Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
Yesterdays PRE SP fell partly (-2.5%) in line with world markets and increased fears over inflation. Also in part because of the plunge (-15%) in mining stocks generally since June. It was also another AT/Bot tree shake.
On the wider front - as predicted - China Fires a Fresh Salvo in the Chip War.
On Wednesday, a top Chinese trade policy advisor warned that Beijing’s latest export restrictions were “just a start” if Beijing continued to face Western pressure. “If restrictions targeting China’s high-technology sector continue then countermeasures will escalate,” Wei Jianguo, a former vice commerce minister2003-2008 and now vice chairman of China Center for International Economic Exchanges, a state-backed think tank., told Chinese state media.
https://foreignpolicy.com/2023/07/06/china-tech-us-metal-export-yellen-gallium-germanium/
US has a stockpile of germanium to cover the immediate short term, but no gallium and China is the source of 92% of the world's gallium. Both metals have increased in price over the last 3 days since the restrictions were announced.
China's move has also raised concerns that restrictions on rare earth exports could follow.
China appears unconcerned about the collateral damage it is doing to its own reputation as a reliable and fair supplier of critical metals, which can only raise the viability of Western investment in China-excluded supply chains.
Well China made its move - I didn't expect to be proved right so quickly.
It has pushed its first rare metal pawn into play and off we go.
China slammed the export brakes on 2 rare metals yesterday - gallium and germanium and there's more to follow:
https://www.reuters.com/technology/us-firm-axt-applying-permits-after-china-restricts-chipmaking-exports-2023-07-04/
Price of gallium jumped 6% up from previous session and same expected with germanium, predictably to be followed by widespread panic buying and stockpiling before the Aug 1 cut-off.
Ga and Ge are critical chip manufacture metals, but also widely needed for fibre optics, solar panels and a lot of high tech manufacture. Ironically US has the world's largest deposits of germanium ore, but only in the ground/unexploited.
Oh dear - supply chain blindness yet again?
If the West fails to get the message now that China has them by the b*lls on all of their critical metals supply chains and massively pump investment into de-risking them from today, it deserve's the caning it's going to get. My guess is that RE magnet and magnet metals are the most likely to be next up as China tightens the screws.
UK government is woefully/willfully unprepared for whats coming.
Re: future growth in Nd/Pr RE's and price forecasts:
All very well for market researchers to project huge increases in RE consumption, and massive price rises as a result, but they're all assuming its a free market.
China has other ideas. It has already warned the rest of the world not to think China will continue to be the default processor/supplier of the world's REs. It has already implemented a centrally-planned programme to meet ALL of its internal EV demand internally in the next 5 years, as well as flooding the world market with ultra-cheap EVs (see BYD). It is already advancing through building a massive internal wind-power expansion which will consume the majority all of the world's forceast RE magnet production in the next decade.
Now Biden has hit China with another tech export restriction - the specialised AI-processor chips China must have to further its plans for world AI dominance. This is on top of existing US chip embargoes, and blocking the sale to China of the software and related technology for setting up chip foundries for the newest chip designs.
Short of seizing Taiwan and its advanced chip foundries (even China probably recognises this would be a grossly retrograde action on the present world political/economic stage), China has recently completed a review of weaponising its RE chokehold (recently acknowledged by the US military as just as strong today as it was 5 or 10 years ago).
So the question is - will China now action its review by imposing an RE embargo to force the US/West to abandon its tech embargoes? On the face of it - given China has control of internal RE supply and demand, backed by the progress it has made hoovering up RE mining and processing capacity world-wide, topped by it's own hefty internal demand in the next 10 years - the West would certainly come off worst.
On the other hand, a China RE embargo would cause an immediate panic reaction across the West and Japan/Korea, driving prices sky high and trigger a "build at any cost" supply chain boom in the West.
Every cloud....
Another perspective
Taking a pessimistic view of the recent announcement, which doesn't seem to have moved the SP significantly today (buy/sell remains neutral):
- FSDEA might just have been asked to stump up some more working capital to keep Longonjo above water for a few more weeks
- implying that M&G were maybe also asked for another cash handout, but drew the line this time
- so really all that's happening on the ground at Longonjo is a bit of site prep and clearance work, and there's enough in the $15M immediate loan to keep up appearances and staff numbers there
- while we all wait another 6 months for signs of real money being committed, and for Saltend's future to be decided.
The big worry is the silence over Saltend.
