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REM Mexico shows amazing foresight by whoever named it….. uncanny! ;-)
@EV-Bull Re Snr Monroy’s comments … therein lies the big rub for the Mexican Govt. How can they take out the profits for the state without paying back the debt/set up costs as they’ve done with Pemex? - current debt to suppliers of $13.5bn. They’re recognising the enormity of the investment it will take to make a success of it and the time factor to get it up and running ASAP.
Sounds like they’re trapped between a soft rock and a hard place!;-)
Which is why the whole idea is stupid and they should have just added a lithium royalty/tax on top instead of nationalising it!
No downside risks involved with taxation however at a certain point it may reduce investment.
All avenues explored re Sonora - back to plan A then as the most logical, practical and expedient solution.
There won’t be too many private companies with aspirations of getting involved in lithium mining in Mexico that haven’t already got legal approvals in place. It already looks like a state/private duopoly going forward. They can’t over tax it if they want to consider attracting other private companies in the future. Should work out well for those already involved….. we’ll know soon enough if common sense has prevailed.
@EV_Bull, @Zoom56
hit nail on the head I would say!
and the pressure must be on to deliver something before Aug 24th, there can be no way the recent conversations with car manufacturers haven't centred on lithum being available from circa 2024 onwards.
Worth keeping an eye on Economy Minister Tatiana Clouthier and something like plan one from last year,
https://www.reuters.com/article/mexico-lithium-idCAL2N2ND22S
Economy Minister Tatiana Clouthier told local radio last month that the government was considering a public-private partnership to develop lithium. She suggested the state might have a 51% stake, a blueprint Armenta says he also now backs.
GL
High noon at the ok corral…. no bets on who will blink first….. who has the most to lose?! ;-)
You'd think Ganfeng may also have been awaiting the 100% buyout completion of BCN before completing any deal with Mex gov.
https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0808/2022080800908.pdf
"Recently, the Company received a notice from Shanghai Ganfeng that Shanghai Ganfeng has completed the offer to Bacanora. Shanghai Ganfeng now holds 100% equity interest of Bacanora."
Ganfeng Lithium Co., Ltd
Board of directors
August 9, 2022
Indeed @EV. News feels close...
Economy Minister Tatiana Clouthier re Tweeted a comment by the Ecomomia Mexico “ We celebrate the approval by the United States House of Representatives of the “Inflation Reduction Act”, which includes electric vehicles produced in Mexico, in the tax incentive proposed by the United States.”
This is a crucial factor that has to be considered. Whether the Mexican Govt taking a 51% majority stake in any public/private partnership still entitles them to participate in the US EV tax incentive scheme remains to be seen. Resolving this could well be at the heart of any ‘behind closed doors’ negotiations.
I'm sure many have seen the cunning plans for A_L.O to develop Mexican lithium with Latin American companies, well he seems to be more aligned with Bolivia of late with Chile and Argentina signing deals one after another with private companies:
Bizarre:
https://www.reuters.com/markets/commodities/bolivia-delays-decision-lithium-mining-tie-ups-december-2022-06-17/
Despite decades of attempts, Bolivia has yet to achieve any commercial lithium production. Demand for the ultra-light metal has surged in recent years.
really!
51% government owned sounds familiar… could be the same ganfeng m.o… same result… just a different order of events… https://www.lse.co.uk/rns/EMH/proposed-subscription-by-cez-for-51-of-geomet-5i5kl2pd4u5nqz6.html …
Good find , seems to be m o like you say. Same plan different continent .
As long as the president of Mexico doesn't invite Nancy Pelosi down to Sonora. things might just work out right for us. taking 51% the Mexican president could claim control "A Win in his eyes" if they did take a 51% stake. would that not move our area forward dramatically..
why not… 100% of the planned production is sold… mexico will want additional production to supply incumbent industries… batteries (plant) required…
Ganfeng have already announced 50ktpa Hydroxide and purchased land for expansion they have clearly been planning this for a while. They know the purity and grades of Sonora are exceptional.
Kiran has already said that any expansion would mean our areas are needed sooner and more will be needed from them which increases the NPV dramatically.
