Interesting little company. Did a series of asset swops to leave them with half of the 4th largest Nickel deposit in the world.
The deposit itself is in the Philippines has been known about for 30 years but due to low prices and lack of demand in the Far East it was never exploited. With the explosion in demand from India and China the nickel price has climbed from $2 to $6.50 but oddly enough is still considered low.
The final approval stage for exploitation is just about to be approved and extraction will begin. The company already has one contract with a Japanese smelter and is in discussions with smelters in a series of countries.
Nothing clever about the operation, as the ore is of sufficiently high grade, they dig it up and ship it out. Infrastrucure is already in place for operation.
TMC is currently priced at 18m, the initial Japanese contract is worth 4m and each additional contract will hopefully be at this level or greater.
Final approval turns the company into a producer and each additional contract simply increases their size.
The management is tight with cash and has some good quality mining skills onboard.
The Philippine government is fast tracking the final approval and the company says it expects it shortly.
One to hold for approval and through the series of RNS's as more contracts are won. Company should be worth 50m in 6 months and 100m in 12-18 months.
Buy it, ignore it, just pointing this one out.

Well pointed out. One of my favourites for 2006.

i think we'll see this one moving up soon.

looks good, Supplies of nickle are low at the LME.... fallen over last 60 days... could be the start of fall in supply... Zambezi Nickle is also a good play

Got in this morning at 107p, and very happy I did so far :)

Toledo Mining Corporation PLC 22 March 2006

TOLEDO MINING CORPORATION Plc
('Toledo Mining' or 'the Company')

Operations Update

Toledo Mining, a mining company focused on nickel exploration and development in
the Philippines (AIM: TMC), is pleased to provide a forward operations update,
following a conditional institutional placing to raise approximately 8.5million
(before expenses), as announced on 8 March 2006 subject to an EGM. The use of
the placement proceeds will fund an enlarged and modernised operational
framework, to sustain a timetable for increased exports.

Background
As previously announced, the Company has carried out additional
sampling within part of the Berong area, with pleasing results showing slightly
higher than expected nickel grades, & relatively low contaminant levels across
some 13,000 samples assayed, providing a clear indication of the distribution of
higher and lower grade limonite and saprolite ore.


Forward Operations
Following an evaluation of the capacity of the market and the
capabilities of the Company's resources, Toledo has increased its export target
of 80,000-90,000 of dry metric tonnes of nickel ore this year (2006) rising to
around 1 Mtpa over a two year period. Previously the Company had been
forecasting exports rising to 500,000 tpa over the same timeframe. However,
actual production volumes this year will be dependent upon weather conditions as
the period from May/June through October/November is the traditional wet season
on Palawan Island.

The new aggressive sales target of around 1 Mtpa will entail quite a
different scale of operations and type of specialised equipment to that
previously envisaged. Initially a barging and transhipment operation to load the
ore carriers was planned. With sales volume now planned to grow to around 1
Mtpa, a trestle conveyor, extending some one kilometre offshore into deep water,
is planned to be utilized. This will allow the ore carriers to be directly
loaded, with consequent saving in operating costs. The trestle conveyor will
require a capital investment of around US$6M, part of which will be funded from
the placement proceeds.

In order to take advantage of the favourable contract terms currently
available, Toledo aims to quickly commence production and rapidly switch from
the smaller scale barging/transhipment operation to the larger scale conveyor
operation as production is ramped up. This will incur some redundancy of
equipment and facilities, which the Company is working to minimise. However,
Toledo's management remain confident that this approach will best benefit
shareholders.

Mineral Production Sharing Agreement (MPSA)
As previously announced:
The Company requires an MPSA for regular supply into contracts. This
is on schedule to be awarded later this year. However the Temporary Exploration
Permit which has been granted allows us to send off bulk samples for customer
trials, which is the immediate objective for Toledo

The company has secured a Free Prior and Informed Consent (FPIC) from
the Indigenous community and formal authorisation from the Palawan Council for
Sustainable Development (PCSD). As a result of both agreements being approved,
the essential MPSA clearance will allow the company to move into full scale
production after the wet season has finished.