If the UK plant is now down the gurgler, we'll certainly be seeing a mothballing exercise very soon followed by some significant UK Pensana workforce reductions (or maybe some will be re-assignmedto Alkemy/Tees Lithium).
It's a worry that if this cliff-hanger grinds on much longer, it opens the risk that FSDEA will strike a deal either with US or China to get the mine operational and/or commit to offtake deals with non-UK partners as well. Remember the US trade secretary's visit to Angola last year when he promised the Angolan Government the US would directly fund rare earths extraction/processing in Angola?
OK China - put the sword back in the scabbard - I'm still a long-term PRE holder, with no axe to grind - just worried and bored with the whole thing.
Tony - just had a look at ABSA's major shareholders.
M&G (US & UK) 5.02%
The Vanguard Group (US & Aus) 3.90%
Black Rock (US UK Jap Aus Can) 4.40%
Total held: 13.32%
Overall, by geographical area, US, UK, and Canada account for 21.45% of ABSA shares held.
Interesting - no?
Sunak+Biden's Atlantic Declaration announcement has specific references to rare eath and lithium supply chains in UK.
The Antantic Declaration clears the way for both inward investment from US in UK minerals companies, and bringing some UK mining/metals supply firms within the scope of Biden's IRA and green subsidies. Here's a few significant quotes:
- An agreement could help companies all over the UK, including firms carrying out nickel production in Wales and lithium processing in Teesside.
- Mr Biden has committed to ask Congress to approve the UK as a “domestic source” under US defence procurement laws, allowing for greater American investment in British firms.
- The two nations will also begin negotiations on a critical minerals agreement, which would allow some UK firms to access tax credits available under the US Inflation Reduction Act.
- An agreement would give buyers of vehicles made using critical minerals processed, recycled or mined by UK companies access to tax credits in line with the IRA
- Biden asserted that strengthening critical mineral supply chains and making them more resilient is central to breaking the People’s Republic’s headlock.
It seems that the hard lessons of Putin's weaponisation of energy supply and other critical resources have been fully taken on board now by the whole of US/Europe/UK/Africa/Canada/Australia, with a sudden realisation of the choke-holds the non-democratic nations have over us. A massive pivot is now unstoppable.
The only way is up.
PA is giving a presentation at MINSOUTH (Institute of Materials, Minerals and Mining) on Jun 8 at 18:00 BST the same day as the PRE GM (8 Jun at 11:00am)
Details/registration for virtual e-ticket (free) here:
https://www.eventbrite.co.uk/e/pensana-plc-advances-uks-rare-earth-element-self-sustenance-tickets-649627171357
PENSANA Plc advances UK's rare earth element self-sustenance
ORGANISER MESSAGE
Thank you for registering for the lecture 'PENSANA Plc advances Uk's rare earth element self-sustenance' given by Mr. Paul Atherley. Mr. Atherley will be presenting this lecture virtually. One can view it either with a group of mineral industry professionals at The Counting House on Cornhill or virtually.
Wonder if he's going to take questions?
Trading has just about ceased in PRE today - 11 trades by lunchtime. Peak doldrums....
PA's comments in the Apr 5 webinar were that, should the Strategic's non-executive investment committee decide to postpone investment again, beyond end-April, PRE would prepare to raise the already in-hand bond funding, which would likely come by end May, and expressed his confidence in the funding.
Pinch! Punch! PA - it's the first of the month!
As a humble private investor, I understand that Pensana have zero interest in keeping me informed as to where my investment is going - so can anyone here offer any update on funding advances in the last two months?
Jordie1 - yep and the bots are out in force again - AT selling mainly keeping a lid on what might be a bit of a rally. only the day trader(s??) is trading PRE - buying is laughably small.
However, today is the last opportunity for PRE to achieve some action on the bond financing which PA said would be sorted in May. Any positive price trend today will be significant, so it's boring, but it's a case of wait and watch....
Any ideas what is going on with dealing today? There's a bunch of 6 unclassified trades, some with time stamps in the future - amounting to 1.1M shares all sold below bid. Sell volume is 490K, against a tiny buy volume of 65K and still the price is in positive territory?
Another China exploit of Africa's mineral wealth:
https://www.mining.com/web/congo-president-heads-to-china-amid-mining-contract-negotiations/
Angola, and other mineral-rich nations will be observing with interest how one African nation has been exploited for 15 years by China. In comparison, Pensana's proposed ESG supply chain and fair deal approach only gains strength.
