KNL - Kibaran Resources Limited

[robbo24]

Graphite is getting hot again - just ask Tesla.

Interesting stock here - relatively small MCAP and has broken out of its downtrend not too long ago. 17 cent oversubscribed placement may serve as a price floor.


Key Investment Highlights:


Large flake, high grade resource with favourable metallurgy
Premium quality, ultra-high purity (99.98%) graphite product with a high proportion of large flake size (>50% above 180 micron)
Binding offtake signed with a major European graphite trader (10,000 tpa)
Letter of intent from ThyssenKrupp to enter into binding offtake (20,000 tpa) with the binding offtake agreement expected Q2 2015
Bankable Feasibility Study completion by the end of June
Early mover advantage with the potential to be one of the first new graphite producers

[robbo24]

http://www.proactiveinvestors.com/companies/news/61360/kibaran-resources-delivers-maiden-graphite-resource-for-merelani-east-61360.html


...
Analysis Kibaran Resources (http://www.proactiveinvestors.com.au/companies/overview/2444/Kibaran+Resources) estimate of 17.2Mt at 6.5%TGC for 1,120,000 tonnes for the Merelani East deposit supports its future expansion strategy of producing a premium quality graphite product from an additional source to the flagship Epanko Graphite Project.

This demonstrates Merelani’s potential as a significant asset with the company’s graphite portfolio in Tanzania.

It also benefits from being located within a brownfields graphite province that has past production, proven processing flow sheet design and a recognised graphite sales history.

Merelani meets the longer-term requirements of the broader graphite market which is seeking supplier diversity.

There is potential for further resource growth with mineralisation at Meralani East being open in all directions with trenching demonstrating strike continuity of mineralisation outside the resource limits.

[robbo24]

http://www.asx.com.au/asxpdf/20150515/pdf/42yl93yv16dz0w.pdf

KNL's SPP oversubscribed by 3:1 at 17 cents.

The company asked for 1m and got 3m subscribed. SPP increased to 1.5m and apparently scaled 50%.

Refund cheques arrive back to holders next week - may see some on-market purchases.

Good outcome for the company after a parallel, heavily oversubscribed placement to institutional investors at 17 cents.

Recent share price movements have not broken below the SMA50 at 17.5/18 cents, and lately it's been trading at 19-20 cent range.

Fully funded until the decision to mine.

I wonder if we will see a retest of SMA200 at about 21 cents? :D

[baller18]

How does this compare to TON robbo?
Ton has signed many deals lately, but the SP keeps getting hammered...

[robbo24]

How does this compare to TON robbo?
Ton has signed many deals lately, but the SP keeps getting hammered...

I've traded TON many times. It's a hotbed of HotCopper hype, it makes it easy to take money from their hands.

In my view, the problem with TON is that they are in the process of signing away the future and fortunes of the company to its new Chinese friends.

Basically, in my head it now works like this for TON, in order of their recent announcements:

Massive paper-deal with Chinese Company X for $2bn of offtakes for 20 years. This seemed wonderful at the time, a good solid offtake.
TON issues about half of its capital to Company Y and gets debt to the tune of double its current market cap. Signs a cheaper offtake with Company Y. Clear sign of dilution on the way with Company Y.
TON announces $12m placement at a 20% discount to current SP. Shareprice drops.
TON, as it turns out, has entered into a joint venture agreement with Company X (from 1. above) which means: TON is now a de-facto graphite refiner too. Essentially this means that TON has changed from a miner to a miner/refiner/end product producing wonder-company that is owned by Chinese companies.


In my view, the unfolding story essentially means that TON is not just selling graphite to a graphite refiner. No. TON is now tied into the risk of the refined graphite product. In my head it works like this:

TON mines graphite.
TON sells graphite to Company X/TON JV and Company X.
Company X/TON JV And Company X sells refined graphite product and makes money.
Company X/TON JV and Company X pays TON for the graphite.
Rince and repeat.


On top of the dilution and other issues people have with these deals, it makes the TON deals seem a lot less enviable.

The last placement was at 35 cents, you might see a bounce from there? :D

KNL has its bankable feasibility study, further drilling results, mining license and further off-takes (hopefully with established graphite merchants who just want to buy graphite, not the company). Keeping in mind they already have an off-take with an established European company... :D

On the whole, KNL just seems to have more room to go up with a $28m MCap against TON's $100m+ MCap.