A copy of this operations update will be sent to shareholders together with the
proxy for the EGM to be held on 3 April 2006.

George Bujtor, Chief Executive Officer, commented:

'This is an exciting time for Toledo Mining following the private placing.
Toledo Mining is now well positioned to rapidly commence production starting on
a small scale with barging and transhipment operations. We also intend to
further the development of the operational framework including the asset and the
surrounding infrastructure. This will enable the Company to achieve a
significantly increased DSO (Direct Shipping Operations) and export sales target
of about 1 Mtpa of limonite and saprolite ore.'

22nd March 2006

For further information:
Yve White, Toledo Mining Corporation Plc: +44 (0) 20 7514 1480
Charles Vivian, Pelham PR: +44 (0) 20 7743 6676
Editors' Notes
Toledo Mining Corporation, is an AIM listed company and has significant
interests in three nickel laterite projects (Berong, Celestial and Ulugan) on
Palawan, in the Philippines

The Company's short term two tier strategy is to achieve production with the
Company's nickel assets in the Philippines as well as targeting under performing
or undervalued mining opportunities.

Siwel2 - Great Tip, thanks!! This could be quite a goer . . .

Has anybody seen any feasibility studies published on this one?

Alternatively, do the news releases on the Japanese 4M contract stipulate the tonnage of ore involved? It would be interesting to know how much cash TMC expects to realise.

Just a going over of things :

http://today.reuters.com/business/newsarticle.aspx?type=naturalResources&storyID=nMAN131673&imageid=∩=


INTERVIEW-Big nickel mine set to open in Philippines
Wednesday 15 March 2006, 5:10am EST By Dolly Aglay

MANILA, March 15 (Reuters) - The Philippines' Berong nickel mine, whose inferred resource is said to be the world's third or fourth biggest undeveloped laterite resource, will start commercial production later this year, its owner said.

The start of production at Berong on the western Philippine island of Palawan comes at a time of increased demand from China and Japan for the metal that adds sheen to stainless steel.

"The plan is to get trial shipments at the middle of the year. We will take out at least half a dozen bulk samples to customers of 5,000-6,000 tonnes each," George Bujtor, CEO of Toledo Mining (TMC.L: Quote, Profile, Research), which has a 56 percent stake in Berong, told Reuters on Wednesday.

"We will send small quantities to the various customers so they can trial it in their plants to see how the laterite behaves and how it can be processed," he added.

Bujtor said that once processing plants in Japan, China, Europe and Australia approved the samples, Berong would start commercial production in November or December this year.

"The key thing for any of this development is the infrastructure, the access roads, the port facilities and knowing what you have on the ground," he said.

Bujtor said Berong aims to ship 80,000-90,000 dry metric tonnes of nickel ore this year and to increase this to 500,000-600,000 tonnes in 2007.

The Berong mine, which is composed of three deposits called Berong, Moorson and Long Point, is expected to produce 920,000 tonnes in 2008.


WORLD CLASS

Berong, which has an inferred resource of 275 million tonnes of laterite ore containing an average of 1.3 percent nickel per tonne, would be the third or fourth largest undeveloped laterite nickel resource in the world in terms of contained metal, Bujtor said.

The nickel metal resource of 3.6 million tonnes at Berong, valued at $53.46 billion given market prices of $14,850 per tonne, however, has to be validated, he said.

Bujtor said his company has to conduct more drilling and testing of samples from Berong to prove the resource based on standards set by the Joint Ore Reserve Committee of Australia.

"A lot of the drillings were done 30 years ago," he said, adding his firm has so far spent over $1 million to retest and get fresh samples from the old pits and new drillings in the area.

In addition to London-listed Toledo Mining, local firm Atlas Consolidated Mining Corp. (AT.PS: Quote, Profile, Research) has a 25.1 percent and the remaining 18.8 percent is owned by Australia's Investika Ltd. (IVK.AX: Quote, Profile, Research).

