Keith — great post!
Now let’s walk through a conservative valuation scenario for ESR, focusing solely on the limestone component!
LIMESTONE VALUATION assumptions:
Resource size: 500 million tonnes of JORC-compliant limestone
Sale price: USD $15 per tonne (approx. AUD $22.50 at 0.667 FX rate)
Net margin: 15%, accounting for middlemen and operational costsFX used: 1 USD = 1.50 AUD
Gross revenue:500,000,000 tonnes × AUD $22.50 = AUD $11.25 billion
Net profit @ 15% margin:AUD $11.25 billion × 0.15 = AUD $1.6875 billion
Now here’s the cautious part:Let’s assume significant dilution, with the total shares on issue eventually increasing to 4 billion, double the current register.EPS = AUD $1.6875 billion ÷ 4 billion shares = AUD $0.42 per share
Valuation range using extremely conservative P/E multiples:
P/E 2x = AUD $0.84
P/E 3x = AUD $1.26
P/E 4x = AUD $1.68
Even after assuming maximum dilution and rock-bottom P/E multiples, you’re still looking at a SP that no longer resembles and Junior explorer.
UPSIDE IF ESR CRUSHES LOCALLYIf ESR crushes and screens the limestone on-site in Timor-Leste (e.g. 10–30mm flux-grade), sale prices could increase to USD $25–30 per tonne (AUD $37.50–$45.00).
Let’s use USD $25/t as a midpoint:Revenue = AUD $18.75 billion
Net profit @ 20% = AUD $3.75 billion
EPS = AUD $3.75 billion ÷ 4 billion shares = AUD $0.94
Even on a P/E of 3x = AUD $2.82 per share
Now to the big question...
How does ESR define 500Mt of limestone under JORC in the next 3.5 months — with just a 13,000m drill program?
Per the announcement, ESR must:
• Announce a JORC Code compliant resource ≥500Mt by 30 September 2025
• Complete a positive Scoping Study by 30 November 2025
• Secure export approvals and port infrastructure by 31 December 2025
These aren’t aspirations — they’re contractual deadlines, and the JORC resource is critical for triggering REM’s minimum offtake obligations.
It’s likely to be Inferred, but still, it will unlock asset-level financing, infrastructure partnerships, and external funding options.
If they can show there’s 4x that limestone in the ground, which I believe,
ESR could become one of the largest undeveloped industrial mineral stories on the ASX.
Also watch today's close, we must be getting close to the drill landing in Timor-Leste, and I’d like to see some strength ahead of that, hopefully beginning next week.
One catalyst at a time, but 30 September is shaping up to be a defining moment for ESR.
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