our globally significant Lithium Resource, page-327

In order to get an idea as to Goulamina’s valuation, we tend to compare it to AVZ, LTR etc. Whilst these 2 stocks aren’t at the upper end of valuations (eg PLL), in order to get a minimum valuation I thought I’d compare it to Prospect Resources PSC, which is what I consider to be the 2nd most under valued lithium stock after us at a similar stage.

PSC has completed their DFS, are fully permitted (like us) and are working on finance etc.

I’ve put the DFS figures in the table below,

They own 70% of their project, we have 90% (possibly 80% but would sell that extra 10%).

Their project is in Zimbabwe which I’d consider to be a higher risk than Mali.

Our NPV is 75% higher than theirs,

Our resource is only 50% bigger, but with the higher grade would be double the LCE

Our planned production is 150% more

Our capex is 20% higher (but for 150% more production)

Our opex is 18% lower

The only place they beat us is IRR, which is hard to understand given the other numbers. Although IRR is useful, I don’t put too much weight on this, as an extreme example. Would you prefer a $1m project with a 50% IRR or a $5b project with a 30% IRR.

They also have offtakes for 72% of their planned production. Offtakes are useful for financing, however smaller companies tend to get screwed in these deals, so I’d prefer to be in our position and have 100% of our production available to any potential buyers/partners in the data room.

PSC have a current market cap of $70m @ 21c.

Given the above figures, at a bare minimum Goulamina should be double their market cap based on NPV & Resource size/grade alone. Then add in the ownership percentage differences, and the other metrics in the table below (many of which are built in to NPV) I think double their market cap would be ultra conservative.

$140m is what I’d call a bare minimum. That values our gold at $40m

It’s just my opinion PSC is the 2nd most undervalued lithium hard rock stock, I’d be happy to hear about any other undervalued stocks at a similar stage.

		FFX - Goulamina	PSC	% difference
1	Project ownership %	90	70
2	Market cap A$m	??	70
3	Resource mt / % Li	108.5 @ 1.45	72.7 @ 1.11	49%
4	Planned production	436	173	150%
5	Opex USD/t	281	344	18%
6	Capex USD	194	162	20%
7	NPV pre tax	$1.234b	$710	74%
8	IRR pre tax %	56	71
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