The president added that in order to exploit lithium, a state company is going to be created –which will be like Petróleos Mexicanos and the Federal Electricity Commission–; Likewise, he indicated that “this company is going to make agreements with financial companies and with the automotive company –for example, here is Ford–, with the purpose of taking advantage of lithium. Batteries can be made in Sonora, as long as more automotive plants are established here.”
A bit like what the plan recorded by Geomet for EMH/CEZ infrastructure at Cinovec, CR (EU)
Thanks @EV_Bull, we seem to have different accounts being reported but then again A_L.O is inconsistent in what he announces and most likely intentionally I would say. Now let’s see if more of the state company details are released, meanwhile the energy dispute starts today:
https://mexico.detailzero.com/news/102693/USA-and-Canada-vs-Mexico-energy-controversy.html
The 75-day term to reach an agreement is already running and although it may eventually be extended, the contentious process would begin later, on October 3 next.
According to the dispute settlement process under the T-MEC, if Mexico reaches a dispute panel with the United States and Canada, the preliminary report would be known by April 1, 2023 and the final report by May 1 of that year.
Why would they make agreement with financial companies… to fund a stake in the Sonora project maybe?
I would hope so @EV_Bull,
Has this been posted before, it's prior to Ganfeng completing the BCN purchase, but technically we still have a British interest?
https://www.bilaterals.org/?t-mec-an-obstacle-to-lithium
For Jorge Molina Larrondo, international trade specialist at TEC de Monterrey, we will have to be very attentive to the six-year T-MEC review, as Mexico’s partners will surely want to be stricter.
“By including Section 10 of the Mining Act that the lithium value chain will be exclusive to the Government of Mexico, a window is opened for the United States, and above all, Canada, to challenge this article,” he said.
In the case of the project in Bacanora, Sonora, it has British involvement, so if the government wanted to confiscate it, it wouldn’t be so easy. “Mexico has signed an agreement with the United Kingdom, and it will expire until 2031, so the government must respect this agreement, otherwise it will also mean getting into trouble with the European Union,” he said.
Also worth a read, a little error though US approval is $billions:
Only that the US President managed to get Democrats and Republicans, from the House of Representatives and the Senate, to approve 370,000 million dollars to reduce greenhouse gases by 40% between now and 2030.
https://mexico.detailzero.com/news/102446/Mexico-and-the-US-on-two-different-paths.html
That $7,500 subsidy could be the end of any Mexican EV or battery production and I wouldn’t imagine the likes of Ford want to hang around to find out!
I stand corrected, they were right $370,000m - that's $370bn
That's of course for green energy and transport, still there's a huge amount of planned over overseas investment both European and Asian to serve the US that just might get pulled:
"The problem that López Obrador does not understand the dimension of what the route that the United States has taken implies is that it will leave Mexico out of that path and will end up marginalizing the country even from the trade agreement.
Industrial suppliers in the United States will have to meet high production quotas with clean energy that neither Pemex nor CFE will be able to provide with the 4T policies"
#####
bottom line is EV's are to be made with clean energy it's plain to see:
“We invest regularly in plants all around the world to upgrade in terms of process, vehicle production or adapt to electrification as part of our $35 billion investment in electrification and software announced during our EV Day one year ago.”
Stellantis executives met with Mexican leaders including President Andres Manuel Lopez Obrador in July to talk about EVs and strengthening the company’s supply chain in Mexico. A key concern for Stallantis is adequate electricity supply for its plant.
A_L.O, you won't be selling many EV's or batteries to your neighbour manufactured using coal, Gas or Oil power generation - 100% sure of that!
COPP27 November -
it does explain a few of the reasons why and what for… not sure peoples assumptions than ganfeng will move on kdnc next is valid now though… we’re there for a reason…
Is anyone else out there as confused as I am as to how and when kdnc will realise any monetary value from its Mexican lithium prospect asset?
a little… but the longer we’re involved… the higher it’s value… i’m more than happy to see it out to production… where the real money will be made… it’s been my preference since day 1…
tc , I tend to agree, Amapa is the key at the moment. ATB