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First two news hits with 'artisanal mining ghana'
https://theconversation.com/ghanas-artisanal-miners-are-a-law-unto-themselves-involving-communities-can-help-fix-the-problem-192256
https://www.yenisafak.com/en/news/british-foreign-secretary-launches-5m-uk-ghana-gold-mining-program-in-africa-visit-3667994
No relevant hits found regarding specifically lithium with the news serch 'artisanal lithium mining ghana'
Little doubt Ghana will monitor for that in the future, but I can't see how such a possibility would adversely influence decision making on Atlantic's licence.
NH when licence consolidation first mentioned in rns, 20 June
"We also await approval of the consolidation of the licence covering the proposed mine and processing plant site, which was undertaken to facilitate a smoother approvals process and simplified operational structure, as advised by Ghana's Minerals Commission Technical Committee.
"The Company expects no further major amendments to the application, so believes that the Mining Lease will be granted for the Project in the coming months"
From QAR to June, now 5 weeks on
"Mining Lease Update
The Company currently awaits the approval of the consolidation of the Mankessim and Mankessim South licences, which covered the proposed mine and processing plant site, into the single Mankessim licence. This was undertaken following guidance from Ghana's Minerals Commission Technical Committee in order to facilitate a smoother approvals process for the Mining Lease application and to establish a simplified operational structure.
As part of this process, the Company took the opportunity to implement optimisations based on the finalised plant flowsheet into its Mining Lease application. The revised Mining Lease application now also includes the addition of deposits that were sitting outside of the mine plan in the initial application submitted.
Upon approval of the mining licence consolidation, the Company will submit the revised application for a Mining Lease for the Project.
The Company expects no further major amendments to the application to be requested by the Technical Committee and has no reason to believe that the Mining Lease will not be granted for the Project. The Company hopes that the Mining Lease may be granted in the current quarter"
The updated ML application has been completed for some time and it is probable MINCOM has also had informal view of this for a while. It would be easy to speculate that if there are delays they are not of MINCOM's doing. But also equally this can just be 'process'.
Can still happen this q aisi.
Https://thewest.com.au/business/mining/plummeting-production-at-igo-and-tianqis-kwinana-refinery-show-australias-lithium-refining-challenge-c-11442182
Until you've learnt to walk.
With the present Ghana mining policy what will Ghana get from a producing Ewoyaa?
Income
Say steady state production of 350kt/y from Ewoyaa = 1.225bn revenue
Ghana 5% royalty on sales = 61m/y
AISC = 610/t so cash flow for Ewoyaa around 1.02bn, est profit before tax at 850m.
Ghana 30% corporation tax = 255m/y
Distribution to Ewoyaa's owners est 550m/y.
Ghana own 10% = 55m
Asset
Ewoyaa fair value with LoM 12y and so PER of 5 with 850m earnings = 4.25bn
Ghana 10% = 425m.
Potential additional MIIF interest at say 5% of Ewoyaa = 213m plus annual distribution of 27m.
Rough estimates but not to be sniffed at imo.
Well. MINCOM about to announce?
Re achieved sc6 prices SIGMA just shipped its first 30k and realised 3.5k/t. All went to China.
https://www.prnewswire.com/news-releases/sigma-lithium-ships-30-000-tonnes-of-battery-grade-lithium-and-by-products-achieves-net-zero-carbon-operating-profitability-and-premium-pricing-301885762.html
Two points on my thinking:
-AFAIAA no country with actual or potential spodumene resorces has restricted export of that lithium as concentrate and has instead mandated it is further procesed to hydroxide or carbonate.
-If Ghana do insist on such a conditional on granting an ML to Atlantic neither Atlantic nor Piedmont will proceed. The ore will stay in the ground, no earnings will arise for either co or for Ghana.
It may be an ambition but I would argue establishig the mine with unrestricted export of lithium concentrate spodumene will have to come first.
The logic aisi.
ATB
"..the Question revolves around partial or full processing and Govt aspirations"
I see it as a low level but still legitimate concern for any holder to have here because if the ML comes with a restriction that SC6 has to be further processed to hydroxide/carbonate in country (though Ghana would be very foolish to do that imo) then 1) Piedmont would walk and 2) Atlantic would have little ability or funds to build that facility so would have to wait on a processor to set up in Ghana if that ever took place.
With either outcome it would then become very costly to holders to get the mine built and little profit would be made from domestically sold Sc6 as the refiner would be the sole buyer. Ewoyaa would highly likely never be built.
However Ghana's significant take would also then never arise. With them presently under severe restrictions with the IMF foregoing that tax take and also the export earnings will be seen by the international lenders as beyond stupid...... IMO.
Ghana has a good record for not being so.
We'll see.
Deeds not words will butter dem parsnips!
The 'scare' narrative
https://youtu.be/cxEY4VyF59E
Priscila. Aye , listened.
For this co aisi it all rotates around continued rapid take up of EVs in the US. Looks around 70% growth this year over '22. ESS is also fast becoming significant.
The ore to EV chain will have to be built out fast in the West if incumbent US and EU OEMs genuinely want to survive having their lunch being totally scoffed by China.
TT.
I'll have your NPV16! ;-)
Yes from the q&a a capital shortfall of some 60m looks probable for Atlantic. This will become steadily required once
Piedmont have spent their 70m. The co look set to prioritise sourcing that say 60m first from a JV/offtake providing up front cash, then also possible early revenue from modular sales before the final bills come in for the main DMS and any uncovered balance then from an equity raise.
I think it would only be this last option where analysts looking at the cost of money would have any impact on what Atlantic would issue at and so the degree of any reduction of earnings per share ahead for investors (my favoured project metric). But I also think this is going to be a relatively small amount of money - sub 20m, maybe zero.. The majority of the capex shortfall I expect will come from the JV. 40m my guess. Analysts again may have some say there but when it comes to agreeing how many years supply of SC6 and at what discount the partner can get it will be the demand/supply dynamic for lithium and whether it's the buyer or the seller who has the upper hand that will be by far the dominating factor. IMO.
Interesting prospects here.
ATB.
In the DFS the 4.7mt of 1.2% secondary product was assumed to sell at average 190/t over LoM. Revenue 900m.
If instead say 80% can be benificated to a 5.4% product (4 1/2x concentrated) that would yield some 830kt of SC. If that sells at av 1600 that gives higher revenue of 1.33bn.
Worth studying then. Also worth knowing that potential alternative can be done as selling fines may end up restricted or there is no market.
Two things to note from the DFS:
The NPV discount rate was set at 8% as was also the case in the PFS.
The capital funding model uses 100% equity and 0% debt for calculating IRR, NPV etc. Table 23.
Should get the end June figure late July from DGR
https://www.dgrglobal.com.au/asx-announcements
End December was 5.37%. March 3.24
Certainly better than watching the sp! :-