General Discussion, page-9464

With the Lithium producers Activities reports now released, it’s interesting looking at some of the C1 costs (I’ve converted to USD)

remember too these are FOB prices excluding delivery + Royalties, quoted SP6 prices are CIF - include del + royalty

PLS US$416/t - US$523/t cif China

CXO US$1289/t - they mined a big stockpile for wet season, so probably lower

SYA/PLL - US$922/t sales price was only US$624/t

IGO Greenbushes US$ 235/t

MIN Wodgina SC6 basis US$ 577/t (said Mt Marion + Bald Hill profitable)

Add in sustaining costs and even PLS is getting close to breakeven at current $850/t prices.

Looking at how we’ll fare, our DFS was done in Dec’21 so a bit outdated, but gave C1 as US$312/t and AISC of US$365/t.

Simon has said they’ll update that when all the contracts etc are awarded.

As a guide, LTR did it’s DFS at a similar time to us. It’s DFS C1 cost was only US$7/t more expensive than ours, I think it was very rubbery in the 1st place. They updated their OPEX in Sept’23, Interestingly their processing costs are now almost the same as our DFS (LTR US$10 cheaper), their mining cost $449/t is triple our DFS cost. Their awarded mining contracts on a per annum basis were also 3x our mining contract which was awarded July 2023. Considering we’re low cost (there are advantages to being in Africa) our DFS figures stack up very well to LTRs updated figures.

I have no doubt our C1 costs will also increase, however our DFS mining costs are in line with LTR’s update given the known contract awards + cost. Our Processing cost is $10/t more than their updated figure so IMO just as we didn’t experience big CAPEX blowouts, I think we’ll be pleasantly surprised by our updated OPEX figures.

Even if it increases 25%, that still gives us a C1 cost of US$390/t and an AISC of US$456/t

Even allowing for Royalties + shipping, that is still a healthy margin from today’s prices, yes we’ll burn some cash commissioning & during ramp up, but with Ganfeng’s expertise that should be fairly seemless.

Fast Markets expects these prices to persist throughout 2024, IMO many of the higher cost producers may end up on Care & Maintenance. Between ourselves and Liontown we’ll be putting an extra 1 million tonnes of SC6 on the market (per annum basis). That is not going to help the supply/demand equation, only the low cost will survive. Yes being in Africa is a pain in the a^*e sometimes, but for once we’re going to be very glad for the low cost benefits.