[robbo24]

I wonder if we will see a retest of SMA200 at about 21 cents? :D

A post-open test of 21 cents, good times :D

http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Stock&symb=au%3Aknl&x=53&y=12&time=7&startdate=1%2F4%2F1999&enddate=5%2F17%2F2015&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=4&maval=50%2C100%2C200&uf=16&lf=4&lf2=1024&lf3=268435456&type=4&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11

[robbo24]

http://www.abc.net.au/news/2015-07-02/graphene-potential-sparks-miners-to-explore-for-graphite/6591642

Interesting article by ABC news. It discusses uses for graphite/graphene and says the price is tipped to increase. It also discusses Kibaran:


Kibaran hopes to start production on Tanzanian minePerth-based company Kibaran Resources also has its eye on the ball.
It has snapped up three graphite deposits in Tanzania and hopes to start production at one of them by the end of next year.
The company's managing director Andrew Spinks said it would initially export graphite to be used for its traditional purposes in manufacturing, electronics and batteries.
"Our focus is bringing Epanko [deposit] into production; we have taken a view over the last two years to fast track the discovery of Epanko into production," he said.
"We are at the back end of completing a feasibility study, so we believe we are very well positioned to bring that deposit into production based on existing supply demand.
"We hope to have a feasibility study completed by the end of July, financing the second half of this year or the back end of this year, construction the first half of 2016 and commencing production mid 2016 to the end of 2016."
Kibaran is also making sure it is at the forefront of development of graphene products, teaming with CSIRO and the University of Western Australia.
"Graphene is a phenomenal discovery, the commercialisation of graphene as a product will revolutionise significant aspects of way things are produced in the future," Mr Spinks said.
"There is no doubt aligning ourselves with CSIRO as a strategic partner looking at graphite or graphene inks in 3D printing, but that is the level of our R and D [research and development].
"We are more interested and focused in participating in the downstream value add of manufacturing and processing purified graphite products."
Dr Karton said research into how graphene can be used in 3D printing is an exciting opportunity.
"Unlike other materials that are being used for 3D printing, this graphene-based wonder ink holds many new possibilities," he said.
"For example, it can be used for tissue design, can conduct electricity and also because of the non-toxicity of graphene it is very bio-compatable.
"It can be used for printing 3D electronic devices because it is a very good conductor of electricity, these are some of the possibilities for it."

[Aotea]

Hi,
I hold a decent parcel of Talga, TLG as my entry into graphene. No doubt Kibaran looks interesting, and in my opinion TON is all hype. Robbo, I'd be interested to know if you have looked at TLG as an option? cheers

[robbo24]

Hi,
I hold a decent parcel of Talga, TLG as my entry into graphene. No doubt Kibaran looks interesting, and in my opinion TON is all hype. Robbo, I'd be interested to know if you have looked at TLG as an option? cheers

I don't hold any TLG but I have read about them. I'll be more interested once they get rid of their gold mine and iron mine assets. It is unfortunately not the most accommodating environment for them to do that. It will be interesting how that pans out and something I will watch. After that they will be 100% graphite/graphene.

I have read about their particular techno-advantages and value-added product they are going for in addition to actual graphite of varying flake sizes. This raises some (probably unfounded, but still existent) concerns about exactly what you're buying when you buy TLG. Are they a miner or a company that is mining and processing, in which case does that pose an additional risk? Does it add complexity to figuring out whether TLG is overly risky?

Yes they are setting up in Sweden and yes Sweden is a nice safe place to mine. Very little chance of militia showing up and kicking you off your tenement.

My general position is that the less moving parts the better. If KNL digs up jumbo flake graphite and people want to buy it - good. That's an easy transaction. TLG seems more credible than TON but there's still the muddying of the waters around whether their main money-maker will be mining the stuff or selling refined products (a lot like TON except add the Chinese element into that mess...)


:D

[Aotea]

Cheers robbo- have to agree with your position. Will be intersting to see where the next couple of years go with graphene.
thanks

[robbo24]

Cheers robbo- have to agree with your position. Will be intersting to see where the next couple of years go with graphene.
thanks

https://www.youtube.com/watch?v=DX-o6I2WbOE&feature=youtu.be

Mark T of Talga talks a good game here... Their "special" ore characteristics, and only our ore can be processed in this way, and this gives us a really low capex, people are offering us personal cheques of $25m for financing, we have options, there's money sloshing around in Europe for projects like ours...

Sounds like everything is rosy... But is it too good to be true? :D (It may very well all be 100% true, I actually don't know)

Why would anyone invest their grahite/graphene money anywhere else?

[robbo24]

Cheers robbo- have to agree with your position. Will be intersting to see where the next couple of years go with graphene.
thanks

Look over the fence at KNL :D

http://www.proactiveinvestors.com.au/companies/news/63352/black-rock-mining-has-assays-pending-from-world-class-graphite-district-63352.html

Good good good.

[Aotea]

I wish you well Robbo..There is plenty of room in the graphene sector for a number of operators. TLG is set to service the european region, and KNL has scope in numerous directions for economic options.

I would like to see both boom, and they may well. For me, TLG is the one to hold, so lets see.

[robbo24]

I wish you well Robbo..There is plenty of room in the graphene sector for a number of operators. TLG is set to service the european region, and KNL has scope in numerous directions for economic options.

I would like to see both boom, and they may well. For me, TLG is the one to hold, so lets see.

Black Rock next door. They are big (as you'd know from AVB) and it shows confidence in the region. The Black Rock mine is contiguous with the KNL resource.

Could make infrastructure projects easier/cheaper and provide an easy takeover bid from Black Rock.

KNL is hopefully soon to get their mining licence (weeks not months) which means it would be easy for Black Rock to extend the KNL licence rather than apply for their own (kind of like what NTL is doing at Rahu).

Keep an eye on this :)

[robbo24]

Mining licence granted! http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01641416