Very interesting chart Batman...
We are both Australian companies, near term/current producers, affected by the same forces on the ASX.
We are both subject to the Weakening macro, soft lithium prices, and the more underhanded institutional suppression, algorithmic manipulation and co-ordinated downramping and shorting on the ASX.
And that is why you see both the SP's tracking in similar trajectories....until the 28th of March.
28th March was the now infamous announcement that Albemarle was willing to pay AU$2.50 /share for LTR, prescribing an instant near doubling of the SP and the MC.
A valuation WHICH IS STILL UNDERDONE AND REJECTED!
With rumours ALB widely tipped to to renew its offer north of AU$3...
If Sayona had a similar offer...what would the offer be 30c, 40c, 50c+??? More????
If we had a resource as good as LTR's, would there already have been an offer?
If we had a market driven current offtake, rather than the sub-par, ball and chain deal we have with PLL, would there have been an offer?
What would our price be when-
When the future lithium shortage, compounded by the lack of new supply for and the exploding timelines and Capex's are taken into account.
When the realisation that EV mass adoption will compound this shortage and the IRA will heavily penalise manufactures, if their minerals are not sourced and refined in Nth America. Penalise them to the point their offerings will be uncompetitive in one the the largest markets in the world, and why we are seeing the massive investments by the Europeans, Japaanes and Koreans into Nth America, as they scramble to decouple their reliance on China and secure local supply.
When ESG has a greater importance than ever and can earn carbon and tax credits, making these sources more valuable and favoured, to the point a premium can be attributed. And not just energy used in the mining and refining, but in the total logistical carbon footprint of the end product.
When future growth projects at Moblan, are already the single biggest pegmatite/lithium ore body in Nth America...and growing.... are taken into account?
When downstream processing plans,which is well advanced and on the horizon, are taken into account?
When the shackles of institutional manipulation and a manufactured weak lithium price are broken?
When security of supply in a tier 1 jurisdiction are taken into account....
What will Sayona be worth?
ALB took LTR's future into account, and the offer was still underdone, at AU$5.5B....for a mine which is yet to produce anything....
This is where the difference is and the divergence comes from in the chart..the attributing of future earning potential.
Albemarle, SQM and those invested in Chile are in the crosshairs, and to a lesser extent all projects in Sth America. For if this does not backfire on Boric and the Chilean Government, it will be contagious, as other Sth American countries pivot to take a larger slice of the pie.
And with this increased sovereign risk, where future investment be directed?
Canada....Australia????
and the quickest path forward if you can raise the capital .....Takeovers or Mergers and acquisition....and be quick and be ruthless......before your competitor realises, and snaps the projects that '
fit the bill,' before you do....
With massive investment very recently announced by Japan and Europe , along with the Koreans and the massive IRA act in the USA, it is more lucrative than ever before. As well as, and additional to the EU act, Germany, Italy and France have set up or increased their funding, tax credit and cheap loan facilities, in an attempt to protect their car industries.
Picking up a tier 1 asset is now more important than ever...
Now if I backtrack to the 2 questions I posed earlier-
If we had a resource as good as LTR's, would there already have been an offer?
If we had a market driven current offtake, rather than the sub-par, ball and chain deal we have with PLL, would there have been an offer?
If I can respond to these 2 questions I would answer-
'We may, in the near future, have a resource which comes close to LTR's at Kathleen Valley, and may even better it. With further exploration and drilling we may indeed have a tier 1 asset. At a minimum, we will have the best single resource in Nth America.
From LTR's website-
oppins, sans-serif;font-size:20px;font-style:normal;font-weight:400;background-color:rgba(245,245,245,.8);display:inline;">An Ore Reserve of 68.5Mt at 1.34% Lioppins, sans-serif;font-style:normal;font-weight:400;background-color:rgba(245,245,245,.8);">2oppins, sans-serif;font-size:20px;font-style:normal;font-weight:400;background-color:rgba(245,245,245,.8);display:inline;">O, as of November 2021
for comparison-
And although NAL may never realise such a clean, large and pure ore body, it will eventually have a massive tonnage which has been proven to be concentrated to 6% or a more viable 5.4%
BUT Moblan....
Moblan- Measured and indicated or Reserve - 50mt @ 1.2% and is well on its way to emulating Kathleen Valley, and via open pit, not underground.
As for the second question-
PLL's offtake, does not extend to Moblan and the Northern hub and said offtake will be minimised/eradicated, when the refinery is upgraded and commissioned at NAL......
So, in our future, if institutions or prospective bidders wish to value SYA, with our 2 major current drawbacks removed, and we take into account, just like Albemarle did with LTR, their future with ALL factors considered, what would SYA be worth??
If you follow LTR's offer, it was around a 60% increase, remember, they are not producing yet and will not until mid 2024...so maybe 32c, NAL???
Still sounds undercooked to me...We should realise that price with the next offtake, the carbonate PFS and the Moblan PFS. And if its a takeover, add the premium, so 40-50c?
So where is this headed??
As for future value, and a lot of time and money and capex..
(Mind you, we already have 30% tax credit for capex starting 2024, with multiple governments, now including Japan, pledging direct funding of mines and downstream smelting/processing to secure supply. This has possibly worked in our favour, with our second offtake, but more probably with our future at Moblan, as more governments push to secure supply in this tier 1 jurisdiction)
Southern hub 2025-2027-
Authier/NAL/Vallee, maybe Tansim- 2 concentrators 500-600, 000 tonnes spodumene concentrate-5.4-6.0%.
With 1 refinery to take half the concentrate and feed the carbonate plant.
Total output 250-300,000 concentrate, 25-30,000 Carbonate
Peer review values this operation with these outputs to 8-12B company.
Northern hub 2027-2031
Moblan/Moleon...who knows how big this can get- 3 concentrators, 750-900, 000 spodumene concentrate, probably all 6% due to the purer ore body.
Feeding the refinery who has been earmarked to produce 100,000 lithium hydroxide.
Total output 100,000 tonnes hydroxide
Peer review values this at possibly around 15-20B
In total and with proportioning out ownership percentages, we are looking at possibly a 23-32billion dollar company, dependant on lithium price.
Good luck everyone...