Hi NRW people.
For those who know who they are and care , I’m back in Perth for a bit
- And five weeks on Sunday into my ‘season of the ankle’.
…And wondering if life will return to old foci (ie mainly NRW) now I’m draped again into one of my comfy old ‘office’ couches.
If I start posting again like a babbling brook (as was my wont) we’ll know it’s the couches?
….Or perhaps the lay lines here?
Or something?
Oh but perhaps the quieter NWH threads have just been because NRW was just having a dearth of news?
And nothing to do with Sabinic sick leave?
However I think I wrote a few days ago that there’s never ‘no news’ at this fine and very busy company ?
And even when there’s a constant gurgle of babbling brookiness, that’s not even the half of what’s really going on behind the scenes
.. still it keeps the threads moving .. and gives a feeling for the company?
And re the official, out-in-the-open, potentially share price-impactive news, it is only six weeks now, till the curtain falls on Financial Year 2023!
So the news must start?
And has.
I have some tonight from the Canadian lithium company, Green Technology Metals (GT1).
Not because I am looking over the fence!
NRW’s Primero is a part owner of GT1 to the tune of more than 10 million shares (since seed!) and Primero boss, Cameron Henry, is heavily involved beond this with an equal number of shares, plus options, plus big clout as a founder and non executive director!
The news is that this fledgling company (which has the starter upper of Pilbara Minerals on board too) has just done a deal with LG Energy ..
Deal-making in the red-hot lithium sector shows no signs of slowing down, with Canada-focused explorer Green Technology Metals inking a $20 million investment and offtake agreement with LG Energy Solutions.
The deal — which advances Green Technology Metals’ plans to be the first producer in Ontario — sent shares in the company soaring 14.1 per cent, or 9.5¢, to close Friday at 77¢.
It will give the South Korean battery-maker a 7.89 per cent stake in Green Technology Metals and access to 25 per cent of the company’s spodumene production from its flagship Seymour lithium project in Ontario for five years.
A boom in electric vehicle demand is fuelling a wave of mergers and acquisitions in the lithium sector, with a $15.7 billion tie-up announced last week by Allkem and US group Livent.
LGES is investing $20m in Green Technology Metals at 92¢ a share, representing a 43 per cent premium to the 30-day volume weighted average price.
The company’s Perth-based board counts Pilbara Minerals co-founder John Young as its chairman Cameron Henry of Primero Group as a non-executive director.
Green Technology Metals chief executive Luke Cox said the offtake agreement was the final piece of the puzzle to completing a stable critical minerals supply chain in North America.
“We plan to be concentrating the material and then converting it (in Thunder Bay) and distributing to the battery manufacturers all in the one province,” Mr Cox said.
“That really completes the supply chain . . . you’re now going from a rock, to a battery, to a car, all in North America. That’s like the golden chalice for anyone.”
Green Technology Metals is planning to build a lithium hydroxide plant in Thunder Bay which would feed a number of battery manufacturers in the region, including Volkswagen.
The German car manufacturer last month committed $C7 billion ($7.8b) to building a battery gigafactory in St. Thomas, Ontario, the biggest single investment ever in the country’s EV supply chain.
Green Technology Metals’ lithium hydroxide plant is slated to start operating in mid-2027, with an initial capacity of 25,000-30,000 tonnes per annum.
The offtake agreement also comes the same week as Canadian Prime Minister Justin Trudeau travelled to South Korea to shore up supply of critical minerals and expand security ties. China currently dominates the market for critical minerals for EV batteries.
Mr Young said he looked forward to LGES’ contribution as a new strategic partner alongside other major shareholders AMCI, Lithium Americas and Primero, which holds 6.5 per cent of Green Technology Metals.
“LGES brings global scale and expertise in battery manufacturing as well as balance sheet strength as GT1 advances its integrated lithium strategy in the Tier 1 jurisdiction of Ontario,” he added.
Green Technology plans to use the funds from the deal to advance its Seymour project, which is due to start construction next year and produce spodumene concentrate from 2025.
LGES chief procurement officer Myung Hwan Kim said the company had always been committed to expanding its supply chain in North America, noting a steady supply of critical minerals was key to delivering reliable power solutions to customers.
Battery Age Minerals and Critical Resources are also developing lithium projects on Ontario, while Patriot Battery Metals’ flagship Corvette Property is in the James Bay region of Quebec.
As you can see from the chart, the price at GT1 has been higher than that at which it closed at on Friday.
And 6.5% of the MC on Friday was around $9.5M - which is peanuts to NRW in the general scheme of things - but still the investment was minimal to start off with according to Jules.
And Primero boss, Cameron Henry not only owns an (equal?) number of shares but is a founding partner of the company and a non executive director!
And that gives the ‘us’ contingent considerable clout?
And as Jules said in the half yearly call in 2022 (when prices at GT1 were heading for their first peak) the potential is solid for NRW in regards future contracting work*.
GT1 is “an example of, if we’re in there very early, in terms of providing services for these clients on assets that are yet to be explored or drilled, we have an opportunity to potentially invest in some of these things and not necessarily just become the contractor, but also to become an equity investor in some opportunities
.. and obviously there’s a great example of a success story.”
*and in line with this, greater reputation in the field as a ‘go to’ provider..
(20min delay)