I’d like to bring in a few points that Ifeel need making in respect to much of the vacuous negative sentiment that is beingposted here. I have used some as examples, and wish to finish on a note that Ithink is realistic.
Some I know will ardently disagree with mysentiment, however when one dares then must expect the criticisms.
12 Dec 19
If it was going up and down we wouldn't be so negative.Unfortunately it's going down and down with no end in sight.
Mate, you keep putting up Lithium charts. Maybe you shouldactually look at them. Lithium has risen since late August, we haven't. Youcan't correlate the two.
10 Dec 19
Take a look at the chart, champ. You'd have to turn it upsidedown not to have a "negative, henny penny, sky is falling opinion"
It's a punishing stock that's for sure. All the glossypresentations, roadshows etc have obviously been for nothing because the marketis not impressed. If 1.5c falls from a TA point of view, watch out.
Bye bye the SP goes again.
9 Dec 19
Why throw more good money after bad.
I hope you're leaving your shares to your great great greatgreat great grandchildren then!
8 Dec 19
3c, wow you're confident. Will struggle to get to 2.5c Ireckon.
And yet LPD continues to go down!
6 Dec 19
Yep I’d take it. Really going to struggle to get to 2.5cotherwise. So much overhead resistance and too many SOI.
I’ll take a takeover price of 2.5c right now and move on.That’s a 50%+ premium.
29 Nov 19
I'd be surprised if this EVER became a 3 bagger from here letalone a 300 bagger. It's a ridiculous thread and should be closed.
It's called interpreting the chart. TA. You think it's downramping because I am solely responsible for LPD going down.
1.5 close. If 1.5c falls from a TA point of view, we're inbig trouble.
20 Nov 19
A paid report, probably can't see them valuing LPD at 2cwhere it should be.
The litany of bearishness just goes on.
My question is:If he identifies a stock *EL ( I’ve kept the first initial oblique in order not to cross-promote) as being the best on the AXS, why not cut his losses on LPD and shift the funds to this better performing stock.One would think he has done the due diligence on both companies, why is he still holding?Even Jasox was rational with his choices a few months ago.
24 Sept 19
Your response Beton2:
Re your last sentence, not if they are supplying anattractive product.
Date released 16-Sep-19
Product | Producer |
|
Content | Lepidico | Lepidico | SQM | FMC | Albemarle | TIanqi |
Pilot Plant | Mini-Plant |
Li2CO3 (% min) | LCE | 99.9 | 99.9 | 99.2 | 99.5 | 99.8 | 99.5 |
|
|
| Impurities |
SO4 (ppm) | Sulphate | <10 | 134 | 300 | 1000 | 500 | 800 |
|
Na (ppm) | Sodium | <10 | 13 | 600 | 500 | 650 | 250 |
|
K (ppm) | Potassium | <10 | 14 | 50 | 10 | - | 10 |
|
CaCO3 (ppm) | Calcium carb | 919 | 140 | 250 | 1000 | 400 | 125 |
|
Fe (ppm) | Iron | <10 | 9 | - | 5 | - | 20 |
|
Moisture (%) |
| NA | NA | 0.2 | 0.5 | 0.35 | 0.4 |
|
PlantProject Feasibility Study▪Key metrics for the Feasibility Study scope* are plant thoughput at 3.6tph of lithium-micaconcentrate (annualised rate of 29,000tpa –91.4% operating time)-
Batterygrade lithium carbonate equivalent (LCE) production of 3,000tpa nominal, withdebottlenecked capacity of 5,000t –6,000t pa LCE -Average C3 Costs ofUS$1,000-2,000/t after by-product credits including:
i)amortisationof development capital-Capex of US$40-45M
ii)incl.20% contingency and US$5M for DFS costs-
iii)Valuablesuite of by-products including
a)sulphateof potash (SOP),
b)caesium,
c)tantalumconcentrate and
d)sodiumsilicate
Pilot plant has:
§Run at 15kg per hour L-Max® pilot plant completed on schedule and within A$3M budget, April 2019 Campaign 1 completed August 2019 and:
§LOH-MaxTM capability being retrofitted for Campaign 2
▫demonstrated L-Max® technical viability using small scale industrial equipment, similar to that employed in the Phase 1 Plant design; expenditure eligible for R&D tax refund (43%);
▫produced 99.9% Li2CO3 with very low impurities (ASX 16 September 2019);
▫generated material for further product development of: SOP fertilizer+52% K2O, amorphous silica (S-MaxTM), caesium/rubidium brine and environmental remediation residue;
▫reduced scale-up at nominal throughput of 6.9tph for Phase 1 Plant to 460 times; and
▫provided data for optimisation of Phase 1 Plant operating parameters
LOH-MaxTM delivers an industry solution to lithiumhydroxide production without by-product sodium sulphate
§Strategic Metallurgy Pty Ltd, in collaboration with Lepidico, has developed a hydro-metallurgical process that produces high purity LiOH from a lithium sulphate intermediate without the production of sodium sulphate.
