Final Dividend likely to be what ?, page-209

@glenstewart20

Same reason PLS wants to look offshore for another Hydroxide JV - too costly, too difficult.
There are significant competitve advantages in doing it elsewhere. Beyond that the Australian government isn't nearly as supportive of those that want to secure their nations with a foothold in conversion and battery manufacturing.

China already has a massive cost and expertise advantage to begin with. Other nations that want the industry are throwing huge dollars at it to help attract investment. The Australian government attitude seems to be to that words and a few small handouts are enough given we have the mineral resources here - that the location of the source ore should be enough to attract. Truth is that if Australia wants it, the government will need to pay up.

We have all the materials required to take a big chunk of the market - yet Indonesia even seems perferable - because their Government is ensuring so.

I do think though, a bit of value add onsite by going part way downstream has potential. Lithium Sulphate isn't too complicated or capex intensive. It also has the benefit of opening up access to markets (thinking parts of Europe) that will not accept the waste component of a product containing just 5-6% LiO2.

If Australia truly wants a large share of conversion and potentially battery production capacity, the government will need to intervene just like all the locations PLS is likely looking at for the next conversion JV.

I do fear that it is likely too late for Australia and in a generation people will be looking back wondering how Australia missed out and complaining we don't have the industry. The government historically has been prepared to offer extremely good terms to incentivise multinationals to invest in mineral / gas extraction so it is a little baffling that they don't have the same attitude when it comes to downstream manufacturing given the sheer scale of funds being thrown at companies by other countries.

Perhaps the political optics given the concerns voters have regarding massive profits by the gas sector that mostly disappear offshore makes it unpalatable. Maybe lobbyists are still squabbling to push a Hydrogen future. The link between lithium and EVs might cause some partisan issues when it comes to campaigning. Or simply buying an industry for the future doesn't sit well with their sense of global fair play.

What we have seen with Kwinana and Kemerton is that Australia is a very difficult and expensive jurisdiction to get into the chemical processing of Spodumene. Only natural for companies to go where they can maximise ROI and government intervention is playing a huge role in where capacity is being built globally.

Do I want to see PLS building a Hydroxide refinery in Australia if it may cost twice as much and potentially not be as competitive in terms of opex? Nope.