Besides Berong, Toledo is also exploring the Celestial mine with an inferred resource of about 80 million tonnes and the Ulugan mine with about 25 million tonnes, on the eastern and western side of Palawan island, respectively.

Eventually, the company plans to put up a processing plant in Palawan using the so-called atmospheric leaching technology or applying low-pressure to extract nickel from the ore, Bujtor said.

Miners have said the Philippines has the potential to become a major source of nickel, whose price has more than doubled in value since 2001, as it hosts at least a quarter of the world's known laterite resources.

A study by Toronto-listed Crew Gold Corp. (CRU.TO: Quote, Profile, Research) said the Philippines has 20-25 million tonnes of nickel in its soil worth $297-$371 billion, enough to pay the government's $76 billion debt nearly four times over.

But more foreign money is needed if the country is to raise its nickel output from 16,973 tonnes in 2004.

Should also be remembered that presently Toledo is valued at 0.1% of "in the ground" resource.

Once MPSA is approved, and its underway and presently pending, see the link below, then this valuation will be in for a sharp rerating, similar to AEN for example I think. For those brave enough to buy in now and hold, waiting for MPSA in the hope of no failure in the award of it, the rewards could be very enjoyable.


http://www.mgb.gov.ph/miningportal/projects/Exploration%20Projects/Exploration%20Projects_List.pdf

PapalPower,

Thanks for the excellent info. You're not the only one who thinks that TMC's current valuation is way too small given the resources' potential (my rough-and-ready calculations suggest total portfolio nickel resources net to TMC of anywhere from 10-16 Billion, depending on how conservative your estimate is of the future price of nickel. My lower figure uses $10,000 per tonne, higher figure $14,000, DYOR).

I haven't dug into AEN apart from a quick look at the chart, but I can see your logic.

How would you assess the risks regarding MPSA approval? On the list you indicated, most co's have either an Exploration Permit or an MPSA already granted, so I'm guessing that TMC's chances must be fairly good. I see also from recent news releases that other sorts of permits and approvals they need along the way have already been granted. It augurs well . . .

Soul Traders, there is always a risk that MPSA will not be granted, or perhaps will be granted but on very pro-Government (not so good for TMC) terms, this is the variable whch instituions cannot put into the price, and so in the most will stay outside until terms are known and its granted.

However, the upside even on very poor terms for TMC are massive, and with all SE Asian countries, anything can be done when its wanted to be done, so I think approval should be 99% certain, but the 1% is still there until its a done deal, others may think its 50/50, but I would say at this stage, with so many of the other required approvals already done, that they are very nearly there.

PP,

I couldn't agree more with your conclusion. I am not familiar with bureaucracy in the Philippines (!), but feel that if there had been any significant objection to TMC proceeding, it would have been raised already.

Have purchased an initial chunk of stock today at 112p -will either add over time or wait until the MPSA is granted and pounce!

To me the potential of this stock is outstanding. I wish I'd got into VOG while it was still at 30p - but I think this could make up for it!! (IMO, etc). The only possible drags on physical progress with the mining are the disruptive potential of the rainy season and the fact that it may take up to 18 months for the co to get up to speed on production. However, that certainly doesn't preclude a big re-rating on the grounds of the huge assets to which TMC have access - and that's the reason to get in early!

Thanks again for your excellent contributions to this thread and your helpful comments.

Best wishes from Frankfurt,
Soul Traders

soul traders, glad you are onboard and find the information helpful. With TMC, if they get the MPSA then the upside is massive, bigger than VOG I would say. I am familiar with the Phillipines and the way it works, and in my mind MPSA will be granted, just a matter of time and terms.

