Here’s an overview of how things went down for those who couldn’t attend. Nothing particularly new. NF presentation exuded confidence as also, however I wasn’t convinced that we are ‘Imminent’ for ML. A few points he mentioned about difficulties suggests to me that we aren’t just awaiting formalities or anything like that, but that the fight remains well and truly on.
2022 AVZ Annual General Meeting Notes
Chairman’s address: Some milestones were reached, however also some unexpected delays beyond company control. We affirm that we legally hold 75% interest. Have purchased some critical equipment. Our project progress and a buoyant lithium price boosted our SP to record highs this year. Despite highlights, voluntary suspension entered pending award of ML. Awarding unexpectedly delayed, unissued by CAMI in addition to disputes over the mining/exploration rights. Attracted unwanted global attention given scale of resource, third parties trying to join the game unlawfully. Claims spurious, hold no legal basis. Continuing to engage at the highest levels. Granting of ML catalyst to lift suspension. NF working tirelessly to defend the project this year. Extremely frustrating times for us all. AVZ still well sited however to develop one of the world’s most significant lithium mine.
Items of Business:
Renumeration Report: Initial vote count suggests easy pass. No Q’s
Re-election of Rhett Brans: Initial vote count suggests easy pass. No Q’s
Ratification of subscription shares: More against votes for this one, but still likely an easy pass. No Q’s
Ratification of previous shares issued: Similar against votes as the above, but still likely an easy pass. No Q’s.
Nigel’s Presentation
- We want to be a transformative resources company, delivering long term benefits for all stakeholders
- Serge and Balthazar are critical pieces of the puzzle – presenting us to government and moving forward through a difficult time
- Have 48mil in the bank, and we intend to have a 3-month rolling approval for budget. If things turn to the worst, we’ll take the decision to cut back on budget and save cash.
- DFS numbers well and truly out of date now – due to prices spiking massively.
- 75% ownership totally undisputable. Can’t listen to any of the nonsense going on with third parties trying to claim percentages. We’ll be going to the next level in defending this if need be.
- Capital requirements likely over US$600m now, even for 4.5 mpta plant.
- Infrastructure is something we need to get sorted, to mobilize our equipment
- Despite best efforts of people in country that say we don’t have the hydro facility – its undisputable that we do, its under the MOU and we are the one’s who will be refurbishing it. We’ll fight tooth and nail to keep M-P
- Awakening the monster – still asleep now until ML, but it’ll be a game changer.
- Good news coming in in the future on strip ratio
- RD focus - very clean product. Old pegmatite boundary was being hidden, and a larger peg boundary now means more tonnes can come into the pit design.
- Drilling programme for RD ongoing – 4 drill rigs operating 24/7. This will keep going until resource completed. We believe this will be a good boost for reserve tonnes, and strip ration.
- We were looking at about a 20% LCE market share, based on demand, which could go higher.
- We still retain first right of refusal of Cominere’s remaining percentage. “we will be purchasing that 15% if the hurdles are removed, as long as number is right”
- C’s must cede its 10% to the government – under our JV agreement
- Very confident of maintaining majority ownership moving forward.
- We went into trading halt originally because of short selling campaign, and then decided to stay to protect shareholder value
- Enemies doing a very good hatchet job on us in country, but that’s turning around
- Don’t believe Jin Cheng have a leg to stand on – we’ll be taking them to task
- We’ll be defending Dathomir – won’t be held up much longer. Legally we are on a very strong footing. Pretty sure it will be a positive outcome for us. It was only after we’d received the share certificates that they started messing around with legal actions
- CATH meeting with us next week, to have an update. CATH still very keen
- Intend to stay in suspension until ML delivered. No point in coming out without it and allowing short sellers to beat the price down.
- Sustainability and ESG a main focus. Even though well be a bit of a black startup due to calcination needs, but that will be eased over time
- DFI’s still at the table, still keen to get involved, and have large checkbooks interested in opening to us when ML delivered, and data rooms reopened
- Funding should be well and truly covered - and can get more if required
- We’ll be looking for additional O/Ts as expand – looking for geographical diversity
- We are revising the wheel of the original route used in the Belgian tin mine. North from Manono on either the road (needing refurb) or river to rail, traveling to port of Kalemie in Dar es Salaam. It’s operational. Transport does work, but needs to be upskilled and upscaled from 500 tonne a week -> 5000 tonne a week. Need to change gauge too
- Central corridors logistic study is underway, through consultants. With logistics optimization plan
- Why PLS – higher value product. Reduce shipping tonnes. Targeting Europe (reducing waste). 90-94 percent product, 6-10 percent waste. Low waste approach – waste included into landfill in Manono. Ongoing studies with hydroxide conversion which are looking good. SC6to PLS 4:1
- Very comfortable with expansion of operations. 10mil tonne study underway – need to fill in details and fill in funding plan for that.
