The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
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This was prior to the mining law change:
https://newsrnd.com/news/2022-03-15-ganfeng--%22we-are-going-to-continue-in-sonora-because-the-laws-of-mexico-allow-lithium-to-be-exploited%22.rJfzAYYpZq.html
And after:
https://mexicobusiness.news/mining/news/sonora-lithium-project-not-risk-ganfeng-lithium
So eyes on Ganfeng for a response, I do agree the processing plant will be a requirement - nothing new but to also provide for the states processing.
#####
Good news is they haven't rejected Ganfeng's rights to mine the concessions, Ganfeng might just agree knowing the mining law changes might be reversed before the plant is up and running.
The initiative modifies articles 1, 5, 9 and 10 of the Mining Law to grant the State exclusive control of the exploration and production of lithium. Experts warned that the reform and the cancellation of concessions, in addition to driving investment away from Mexico, will lead to more lawsuits and precautionary measures against the government, since it will violate international treaties.
it’s a bit less than tesla’s budget… not sure it’s enough… ;)
https://www.bnamericas.com/en/news/mexicos-finally-reveals-details-of-state-lithium-company
PRIVATE SECTOR PARTICIPATION
Section VII of article 13 stands out in the decree, granting LitioMx the ability to “associate with other public and private institutions … to administer and control the activities necessary for the production, transformation and distribution of products derived from lithium.”
While this seems to leave the door open to private sector participation, questions remain over LitioMx’s involvement moving forward, particularly with respect to pre-existing private projects under development.
As to Sonora? Completely under the radar. The wider market doesn't realise we exist and hold a relatively large stake... Very excited to see how this plays out, we could be talking triple digit millions to see us gone. :-))) Though anything half decent would surprise the market as it currently values Sonora at near zero from what I can see...
Interesting to note who will be sitting on the proposed board of directors:
The country’s energy minister, as well as the finance minister, economy minister, interior minister and environment minister will sit on the company’s board.
And on the present Bacanora board:
Peter Secker
Wang Xiaoshen - Vice President of Ganfeng
Junichi Tomono - Hanwa
Some significant ‘top brass’ to reflect the size, potential and importance they’re placing on this project. All with the power to sign off the necessary decisions with minimum delays or reference to higher authority.
now running a >$1bn company…
MEXICO CITY (Reuters) - The European Union should sign off on its updated trade agreement with Mexico later this year, Mexican Foreign Minister Marcelo Ebrard said on Friday.
The EU and Latin America's second-biggest economy in 2018 reached an agreement in principle on updating their joint trade deal, but the coronavirus pandemic and a complex approval process have hampered final ratification in Europe.
Speaking to Mexican lawmakers, Ebrard said that concluding the process would depend on the EU, and that European officials had informed Mexico this would likely occur in 2022.
@EV_Bull,
I would imagine the moves from A_L.O are stalling many decisions on whether to invest in Mexico:
https://www.newsncr.com/automobile/lithium-experts-skeptical-on-success-of-mexicos-state-run-miner/
“Would CATL be willing to build a factory in Mexico if they knew they’d be answering to the Mexican government? Unlikely,” Berry mentioned.
We then have COP27 in November and that could see pressure on Mexico:
Mexico's most recent electricity development plan, for 2022 through 2036, delays by seven years the country's previous commitment to generate 35% of its energy from renewable sources by 2024. It now says that will only be possible by 2031.
The only way Automakers will be able to secure new long term #lithium is to own the assets.
We are now at the stage where off-takes, loans won’t be enough for most. @benchmarkmin
https://twitter.com/sdmoores/status/1563075489815986176
Industry guru Joe Lowry answered a question on his opinion of the likely success of a nationalised Lithium industry in Mexico in his Global Lithium Podcast, Episode 143 min 44:20. His views cast similar doubts as have already been expressed by many on this board, especially if it follows a similar path to other nationalised industries in Mexico.
https://open.spotify.com/episode/5HrhSxp6jm5h7omTOYJZCk?si=kTfKunc0TjGxJZltYuglhQ&context=spotify%3Ashow%3A6jZzmmYVDpTBpRyYPfejuL
@Zoom56,
Yes, that view is being widely expressed in many articles and what a disaster A_L.O's policies are -
https://www-elfinanciero-com-mx.translate.goog/nacional/2022/08/27/litiomx-por-que-la-nueva-empresa-estatal-podria-convertirse-en-el-nuevo-pemex-para-mexico/?_x_tr_sl=es&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=sc
The wheels are truly falling off!
https://mexicodailypost.com/2022/08/28/mexico-finance-minister-rogelio-ramirez-de-la-o-under-great-pressure/
The kings clothes come to mind.
@Olderandwiser,
I just think we a need catalyst and anyone of our assets just might be the one to get the chain reaction in motion with fresh sticky investors and realistic rerate, I continue to add as funds become available.
https://reneweconomy.com.au/forrest-strikes-huge-green-hydrogen-plan-with-german-energy-giant-e-on/#:~:text=Great%20Solar%20Business-,Forrest%20strikes%20huge%20%2450%20billion%20green%20hydrogen%20plan%20with%20German,ON&text=Australia%20iron%20ore%20billionaire%20Andrew,of%20green%20hydrogen%20by%202030.
Forrest also has private investments in massive projects such as the Sun Cable project in the Northern Territory, which will be the world’s biggest solar and battery project, and a raft of large wind, solar and battery projects in Queensland.
#####
Disruption
Sonora will be synonymous with lithium for the automotive industry
Sonora seeks to be the leading entity in the exploitation of lithium. The state wants electric vehicles to be produced in its territory through the lithium exploitation plan with which it will work from now on.
"Alfonso Durazo Montaño commented that he seeks the association of LitioMx with private companies for mining projects, but with the condition that the industrialization processes take place in Sonora."
https://www.barrons.com/amp/news/mexico-plans-to-open-lithium-sector-to-private-investors-01661973308
Mexico Plans To Open Lithium Sector To Private Investors
"In June, the president announced that the permit granted to the Chinese company Ganfeng Lithium, a partner of the English company Bacanora Lithium, would be respected to exploit the resource at the mine in Sonora."
https://www.24-horas.mx/2022/09/01/andres-manuel-lopez-obrador-empresa-estatal-de-litio-en-manos-de-pablo-daniel-taddei/