Still high risk, but for me its a risk worth taking given the incredible upside potential. MPSA should be awarded any time in the wet season, so any time from May to November. I will just keep tucking some away every so often until that time :)

A nice link from a post on AFN, and this is what matters, local people wanting it.

absinclair - 27 Mar'06 - 14:37 - 57
hi guys. thought you might be interested to see this article related to mining in the Philippines, in particular Toledo city.

http://www.manilatimes.net/national/2006/mar/27/yehey/prov/20060327pro1.html

Good news for EKA (copper) and TMC (Nickel) :

More background info - from this week :

Citigroup turns bullish
Earlier, Citigroup said it's abandoning a long-held bearish outlook on copper and nickel on expectations of economic growth, tight supplies, sluggish capacity additions and persistent operating outages or shortfalls.

"We continue to adhere to the Commodity Supercycle theory, believing that the combination of 15 years of underinvestment, thorough-going corporate consolidation, mounting regulatory/NGO pressure, and input cost escalation are conspiring to prevent the industry from mounting a meaningful supply response to "peak-peak" prices," said analyst John Hill.

Citigroup raised its 2006 forecast for gold to $553 an ounce from $540, and upped its copper outlook to $1.85 per pound from $1.59.

On the supply side, copper inventories were down 44 short tons at 28,104 short tons as of late Friday, according to data from Nymex.

Gold supplies were down 487 troy ounces at 7.53 million troy ounces, while silver supplies were down 119,875 troy ounces at 124.9 million troy ounces.

PP,

You may be interested in taking a look at the Galahad Gold (GLA) thread, if you haven't already done so. Similar prospects to Toledo, IMO, and they may be announcing the results of a scoping study at the end of this week (although whether that will do much to affect the SP is another ballgame altogether). Would be interested to read your comments.

ST, will take a look.

Excellent post from AFN :

Geko5trade - 29 Mar'06 - 00:56 -

Spoke to George Bujtor early this morning (Philippino time). Some people don't like talking to CEO's and directors for fear of getting too close to the company. I can understand that viewpoint but I've been saved a number of times by talking to management.
I don't think anyone should be in this share if they haven't come to terms with the political risk. That said I think the probability of success, and major success, has increased very significantly since GB came on board. He is hands on, has an excellent grasp of the production issues combined with a common sense overview. During the conversation I raised a number of issues regarding the MPSA, allocation of funds, timing of progress with regard to the wet season amongst them.
The first thing that struck me was that he is totally committed and sees this as an opportunity to develop a major company. He is fully cogniscent of the difficulties of dealing with Philippino bureaucracy. He doesn't shy away from any of the issues and has a strategy in place to deal with them. In many cases this is simply having people on the case chasing departments to make sure papers have gone from A to B. Mintybear I wouldn't want to gamble on long delays to MPSA, my opinion is that where he needs to buy expertise, he buys it. The report is complete for shipping access and the stages for the development of the docking area well thought through. As I understand it a spur will be used for the first shipments and this will be developed into the permanent access and loading area and there is no problem accomodating the deep draft vessels. Clearly there are issues. Just building an access road entails a group coming out to monitor every tree that's removed! The important thing is that where difficult criteria have to be met they are being met and the infrastructure is moving into situ. The conveyor is a major expense but remember they are likely to be moving three times the volume previously anticipated.
I had assumed that the rainy season would halt production. GB made two comments regarding this which I think are worth consideration. Firstly the weather on that side of the island may not be as severe as in other parts. So whilst we have to assume delays there may be opportunity to continue operations. Secondly the parameters for 'dry shipment' vary considerably. Effectively some companies ship with a higher percentage of water content than others. Perhaps this depends on demand I hadn't really thought of it. What I do think is that if someone is likely to capitalise on that possibility and build it into the contracts GB will take that opportunity.
I think there was another interesting point about the politics. There is a tendency for us to view NGO's as a coherent group. What GP pointed out is that they are more akin to numerous self-interested groups with very different isolated agendas. ie a local group that wants to build a church, another that wants something else. I'm not suggesting there's anything wrong with the intentions of each group but it is probably wrong for us to view them as a coherent unified opposition. That is probably a perception that politicians try to infer and has little bearing on the everyday workings of a developing company like Toledo or the bureaucracy they have to deal with.
I consider the MPSA a small part of the planned expansion. I have some notes on the various stages, permits and agreements, and how they relate to the hectares involved. I think it is all in the public domain but I'm going to stop rambling just in case there are discrepancies that might be price sensitive. I doubt it. GB is very sharp and has the knowledge and experience to back an opportunity. All IMO.

