Member Info for ChameleonMan

We have had the consultation period so further discussion of the pros and cons of impact on the community and what they should or shouldn’t be thinking is largely pointless. We are not waiting for environmental approval - we have it.

Sure there will be protests up to and beyond the time when mining starts but the ball is rolling towards production and only principally commercial and financial matters are hurdles to be negotiated ahead.

You’re preaching to the converted here Oscar! :)

I note that Fortescue is also experiencing the wrath of a local council, in this case in Valpaços!

https://www.portugalresident.com/valpacos-town-council-wholeheartedly-rejects-lithium-mine-project/

Seems to be being manipulated up at the moment?

Yes, the words on responsible sourcing chime with SAV’s promises in the EIA document. Will get excited only when the off-take contract arrives though!

Good find IB! The presentation is very polished and aspirational but low on content - draws a veil over what they may be doing and when and what materials may be needed. However all moving in the right direction!

There are some voices of reason… but are they being heard?

https://www.theportugalnews.com/news/2023-09-26/the-strategic-importance-of-lithium-and-rare-earth-elements-in-the-energy-transition/81691

Perhaps someone with predatory intentions has been whispering in the ear of the local council to embolden them to embark on legal action which must surely have some significant costs attached?

I think I’ve answered my own question:

“According to The Faraday Institution, cathode manufacturing makes up 54% of the cost of a battery cell. Within this cost, a significant proportion is attributable to the import of raw materials such as lithium, nickel, and cobalt. However, as long as the cathode manufacturing process is located in the UK or the EU, the overall value would count towards the Rules of Origin thresholds.”

https://autovista24.autovistagroup.com/news/why-rules-of-origin-causing-problems-for-europes-automotive-market/

I’m not sure whether the origin of the lithium figures in that %? If the battery is made in the UK with Chinese mined and refined lithium compounds do they still score 100% for the battery component?

I should also note that (referring to the final chart in the corporate presentation) to approach just the average valuation of our peer group of post scoping study projects, SAV’s SP needs to rise 3x to ~10p . That is a reasonable short term target given our potential I would have thought? A nice bit of news in Q4 could trigger it.

Init2, in the context of price manipulation, the first chart shows the change in SAV’s SP vs all AIM shares which indicates that over the timescale SAV has done better than AIM as a whole. I see no evidence of price manipulation, just a short term trend of reversing to the mean.

The final chart you refer to shows SAV’s SP/ NAV ratio vs peers and indicates that SAV is undervalued ( although not as much as INF).

My conclusion is that SAV’s SP should rise in a rational market long term but in the short term in the absence of news, the SP May decline a bit further .

SP Angel’s forecast of 21p seems more than a bit ambitious at this stage.

Some muttering about manipulation to explain SAV’s low valuation are I believe misplaced. AIM as a whole is in a bear market with most company valuations at extreme or even irrational levels. The chart published on the corporate presentation suggests that SAV is doing better than most.

Was wondering if “GT” will show up at some point- by sail-powered yacht of course!

Interesting piece by Reuters on the local stand-off in Barosso. I am intrigued by how the land issue will play out given the stated resistance to giving up any ground to SAV. Seems like compulsory purchases may be required. The options seem to be:

“(SAV) is offering an annual 335 euros per hectare to rent the baldios and 2-2.5 euros per square metre to buy private plots – at least twice their market value, according to Scarrott and Savannah. So far it has secured just 93 hectares.”

Or

“The Portuguese government could authorise a compulsory purchase in the public interest but no such request has been received, the environment ministry said, noting that such an order would require the payment of fair compensation.”

https://www.reuters.com/world/europe/europes-mining-quest-faces-hurdle-angry-locals-2023-09-13/

Good update if not perhaps as dynamic as some would have hoped for? Pleased to see that Dale also thought that these spurious press articles on land ownership needed to be addressed directly (see below).

The absence of any comment on press rumour of takeover talks does speak volumes. It just doesn’t align with SAV’s strategy which is considered, planned and robust.

While it may be encouraging to have another miner (and a Portuguese one at that) showing an interest, I can’t see that this aligns with the SAV board’s strategy to take this to production? There are many value adding opportunities along the way that are not reflected in the current market cap. Valuations in general are low and we are not short of cash so under no pressure to sell. An equity partnership deal might be better and in itself would add strength to the company. We will see.

HEE-HAWlways does! :)

A suggestion in this article that SAV doesn’t own the mine area yet may need to be addressed? https://www.portugalresident.com/new-protest-camp-scheduled-against-barroso-lithium-mine/

I also subscribe to IB’s summer doldrums hypothesis but it’s also worth considering the overall AIM market, down 19% on the year. Money rushes around AIM trying to find the latest success story but unless the overall tide is rising, even the best prospects will suffer declines as time goes on?

https://www.londonstockexchange.com/indices/ftse-aim-all-share