I have brought this up a few times now. Pilbara players have shot the lights out with cost estimations. Thats not a good thing for original investors who expect X. Another AU player will get ~$90/pound TA from a proven product in the short term (this month), unlikely PLS will get that, not a comparable product, if they do ill eat my words. Prices are dropping again from most recent reports and it doesnt seem to be a space where contracts get locked over the longer term.
So already we are seeing unachievable FS study figures with AJM costs already rising from DFS of low 300s > than 10% to approx $350t recent presso (that will continue to rise imo, sneaky sneaky throw it in there, say nothing) and PLS still no TA guidance/deal signed for the 25% TA high value product that (as per their FS) demands $87 for LOM, maybe they will close that deal soon…...
We are in the real world now where performance matters and talk doesnt.
Lets see who has the biggest mouth and who has the best operation over the next 12 months when all projects are bedded down.
With debt ratio at 40% and closing down towards 50% if AUD keeps dropping in tandem with poor performance of company, this is easily the most high risk lithium producer on the ASX. PLS ratio much much lower somewhere around 15% ratio giving scope for stage 2, no scope there for AJM. Im not surprised no offer is forthcoming this could be picked up for a song over the next 18 months pending plant/management/market performance.
As a comparison GXY throughput over the last 2 quarters was 866k.
AJM plant input are 770k per half year, 1.54mtpa, so 13% less than GXY.
GXY grade was 1.14%, AJM average somewhere around 1%, so 14% less than GXY.
GXY recovery 54%, AJM - no test work anywhere that I can find referencing recovery rates.
GXY spod produced 91kt, 180kt annually at that run rate.
To summarise, AJM have done little test work to show the recovery properties of AJM product and the deleterious elements of those recoveries or to be more concise they have not released them to the market which raises that flag i talked about earlier, grade is 14% lower, plant throughput is 13% lower, yet the company expects over 20% more product produced compared to GXY?
Nom Nom Nom this popcorn tastes good, it wont for everyone.
GLTAH
AJM Price at posting:
24.5¢ Sentiment: None Disclosure: Not Held
