It’s looking decidedly grimmer and grimmer as each week passes on ‘Uber dog & ‘Uber’ ramped Chesterfield Resources (LON: CHF) This outfit are without doubt the biggest crock of shit currently on the small cap mining resources sector. They’re a mining copper play with bits of paper laying claim to ‘Copper Riches’ beyond your wildest dreams, in Cyprus.
Having spoken to ‘The Secret Nomad’ on all things standard listed and gone through every RNS and company presentation/s I can now tell you exactly what’s in store for any mug punter who falls for the ‘Greeks Bearing Gifts’ spiel currently being vomited out by this POS and their paid promoters.
Chesterfield listed on the 29th August 2017 raising £1.3M at 5p. Two months later the company was suspended, apparently a reverse takeover, so with a new prospectus they announced on 28th June 2018 that they’d raised £2M at 7.5p and had also issued 6,666,667 shares (£500K) of stock to HKP Exploration Ltd to take them over for the rights to 7 permits. HK Exploration paid nominal sums for the permits which were now incorporated into the new improved POS Chesterfield.
In September 2018 they released their Interim Results up to 30th June 2018. Where the cash balance was circa £900K. Now here’s the conundrum. On 28th June they confirmed the relisting and £2M raise. Their Interim’s are up to 30th June 2018 yet CHF state they have £900K. Have CHF ‘Jazz-funked’ away £1.1M in the space of 2 days of being relisted? If so then Whilst in suspension CHF must have been bust. The licences were paid for in shares. What was the £1.1M spent on, in two days, other than debts? It gets worse. If the above is correct then £2.4M in total has been spent over 10 months from listing to re-listing. Which leaves CHF £900K as of June end 2018, 8 months ago. The Company needs to clarify their cash position pronto!
If the £1.1M of the £2M has gone then they were burning cash at circa £240K per month up to June 30th 2018. How much cash has CHF got left? Well, on the cash burn up to June 2018 they again would be? Bust.
But let’s be generous because I’m a good guy. Lets say they decreased their cash-burn by 66% for the 8 months up to today. That means the Company have circa £100K in cash. And believe me ‘Uncle Dan’ is being extremely generous in cutting their cash-burn down by 66% per month. CHF are running on vapours. Mining, by it’s very nature, is hugely expensive. It’s hundreds of millions of pounds of capital expenditure (Capex) before a mine can be opened.
But here’s the ‘wibble in the wobble’. Being a standard listed company they can only issue 20% of their shares in actual issue in any one 12 month period, unless of course they come up with another ‘Acquisition’ and suspend and re-admit yet again….. If they go for a placing, 20% of shares are circa 12M shares. At 2p that’s one months cash-burn. At 3p that’s 6 weeks cash-burn. Or on the “generous good guy” figures of £100K per month 10 weeks or 15 weeks. Of course they’ll have to wait about 90 days before they issue.. There’s a very real possibility that CHF may well have to submit another prospectus and suspend. As Yoda would put it, ‘Vapours, almost certainly running them on’.
Cyprus was famous in antiquity for its copper resources. In fact the very word copper is derived from the Greek name for the island, Kupros. Cypriots first worked copper in the fourth millennium B.C., making tools from copper, which at that time could still be found on the surface. The discovery of rich copper-bearing ores on the north slope of the Troodos Mountains led to the mining of Cyprus’ mineral resources in the Bronze Age at sites such as Ambelikou-Aletri.
Of course today after 3,000 years of mining one may want to ask exactly what’s left? Other than a few small time privateers, since 1970 the Cypriot mining industry has been in recession. Copper produced used to come from low grade dumps. That’s to say; processing of waste material from previous mining operations such as the Skouriotissa mine owned by Hellenic Copper Mines Ltd. Who’re a small scale producing copper mining company on Cyprus. In fact, Hellenic Copper Mines Ltd. are the one and only mining company on the island of Cyprus. Why is that? Answer. Because they have all the mining waste from their previous operations. In other words there’s fook all left. The only copper being produced in Cyprus comes from waste. Slag heaps. If you’d like to buy a permit and try your hand at finding the mother-lode of copper, gold or any other metal on Cyprus the cost is circa £8K per permit.
If you believe that defunct mines that cost a minimum of $200M dollops to clean up and get into production is good business then you need to send me all your money because I’m opening a gold mine at the back of a pawn shop in Didsbury….
Now we’ve all heard of that pithy saying “Beware of Greeks bearing gifts”. So here are the facts
Most mines on either side of the ‘Green Line’ (Google it) are of special scientific interest to the worlds archaeologists. That’s the Cypriot, copper industry in its entirety. There are 100’s of toxic abandoned mines. A full producing mine costs hundreds of millions of dollars to get into production. This lot have zippo cash and are about as far away from producing copper as I am from receiving a Royal Pardon and an invitation to become a ‘Lord’ of the realm. It’s a fantasy ‘Paper Mine’. Nothing more nothing less. Of course the ‘howler monkies’ will scream and scream and scream some more as reality bites.
I’ve seen it before. It’s an old worn ‘recipe’. Pick an area that’s had a history, get some spurious exploratory permits, throw in a few RNS’s, add a dash of diamond drill sampling, over-promote, give a few quid with an expenses paid jaunt to a couple of P&Ders, a pinch of ‘Total Market Shite‘, light the blue touch paper, sit back and laugh as you Mine the City of London via Mug punters.
Having spoken to ‘sources’ on what’s likely to be going on within this POS, I can only say commiserations if you’ve been suckered in by the blatant P&Ding that’s got you to this point in your trading/investing methodology where you greedily suck up more shite than a portaloo, suction cleaning vacuum.
This so called mining copper riches story is very similar to another one. In fact you could say it’s right out of the mining play-book for ‘Suckers‘. For those of us who recall the ‘Greek Tragedy’ that was Emed Mining. I’ll tell you this. It didn’t end well… Emed Mining were, (note the word “Were) a copper mining riches beyond your wildest dreams with licences in? Yes you’ve guessed it, £8 grand a ‘pop’ permit, Cyprus…
It’s Suspension, Placing or Both. Shell value 0.60p