Member Info for Simon_Said

In fairness that one actually did make me laugh.

I loathe these vague kind of statements. Let's be explicit. If the Czech state were to remove, or infinitely delay progress at Cinovec, this would end up in the European courts. Babis is pro EU and planning for the CR's stint in presidency. Not only would he not want an arbitration case, he would obviously lose because retroactive legal changes would never be upheld. Surprised we're still having this conversation.

Wow what a stinging and insightful point you have made. That you can successfully irritate people. Enviable skill.

The second there's any negative movement, in swoops the basement dwelling loser again.

'To get a reaction' - are you 14?

After spending some time around .6/65 there was bound to be some churn on the first meaningful tick up, and it's larger investors who are often first to sell, as they are moving larger amounts around and a quick 10% profit is a significant amount of money at their scale.

This is fine, the shares are being bought up and the spread is not budging notably. This may even suggest a background order is being worked, we won't know till later of course.

The next few weeks will see the first news from California get going, and then in September we're already getting on with Wick. With 6 drills coming in 5 months, I'm not going to be the one taking 10%.

Odey asset management increase their holding.

What a refreshingly reasonable conversation this is!

Yes, I note the drops for UOG and BOIL, which I understand to be related to the cost increases. Reabold is not subject to these due to its position as investor rather than farmor, hence the stability here.

As you say, this is merely one iron in the fire of this nicely diversified play. Like many/most/all here I have been burned before on 'one drill wonder' companies where the share price is almost entirely supported by a single project. It's of great comfort to me that all projects are equally emphasised here, and due to the way the company's deals are structured and the low market cap that the current share price implies, only one or two of these drills needs to strike to have a transformative effect on the share price.

Nothing in life is a given but without risk there would be no room for share price growth. As risk reward goes, I'm very happy with what Reabold have cobbled together.

adoubleuk, there are no 2 ways about it, Reabold is not farming in to Colter. Reabold owns part of Corallian, and it is them who hold the farmout agreement.

With regard to Colter permissions, I discussed this with Stephen Williams in-person last week. He was clear that the public outcry (and indeed celebrity!) has not presented a problem in the path of the application thus far, and the application has made good progress thus far. As I understand it the EA had some requests for changes to the drilling plan which have all been made, so it should go ahead.

There is a misconception that pure pressure from activists could stop this, but that's not the case. There is steerage from central government that UK drills should be permitted where possible in the name of domestic energy security, as long as all regulations are followed (environmental and others). A local authority only has limited authority to stand in the way of this sort of thing.

This is especially the case for Colter, which is just a small jackup rig for a few weeks, and will be plugged and abandoned no matter what the result. I think we have some new investors here who don't understand what this is, so I strongly advise anyone surprised by this to go and read up on what the Colter appraisal project actually is. It's a temporary rig just to test the oil there directly. It will then be plugged and abandoned. If the result is positive, after that the resource will be accessed horizontally from onshore, NOT from a permanent offshore installation.

All this means that, as requests for offshore drilling go, this is extremely mild. It is being drilled several kilometers offshore, outside of the tourist season, very temporarily, and then leaving. Blocking this temporary structure would almost certainly be overruled by central government, but that's irrelevant as it simply won't happen.

And they don't need all the assets to strike. Just one or two would be transformational for the market cap. Remember S&S were going to start a fund originally and come from that sort of background. They are all about hedged, spread risk. That's why they're rushing to acquire lots of assets during this part of the cycle.

Regarding the cash still in the bank, after Stephen's speech I asked him about the excess cash on hand. They've said many times to expect more asset purchases in the near-term, but I went deeper and asked him about the projects in the presentation from the placing a few months ago.

He told me that they are all still under consideration. Not some. All.

The impression I got from a few things he said was that California was an unexpected opportunity they just couldn't resist. There was visible excitement, and he mentioned it many times. So perhaps there was something else they wanted but have yet to seal the deal on.

Could be wrong but I still expect another asset deal this year, taken from that list in the presentation.

Really appreciating your insights here iceberg, thank you. It's a confusing time.

I said for many years that EVs would be a big thing once they passed 'the parents test'. Once people's 60+ year old parents started considering EV's, that was when we'd know a true culture shift was happening.

