der Hauptversammlung aus dem HC
Hi all,
I attended the AGM and also had a chat with Nigel himself. Here's a brief summary of some important points from the meeting.
1) RESOLUTIONS - I personally voted against every single resolution and if you look at my previous posts, you'll know that I have been very critical of the board however after today's meeting, I'm feeling very confident that the company is heading in the right direction. The most substantial "against" vote was regarding the re-election of the Huayou board member and I know for a fact, that this will send a very strong message to Huayou that the shareholders need them to be more involved.
2) Huayou involvement - Some shareholders have been frustrated with Huayou, because they believe they haven't helped out when funding was required. It is important to note that if you look at Huayou's share price, they have also been SMASHED during the past year. So they are also very much in the same boat as AVZ. At the moment, they are in a spot of bother with their own company, so obviously AVZ will not be their number one priority regarding additional funding. They have their own business to run, however, given the fact that Huayou is already heavily involved in the DRC with other projects, the company is VERY CONFIDENT that Huayou WILL exercise their options and provide AVZ with an additional $18 million approx, given the fact that they are ALREADY HEAVILY invested with AVZ as their "lithium prince".
3) Huayou conflict of interest - Some shareholders have been concerned that there could be a conflict of interest with Huayou listening in to offers that are presented to AVZ by other parties and could try to de-rail negotiations. Nigel and the rest of the board said clearly that Huayou will not be involved when negotiations are happening with other parties so there's absolutely no chance of conflict of interest.
3) Shareprice DECIMATION - The board made it very clear that the reason our SP has tanked so much is very much due to the overall lithium sector shitting the bed in 2018. It's important to remember that we are a mining JUNIOR. So when the lithium wave took off in 2017, we were riding the top of the wave, but when the lithium sector tanked in 2018, the JUNIORS were all HEAVILY AFFECTED. This has been highlighted well by Dr Manhattan previously. So nothing out of the ordinary. We are actually holding up well around the 8c mark and as we all know, with the recent positive developments regarding lithium sentiment, we all know that another big wave for lithium is coming, and rest assured, AVZ will again ride the top of that wave, in 2019.
4) Offers / MOUs - it was mentioned by Nigel that AIRGUIDE are in china as we speak, involved in discussions for AVZ, so they couldn't be there at the meeting today. Nigel himself will be travelling to China AGAIN, emphasis on the "AGAIN", even though he was just there recently. Very interesting. Regarding funding, there have been multiple offers presented to AVZ but Nigel has simply rejected them because in his words they were "ridiculous" so these offers were not "worthy" of being presented to the shareholders. I'm very glad to see that Nigel and the board are prepared to put their foot down and not give-in to these lowball offers. However, Nigel is very confident that the next round of funding will be secured through some sort of Off-take arrangement at a very "appropriate" price. Yes there is an undisclosed MOU, as has been revealed previously on twitter by a certain someone. The reason this was UNDISCLOSED is to respect the "privacy" of the interested party. Discussions are ONGOING with ALL the MOUs and all interested parties Wink
5) Government involvement - Nigel and the other two board members kept repeating the fact that the GOVERNOR is veerrrrryy keen on this project going forward, so they are actively in discussions with the government regarding the tax concession and they are very confident that they can get the tax concessions and the GOVERNOR himself has expressed that the roadwork will be accelerated for AVZ. The DRC politicians have realised the true monster that AVZ is and they know that when it unlocks its potential, it will be massive for them too.
I had a personal chat with Nigel and am feeling very confident about this. Way more confident than I was yesterday. You know its a good investment when you have to try really hard to find any major negatives.
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Address/AGM:
There is only one other larger resource (withlower grades) and “we will be knocking that off soon”
China “recognises the resource”
“Grade is king” and “we can get above 6%concentrate” and “we can bring the grade of iron oxide down to 0.44%”
“ICE will be a thing of the past within 5 years”
“..the industry is falling short on output”
“Not stepped into the feasibility study yet butdoing prep”
Discussing OT “with various including outside China”“to put us into production”
Still looking at “various options” re transport/roads– I took this to mean outside of what is already available (Later mentioned inpresentation that they are “investigating other routes as well”).
“Share price has floundered” and Nigel expects “Lithiumprocess will be up and running next year”
Nigel is “going to Beijing next month”. As yetcautious OT and China because “If one company gets involved then the others stayaway” (Need the right deal first).
Re alleged non-disclosed MOU. Nigel couldn’t discussbut no further info would be made available because its “not going to happen”.
Presentation (Nigel and other board members)
Will “be a billion tons if we keep going down” (Nigel’sspeculation)
“Possibly do a blasting trail next year”
“Will take 3 to 4 months to pump the water out”
The pegmatite/lithium is “really hard”
The Governor is onboard – motivated to get roads/bridgesbuilt to assist development of a link into the south west of DRC (also saidseeing him on a regular basis)
Likely to get a good tax concession (cant recall%)
Simplest route is Dar es Salaam – various roadsneed to be built and two major bridges. One bridge being built now. (Thesebeing progressed via Governer).
Barges/ferry – (got a bit lost on comments here)
Rheet (who is a civil engineer) says that whathe has observed re road/bridge – looks like good/well built
Current scoping study has power via diesel.Hydro power also being explored. Likely to cost “$50m to get the plant back infull working order” and “$10m to get one turbine powered up and working = 9mw)
Re 30% DRC gov shareholding – is a free carryinginterest. Likely to assist when getting permits ect.
There is no more drilling planned
Have $4.4m in the bank today (diff topresentation due to payments made)
Will have to do financing, OT and/or have “cornerstoneinvestor”.
Definitely looking to sell tin/poss Tantalum –need metallurgic assessments
OT – explore in the new year.
Possible new engineer project manager (Board member?)re mine building look to appoint in Jan 2019
Share price falls – doesn’t know why other thanappears to be
Wont be selling any of the resource – would createcompetitor
Election in DRC – no current oppositioncandidate atm so don’t foresee any changes. Have good relationship with themines minister.
Main challenge going forward is the transportroute (other aspects of the project all okay).
Overall I found it aninteresting experience – got the impression that being at the AGM and voting doesn’treally change the outcome (most votes already cast and in favour). Was helpfulto hear comments as well as read information – couldn’t stay to speak directlywith board members but there was an opportunity to be able to do that.
I still have hope that AVZ will get to production and feelthat those involved are working hard towards that – lots of challenges ahead andI will remain in for the long term. |
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