap today - and certainly cheap, if you see further upside - and this is what my geologist-friends in Perth definitely see here. The MD is strong and trustworthy - headoffice is very tight, and the company is spending below 1 mill A$ p.a. on admin and headoffice. I guess this will change a bit - at least it should - as the company is gearing up to more agressive exploration, and development is on the horizon, requiring more personell. Anyway - none of the several lodes at Lady Rebecca have been closed off as yet, and the 20% owned ( and carried to a decision to mine ) asset in Northern Ivory Coast in JV with Exore is also promising. The recent placement is giving the ( conservatively managed ) company enough funds for the first time, to really spend heavily on exploration! I would be surprised, if we would not get more results within the next few weeks.

Carawine - CWX, are trying to find a copper/gold porphyry deposit in Victoria. The big price has not been found as yet, but strong sniffs have been had. The Hill 800 prospect, as part of the wider Jamieson Project, has delivred drilling results like 93m with 3,22g gold / 43 m with 4,24g - most drill holes are associated with 0,2/0,3/0,4% copper as well. Just last week, the company discovered a new high grade zone there with 11m at 9,9g gold + 0,3% copper, and results of one deep hole are expected later in March, while another deep hole is currently being drilled. Also at Carawine, corporate and headoffice costs are below 1 mill$ - nevertheless, cash will be an issue here in the not too distant future, as by the end of this Quarter, they will only have 2 mill$ cash left. However - we will have results of the two current holes soon, and more drilling to test established anomalies is starting within 2 weeks . If these guys confirm, what I think they might have, the share price will go on a strong run much before any potential placement! CWX counts two of the wealthiest Australians among it´s largest shareholders, who I understand, are both strong supporters of the company. Very unusual for such a small stock!

Tietto - I don´t know why, but the stock has languished since the last placement took place ( at 28ct )in late November. Many of you have seen them in Zurich recently ….this is a very strong story, having announced resources of 2,2 mill oz recently - and at a market cap of 78 mill A$ ( incl approx 16 mill A$ in cash ) , with 4 company-owned drill rigs drilling , we should see many results over the enxt weeks and month, as they are working through a 50.000m drilling program. Some investors might see them connected to the virus outbreak, as the drill rigs are partially manned by Chinese drillers ( the MD is originally Chinese ) , but all Chinese employees, in case they went to China this year, have been subject to a voluntary, 2 week quarantine ( and I am sure, that none of them are stupid enough to go back to China for the time being!! ). I think you should certainly use the current weakness, like I am personally doing!

Horizon Mining - I ahve written several times about them. I just know, that they have to raise funds in the short term - be it from the market, or from a potential JV-partner, as their cash will be approaching zero. I believe, that they only need to riase 1-2 mill$ to enable a drilling program, which can convert inferred resources to indicated resources. The watchdog in Australia does not allow them to publish the results of a completed scoping study based on inferred resources. Recently, Panoramic which still own 25% of the company ) have sold 25% of Horizon to major shareholder Zeta Resources, at 25ct. I am sure, that PAN needed the money, and hence, I am ok with this - but I am sure, that Zeta ( which has board representation ) would be well aware of the scoping study results…..and very-much-back-on-the-envelope calculations would arrive at potentially much higher valuations. Even if I only include the 400.000oz of HRN, which I understand have been subject to the scoping study , as part of their more than 1 mill oz total resource, the market cap os say 18 mill A$ ( following a 2 mill$ placement ) is still way too low, in my opinion.

All of the above stocks, with the exception of Carawine, already have existing resources - and have at least run some metallurgical testwork ( all of them positive ). So in my opinion, the risk in these stocks is not dramatic, and especially a basket of them, could see strong performance ove rthe next few month in an enviroment, which should continue to be very supportive at least for gold stocks!

