AGM today, page-72

Hi guys

I attended the AGM today and have some comments below.

Please also read other commenters’ opinions and comments on the AGM and please DYOR as there is a good chance I could have skipped/misinterpreted a lot of stuff and is just my best opinion on today’s meeting based on what I think that I remember. Long comment coming up – so grab a coffee

1/ Other documents and comments which might help

Just a few documents which might help while reading about today’s meeting.

AGM results
https://hotcopper.com.au/threads/ann-annual-general-meeting-results.7093576/?post_id=64840042

Presentation
https://hotcopper.com.au/threads/ann-agm-presentation.7093441/?post_id=64838356

Chairman address
https://hotcopper.com.au/threads/ann-chairmans-address.7093438/?post_id=64838338

2/ Basic info about meeting

Hybrid meeting- physical location and online

Meeting was quite professional with John Clarke chairing the meeting, and several people from management attending – Nigel, Graeme Johnston, Rhett Brans, Jager and Ben Cohen from memory.

Around 50 to 60 shareholders were present. Meeting started at 2 pm

Auditor Kris Nicolof from Hall Chadwick was also present

3/ Chairman intro to company

Hereon, I’ll mention what I remember. Clarke mentioned that speech released to ASX

Claims have no legal basis
Engaging with highest level in DRC
Mining license catalyst to end suspension
Thanks to Nigel and team for defending our asset

4/ Resolutions

Resolution go through

5/ Presentation

Formal part of meeting over by around 2:20 pm, and Nigel starts talking now with the AGM presentation (You might find it helpful to open the presentation document)

Presentation very similar to recently circulated
Only change in board is Huljich gone
Balthazar co-ordinates with DRC government
Cash is not an issue at present
3 month rolling approval for budget
Will cut down expenses later if required
DFS is outdated with progress in lithium prices around 8800/tonne
We have 75% ownership-can’t accept any nonsense. This is indisputable
Mining license is main thing needed
We need to convert resource to reserve
$600 million or more will be capex in line with inflation
Some equipment on site
Mpiana Mwanga allocated to us despite rumours
Monster of Manono asleep for now. Incredible strip ratio, clean product for battery
Drilling concentrated at Roche Dure – clean product to drill
Projected boundary more to south west
Many drill holes. 4 drill rigs working 24/7
Ore body close to surface
Good boost to strip ratio and reserve and resource tonnes
AVZ could have 20% market share of lithium demand in time to come

6/ Ownership issues

Not entertaining anything besides 75%
ROFR on remaining
10% will come from Cominiere
66% at end after CATH deal
CATH contribution of $240 million will rise to $400 million after their share of project funding
66% will be our final and not 36% as some shorters say
Minimum 51% if we don’t take extra 15%
Ministerial decree came in May 2022
Suspected short selling campaign. Went on suspension. We need to protect the company, our assets and our share value. Possible co-ordinated collusion against us in DRC
Results fairly soon. We maintain it is 75%
Jincheng has no legal rights
We can defend Dathomir claim - very strongly positive for us. We’ve paid everything. They have no claim. Soon as cash in their bank, shares were released from escrow, they took action against us.

7/ CATH and suspension

Strong relation with CATH. Pei coming later.
We’ll stay in suspension till mining license comes or shorters will aim to pull share price down

8/ Relations

Donations, medicines, funds etc to DRC

9/ Mwian Mwanga

We’ll fight tooth and nail to keep with us

10/ Clean energy

Looking for solar, turbine, biofuel etc and to get rid of diesel

11/ Funding

Cath funding is going to be there
Pan African DFIs also have a large cheque book. Looking for mining license mainly
600 million will be covered. Additional debt if needed

12/ Offtakes

Looking for geographical diversity too

13/ Transport

Export route and transport route – warm reception at Tanzania for holding bay. No issues at Dar as Salam

14/ PLS

PLS is higher value product. Less shipping needed as less waste
6% product means 94% waste. Hoping for 94% PLS which means 6% waste for shipping to Europe
SC6 to PLS ratio – 4 to 1 roughly

15/ Optimisation

We can comfortably expand. 10 million tonne study underway

16/ Early works camp

Camp works on and going well. Local products used. Disregard nonsense rumours going around of us spending very less. This is rubbish and we’ve spent lots on camp

17/ Presentation takeaways

We originally stated SC6 around 699 but it is now much more
Co-ordination with highest level of DRC government
Funding from Pan African DRIs
Results fairly soon
We maintain that holding is 75%.
132 of 400 million resource is in reserves. We are keen to expand reserve with drilling
Mainly keen on mining license

Presentation discussion ended around 2:45 pm and now Q&A session starts below. I can’t remember exact questions but discussion surrounding questions is given below

18/ Biofuel

Potential for biofuel
Inviting people to investigate
Elephant grass also has potential
Biofuel is reduction in diesel used