http://www.manilastandardtoday.com/?page=news01_april03_2006

High court says law on mining stays

THE Supreme Court has reaffirmed the constitutionality of Republic Act 7942, or the Philippine Mining Act of 1995, when it declared valid the governments financial and technical assistance agreement with an Australian firm to operate mines in Nueva Vizcaya and Quirino.

The Mining Act allowed foreign investors to tap into the Philippines estimated $1 trillion in mineral wealth, and the high court affirmed it in a resolution en banc or in full court and with full judiciary authority.

It upheld the decision of its First Division dismissing a petition questioning the constitutionality of Section 76 of the Mining Law and its implementing rules and regulations, the Department of Environment and Natural Resources Administrative Order 96-40, and the agreement signed by the Philippine government with Arimco Mining Corp., an Australian firm that was later renamed Climax-Arimco Mining Corp.

The First Division had dismissed the suit filed by the Didipio Earth-Savers Multi-Purpose Association Inc., which questioned the legality of the governments deal with the Australian firm and the constitutionality of Section 76 of the Mining Act and its implementing rules.

Separately yesterday, President Gloria Macapagal Arroyo assured foreign investors that the Philippines would not revoke its liberal policy on the mining industry even as she urged them to support the governments environment protection programs.

I want to develop the mining sector, though not at the expense of our environment or our workers, she said.

I believe a modern state can provide a clean environment and a good job especially if you will help us in that respect.

The President met some of the largest foreign donors and investors last week when she opened the two-day meeting of industry stakeholders at the 2006 Philippine Development Forum.

She gave her assurance that the Mining Law would not be substantially amended following calls from influential Catholic bishops that the government review its mining policy.

But the President urged mining companies to devote at least 10 percent of their capital expenditures to finance environmental projects and to spend 3 to 5 percent of their direct mining and milling costs for annual environmental programs.

Mrs. Arroyo also assured foreign investors that government efforts at creating a culture of transparency in the bureaucracy would continue.

We want to make sure that every dollar that you invest in the Philippines is well spent, she said.

Earlier, presidential chief of staff Michael Defensor said the government would block any move to inject substantial amendments to the Mining Law.

The policy stays. There will not be any substantial changes or amendments, and especially not a reversion of the law, Defensor said.

The Philippines is trying to attract about $6.5 billion in foreign funds to revive the mining sector amid calls from influential Church leaders early this year to cancel all mining concessions.

In Congress, House Speaker Jose de Venecia has already instructed the committee on environment and natural resources to look at the possible amendments to the decade-old law. Rey E. Requejo and Joyce Pangco Pares

Post from one person who attended the EGM today, all good news I think :) :


david77 - 3 Apr'06 - 14:03 - 5906 of 5906

Seems I get the honour! There were about 15 shareholders at the meeting chaired by CK - Merfyn Roberts was also there.

The two resolutions were passed by substantial proxy votes and by those attending today.

The new shares had been irrevocably placed with institutions @ 108p subject only to today's votes. Those institutions included Framlington, Fidelity, Scottish Widows, RAB Capital, and GS Mineral fund(?). I may not have remembered the last one correctly.

CK told us pretty much the same as in the operations update of 22 March.

The MPSA is not holding anything up at this time, and he couldn't really give any more info than that he expects the MPSA 'soon'. He is confident that it will be issued in due course - all of the preparatory work has been agreed.

Good stuff, PP.

Two further posts from EGM attendee's and much more detail, and thanks for daz and Tiggy for sharing :) :

daz2004 - 3 Apr'06 - 21:30 -

Meeting was better attended than AGM...about 15 PI's i reckon, 20 in total.