And here is today´s report !:

So after I finished yesterday´s report late afternoon, the market in N.Y. tanked, once again, to finish the down by nearly 3%! But today, everything is looking strong again….Biden´s victory is being seen as very positive - obviously, Sanders would be a very bad alternative to Trump, at least in the eyes of Wall Street!!! And I have to admit, that I find it very hard to believe, that a democrat socialist would be good for the US…

Metals are slightly stronger - and gold is holding nicely above 1640 US$ ! Very disappointing indeed, how gold stocks are performing ! But as I wrote above - I think there is some fun to come…But for now, gold stocks are down by 1% in New York..just don´t want to move, despite of bond yields falling again today.

Chalice - reported some more drilling results, with some good, but as yet, uneconomic mineralisation. Nevertheless, in light of the very large target tehy are drilling, and the current, very wide spacing, I do regard this as good news. It´s one step forward in trying to understand the target - but not the big breakthrough as yet!

Oz Minerals - reported, that the new Carapateena plant is now running at design capacity, So that´s obviously good news, as recoveries as well as concentrate-grade are also as expected. But the full ramp-up of mining will take time, and teh company is targeting a full ramp-up until the end of this year. Good company and all fine here - but I think to buy them in the current enviroment, I would like to see them lower!

Have a nice evening!

Ws

General - Oklo - Metro - Strike - Panoramic - Antipa

Good afternoon

following a time of complacency, the market is getting crazy now! Only 10 days ago, on the 20th of Feb and well into the virus-story, the S&P hit a new all time high…only to give up 10% since then! And the DAX, which hit it´s high on the 19th of Feb, has given up the same!

The gold price is down by 60 US$ from it´s recent high on the 24th of Feb, while the GDXJ is trading 20% down from it´s recent high! Gold is trading 150 US$ higher from those days back in November, when the GDXJ last traded at current levels! Amazing…it must be the search for liquidity, which is driving this move. All I can say is, that gold stocks are fundamentally rather cheap currently - in A$, it´s still trading at a staggering 2444 A$/oz. Just as an example, Macquarie are using 2074 A$/oz for the current financial year, and 1991 A$/oz for the year 2020/2021 for their estimates…Funny enough, gold seems to follow the direction of equities today!

A very volatile day today in European equities—-up and down like a yoyo…strong early in the day, the market tanked down nearly 4% from the high - only to recover and be unchanged now, as the US have started trading in positive territory. The US 10-year bond is trading close to only 1% yield, a new low…and Goldman´s are expecting a 50 bps interest rate cut soon! The OECDis expecting growth to halve to 1,5% this year, unless the virus can be contained soon.

Today has been a bit of a capitulation day for many smaller stocks, I think…West African for example traded as low as 0,45 A$ ( close at 0,53, on 15 mill shares turnover / Strike Energy traded as low as 0,115 A$ ( to close at 0,135 A$, on 30 mill shares turnover )…and there are numerous similar moves. Again, for many investors, liquidity must be the reason - I just could not imagine, why otherwise somebody is selling WAF at 45ct vs a price of 64ct less than a week ago!!

Oklo Resources - completed their placement at 0,21 A$, which was upsized to 12,5 mill A$ form the originally planned 10 mill A$ on strong demand - only to close at 0,195 A$ today, the first day of trading after the transaction!! The placement came a little surprising to me - but it got to be good news, that the company can now refrain from raising fresh capital for the next 18 month, I guess, while they undoubtedly will increase resources ove rthat time frame.

Metro Mining - the stock is not far above 3.5-year lows, despite being in production, despite of making money, despite of performing fundamentally at least in line with expectations! And all this, despite a very favourable financing for the expansion from 3.5- to 6 millt of bauxite p.a., at costs, which should fall by at least 18%! Yes - all of it´s product goes to China - but China seems to be behind the worst of the virus-impact, and Guinea , the major exporter in the world to China, seems to be in increasing trouble. They will have an election this year, and President Conde is trying to change the constitution, to allow him to run for a third time as president.There have been several instances of attacks against mining trucks, the blocking of railway lines etc. I guess it might not get any better, the closer the election comes. In any case - I would be really surprised, if Chinese buyers would not value Australian supply very highly, once Metro starts shipping again in 4 weeks time or so!

