PLL presentation, page-2

So have I understood this correctly,

The Abitibi hub has existing facilities that were on care and maintenance and is restarting. They PLL has signed a life of mine offtake agreement with a floor price of US$500 and ceiling price of $900 which will ensure production is profitable in all market conditions, including periods where Spod prices may be low. The offtake is the greater of 50% of production or 113kt/yr.

At the 16 minute mark there is a presentation slide noting the following:


The Abitibi hub is expected to be in production in 1H 2023 (per below), at which stage PLL will still be constructing hydroxide facilities. This will mean that PLL will either stockpile this 113kt pa, or sell it on the spot market in 2023 and probably also in 2024. While PLL has an economic interest of 37% in Sayona, it has a 100% interest the Spod received from the off-take at a price of no more than $900/t.

Assuming spod price come back down from their high's to US$3,000/t in 2023 (some HC posters wonder whether this significant fall won't happen until 2024 when some other big projects come online). PLL would be in a position to make $2,100/t on-sale profit on this 113kt of Spod (or US$237.3m of EBITDA). If its two years before they need this production capacity as feed for Hydroxide, they have two years of spod sales in what is likely to be a strong market. A significant portion of the financing needed for Hydroxide could come from Spod on-sale profits from their capped contract. If you use current US$5,000 prices for spod, then the on-sale profits are just crazy, potentially as much as US$463m over a 12 month period.

https://sayonamining.com.au/authier-project/



https://piedmontlithium.com/piedmont-lithium-outlines-2022-development-plans/