If they pay 1 or 2 years up front, then things to consider:
1) Is it 1st and 2nd year paid up front prior to production or is each year paid at the start of that year?
2) We will need OPEX for each year prepaid. How much would they need? If it is all received upfront, then we need to put enough aside to get through to the 2nd or 3rd year. Otherwise we will need to get some other form of finance for OPEX.
3) We will need development funds in the 1-2 years PRIOR to first production. Upfront payment received at the start of the production year won't help pay POSCO's capex bills!
I don't know that it will be a game changer, but it certainly goes a long way in terms of providing guarantees to development financiers that we will have both cash and customers.
TNG Price at posting:
17.5¢ Sentiment: Buy Disclosure: Held