Antipa Minerals - announced a major transaction with Newcrest on Friday: 3.9 mill A$ placement at 0,017 A$ / potential investment of 60 mill A$ to earn up to 75% in some of AZY´s properties, of which 6 mill A$ will definitely be spent, within 2 years. This follows similar agreements with RIO and Fortescue, over other properties. In “normal” times ( if something like this does exist!! ) , the stock would tarde at a minimum of 2ct - this time around, it barely moved and closed at 0,014 A$! In any case, the transaction again highlights the continuing interest in the entire Paterson Province! The Newcrest deal follows some positive comments by RIO with regards to their Winu discovery, also in the Paterson, last week.

Panoramic - PAN have now completed the transfer of underground mining activities to the new underground mining contractor Barminco. They will use much better equipment, and while some of it has already arrived, more will be on site over the next couple of weeks. Barminco is a very professional and experienced underground miner, and I have no doubt, that mining rates will improve substantially! The A$ nickel price is at 19160 A$/t currently - not fantastic, but compared with a recent trading band over the last 3 month between 20.700 and 18.600 A$/t, not that bad. The feasibility study , updated recently by forecasts in early December, was calling for AISC of 3,77 US$/lb, at a currency of 68ct ( today, it´s nearly 5% better for Panoramic! ) . Even if I assume another 1US$/lb in additional costs, the company should start generating positive cash, once the ramp-up at Savannah North is complete later this year. In the meantime, the cash burn will fall substantially from month to month. The report for the current Quarter should make some interesting reading and give a first impression, how well mining is doing…but obviously, the June Quarter is the time to watch out for substantial improvements. I could well imagine, that PAN will need further financing until then - but I would think, that the major shareholder will stand by again with a loan. PAN is pretty adament, that tehyx will not need further equity. If you are brave, you buy some now - but it´s probably not the time to be brave! So wait for some information from the company ove rthe enxt 1-2-3 month to get more clarity on 1. how well mining is doing, and 2. what financing wll be provided.

Strike Energy - this was one of the most convincing presentations at our conference recently - at least in my opinion - yet the stock has fallen the heaviest during last weeks downturn, to an intra-day low of even 0,115 A$ from 0,18 A$ just a week ago! I have bought more at various levels! The best trigger for the stock to go up in the short term was the potential of a short term announcement from Beach Petroleum and Mitsui, to supply gas into the North West Shelf LNG project, as it would have removed any future supply overhang of gas in Western Australia. I can only suspect, that any agreements of such type will be made difficult by the current turmoil. But looking past this, I think opportunities for Strike to sell gas at very profitable prices into the Western Australian market will be ample….We will look back and wonder, why we did not use this buying opportunity! About 30 mill shares changed hands today - obviously, I am not alone as a believer in Strike!

Have a nice & corona-free evening!

WS

Australian Resources Conference

Good afternoon

Last Friday, we hosted the Australian Resources Conference in Zurich.

A strong audience saw excellent presentations!

All stocks have been marked down heaviliy over the last few days…I think a great opportunity for us! Don´t forget, that A$ gold is still at around 2500 A$/oz!!! I have been skiing over the last few days - that saved me from recommending these stocks too early!!

In the following, a quick run-down in order of appearance at the conference:

Metro Mining - Managing Director Simon Finnis emphasized the excellent year just finished for Australia´s only, pure, and listed bauxite producer, The company produced and shipped a record 3.5 millt, just above guidance. More importantly, MMI secured a 47.5 millA$, very preferential loan from the Northern Australian Infrastructure Fund to enable the planned increase of capacity to 6 millt p.a. from 2021. The company is expected to be debt free again by the middle of 2022, indicating the very strong cash flow from this straightforward operation. Bauxite is mined without any blasting, is then crushed and shipped - it doesn´t come any easier than that! The operation will see a 18-20% cut in operating costs, once the 6 millt capacity expansion has been finished! A very cheap company, which should also profit from low freight costs this year!