Anyway funding was as already detailed due to taking production from 500kt to 1Mt+ per annum...original estimate was US$10m now to be US$18m.

- conveyor to be used instead of barge boats...conveyor to be 1km in total length so that 30-60kt ships can be loaded. Barge boats would have meant 3-4 of these being filled and towed out to then for their loads to be taken off again to be then be reloaded onto ships, this whole loading process will reduce timescales dramatically.

- additional work will be done to the roads to increase their widths...

- additional work will be done to increasing drying areas

The whole issue of this placing really is to get Direct Shipping Operations performing to a much higher level than was estimated. When all this infrastructure is in place income generation will be significantly greater than anticipated.

Sample shipments are scheduled to up to 3 Japanese smelters(NIPPON is still taking it), 2 Chinese, and the one of the largest smelters in Europe (Greek smelter LARCO http://www.larco.gr/ )

ECC meeting is next week, CK confident its in the bag. Something mentioned about DENR minster needing to sign something and he's been out of the Country.

MPSA requires ECC & feasibility study of designated area. The feasibility study is very throrough as DENR have requested it, its up to JORC standard but CK mentioned something about nickel deposits being difficult to JORC standard?? (I haven't got that written down, just remember that)

Tax required for DSO is 35% for government & 2% for Indigenious People, and thats all...infact capital expenditure can be offset and also if Acid-Leaching operations set up then 5yrs tax free holiday mentioned.

PR is being addressed with Charles Vivian, Pelham PR in attendance, who informed us that they are talking to finacial press and priming them so that when news is released in future then they will hopefully run a feature for example on mining exploration in Philippines with TMC mentioned. Felt reassured that the PR is being worked on and I look forward to more exposure coming...

I hope the above is a fair assessment, I may have missed something out or someone who attended may be able to elaborate further...but the overriding sense that attendees got imo, is that management know exactly what they are doing, the DSO is not some small operation being undertaken, George was not there, but CK has complete 100% faith in what George is doing and he mentioned his previous experience has/is paying dividends, "WE are extremely lucky to have him" was stated...the sp is where it is because its the Philippines it carries a higher risk, however he did state that the hardwork has paid off and he highlighted that the rewards are also higher as well.


Tiggy2101 - 3 Apr'06 - 21:32

I attended the EGM today, and thought it was a very positive meeting and well worth attending. I also met Daz and had the opportunity to thank him in person for all the hard work and well researched information he has posted on this board over the last two years.

My notes are similar to those posted by David77. However I will add \ confirm the points made at the EGM, in no particular order.

1)An institutional visit is planned in April 2006.
2)Chris commented that George is confident that more orders will be added and that the order book will only get bigger.
3)Toledo will be focused on direct shipping and cashflow generation and confirmed the BFS will be funded by direct shipping.
4)The market will be informed once contracts have been signed, should be in the next six weeks or so.
5) Chris stated that TMC was very fortunate to have George on board and have Atlas as a partner.
6) MPSA will be expected in the coming weeks, and all preconditions of MPSA are in place. Chris did comment on the amount of bureaucracy and is continuing to chase all the necessary documentation on a daily basis.
7) Return on investment should be no later than December 2007
8) Confirmed BHP are still on board and a large smelter in Europe could be added in addition to 2 in Japan and 2 in China. Could not name names until contracts have been agreed.
9)Construction of the trestle conveyor should start in August once the sample shipments have taken place. It will take about 2 months to complete the trestle conveyor located 1 Kilometre inland.
10) The question was asked about the bishops who are opposed to mining. Chris stated that the majority of the catholic church were not opposed to mining and did not see any potential problems.
11)The placing for shares was taken up by Framlington, Fidelity, RAB Capital, Scottish Widows with the smallest investor taking 250k
12) A new PR company was appointed in January 2006

Hope the above information helps, and thank you to all the ADVFN posters who have contributed to this board. I guess my sentiments are in the Daz \ Minty camp!!

Regards and good luck
Tiggy