Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Mick - good point, hadn’t spotted they only had 10% stake in the battery factory. So they’d likely prioritise profit on the mine.
Greenmachine - that is my hope too, EU conditions should stop any underhand dealings. Maybe that was why KC wanted that German support asap as a defensive measure.
The next concern will be if CEZ is nationalised, then they could be willing to arbitrarily set prices to move profit around the supply chain to wherever it works best for them - ie cheap lithium, but sell batteries at full price?
Greenmachine - three places. Firstly, other JVs explicitly indicate what lithium volumes each partner is assigned and under what terms. There isn’t any such agreement for Geomet.
Secondly, offtake agreements are with Geomet directly so the majority partner will be the ultimate decider of who to sign with, leaving the minority partner with a share of the benefits.
Thirdly, you can see this play out with the announcements, or lack of. EMH benefits when there is an announcement, but CEZ as majority partner decides how much and when.
No automaker would see EMH alone as an investment in order to secure lithium supply - the deal would be done with Geomet. An acquirer might be someone else, but EMH holds little strategic significance by itself.
That doesn't give them any entitlement to the lithium produced. Unlike other joint ventures where the lithium is divided up between partners, I believe EMH is only entitled to a share of the profits. So not attractive to big auto other than as an pure investment... They'd have to provide Capex for Geomet directly, and half of it could be secured with equity in EMH, the other half goes to CEZ.
Fingers - Jan 22 PFS mentions "The mine will be accessed by a twin decline system" - so think no change there, just that they would use the grant to build the first crucial component ahead of securing the remaining funding?
Comments on European projects reported by Joe Lowry from Tom Benson, VP of Global Exploration, Lithium Americas: https://open.spotify.com/episode/1XTaRayNwTx1PBdoL022Kw?si=QHJIzPKcRHui8Cw-BUB5aA&t=776&context=spotify%3Aepisode%3A1XTaRayNwTx1PBdoL022Kw
Happy New Year all - and some posted updates from 21st Dec on the ESG dashboard: https://esg.socialsuitehq.com/mob-public-dashboard/european-metals-?report=1637305297946x302952839446447800
Skelly, I asked ChatGPT to write your song for you. See if you like it:
Verse 1:
In the land of Europe, there's a mine of lithium
Waiting for a deal to be signed, oh so patiently
But the time just keeps on passing, with no news in sight
Oh, when will this deal be inked?
Chorus:
Wen inking? Wen inking?
Will this deal ever be signed?
Wen inking? Wen inking?
We're waiting here, so patiently
Verse 2:
The miners they keep digging, through the days and through the night
Hoping for some good news, to make everything alright
But the negotiations, they just seem to drag on
Oh, when will this deal be inked?
Chorus:
Wen inking? Wen inking?
Will this deal ever be signed?
Wen inking? Wen inking?
We're waiting here, so patiently
Bridge:
We're tired of waiting, we're tired of wondering
When will this deal be done?
We just want some answers, and for this to be over
Oh, when will this deal be inked?
Chorus:
Wen inking? Wen inking?
Will this deal ever be signed?
Wen inking? Wen inking?
We're waiting here, so patiently.
Anyone got a subscription to share the key points? https://source.benchmarkminerals.com/article/opinion-europe-is-on-a-mission-to-secure-critical-minerals-heres-three-things-it-should-do
Details here Colin:
https://www.europeanmet.com/wp-content/uploads/EMH-Shareholder-Circular-Final-To-lodge-on-AIM-incl-Proxy-Form-v2.pdf
And:
https://www.investi.com.au/api/announcements/emh/2df48df2-cc4.pdf
Yawn - "why hasn't KC said this, done that, whatever". If everyone realised that you're invested in CEZ, then maybe everyone would calm down. KC is not in control but I believe does have our best interests at heart. This will get done at the speed that a publicly-listed conglomerate gets things done ... slowly, throughly and diligently. No public company wants even the slightest hint of reputation damage. Their news flow objectives are directly opposite to a typical lithium junior.
Zinnwald RNS: https://polaris.brighterir.com/public/zinnwald_lithium/news/rns/story/rm3d9nx/export
Further clarification: Miners in Australia talking about moving to Lithium Sulphate/Phosphate as an intermediate alternative to spodumene, since it massively cuts down on the volumes needed for transport and dealing with the subsequent waste (which is a real problem in heavily regulated jurisdictions like the EU) - this means in future EMH can compete directly from within the EU to supply both lithium refiners and battery makers. Any takers of the EU's largest source of lithium, and top 10 globally by size?
For me, the hidden good news that no-one is talking about is the ability to produce mid-stream products Lithium Sulphate and Lithium Phosphate. It not only shows that they're listening to the changing discussions in the market, but also that this could potentially expand their market with next generation lithium refiners - bullish for expansion of production. Because of the unique Zinnwaldite feedstock, having the end product limited to cathode materials means their market was limited to battery makers. This announcement changes that, but also further derisks the project in case refining of Lithium Carbonate or Hydroxide doesn't meet expectations.
Responsible mining in Europe: https://youtu.be/0QvZHucnfNI
But something is in the air ... maybe not the chickens but something... ;)
https://twitter.com/LithiumIonBull/status/1583078762660253696
NEW ?@CowenResearch substantially increases #lithium price deck for 2023/24/25 $74.5/68/65 & industry leading long-term $31/LCE.
And there was me hoping for $26/kg long term price…
Bear in mind those sensitivity analysis numbers are for the project in its current state, without being derisked. Take their price target of AUD $2.35 as the starting input and the numbers get very large very quickly.
Jan 22 PFS capex was US $643.8m, so assuming (never assume!) the application is solely for Cinovec project, and they are awarded the full amount, then this application is for a massive 70% of project costs…
EMH would only have to raise US $100m plus initial working capital.
CZK 11.1bn = US $440m