Member Info for BorderBob

The smartest investors I know will always quote the market axiom, "Buy on rumor, sell on news." The discussion here assumes that the market does not know any favorable prospects about BHL, so it will be totally surprised by what a handful of ardent supporters are convinced is certain. That may very well be true about lightly-traded penny stocks. But I doubt it.

What does he say about his Chinese shareholders?

We know you have no opinion on it. Which I suppose is better than having the wrong opinion on how much I hold. Just because I own shares doesn't mean I have to look at them starry-eyed through rose-colored glasses.

9. BHL market cap is only ~£53m, this is very low vs. industry peers, clearly some are ahead of us however the biggest share price % gains are often in the period before resource grows exponentially and before production. American Lithium ~$652m, LAC $5.74 CAD, Liontown Resources $4.21bn, ALL £293m

Just sold some of my American Lithium yesterday because of the run-up in price; it will recede 10% and I’ll buy some back. Unless I find something even better. Lots of fish in the sea.

10. High quality major shareholders, Jim Mellon owns over 20%, the Wray Family hold a significant %, we’ve also seen TR1 holders adding to their positions at around the 15p level, Raj Chawla added to his position twice in February.

Some “high quality” people are losing their shirts in the nickel market. But I did make 50% on that Mexican deal because high-quality Ganfeng was a fellow shareholder.

=As always any junior miner has risks associated however I believe that the risk vs. reward for BHL is very good, the stock has also held firm with recent macro issues (Omicron & Ukraine conflict). =

Ukraine is contributing to a rise in price for most lithium miners. Why do you see it as an issue?

1. Lithium demand is set to grow long term, current and next generation EV batteries are dependent on significant quantities of Lithium, it is also used in many other energy storage applications.

Alternative are being developed that work better for long-term storage. Lithium isn’t really very good except for overnight.

2. Supply is tight and much of the current supply is thousands of miles away from the US, for example Tesla have agreements with Australian supply, this simply isn’t good from a ESG perspective

What makes you think Tesla is using that lithium for American cars? They sold 56,515 Chinese-made cars just last month.

3. The Lithium price is up ~600% in the last year

Pricing itself out of the market.

4. US Gigafactories growing at pace, 13 more to come online between now and 2025

Announced and hyped, but few have broken ground. Meanwhile, twice as many North American miners promising “to come online.”

5. The US know they are behind the curve, they need to catch up and can’t depend on other countries for energy any longer. Less than 1% of global lithium is mined & processed in the USA (according to a recent CNBC article “How the U.S. fell behind in lithium, the ‘white gold’ of electric vehicles”)

The US knows it is behind in exporting natural gas to Europe also, but (unlike in Stalin’s Soviet Union) it can’t force private industry to start or stop trading with other countries. Well, OK, maybe no more caviar from Russia. Every American carrying an iPhone is relying on Chinese lithium, and Apple is not going to catch up on that anytime soon.

6. BHL are fully funded for 2022, have a concrete plan and are delivering at pace. They also have smart royalty payments coming in upon specific milestones, these provide cash and reduce the need to raise cash via placing.

That’s because they really aren’t doing much in 2022. News releases are cheap, they don’t even require paper these days.

7. BHL have at least 9 projects, just one of them (Basin East) has a JORC of 185k/t, this resource is due to be updated in “Q1”, at $75,000 per tonne the maths on just the current 185,000 tonnes is staggering.

It might cost $30K a ton to process the dirt, and the price may fall to $35K a ton once another couple dozen miners start production. Still, a modest profit, but other battery metals are doing much better lately.

8. BHL have projects with all 3 types of Lithium - Brine, Pegmatite & Sedimentary. This is quite unique.

As opposed to “not-so-quite unique.” That would probably apply if they had employees with red, brown and blond hair.
Ganfeng and SQM have fingers in all three pies too, don't they? But maybe you are talking about small fry.

Disregarding political environment

@ SS -- The 50% premium for BCN was actually quite generous, considering no one else would want a Chinese partner and Ganfeng had bought half of it already. And I don’t blame management for that, because no one else wanted to buy in before the Chinese came along and the bank account was empty.

Look at recent buy-outs of midcap stocks. 20% is often considered a great deal. Either that, or a starting point for negotiating that takes it up to 30%. Sure, there are exceptions, but they prove the rule.

The unknown is the starting point for valuation. A turnkey operation, where all that’s needed is capital and technical expertise, should be worth a lot more than BHL’s current value. But those essentials are best found in the U.S., at least for a U.S. project, and investors here just laugh at penny stocks on foreign exchanges. It’s like opening a haggis restaurant in Beverly Hills.

The world has known there is lithium at San Domingo since at least 1962. You have to wonder why no one has wanted to develop it until some British company that doesn't know how to spell the name of the nearest town came along. You have your Battenbergs, we have our Wickenburg.

It's always a question of proven capital, not proven resources. A big player will buy out BHL, which will agree to a fair price for a few years' work, and the long-term profits (and risks) will go elsewhere.