▫LOH-MaxTM is compatible with the highly efficient L-Max® impurity removal stages and,
▫can replace the subsequent standard industry sodium sulphate and lithium carbonate recovery circuits
Lithiumchemical demand growth has shifted strongly to LiOH
§Strategic Metallurgy Pty Ltd, in collaboration with Lepidico, has developed a hydrometallurgical process that produces high purity LiOH from a lithium sulphate intermediate without the production of sodium sulphate.
-LOH-MaxTM is compatible with the highly efficient L-Max® impurity removal stages and can replace the subsequent standard industry sodium sulphate and lithium carbonate recovery circuits
-Capital intensity and operating costs are more competitive than for production of lithium carbonate:
-Elimination of sodium sulphate circuit; significant capital equipment and by-product sales risks removed
-Potential for lithium hydroxide and/or carbonate producers to retro-fit existing plants or redesign planned plants
-Funding and off-take agreements for new lithium chemical plants in 2018 were heavily skewed towards LiOH operations
-Process residue is benign and alkaline, and is being evaluated as an environmental remediation product
Source: DevelopingHigh Purity Lithium Chemicals from Lepidolite, Corporate Update September 2019§Final engineering due December 2019, to include:
▫6.9tph concentrate feed for c. 5,500tpalithium hydroxide output;
▫LOH-MaxTM process design; and
▫pilot plant optimisation plan
Phase 1 Production Plant:
▫ Primary location: ICAD close to excellent established infrastructure:▫ Local abundance of key reagents, sulphuric acid, limestone and lime;▫ Competitive labour, gas and power costs▫ Close to markets for bulk by-products: silica products and SOP fertiliser▫ Non-binding off-take MOU with BASF for LioH▫ MOU with Gulf Fluor for marketing by-products▫ Feasibility Study results due March 2020State of the Battery Manufacturing Sector and Chemical supplyGrants from the EUBattery cell production in Europe can be subsidized with billions of euros in the future according to a decision of the European Commission. The Brussels authorities gave the green light on Monday to promote the so-called "Batteries Alliance" in seven countries - including Germany and France - with up to 3.2 billion euros. "We want to build the most innovative and sustainable batteries in Germany and Europe, thereby safeguarding added value and jobs in Europe." For example, BASF intends to further develop the performance and cost-efficiency of batteries with battery materials.
The U.S. Department of Energy released a report highlighting critical materials (lithium as being one) playing a key role in the development of clean technology.Lithium prices have already started showing signs of life in 2019, this is only the beginning. One big reason lithium prices started to rise is U.S. electric vehicle sales in 2018 soared 80.8%.
According to Roskill:
“Demand for lithium is expected to increasefive-fold over the coming decade, driven principally by demand for lithium-ionbatteries and their use in electric vehicles, energy storage systems andportable electronics. Lithium demand is forecast to increase by over 20%py,with demand from battery applications increasing by over 25%py through to 2028.Meanwhile demand for lithium from industrial applications such as ceramics,greases and glass are also expected, albeit at a more modest rate of 2-3%py.With this backdrop the lithium industry will require significant investment inadditional supply from new mines, process plants and from the nascent recyclingindustry.”
They go on to say: “Recently there havebeen capital expenditure blowouts, delays in mine ramp ups and the bear marketin the lithium equities has undoubtedly curtailed investment in greenfieldprojects. These developmental challenges, along with the changing cost profileof the industry, highlight the technical and financial hurdles involved withbringing such sizable volumes of new capacity online. We maintain the view thatconcerns about future refined lithium over-supply are poorly founded and expectthe lithium market to enter a period of sustained supply deficit in the early2020s.
Some points made from an 9 Dec 2019 Interview withRodney Hooper
LithiumSupply:
It is of upmostimportance that companies wishing to stay in the Lithium Industry arepositioned to supply the required battery manufacturers’ specifications.Whether Li2CO3 or LiOH.H2O the level of impurities must meet specifications -orbe lower.
SQM is being forcedto sell into the Chinese market is because its product contains impurities whichare too high, therefore not reaching battery makers’ standards; and is beingrejected by Japanese, Korean and European OEMs.
Bifurcationof the lithium market:
Lithium equivalentprices in China fetch US$7,000 or less, whereas battery grade quality forLiOH.H2O in Korea and Japan sells US$12,000 to $15,000.For suppliers to the lithium chemical and battery makers it is imperative to get the higher price range as the competition for the low end of the market is very intense and a large majority of these suppliers will exit the industry.