Genex Power - the company is producing solar energy currently at Kidston in Northern Queensland, and has it´s second solar operation in Northern New South Wales under construction - starting generation late this year. The main price remains GNX´s pumped-hydro project at Kidston, using the two existing, mined out open pits. Financing incl equity has been negotiated - but the company late last year was stopped at the very last meter, when the Hongkong-based board of Energy Australia, the preferred off-take partner, did not sign the agreement. The company is now targeting a new, financial close for the project”in the 2nd Quarter”, and reading between the lines, I expect it potentially even sooner. But once bitten, twice shy - so it´s good to be conservative in terms of timing. Pumped-Hydro is just what Australia needs very urgently - and I think we will see a breakthrough soon here, making Genex a very cheap stock!

Chalice Gold - a newcomer to the conference, the young MD, Alex Dorsch, made a very strong impression! Led by Chairman Tim Goyder, these guys are very systematically exploring their massive, 100%-owned landholding in Northern Victoria, in land, which has many similarities to the nearby fantastic Fosterville Mine, which is a worldclass mine by any standard., and was a company maker for Kirkland Gold. Chalice has had some good sniffs already, is very well cashed up with approx 30 mill$ in cash + investments! Chalice have had a large cash holding for some time, and successfully invested it in very selective exploration. and investment opportunities for several times. The latest investment in Spectrum Metals, which is now under takeover by Silver Lake, was made at 5.3ct and should net the company something like 8-9 mill A$ after tax. Chalice is a very big story potentially, well supported by some smart people and smart money!

Graphex Mining - MD Phil Hoskins was understandably under a bit of stretch to present this slightly more complicated story in 20 min. Graphite is still new to many investors, and the problems of the big producer of this mineral, Syrah Resources, don´t help - even though the use of this companies graphite, mainly in flame-retardent building materials, is completely different.,GPX has a large backer already, who has 60 days to confirm his ongoing commitment, following the release of the recent Final Feasibility Study. It´s not easy to finance a 90 Mill US$ capex + working capital project for a 10 mill$ company - but the chances for GPX to get it done appear very high! The 330 mill US$ NPV underlines the massive returns possible here! It should be very worthwile to spend some time on Graphex! The company detailed the other day, what is left to do to get a firm commitment from it´s major financier, and probably others. They stressed, how deeply the Financier has been involved in all diicussions and all aspects of the bankable feasibility study!

Liontown Resources- the absolute star performer from last years conference has further, substantial upside! That´s the message MD David Richards sent to investors. The current resource of 139 millt of 1,33% lithium LIO2 is large by any world standard, and recent, stunning drill results of grades above 3% send the clear message to investors, that more and at higher grades even is probable! drilling is ongoing, a new reserve will be announced within a few month, and the final feasibility study will be finished this year - without the need to raise fresh capital. By the time this project could come to market in 2-2.5 years, the lithium market will have grown substantially as well. The project is 100% owned and LTR will be a prime target for all lithium majors! The company has been massively derisked since last years conference, and will not repeat the 600% increase from the last 12 month - but there is a lot of room left, and at much lower risk!

Cassini Resources - MD Richard Bevan presented the outcome of the very detailed pre-feasibility study, recently completed by top-rated JV-partner, OZ Minerals. The project needs close to 1 bill A$ in development capital, but has an expected NPV of 800 mill A$. While the JV-partners are using a potentially agressive nickel price of 7,60 US%´$lb nickel , and a currency of 67ct ( which as at today, is even more favourable ), Richard pointed out, that the NPV rises by 10% at least with every year. So even using an NPV of say 500 mill A$, the outcome would still value Cassini at more than 3x current valuation. Once OZ Minerals firmly commit to this project, producing nickel + copper as by-product, we will see a strong increase in CZI´s share price, and potentially, a friendly takeover. It makes much more sense for OZL to own this thing 100%, than to organise financing for the junior partner!

