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Malcolm Shaw

 
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  • From Frac Sands To Oil Sands: Athabasca Minerals Has It Covered [View article]
    Just a final note blueice... Athabasca HAS received their permits! The receipt of permits coincided with the high in the stock price. Perhaps the preliminary economic assessment will be the next milestone to watch for...
    Oct 11 09:04 AM | 2 Likes Like |Link to Comment
  • From Frac Sands To Oil Sands: Athabasca Minerals Has It Covered [View article]
    blueice,

    Your sentiment echoes that of many. Pressure on the oil price has dampened drilling expectations, which has impacted the U.S. silica sand producers, and is a double whammy on a small/micro cap like ABM.

    The good thing about silica sand in my mind is that it is kind of like wheat… there is ALWAYS demand of some sort, and the "weather" (weather being the oil and/or gas prices in the silica sand business) determines times of feast or famine, but make no mistake, you will always need it. The only real question in my mind is one of economics, which a PEA (preliminary economic assessment) should shed some light on in a couple/few months. If it's economic, it is a multi-decadal asset in close proximity to the core of the Western Canadian Sedimentary basin. That's quite a potential prize.

    With that in mind, the value of the silica sand operation as determined by the market at any point in time is irrelevant to me, as long as the company can survive without any excessive dilution while waiting for the "weather" to improve.

    Can Athabasca survive a dip in drilling activity? History would suggest "yes", based on the company's tight share structure and profitable history. I look forward to seeing the quarterly results near month end and perhaps an update on the plan for Firebag. Athabasca does not have fancy offices or high salaries... and with the aggregate business, you're only a few quarters away from being a "just in time" supplier, so there's not too much working capital required unless you are scaling up (in which case business shoould be good).

    Western Canada absolutely needs to increase domestic silica sand supply. Rail border crossings are limited and traffic is heavy. To use the wheat analogy again, it makes little sense shipping wheat an extra 1500 miles when you have access to wheat from a local (closer) source that will serve the purpose.

    That pretty much sums up my thesis on Firebag. A lot of things have to come together for me to be right and management has to execute, but I think that to suggest it's game over at this point has little to do with fundamentals and more to do with which way the wind is blowing right now. Time will tell.
    Oct 9 11:57 PM | 2 Likes Like |Link to Comment
  • From Frac Sands To Oil Sands: Athabasca Minerals Has It Covered [View article]
    Amen! Having the sand resource is just a part of the battle. Management has a real test ahead of them. I'll be keen to see how their aggregate business is doing when they report at the end of next month and I hope to see them make moves firming up the commercial value throughout the rest of 2014 and early 2015. A bit of a rout in the markets today. Almost nothing that I follow was spared.
    Sep 25 07:20 PM | 1 Like Like |Link to Comment
  • From Frac Sands To Oil Sands: Athabasca Minerals Has It Covered [View article]
    Thanks for the questions blue ice and no_idea…

    No_idea: Yes, we have the same sand supply issues in Canada as you guys do in the U.S. Most of Canada's sand is imported from the U.S., which is one of the reasons that Firebag could be so important - a large, domestic, silica sand source. As for the rest of your questions, most, if not all, should be answered when the company completes a PEA (preliminary economic assessment). The PEA will include estimates of capital costs, operating costs, revenue potential, logistics details etc.

    I would argue that the frac sand project is "free" at this point, depending on your view of the value of the existing aggregate business. I look forward to seeing the results from the aggregate business in the latest quarter when the company reports in about a month.

    blueice: Your sentiments and observations regarding the trading are echoed by many. I believe the current lack of interest (reflected in price and volume) has to do with a few things: 1) The whole Canadian resource market is under pressure, which tends to put pressure on all materials stocks as negative funds flow persists; 2) the market is waiting for ABM to finance in order to build the project, which can create overhang as new buyers take a "wait and see" approach before stepping in ahead of a potential deal (I tend to believe that this is putting the cart before the horse, as a PEA will be needed before the company and market can point to a 43-101 compliant document detailing capital costs, and hence capital requirements); 3) the market is waiting for customers (frackers) to give some kind of official "green light" to the use of Firebag sand… To me, it appears that Firebag sand stacks up well against Brady Brown sand in terms of physical properties, and the industry pumps millions of tons of Brady Brown into frac'd wells in Texas every year, so I'm fairly optimistic in that regard. So far the samples that ABM has sent for testing are literally just washed and screened. With a little bit of additional processing, there's a good chance that the quality can be raised further, but time will tell.