AQuality Lithium Asset Investment:
Must have a good supply of the rawmaterial, either brine or hard rock.Plus, they must have the processing capability and the human capital of ‘know-how’ to get the right product to market after the initial processing for end-user specifications. Companies at the grass roots level of development are found, in the main, to be wanting in their expectations. Their presentations are often over-blown; and their feasibility study(s) figures paint too rosier a picture and outcomes do not match their claims. This inadequate behaviour will continues with the rush to get into production the cheap end of the market will continue to be over-supplied and demand constrained and limited to the industrial sector of the market.Eventually there will be a clean-out of these suppliers as growth in supply fails to be matched by demand; the rationalisation of the industrial supply sector will be very painful.
The companies producing aconsistent product (Li2CO3 or LiOH.H2O) that meets battery qualityspecifications by removing highest level of impurities from the product willfair the best in earnings.
Gangfeng is the gold standard in theLithium Equivalent market when it comes to meeting battery qualityspecifications and having long standing relationships with its customers.Lithium chemical/battery manufacturers need US$100 per Kwh to make a margin andEVs competitive.
These lithium equivalent extraction processmethods will get the best revenue result post 2025 when EV mobility take-offmoves onto explosive demand growth.
Quality LiOH.H2O is in short supply at the moment;however, when the supply squeeze really hits in 2025 and things tighten upsignificantly there will be endogenous shock to market that is not widelyexpected.Presently, the small EV car’s up-front price is more expensive than its counterpart ICE models to buy – this however doesn’t take into account the operating costs over the life-time of the cars. Despite this, European sales for EVs in 2018 were up 76% Y on Y. Sales for the 2020 year is forecast to exceed 1 mill units.And if VW, Tesla and China meet their sales targets for 2023 then given current projections, potentially there will be no other lithium equivalent for any of the other EV manufacturers.
Chinese car sales have been growing rapidlyfor years and even with the economic downturn, are still expected to rise by26.68 million in 2019, down from last year’s figure of 29 million. Of those,about 1.5 million are expected to be electric, an increase of 240,000 on lastyear. The figure is rising despite the removal of subsidies of up to 60% inJune.A factor that may mitigate the scarcity of lithium equivalent is China’s E6 policy, whereby it abandons all of its subsidies to purchasers of EVs.
BYD Co., China’s biggest maker of new energy vehicles, or NEVs, last month reported an 89% slump in third-quarter earnings and warned profit could fall as much as 43% this year.
China has by far more electric vehicles onthe road than any other country, with about 45% of the world’s 5 million at theend of last year. Europe had 24% and the US, 22%.China wants electric and hybrid to account for one-fifth of sales by 2025, South Korea aims for 30 per cent to be electric next year, Germany has set a target of 2050, while France and Britain are looking to 2040.
**
Where does Lepidicoposition itself in this market?
A.It is generally believed to be low on the cost curve. This is yet to be proven, and will require full testing over several production cycles.
B.The grades of its products have shown to be of high quality for Li2Co3, we now await the results for LiHO due late this month, but could be delayed due to the holidays.
C. What are our connections? BASF and Gulf Fluor with M of U(s) –usually not found to be reliable, one can always be surprised. Also, Portugal Mota Ceramic Solutions (MCS).
D.Feedstock supply: Alvarrões, Portugal (recent Jorc completed Dec 2018); Lepidico continues to hold an exclusive right until 7 March 2020 to finalise a commercial relationship with MCS with regards to ore supply from Alvarrões. And Namibia, which now is, it appears, to be the main source for feedstock. The least likely is Separation Rapids, Canada; it now seems to be on backburner.
E. Management: Team is harmonious and works well together. It is accessible to shareholders, occasional slippages in time-frames. On the whole a strong team.
F.Capitalisation and Project Financing: As with the vast majority of small greenfield companies, Lepidico is not financially strong. At its last quarterly report in Sept 2019 Qtly it had cash and equivalents of $6.541 million; and an expected cash burn for coming quarter Dec 2019 of $2.225 million. If that eventuates it will be left with $4.316 million. If the program goes to plan, i.e., LiHO tests are successful then that would leave the company only having to deal with normal operating costs prior to a capital raising later in 2020; however that would depend greatly, on whether there is a requirement to do further infill and explority drilling.
G.Balance Sheet Strength (BS): The BS is getting to the stage where further capital raising are becoming more difficult as the share price is not carrying sufficient premium value to make it attractive for shareholders to take on more shares at current price levels. Consolidation will not make it anymore attractive because without a cash-steam of earnings there is nothing to support the price after consolidation, parcels below a certain level of value will become unmarketable leaving small holders high and dry; and with negative feelings towards the company
H.Shareholder Base: If Lepidico can avoid offending its current shareholders (and future shareholders) it can continue having such a loyal following.
(20min delay)