Many of that generation are getting hybrids already, including the interesting plug-in hybrids like the Golf GTE and Mitsubishi Outlander PHEV. But at least anectodally, I've noticed more of that generation showing a real practical interest in getting full EVs. I was at a few motoring events this year and the Tesla and Jaguar (I-Pace) stands were packed out.

Meanwhile the other uses of lithium like domestic energy storage are increasing too.

The only argument to be made is that supply will keep up with or exceed demand, but that implies a level of scaling up and proving up new resources that may not even be geologically practicable, without the cost of lithium rising enough to make the exploration economical. It ain't a cheap business.

So 'Yuyus' below asked about what happens when the assets are sold:

This was covered by Stephen Williams at the LSE evening earlier this week, which I highly recommend watching. https://www.youtube.com/watch?v=_BC56456AmY

I have transcribed the relevant answer below as I think it's important. You will never hear CEOs say things like this normally (note this is just my transcription, feel free to watch the clip to check my accuracy):

"There's an opportunity at the moment to fund these things at extremely low valuations, drill them very quickly, and get these monetisation events shortly afterwards. That window is open, so if we we were theoretically to sell one today, for a big uplift, we would be very likely to recycle that, because the projects are there, we're talking to companies, they want the cash, the agreements can be put into place, everything's good. We suspect at some point that window closes or at least starts to close and the reason is we've got a higher oil price, the industry is feeling a bit more flush with cash, there's a bit more confidence around, I think other players in the industry will start to do deals in some of these projects and we will see a little bit of asset inflation. The entire basis of our model is to be able to buy into this stuff at zero cost, almost zero cost. That's the basis, it's all about that sort of cyclical play, and as soon as we lose the ability to do that, we'll start returning cash rather than redeploying.

...

If everything inflates then our projects will have inflated so we'll have made everybody loads of money, so that's fantastic, and then what we'll do is we'll sell everything, and we'll stop. We have no issue with walking away from this business once the job has been done. This is a cyclical play, there's no point riding everything up then being fully-invested when everything collapses, that doesn't make any sense."

Very illuminating, thanks for posting this.

So really this comes down to a binary bet about the price of lithium. Which, in fairness, has always been the case for juniors.

Secker wasn't lying in the RNS when he said 'due to the volatility of the commodities market'.

Personally I'm more than happy to bet on the high future cost of lithium and many experts are too.

Oops I thought it said .8p!

That sounds more like it.

That's a very modest target to go for when we're talking about a company with 6 drills in 5 months... but each to their own!

(By 'isn't listed', I mean 'isn't on their site available for share purchasing', not 'isn't listed on the exchange' - obviously!)

I am not with Halifax, but after watching the way this has all unfolded I will definitely never be a customer of theirs for shares (I have other products with them but avoid them for shares).

My share accounts with HL and BestInvest are so different - if you want a stock that isn't listed, both will research them for you free-of-charge to see if they can list them, and I've never had them refuse to list a company's shares. I've had many added to the latter, actually. They would never adopt a stance like this. To be clear, this is Halifax simply using the (IIRC) Digital Look classification and not manually researching the company. If they did, it's blindingly obvious that this isn't a PRIIP, but they're doing a 'computer says no' and just sticking to the erroneous 'big pipe' data.

Can see this share is finally getting broader attention with new names showing in this forum thick and fast now. Welcome all. Here's to an exciting drill-packed H2.

This makes sense. Add in this from the IC:

'Speaking to Investors Chronicle, chief executive Peter Secker said prospective investors have been spooked by “a lot of research saying [the price of] lithium carbonate is going to $8,000 per tonne”. Bacanora currently estimates lithium carbonate sells for between $16,000 and $20,000 a tonne.

“The banks don’t understand the lithium market,” Mr Secker said. “Demand is growing a lot faster than supply can match and that will become a lot more apparent.”'

So some II's didn't want in because they are bearish on the lithium price. This is what Secker meant in the RNS when he said the placing cancellation was due to volatile commodity prices.

As Addicknt's post says, a cornerstone strategic investor will be the answer, likely one with a bullish view on the lithium market outlook.