Oklo Resources - excellent presentation by MD Simon Taylor. OKU are having a nice lad position in Western mali ( which, by the way,has never seen the well documented problems in the North- and the East of the country ), right next to several major mines - the closest being Fekola ( B2 Gold ), just 25 km away from OKU´s main project. Oklo had a bit of a slow start, and but following some base work, ahs really hit it big time more recently! many first-class drilling results are showing the potential vor a very high grade, open-pittable fist resource in the next few month. The company is cashed up, is drilling, and should bring out more results over the coming weeks and month. If they deliver, what I think they could deliver, the company will not be there for a long time - the grade will tempt the big boys! Subsequently to the conference, the company announced more excellent drilling results, like 34m with 4g / 22m with 3.9g / 7m with 9 g / 7m with 13 g etc….all from a prospect called SK1. Drilling is ongoing, and the company is expecting results from SK2 and SK3 shortly. The stock was suspended the other day for a capital raising!

Tietto Minerals - MD Caigen Wang started the presentation, and was then follwoed by ED Mark Strizek who drove the message home, that the current 2.2 mill oz resource is expected to grow to 3 mill oz + - and after that, who knows? TIE have so far only targeted a small part of their ground holding, and while artisanal mining is no guarantee, it has been a good guide here in the past for more success. The current resource has a 1.4 mill oz high grade core to it, at 2.2 g gold/t.. If TIE can increase this over time to enable a sustainable mining operation of 200-oz + per annum, and think much larger companies will have a very close look at it. For example West African Resources, once in full rpoduction, or Perseus, once Yaoure is up and running by the end of ths year, would be prime contenders in my view. TIE are conducting a very active, 50.000m drilling program in the moment, and I would be very surprised, if we would not have a resource above 3 mill oz here by the end of this year!

Evolution Mining -Executive Chairman Jake Klein gave a great run-down of existing operations and made a big point of the advantages to invest in medium-sized companies vs the very big boys, as well as the smaller boys. Much easier to finance new developments than for smaller miners / much easier to offer career progression for strong employees / much easier to make a difference via exploration - and this is what EVN have done lately. Strong exploration results at Múngari, but especially Cowal should see a strong increase of reserves later this year. and new reserves are the largest, potential value-add for mining companies! Jake has managed a very successfull gold miner over the last 8-9 years, and I think his story of a sustainable ( in every regard ) mining company, with increasing asset quality, while maintaining a great corporate culture , has miles to go. The next mile will be driven by Cowal, and by their recent aquisition Red Lake in Ontario. The latter has established a base in North America for Evolution, and Jake managed to bring across, just how much this asset needs rejuvenation and some capital to return to former glory! The next 12 mont will be interesting for EVN, and in my opinion, will underprin them as the best gold mining company in Australia!

Bellevue Gold - MD Steve Parsons presented very well - and I think technically, the presentation was absolutely outstanding! Bellevue has been a great success, and while the share price has been a bit dissappointing ( just unchanged from last year´s conference ), it probably needed some consolidation from the previous, big run. BGL have spent the last year well, though, by adding many ounces to now 1.8 mill at the stunning grade of 11.1g gold/t. 8-9 drill rigs are currently working to expand this resource, as well as to increase the status of inferred resources to indicated resources. They have also added Deacon, which should underpin a strong increase of resources. The old Bellevue Mine is currently being dewatered, which should make further exploration and reserve-definition from underground much cheaper and faster. Again - I do not believe, that we will have BGL in Zurich next year - a potential 200.000 oz producer, at probably low costs because of the grade, will be just tu juicy for the larger , Australian gold miners, which are all spitting out cash at the current all time high A$ gold price of 2475 A$/oz!! Subsequently to the conference, BGL announced a maiden resource for the Deacon Lode, of 410.000 oz at 12,3g gold/t - even better than the previous resource grade of 11.2g. The total resource stands now at 2.2 mill oz at an average grade of 11.2 g !! The resource stimate only includes 900m of the Deacon Lode, which has been tracked over 2 km strike length already. Major shareholder Dynamic Gold increased it´s holding, and we also saw strong buying after the conference!

