Good to see the quarterly land today.
What’s “new”..?
Circa $12M in the bank is great.
$13,400/t for the 20t shipment. Not awesome, but not bad either, afaict.
80t of carbonate on the shelf. Great. Good tester product volume for potential partners.
In relation to my comments last night about cost vs pricing wrt to the current plant. the company has now stated its concerns on this more clearly - noting that ramping and producing “
may not achieve economic viability in the short term”.
This is clearly linked to their comments about “
current lithium market conditions and near-term lithium price forecasts”.
So yes, it does appear that they do not want to get in a situation where they run down capital to get the output up, only to sell at (potentially) a loss for an unknown period. One might argue this is a prudent decision, and might prevent a much more dire situation in 5/6 months’ time if the market remains sh!t and the options even fewer.
I had earlier thought we could push through the ramp up and ride out the storm, but it looks like they are being more conservative and don’t want to even get close to a situation where they are up against the wall and have to choose between a couple of sh!tty options at that stage, if crappy conditions and pricing persist for another say 6 months or so, or perhaps even more. No crystal balls unfortunately.
Understandable I suppose, to take a less risky path amidst the uncertainty and considering the recent pessimistic forecasts by the big dogs. (Those market and pricing forecasts and their basis/merit etc are another discussion btw!)
Btw, those with a keen eye will have noticed the 2ktpa cost assumptions (a while back) from cannacord, which iirc was $14k/t. How “accurate” that “assumption” was is unknown, but considering the anticipated costs of higher capacity production (ie at 10ktpa), there is no doubt that production at 2ktpa would be higher cost, and that would increase further still at lower quantities. Afaik estimates have not been released for 2ktpa, but I presume the 2ktpa plant could be profitable at circa $15k/t or perhaps even a bit lower than that, but with eg GS now forecasting closer to $10k/t next year (DYOR and judge the merits of this for yourself), the concern about “
economic viability (of near-term production)
in the short term” is arguably understandable, one might argue…
Anyway, as I said, the management of Puna Mining, alongside the management and board of AGY, has far more specific industry engagement than I do in relation to the targeted partnership, and the various operational options and best path forward, so who would I be to say it’s the wrong choice? Are the armchair experts here any better-placed to comment on the suitability or otherwise of what is being done? …or how things have been done in the past, for that matter…? Ponder that for a while.
Also, wrt to EPCM contractors for the expansion, this has been the plan for some time already, and not a recent “decision” or revelation, eg stated here 9 months ago:
DYOR and put your own jigsaw together; the haters and BEOT desperately want you to upend the table where that jigsaw lays, so you react emotionally and make subjective decisions. Beware.
It sure does suck to see the sp bounce around so much, but we have seen similar waves before and there are very clear fundamental market drivers that are certainly influencing our opportunities and options as a business…. And yes, sure it would have been a smoother ride had the plant commissioned smoothly… but reality is a b!tch and here we are. The game is far from over and we still have significant resources up our sleeve.
Still no dealbreakers afaict, and I note that few (if any) are talking about the risk-reward with the recent sp carnage. Easier to just sh!t on the company and supportive shareholders isn’t it?!
GLA Genuine LT Holders
imo
Dyor
(20min delay)