Disregarding Salton Sea. Private investors have that one tied up.

Goes out of its way to avoid mentioning the Bureau of Land Management, which gave the approval because it's federal land. Towards the end the federal agency is mentioned only by its initials.
And no RNS is worth its sodium chloride without a nod in the direction of the Tesla factory, where lithium is a minor but essential component in the supply chain. And how Eureka is "near" Albemarle, when it's just as near the Great Salt Lake, where US Magnesium is already producing and selling lithium.
BHL doesn't need to be pumped like this unless someone plans on dumping it.

If you're going to copy and paste copyrighted material, you should at least credit the source.
https://tradingeconomics.com/commodity/lithium
So far there hasn't been a prediction of the nickel shortfall by 2030, but if those supplies fail (because the Russian oligarchs find it more difficult to market) the demand for lithium will drop substantially.

You are repeating "information" from Electrek, which admits that "We use income earning auto affiliate links." The story that starts out with one example -- Tesla -- ends with speculation about others. "We should expect Tesla and other companies to keep doing more of those agreements." No other company is named.
https://electrek.co/2022/03/02/tesla-ramps-up-deals-secure-future-supply-of-critical-battery-metals-adds-another-lithium-contract/

For those pollyannas who constantly post stories about rising lithium prices, let’s pause for a moment of reality. Bloomberg reports,

“The recent rout in EV stocks has left the richly valued industry leader and world’s largest electric-vehicle maker well ahead of its upstart challengers. The chasm was apparent last week when two of the biggest U.S. publicly traded EV startups -- Rivian Automotive Inc. and Lucid Group Inc. -- disclosed supply-chain disruptions, leading to steep selloffs in both stocks.

“Just a few months ago, Rivian was being touted as the next Tesla with a market value that was bigger than Ford Motor Co.’s. Yet last week’s disclosure that the electric pickup-truck maker is raising prices due to higher costs as a result of component shortages sent its stock plunging. The shares plunged 30% from Tuesday to Friday, even after the company rolled back those hikes, and are down over 70% from a November peak, erasing more than $100 billion in value.

“Lucid dropped 14% on Tuesday, after it lowered its production targets for 2022, saying it was facing “extraordinary” challenges with logistics and its supply chain. The stock continued falling through the week and is now down 59% from a November high.”

And those reports of the Putin convoy running out of fuel -- there are also reports of his draftee army soldiers emptying the fuel tanks on purpose, to avoid further advances. I wonder what the EV equivalent of that would be. Leave the lights on overnight?

I appreciate the honesty of your bottom line – BHL may not be the best lithium investment with US interests, but it’s the most convenient to buy from that increasingly isolated island northwest of the EU.

And if you want to support Russian oligarchs, lithium production is a great method, because we’ll need a lot more of their nickel for batteries.

Electric tanks? That’s a novel idea. Avoiding fuel shortages? This time last year you couldn’t charge your EV in Texas, because cold weather knocked out the grid. (Texas is the size of Ukraine and has a GDP equal to Russia.)

You don’t have to convince me that lithium exploration is a good investment. I have shares in companies from Cornwall to Australia NT. It required some effort to set up my brokerage account to trade in London, Toronto and Sydney, but I thought since it’s my money it’s worth it. If others want to pump Bradda Head “because it’s not the best, but it’s the easiest to buy,” then – it’s their money.

I wonder how all these shares ended up in my account then.
I hold it, I'm not in love with it.

For example, if you want an Arizona project where you won't get bogged down in BLM approvals, try Thompson Valley
https://ameriwestlithium.com/projects/thompson-valley-az/
And Ameriwest has projects in Nevada that may turn out to produce more, cheaper. The lithium junior miner market is a candy store; don't limit yourself just to the red licorice.

@ fozdog
We all know how your last buyout ended, with a 50% markup to share price by the deep-pockets operator. I wouldn’t be invested in BHL if I didn’t expect a reasonable chance of a 100% gain, but the tunnel vision among lithium investors is frightening. Now they’re trying to see a war in Europe through rose-colored glasses. Germany can invest in alternate energy, or they can invest in defense – see news, for update on that. Long term, people are going to have to drive fewer kilometers, and the need for new vehicles will diminish.

And too much of the discussion here assumes that there is only one junior lithium miner in the country. You can find a dozen in ten minutes, and the best ones are not publicly traded. BHL is the minnow that is allowed to exist next to the Salton Sea shark. But let’s compare minnows. There are two other public companies, just in Arizona. The AZL investors ridicule BHL for their diluted surface samples; meanwhile, AZL offers diluted shares. And if you like lithium, why not some rare earths? ARR is doing well, near the northwest Arizona BHL claims, with financing injected from Hong Kong.

Looking for trite? You’ve come to the right place, on this message board. Looking for comparative analysis? Sorry, we have tunnel vision, even when it involves open pits.

No, just a holder concerned about shares supported only by those with trite comments.