Strike Energy - what a story, and what a commitment! MD Stuart Nicholls probably saved the company by aquiring and driving ( very hard! ) the West Erregulla project in the Perth Basin, which subsequently delivered one of the best and largest ever gas finds onshore Australia! The share price has been languishing for a while, as the punters left the company, following a very strong share price performance. At the current 18ct/share, Strike are a steal, in my opinion. Strike will be one of the lowest cost producers of gas in the Western World, makling money even at the current, depressed prices of 2 US§ for Henry Hub Gas! But Stuart emphasized, that prices for long term contracted gas are still at around 5A$ - a fantastic price for Strike. Next steps for the company will be potential off-take agreements, and appraisal drilling - at a later stage, also more exploration drilling. The success of neighbouring Waitsia and West Erregulla have completely changed, how corporates look at the Perth Basin now. This area can change gas-dynamics in Australia, and also in South East Asia, if it´s really as big as some people start to think! The last 12 month have seen a very strong performance from Strike - but I really believe, that we can see the same again over the next 12 month! Subsequently, Strike has got caught in the general equities meltdown, and is now trading at 0,135 A$! What a buying opportunity! Director Neville Powers, ex- MD of Fortescue, used the opportunity to buy another 2 mill shares at 16ct the other day, as did a few investors from over here!

Breaker Resources - executive Chairman Tom Sanders keeps on drilling and adding value to his Lake Roe project , 100 km East of Kalgoorlie! A very active drilling program should see the next resource increase coming, adding open-pit as well as higher grade underground ounces. BRB have stablished a 3.2km long , mineralised corridor, opening the space for many ounces. Tom is adding ounces by the current drilling, but is also haveing regional discoveries in perspective. The PFS has been put on hold, as BRB wants to increase the resource first, which sounds a sensible thing to do, as it would also expand development options for the company. And last, but not least, a near 2500 A$ gold price is very sexy, if you manage to increase mineable resources! The next resource increase will be interesting!

Have a nice weekend - despite the virus - but make sure, that you don´t catch it!

WS

Australian Resources Conference, this Friday!! - General - Fortescue

Good afternoon

LAST REMINDER - AUSTRALIAN RESOURCES CONFERENCE , Zurich, Hotel Baur au Lac this Friday, at 8.55 pm!

news from China are getting worse every day…airlines getting bailed out amid 20% of usual passenger numbers, businesses getting supported because of not having enough liquidity to pay their workers etc etc…Adidas sales in China slump 85% since 25th of January. Yet the market is banking on the Chinese government to increase stimulus, to catch up lost ground from the 2nd Quarter. Hard to come to a strong opinion in this situation, which is unprecentended.

But one thing is for sure - I am very surprised about markets complacency…not only go they sideways - they are continuing to gain strength!

And strangely enough - the US$ is trong, equities are strong, and gold is strong - while bonds and base metals are doing very little….Gold making a new, recent high + A$ making a new, recent low = A$ gold at fresh record high of 2407 A$/oz currently!

Palladium and Platinum going through the roof….Gold stocks in the US with strong momentum and they feel like breaking out…

And TESLA continues to go crazy - up 80$ to 940 US$ currently, as unconfirmed reports about fantastic orders for the Cybertruck hit the shorts! Tesla will have 30% of Daimler´s estimated revenue and EBITDA for 2022, but is trading at more than 3x it´s market cap!

Fortescue - good result out today - if anything, a touch above expectations. The dividend, while being a fantastic 0,76A$ fully franked, fell a bit short of eskalated expectations. Mr. Forrest does own 30% of this company - but that does not mean “paying div at any price”! Well he is receiving a nice cheque over nearly 700 mill A$ ( good on him ! ) - so I think he would not bother! Joke aside - the company commented on the div-payment,. that they wanted to be a bit cautious in light of the uncertain virus-situation. They emphasized, that they have not experienced as yet and problems to ship or sell iron ore to China! Well I have no doubt, that this will change- and be it only temporarely…As I mentioned above - the market is uncertain

Have a nice evening,a nd see many of you on Friday!

WS