19/ Studies

Works managed with consultants and outsourced too and we are comfortable with them

20/ Expand from 4.5 to 10 million tonnes

If we can, then silly not too. We can ramp up over time. Plant and transport to be looked into

21/ Claims might be spurious but we are still in 6 month suspension

Main issue is ML.
Lots of players in DRC
President Felix has been ill advised about us that AVZ has no money and were not going to proceed
Detractors continue to work in background
Possible gambit by some Chinese players
Several facets and progress being made slowly and steadily
Possibly some collusion from some detractors

22/ CDL 13359

Someone said we did not work on northern portion. Drilling completed on CDL in mining license
99% value to be in mining license. Legally, we own northern portion in our eyes. 15 km of pegmatites there

23/ AJN northern part of CDL

Premise is we retained northern portion

24/ Is DFS delayed because of all this

10 million DFS will come in good order. CATH keen on it. CATH is looking for 2 hydroxide plants and looking to be number 1 in China

25/ AJN Nigel holding

Nigel said he was director and bought it as a gold company. Found out about lithium and stepped down at once. Nigel bought as a gold company and not as lithium company and nothing to do with AVZ

26/ Director insurance risen

No claims against company. This is based on size of project and cost of doing business

27/ 30 days after ministerial decree but we are way past 30 days

This was misunderstanding. Minister did it in 30 days. CAMI has 5 days for invoice and then 2 weeks for payment, registration with RCCM etc. AVZ believe that CAMI illegally holding up

28/ Aussie government support

Yibin Tianyi deal knocked back long ago by Aussie government in national interest; so is there any support now?
Answer is that all Chinese entities in register looked into. At that time, there was talk of some 19% holding and a board position.
Now situation different.
AVZ in in discussion with our ambassador based in Harare, Zimbabwe and she is doing what she can do.

29/ Confidence in high level support in DRC

Would be surprised if nothing changes. More confident now than earlier

30/ Equipment

Not as yet. Comes down to size. Need to finalise first whether 4.5 million tonnes or 10 million tonnes and then long lead items. Mindful of it

31/ Tribal situation or something else?

Not a tribal situation but opportunists. Think we are just about there and they will be taken care of

32/ ETA for mining license

ETA TBA .......

33/ Contingency plan if Zijin and Dathomir situation does not go in our favour

We won’t entertain.. Adamant that we own 75% and then right to 15% more. CATH want product mainly and are flexible about holding %

34/ ICC blush moment

100% confident will be turned over. Proceedings will be non confidential and expecting a blush moment for some people. Some people might be recalled to China

35/ DRC opinion on China

Some backlash now and some local jobs being lost to expatriates

36/ Civil society opinion on AVZ

Several in Manono hand to mouth and they see AVZ as catalyst for future jobs and progress etc. Civil society is behind us

Online questions start now

37 / Roche dure drilling timeline

Program timeline is March
2/3 rd way through now and drilling till Jan-Feb and then assay
Plan to get reserve from 132 million tonnes to 300 million tonnes reserves to underpin study for 30 years

38/ How long to building 10 million tonne plant

2 year process

39/ DRC view on export

Some issues on export from DRC for mainly copper. DRC wants more value addition on site. AVZ already mindful of it and already aiming for PLS rather than SC6 (Refer an earlier comment on PLS vs SCL, waste, etc)

40 / Battery SEZ Zambia

Discussion with Zambia, etc. Want to supply facility if we can. Working in background

41/ Boots on ground

Yes for pre site works. After license, we move forward further

42/ Activity on social media

AVZ has no comment and no need to air dirty laundry. We’ll stick to facts and we’ll have to live with that till license. There could be fireworks down the line

Floor question asked again now-

43/ When will AVZ be in production

24 months to get to production
Will crack whip on engineers
Mid 2024 if we get license quickly, etc

44/ Conclusions

Please DYOR and note that there could be several mistakes above and I could have heard a lot wrong. I’m only sharing my own notes / bullet points based on what I think I heard and these should not be relied for any of your investment decisions. Please refer comments by other commenters for full info

Also note that above points were less of my opinion but more of what I think I heard. Some of my own takeaways from all above are below -

Meeting was quite amicable. There we no torches or pitchforks

Major takeaway is that suspension is mainly for mining license and not Zijin, Dathomir cases etc
AVZ is obviously pursuing all these matters but mining license could be the main catalyst to come out of suspension

AVZ is also not just sitting on these issues and doing nothing else. The goal seems to be to move towards 10 million production and significantly moving resource to reserves to expand reserve, and be a major player in the lithium market

Eventual DFS could be amazing with expanded production, new lithium prices etc.

Not just our coming out of suspension but also production timeline seems to be also dependent on mining license

CATH seem pretty supportive overall

Cheers