    One last point. I've spent a fair amount of time trying to figure out what sand sizes are used in which formations in Canada, but it's been an uphill battle. One good data point that I did get was from a Montney-focused E&P company. I was told that they pump a 50/140 sand mixture into their wells… that would include ABM's 40/70 fraction and 70/140 fraction. If that's the case for other Montney operators, ABM could be well positioned given the scale and longevity of the Montney play in the Western Canadian Sedimentary Basin.
    Sep 25 09:29 AM | 1 Like Like |Link to Comment
  • UNO - Looking For Uranium Away From The Crowd [View instapost]
    Not much to say other than that I hope they are more successful this summer in terms of getting holes down than they were last winter!
    Aug 31 09:15 AM | Likes Like |Link to Comment
  • Patterson Lake Asset Consolidation: Fission Aims For Fusion With Alpha [View article]
    It's been a successful summer for FCU with the drill bit and I would hope to see an initial resource estimate sometime this winter. On another note, for those still following the area, NexGen Energy (NXE on the TSX Venture) also had some very interesting drill results in their "on trend" Arrow zone yesterday. The company reported over 50 metres of "off-scale" uranium mineralization. That was certainly enough to grab my attention, as I did end up buying a small starter position as a result. It's hard to know just how the PLS area will play out over time (never mind the uranium market), but I firmly believe that PLS area is going to be nucleus for a whole camp on the western side of the Athabasca Basin at some point.
    Aug 27 01:38 PM | 1 Like Like |Link to Comment
  • Firebag River - A Red-Hot Canadian Frac Sand Deposit? [View article]
    Looks like the receipt of the Firebag permit was well received by the market. My view on the project remains unchanged, but I expect that the fact that the permit has been granted may play well in terms of investor psychology. Cheers!
    Aug 26 05:33 PM | Likes Like |Link to Comment
  • Valeura Operational And Production Update -- Another Quarter Of Growth In Q4 [View instapost]
    Thanks for the comments. I do still follow VLE and would attribute the retracement in the share price to lack on investor interest in illiquid small cap resource companies in general. Operationally, they look to the doing exactly what they said they will do, but small cap names have a funny way of going into and out of favor in the eyes of the market. It still appears cheap to me and I look forward to seeing what the next quarter brings in terms of production. Banarli remains a "call option" on the deep gas potential.
    Aug 21 08:30 AM | Likes Like |Link to Comment
  • BNK Petroleum's Latest Caney Well Demonstrates Further Operational Success [View article]
    Hard to say. With the credit line announced recently, Oklahoma appears to be on track. Poland is encouraging, but appears to be inconclusive.
    Aug 1 08:56 AM | Likes Like |Link to Comment
  • Argentina And The Peso Devaluation -- Does It Even Matter? [View instapost]
    Looks like my musings may be put to the test...
    Jul 30 08:46 PM | Likes Like |Link to Comment
  • Pan Orient Serves Up A Mixed Bag [View article]
    It's been a long and painful road thus far with POE. At $2, I think it continues to provide long-tail optionality, but remains speculative. As per prior POE press releases, H2 2014 could/should see SAGD pilot well-pair results, exploration drilling in Thailand, and possibly some kind of JV on the Indonesian properties.
    Jul 29 09:03 AM | Likes Like |Link to Comment
  • Nevada Sunrise Wakes Up To The Smell Of Big Gold At Kinsley Mountain [View instapost]
    My math yields a similar result. From conversations I've had, it's my belief that the market is in "show me" mode with respect to Turkey for PLG. Possible permitting issues for other industry players in the country are a factor in some people's minds, which leads them to heavily discount the Turkish assets. Time will tell whether or not that is a fair stance, but for now it appears that Kinsley is the most likely driver for the story going forward.
    Jul 11 04:35 PM | Likes Like |Link to Comment
  • Nevada Sunrise Wakes Up To The Smell Of Big Gold At Kinsley Mountain [View instapost]
    For those following….. Some results today out of PLG/NEV. Confirmatory of the fact that the system is fertile and open to expansion laterally and in multiple horizons. They are half-way through the drilling program with 9 holes in the lab right now waiting for assays. More drilling is required, but PLG appears to be quite positive on the project in light of the CEO quote in today's press release. The market reaction was muted, but Kinsley has produced spectacular results in prior holes and statistics would suggest that there's more to find.
    Jul 10 05:06 PM | Likes Like |Link to Comment
  • Firebag River - A Red-Hot Canadian Frac Sand Deposit? [View article]
    Thanks for the comments. I've looked at Claim Post. My main questions are that: 1) the sand requires processing, as there are fines associated with the deposit that will need to be processed out (ABM has almost no fines), 2) it is still a long truck haul before it gets to rail (it appears to be longer than ABM), 3) First Nations consultation is required (ABM already has a JV with the local First Nation), and 4) it is still in Manitoba, which is still a lot farther from the WCSB than Firebag is. I'm keeping an eye on it, but I just haven't delved to the next level of due diligence beyond the questions that I have listed above.
    Jul 10 05:00 PM | 1 Like Like |Link to Comment
  • Firebag River - A Red-Hot Canadian Frac Sand Deposit? [View article]
    For what it's worth, the recently published Dundee Capital Markets research report report has estimated all-in costs per tonne of $57 during start-up, declining to $53/tonne by 2020 and beyond.
    Jul 2 05:27 PM | 1 Like Like |Link to Comment
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177 Comments
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