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Gold/Mining/Energy : South Atlantic Resources -- Ignore unavailable to you. Want to Upgrade?

To: 3bar who wrote (208)	5/4/2000 4:15:00 PM
From: Gunnar	Read Replies (1) \| Respond to of 225

I wrote this on Stockhouse.com : No, I had not the possibility to attend the AGM. The Annual report is out and after that also a preliminary report from Norra Norrliden. There have been a debate about the revenues from the Storliden mine in Sweden. On the AGM Ted Posey presented figures that should be seen as a worst case scenario: Some 1 billion SEK in profit running the two mines together. Then all cost,including an own concentrator, is taken. The question about building a new concentrator or direct delivery to R”nnsk„r is not clear yet. Negotiations...NAN has not yet included the values reported from the S E where the spectacular 40% Zn values were found, in the total tonnage. Nearby that area NAN also think that they have identified the feeder zone for the deposit. That is to say that they want to go deeper. According to one person at the meeting this drilling will start from the depth, when the access down to the ore is ready. Co will start to go down immediatly after the environmental permit is clear (Late May - August) My suggestion is that we use the low figures from Ted Posey and divide them by 6 years of production. Also this figure seems to be a worst case, as management are talking about an output from Norrliden at 1 200 ton, not at all the annual 300 000 tpa capacity that have been mentioned before. Anyway SEK 1000 000 000 / 6 = 166 million a year. That is SEK 5.34 per share in NAN. If there is an agreement about direct delivery the cost reduction for the concentrator etc is SEK 301 - 430. If we assume the mine site cost at the two mines to 100 million, some SEK 300 revenue can be added to the profit. That is SEK 1 300 000 000 / 6 = 216 000 000 / 31 231 000 = SEK 6.91 per share in NAN. So what do we have left for the stockholders of SCQ: With concentrator .38% of 166 000 000 = 63 000 000 appr equals CAD 10 000 000. How many shares do we have in SCQ, 32 000 000? That gives us some earnings about .31/share in SCQ. Given a p/e-ratio at 10 that is share price CAD 3.10 Using the non-concentrator alterative we got: 38% of 216 000 000 = 82 000 000 = CAD 13 600 000 / 32 000 000 = .42 / share in SCQ. At a p/e-ratio of 10 that is SCQ at 4.20 This is what comes out from the conservative figures presented at the AGM. When do we have that money? With the concentrator alternative in one year and 8 month (3.10), without concentrator in 13-14 month (4.20). The last alternative is still my guess. Should we divide by 4 years instead of 6, at what output per annum will we have from the mines not being limited by a local concentrator? Are you prepared for some more? Have a look at these two links: gsf.fi gsf.fi The Akanvaara host two ore bodies, one of Vanadium and another of Chromitite. Posey says that NAN is hunting for PGE, we'll see. This is now in the hands of NAN. The other link is a concession that NAN has placed a bid on these days. Let's hope we get it. Diamond time soon? Regards, Gunnar