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I read similar debate about Nickel price. Rising prices are good, but have a 'pivot' point
Don't kill the goose ... as prices rise other innovation, elements, science look more attractive. the obvious one being Hydrogen
Looking right to the end of the chain, autos will only produce with a margin, End users of EVs will only pay so much, before they simply do not purchase.
I think we're good, but its a valid angle to be aware of, not so often talked about
I think a shorter mine life is worth the risk to supply more SC6 during the period of high prices. If the prices go too high for too long, lithium won't be adopted in the long term imo.
Was showing 67% down. Almost spat my tea out scrambling for my credit card.
whatever way you look at it, barring black swans, the likely outcome is positive
We either produce, and reap rewards, or before that, it gets bought, and we reap rewards.
imo the latter difficult until the wider resource is at least more 'inferred'. But again, a nice problem to have.
With the lack of new mines in the pipe, there must be so much industry interest swarming. Apart from pounds and pence, I'm genuinely interested how it unfolds. The Li deficit is not going away anytime soon.
Yes you are all correct, the forecasted SC6 long-term price of circa US$1,000/t seems way out of kilter, even since Atlantic's presentation of Dec. 2021. But they have to be conservative with long-term forecasts and though the current price is much higher, it could easily drop during the latter years of the mine's life to below that figure when the supply side picks up considerably. But that, in my view would be >10 years away. So plenty of upside from here.
I think they will do exactly that Jimmy. The only possible complication would be, say, if they go with a new plan with double the production rate, that would require maybe $30 million? extra capex, which would mean an extra $15 million for capex that ALL would have to (happily, easily) come up with.
I know it's maybe not as simple as this, but if the resource is bigger than anticipated. Why not increase the capital expenditure and increase the production for the next 10 years? So instead of 299 they mine 400 a year? Does anyone have any thoughts?
Looks like it’s got it’s Mojo back
and that metric alone, a key key driver
thing is, its still going ..
Think it was Morgan Stanley, reckon its just the start, due to the impending deficit
Thanks! So fair to say ALL has a way to go from £200m mcap. :)
The price recorded last week by Platts daily figures was $3100mt.
Does anyone have a current figure on SC6 prices? I had search and could see $2,444 recorded in Australia in October 21. Is this accurate? If so the annual revenue would be nearly $731m or $365m revenue to ALL before costs.
If you have just heard about Atlantic Lithium Limited (ALL) and wondered what the fuss is all about here are my slightly biased views:
- ALL has a flagship Ewoyaa project ongoing in Ghana, it has vast proven lithium resources
- Only 13km2 of 560km2 tenure portfolio drilled to date in Ghana plus 774km2 (undrilled in Côte d’Ivoire)
- Significant potential to grow resource base within proven Li pegmatite field
- Further discoveries will extend Ewoyaa projected mine life of 11.4 years (highly likely)
- Strong Community programmes and engagement – plus a very supportive Government
- 98% Ghanaian and Ivoirian employment = low carbon footprint
- Ghana has 1.58GW of hydro capacity – green energy adjacent to deposit footprint
- High grade SC6 (Lithium Spodumene Concentrate 6%) with low contaminants
- Target production projected end 2023 (but experience tells you more likely H1 2024)
- Projected Annual Production 299,000tpa of SC6
- Average Life of Mine Opex in Ghana US$249/t (after by-product credits)
- Forecasted SC6 long-term price of circa US$1,000/t = huge netbacks to ALL at these prices
- Payback >1 year and SC6 prices look like they will be a lot higher than published forecasts
- 110km (sealed road) from project footprint to Takoradi port
- Takoradi being re-developed as a major West African oil, gas and bulk minerals hub
- Piedmont Lithium Limited (PLL) has a 9.91% stake in ALL
- Offtake Agreement (US$103m) for 50% of the annual SC6 production from Ewoyaa mine only (free carry for ALL)
- Leaving ALL with an unencumbered right to place the remaining 50% of Ewoyaa’s and 100% of any other production
- Cheaper to ship SC6 from Ghana to Carolina (PLL processing facility) than from Quebec
- PLL facing community and environmental issues in the US and Canada causing delays
- PLL has entered into supply contract with Tesla plus has relationship with other US based auto makers
- No further requirement for funding and dilution for ALL
- ALL retains 100% Côte d’Ivoire lithium assets
- Cash circa US$20m available for future growth initiatives
- Lithium supply / demand with be in deficit for many years to come underpinning prices
- With its 50% share of Ewoyaa production – this alone makes ALL an attractive takeover target for downstream customers
- ALL will either be bought out at a large premium or will make huge profits from production
What can go wrong?
- WW3 (Russia / US get angry)
- Ghana Coup (stable at the moment, but it's Africa...)
- PLL get cold feed and pull out of Ewoyaa deal (highly unlikely)
- Lithium prices itself out of EV battery market (but new technology would take time to develop >7 years)
I own many shares here, so of course my opinions are slightly biased, DYOR.
Holding shares in ALL will be a win win. I continue to buy the dips.
AIMHO