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Just looking up lithium co*s. The NPV that was quoted is JUST FOR VENTANA [88% of mine feed] under BCN, NOT for SLL which has another NPV that has a scoping study done under REM. Just in answer as I was working that out last night myself. Important to get the TOTAL NPV right.
If only it were that simple Dean. The fact you have 4 recommends suggests a lot of people are just wanting to ramp this or genuinely don't have a clue. Let's hope it's the former.
You can't just extrapolate an offer value based on tonnage. I'm sorry.
Bacanora are a bit further along the development curve with Sonora. Ewoyaa and the adjacent area has many advantages to that project (capex, payback, IRR) but the simple fact is that they have a pre-feasibility study on their project. This includes proven and probable reserves. We have a JORC with indicated and inferred resources.
You can see from the terms thst BCN shareholders have been offer c.9% of their NPV ($1.25bn). That is probably on the low side of what the average deal for a company in their position would look like but it's much more realistic than 100-110% of our current NPV of $345m. Were we offered a similar deal tomorrow the equivalent is $30m.
This isn't me crabbing IRR or the asset. I'm just calling for some perspective. In 12-18 months time we should have a topped up resource in terms of tonnage and average grade, a boosted scoping study and maybe a PFS with our own reserves report. $345m will be long consigned to history providing Li prices hold up which they should.
A key period ahead for IRR to get this asset through to a development decision.
Well BCN was offered 190 million for 8.82mt we estimate 14.4mt so approx 350million to 400million for our lithium resource. Because the project is so close to a port may even get more. As for the 100m mc now finance is sorted hopefully we will see the sp move higher.
Deanhopeful - when would it cost nearly £400m for the lithium?
If you're thinking next week or next month then the market cap wouldn't be £100m now.
The marlet has been slow on IRR at various points over the last couple of years but it's not that wrong.
Without being privvy to managemnt plans I'd say the next 12 months will be enlightening on the lithium and value accretive. Resource upgrades, spot price trends, metallurgical improvements and maybe expressions of conventional interest from downstream financiers.
Unluckyme totally agree with what you said. My main point is if someone wanted to buy iron ridge out the lithium alone would be in the region of 400 million pounds. Then you have the the other assets to consider. What’s our MC 100 million. So it just shows you how undervalued iron ridge is at the moment.
Sentiment changes like the flick of a light switch as you know.
The macro picture certainly looks as positive as we could expect but you do have to wonder if the UK government interjecting on the BCN offer could be a blow for other UK listed companies looking to market assets to the countries in question.
I do look at the BCN deal and it enforces that Vince made the right decision to hold onto the lithium and expand it out instead of getting a partner early doors. Some may disagree but i genuinely feel we'll reap the rewards of that strategical move in the medium to long term.
The reason I think this will start to ascend again is sentiment, which turned positive this year. The last time sentiment played a played a part was 2017. Difference now is that we have miles more defined assets in terms of drilling, and the trajectory of EV, which has continued unabated since 2017. It's looking good here imo.
'But experts warned the potential takeover was “deeply worrying” and called on ministers to intervene immediately.
Sir Iain Duncan Smith, the former Conservative party leader said: “The Government should now call this in and block it.
“China already has three-quarters of the world’s rare earth minerals and an even larger share of their processing.
“Rare earth minerals like lithium are to the 21st century what oil was to the 20th century and deals like this are all about taking control of strategic materials to make the West go to China for them.”
Sam Armstrong, of the foreign policy think-tank the Henry Jackson Society, added: "The National Security and Investment Act, which became law just last week, allows ministers to block acquisitions that risk hostile states obtaining a stranglehold over critical resources.
“There cannot be a better candidate for the first ministerial call-in under the new legislation than this deeply worrying acquisition that risks handing control over a critical resource of the future to a genocidal state.”
Strained relations between China and the West have fuelled concerns that Beijing could turn off the tap on supplies. This risks foiling Britain’s ambitions to transition to renewable power and electric cars, with both batteries and advanced motors reliant on the materials.'
What we need to remember the differences between the two companies. If someone what’s to buy iron ridge out they aren’t just buying lithium, big difference between the two companies. We have a MRE due very shortly on our gold project which will be very interesting. Also isn’t our resource estimated 14mt nearly twice the amount of BCN. ????
I’m surprised IRR hasn’t risen slightly on the news Bacanora deal. Surely someone is also looking at IRR’s asset with Lithium in such a short supply as stated. Ideal port location to ship it. Timescale to production is key & hopefully an update on this comes soon. Fingers crossed our patience will be rewarded soon.
It will be interesting to see if this takeover gets called in by the British Government being a UK listed stock, and the increased talk about countries securing this valuable supply of batter materials away from China.
Obviously, it is of importance to us here in IRR as it shows an appetite and maybe more importantly gives a valuation.... Any thoughts about it and what it could potentially value IRR in such a buyout ... though I'm not sure that is the way this is headed but adds excitement all the same and I expect it to give the treading around 20p sp a boost up.
'Ganfeng Lithium Co. Ltd. (002460.SZ) said it will buy out London-listed Mexican miner Bacanora Lithium PLC in a deal valued at up to 190 million pounds ($264 million), becoming China’s latest natural resource asset purchase to feed its booming demand for new-energy products.
Bacanora is mainly involved in the mining of lithium clay, which is one of the main sources of lithium that is used in many types of high-storage batteries. The company’s main asset is the Sonora project, which is among the world’s largest for the mining of lithium clays with estimated reserves of 8.82 million tons of lithium carbonate equivalent (LCE).
Despite its potential, the project has yet to start production. Ganfeng said it hopes to speed up the project’s launch once the deal is completed, according to its announcement to the Shenzhen Stock Exchange on Thursday. It estimated the project will have capacity to produce 20,000 tons of lithium hydroxide annually in its first stage — equal to about a quarter of the company’s total lithium hydroxide output for 2020.