Ann: Mt Cattlin Update-GXY.AX, page-94

@aneeso I think we have our wires crossed.

I don't know anything about the LAC deal other than a cursory look to see the figure of $25m for 50%.
The $400m I mentioned was for Tianqi's Kwinana plant. I was using this as an example of the scale of investment for the smaller return.
I think you may have misinterpreted this as SQM payment - or perhaps that is what they are offering? Do you have a link to more detailed information about it?

We know that the earlier plan for SDV pre-merge was to sell a portion 20-30% of SDV to finance the build.
The merge with GMM was described as the way to permit Galaxy to go ahead without needing to sell equity and to present a bigger company that would find financing easier.

There are at least these 2 paths open to Galaxy to construct SDV.
Equity or Finance. We have a mine to pay down finance interest without dilution.
Another would be offtake agreements with pre-payments attached.
Another is to incrementally build from test-plant size. This is the easiest and slowest. The fact that the latest DFS makes no refrence (even though we were expecting it to) means that the company would prefer to embark on the bigger scale project.

I favour speed of development as key so I am simply stating my preference at this point that an equity deal was the clearest and less risky way to proceed with funding the project with a large cash injection. I do not doubt that this is on the table at the moment and being discussed.
It is the quickest way forward.

SDV is projected to earn nearly $463m AUD per year at 25ktpa (less approx $95m in costs).
It is a very good investment for an equity partner.
Galaxy don't need to raise the full $370m build cost. Close enough is good enough.
Pay down the rest from Mt Cattlin.

My $350m calculation was 20% of $1.4b USD.
That may well be very optimistic - but if attached to a 100% offtake - or with further capacity expansion plans already on the table - Suddenly its the kind of deal that just about any gigafactory would jump at. Even 30%. We can share. The main thing is to get it up and running as fast as possible.

One thing is certain - no equity deal would be done that did not enable the build to proceed easily. $25m is laughable. It would not advance the project at all. Better in that case to rely on finance - with Mt Cattlin earning $150-200m a year to pay it down over a few years.

The really mammoth profits kick in once Galaxy can expand to larger capacity at SDV.
40-50ktpa as a Stage 3 operation. This is the reason to retain as much equity as possible.

The latest SDV DFS doesn't go into these plans but the earlier one priced extra capacity at 13kUSD per ton of extra capacity - which would likely be cheaper than the resulting carbonate or hydroxide price at the time. Not a bad deal to be able to increase capacity at cost (or less).

We'll see.