Democratic Republic of Congo President Felix Tshisekedi will visit China next week as the two nations look to conclude the re-negotiation of a $6.2 billion minerals-for-infrastructure deal. China is Congo’s biggest trading partner with $21.7 billion of trade in 2022 (primarily copper and cobalt). DRC is the world's largest producer of cobalt - at 70% of the market.
China has only paid $0.82 billion (mostly to Chinese contractors) of their side of the agreed $6.2 billion minerals-for-infrastructure deal. Quote - "The watchdog accused the Chinese companies of financial malfeasance, including transfer pricing and dumping, and called for them to be fined $100 million for breaching capital controls under the nation’s mining code by not repatriating more than $2 billion in export revenue".
DRC is simultaneously in dispute with China's CMOC Group refiners (worth $16bn), which also owes billions in unpaid royalties, so DRC has blocked the export of cobalt to CMOC, pending resolution.
Another fine example of a exploitative supply chain - exactly the type African nations now realise they must avoid, and look elsewhere for deals outside of China.
SP - re: falls in NdPr prices this month.
China's RE price annoucements reflect its ongoing campaign to hobble Western investment in building China-free supply chains, and are nothing to do with free market pricing. They want to make the cost-benefit/payback of RE investment in the West look as unattrractive as possible at a time when there are so many pending projects facing what is currently a difficult economic climate.
But it doesn't really matter how cheaply you price a commodity if nobody is going to buy what you're selling.
EU now has in place trading rules of origin and ESG supply chains for RE's/lithium/critical metals which make China an unworkable future supplier for green energy/transport - if you expect to sell the finished product in any European country that is. The US is well advanced down the same protectionist route and I wouldn't be surpised to see punitive tariffs on China supply lines come in during the next 2 or 3 years as soon as their new supply chains are in place.
Korea, Japan and other eastern nations are working closely with US/Canada/Australia and Europe to put in place alternatives to Chinese-produced RE magnets and refining capacity.
Given that China itself is also hell-bent on building its internal market and has a colossal expansion planned for its indigenous wind programme and EV's for internal consumption - it needs to stockpile as much RE's and lithium as it can lay its hands on just to cover that.
It's all smoke and mirrors.
TGL - I'd already read the Lords questions you quoted from. Have you ever seen such a load of complacent, irrelevant twaddle in your life?
Lord Johnston apparently thinks the Nissan battery plant is evidence of UK activity in battery gigafactory building. Nissan sold out all its battery factories to ENVISION in 2018. Shanghai-based Envision is Chinese - and dominates wind turbine and battery production worldwide. Clueless... Apparently BritishVolt is also a success story for the UK, though he concedes it seems to have gone a bit quiet - er, this parrot is dead m'Lud.
The ATF is a completely irrelevant mechanism for the problem at hand - which is massive technology investment now and financing on a grand scale. the ATF's £850M is just pi**ing into the hurricane.
We are lead by lazy, incompetent, I'm-all-right-jack, dullards who cannot comprehend the scale of response needed just to stand still - and still don't know the difference between millions and billions.
See Mining Weekly news here:
https://www.miningweekly.com/article/maginito-to-acquire-hypromag-2023-05-16
HyProMag taken over by Maginito (90% owned by Mkango).
Recycling RE magnet metals to start in UK in 2023.
A new US joint venture planned for magnet recycling.
Backed by $100M research & development by U of Birmingham and partners,
Will use hydrogen decrepitation method for low carbon footprint.
Also claim to now have the ability to manufacture RE magnets.
Nothing new from Pensana - 15 days to the May deadline for the bond raise though...
Interesting review here:
https://www.miningweekly.com/article/vietnam-boosts-rare-earths-output-by-tenfold---data-2023-05-05
Claims of Vietnam's RE deposits = 50% of China's. Rapid increase in extraction & processing RE ores. Also imports RE ores for processing.
Looks like the dominant Vietnamese company is China owned and China takes much of their output.
Eloro - when you say "Where are the plants in the UK and Angola?" you make it sound like nothing has been done.
In fact there is a large amount of activity at both sites. See here for published details of site progress as of 31 Dec 2022:
https://www.sharecast.com/press_note/market_reports/pensana-plc---interim-results-for-the-6-months-to-31-dec-2022--12865788.html
And a lot more has been done since.