Member Info for observer842

I'm cool @Bannor. Not sure about calm. :-) New corporate presentation:

https://www.cadenceminerals.com/wp-content/uploads/2020/06/Corporate-Presentation-KDNC-JUN-2020-PUBLIC.pdf

(spotted while looking up the vendor provided EBITDA, I'm wondering what this would be increased to if today's spot of around $100/t were used instead of the $61/t they used - and of course the correct value at full production, not the mine average as we appear to be reporting!)

I was just about to type the same thing @mr.james!

@Fingers. I agree on both points. Just worth airing why some believe the share price is where it is today - as the worm turns on Lithium prices, and progress reports on the new production method, with presumably improved NPV's bandied about, we should see increases, potentially spectacularly so from here. Feeling patient? I say that, but AIM is weird at times, perhaps as this news gets around the share price will rise despite lithium prices staying subdued since so many bought much higher than today's price and are willing to wait it out? - they've already waited this long, what's another few years, but much sooner if buyers want in but holders aren't (easily) willing to let them. AIM is weird. Did I say that? LoL ;-) And by weird, I mean unpredictable...

That's extremely interesting @Rpks. Thanks for sharing. Presumably if successful this new process will reduce the OpEx considerably. However, a final feasibility study in 2023 is a bit of an explosive (but realistic) revelation for impatient AIM... Got a link and a date for that article?

You know I've never noticed that the "s" at the end of our name was missing on here. Which is a bit unfortunate...

Oh, but we did according to: https://www.lse.co.uk/share-prices/risers.html

Brilliant @Barksy. Apologies for doubting you! Same document, I skimmed too quickly... :-)

I wonder if Brazil will (have!?) follow suit? "Vancouver – June 3, 2020 – Great Panther Mining Limited (TSX: GPR. NYSE-A: GPL) (“Great Panther” or “the Company”) reports the restart of mining operations in Mexico following a government order adding
mining to the list of essential services."

Are you sure @Barksy? I can only see a news release today about their Mexico operations.

Shipping not expected until next month. News announcement to enable this expected this month. News related to our 20% possibly this week, or next.

Let's get to 20% before talk of raising to take us to 27% and to 49%! LoL. We might sell an asset instead of course. I'm getting a good feeling that this could form a very decent launch pad if the news goes our way this week or next, taking us closer to WHI risked target. Anyone looked it up yet!? :-)

I should clarify: they can't have capitulated and then buy without the information being made public, that would be inside trading. But they could be planning on capitulating and buying on the back of that as a hedge.

It does feel that way @Dallas! I wonder if the banks have capitulated and are trying to build a stake here instead. Unlikely. But I do wonder...

Now might be a good time for someone to remind us of WHI's risked and unrisked target price :-))))

Going by the volumes I'd say someone (several perhaps) new is either buying in (do say hello!) or someone old that sold out is starting to have FOMO! Whoever it is, at least someone finally blinked!

It'll be a pleasant surprise if the chart driven, news anticipating re-rate leads nicely into good news from Amapa - could form a good baseline for a decent bag to two from that point. :-)))

Maybe the movement is based on the charts? @Dallas? I'm not knocking a daily ~20% re-rate whatever the reason!

Should nicely progress the following aspects which had a bit of a question mark over them from the recent quarterlies:
===[
Project Finance
The Company has announced in the past that debt finance through the German Government
sponsored Untied Loan Guarantee Scheme (“UFK”) for up to US$140m (~A$215m) is conditional upon
the signing of the Schaeffler offtake contract. This requirement is similar to that imposed by North
Australia Infrastructure Fund (NAIF), the Australian government funded agency, that is interested to
fund a large part of the project’s infrastructure cost of approximately A$200m.

The German State Bank, KFW-Ipex Bank, is advising Hastings on its UFK loan application and has
continued to provide guidance and advise on these negotiations in line with its loan conditions. With
much of the technical due diligence completed, the remaining debt financing work has to be
synchronised with the commercial terms of the offtake contract with Schaeffler which accounts for
one third of the production. As these commercial discussions have slowed, the loan negotiations with
KFW and NAIF is concurrently delayed. The Company is also advised by KPMG Australia for the NAIF
loan.
]===

Some good points @enteleon, I hadn't heard about the transport differences between hydroxide and carbonate. Got any links? My understanding is that the LiOH is created, stored and shipped as Lithium hydroxide monohydrate (LiOH.H2O), which is crystalline, not a liquid. i.e. not too dissimilar to the carbonate form, so I would have thought transport costs would be similar? I'd heard it doesn't store for too long though, of the order years. I can't remember if that applies to both forms, or just hydroxide.

In terms of: "Are we in a situation where the enthusiasm for lithium sparks all manner of projects and there is then a glut ", I highly recommend taking a listen to the interview that @jimb2 linked to the other day where Rodney Hooper explains that even if he had unlimited money today he'd find it very hard to get the mines up and running in time to meet the demand. The argument goes something along the lines of a new battery factory takes 1-3 years to build. A new lithium mine 5-7 years. The numbers are off the top of my head, if you listen to the interview perhaps you can post his estimates here? :-)

"Tesla's Lithium supply chain mapped out" (31 May 2020)
https://www.youtube.com/watch?v=rZV_qI2OkeU
===[
This episode of Tesla's Battery supply chain we cover Lithium and map out Tesla's global Lithium supply chain.

To help with the topic Rodney Hooper from RK equity and co-host of Lithium Ion Rocks podcast will be a guest on the show
]===

One thing I remember about the interview is that it wasn't made clear that it's 0.8kg of LCE per kWh, not 0.8kg of Lithium per kWh. So some may have come away thinking much more lithium is required per Tesla than in reality is required as 1 kg Li = 5.323 LCE.

Ob.

IMHO the biggest potential downside, which is also the biggest potential upside for the Cinovec project is the NPV's sensitivity to the lithium price - more so than any other lithium project I can recall. WHI used $12,000/t LiOH in their valuation which they claim is reasonable as "Lithium hydroxide currently achieves a premium to lithium carbonate (15-20%), a differential that has been higher in the past, but price differential that will be maintained in our opinion". However, the current spot of carbonate according to the LME is $7,500 which would make LiOH (at 20% premium) as $9,000/t LiOH.

You'll see from figure 3 on page 9 that this 25% reduction in the Lithium price would reduce the NPV, and consequent share price considerably. The flip side being a 25% increase to $15,000/t LiOH would near double the NPV, and consequent share price.

Most invested, or starting to think about investing in lithium are doing so predicated on vastly increasing lithium demand in the next 3-10 years. If the price starts to rise over the next year or so in anticipation and then in response to this demand in the absence of vastly increasing supply it's quite likely IMHO that Cinovec will get it's funding and construction will begin. Just a matter of time.

You did ask...

I was about to send when I realised that LME also report LiOH prices:

https://www.lme.com/Metals/Minor-metals/Lithium-prices
===[
28 May 2020 9.75kg/t
]===

That's a 30% premium to carbonate - so the potential downside perhaps isn't as great as I thought. ;-)

Ob.