- 2 PLS plants planned – jumping potentially into Hydroxide plant somewhere
- Early works – Colleen ready for 120 rooms by Dec. 130 more by April/May. Employing quite a few people. Disregard the nonsense on HC and Twitter that we’ve only done some huts and aren’t spending on the camp.
- We’ll need to expand manpower significantly as soon as ML awarded
- We aren’t messing around with bad actors in DRC, we’re meeting with the highest level
- We are as keen to get the ML as you are, we’re all SH’s too and are struggling with it too.
Question and Answer Session:
- Who’ll be looking at Biofuel:Sugar Cane possible to create ethanol – we’ll be inviting people in the SEZ to help with biofuel needs
- Who is the doing the 10mil study– Works being managed in-house with consultants, also outsourced through engineer companies used previously. We’re comfortable with them
- How do you see the development shaping up / staged, or straight into the 10? - With expansion, it’d be silly not to start off with a bigger bang, if we’re supported in that. When it comes to processing though, we’ll be ramping up over time. Wrinkles to get out of the way first, transport, materials etc.
- What happened after ML Decree – spurious yet we’re in suspension. What’s the main issue for ML – is it Dathomir, is Zijin ICC arbitration 15, dispute with exploration rights? – Lot of players in vogue here in country, lot of hatchet jobs being done – President had a bad view from being ill advised by detractors (e.g. we hadn’t done anything, didn’t have money experience, and were speculators). Detractors continuing, but slowly slowly we’re working to remove the blocks.
- We knew Chinese would have a crack, but we did not expect parts of DRC government to be in on it?Nor did we - “we thought it was gambit by Chinese groups to get project cheapest way. We weren’t aware it was also elements of the government complicit. We can’t go into it, but rest assured those people are being turned over within meetings with real information is being shared, and people put on the spot.
- Collusion between all those 3 – namely Zijin, Jin Cheng, CAMI? – That would be astute
- Issue that a portion of mines directorate said we hadn’t done the work on the northern tenement area, and shouldn’t get the north?. That’s not within the mining license. So 13359 should be retained in its entirety – however the northern area may need to come under a separate exploration tenement, even though that’s not the established process. – We know who’s behind this (e.g. DG CAMI)
- What about AJN having a crack– “their premise is that we’ve returned the northern tenement to government. We haven’t. Draw a conclusion out of that”. I was a founding director and bought in as gold explorer. Found out late in the piece for a lithium plan – stepped away as soon as learned that. Shares bought before that lithium plan came into play. No conflict of interest.
- SEZ/BFS delays– the BFS will come out in good order, still gathering information on that. CATH keen for expansion plan – wanting to be no1 hydroxide producer in China. 10 Mpta output makes sense.
- Directors insurance going from 90k to 500k, why? – no claims against us, the rise is because we’ve developed size wise. It’ll rise further when we’re developing
- Interview NF mentioned once mentioned once decree issued 10 day period beforeCourt could issue the licence.What happened? = This was a misunderstanding. As soon as your documentation was in order and issued, this talk of periods was regarding the ministerial decree. Other steps in way of ML – CAMI have held up the invoicing, illegally in our view.
- FIRB knocking back deal Yibin Tianyi if oz govt see national interest what input have they had in support and has board sought them out? NF in discussions with ambassador in Harare, but she’s very limited in what can be done with private companies. She can grab a minister and ask for updates, but we’re unable to do much more than that.
- Given over 6 months since decree, doesn’t it concern you that your belief in high level support is ill founded? – NF - not from what I’ve seen and our visits. Very select group of govt officials have been working as a coalition to extract what they can out of this, corruptly, and misinform the senior people. Id be surprised if you don’t see changes coming up, with some of the public platform announcements coming out of a certain ministry shouldn’t be done (nothing to do with her). O the senior side of things, NF is even more confident now than I was 6 months ago that the right thing will be done
- Equipment needs long lead items– nothing done as yet, comes down to what size we are going to go down for. Yes, there’s some items we need to put down – but we don’t know yet 4.5 or 10. We’re mindful of it.
- Is there tribal attachment behind the blockage– Don’t think it’s a tribal thing at all/ Purely a fact of opportunists that have done a great job that we’re having to unwind. I think we’re just about there and will have what we need coming shortly. And those people will be taken care of.
- Any ML ETA– ETA TBA. (laughter)
- What happens if percentage conflicts doesn’t go out way- I don’t think we’ll entertain a contingency, we are adamant in our JV rights. And JV is clear too that Cominere to cede 10% with the government. With CATH they are after security over product. The 24% is flexible. We wont wait for ICC for ML. 100% confident the ICC will turn over Jin Cheng. Expecting a blush moment for Zijin because proceedings will be public.
- When will RD drilling results be ready? – probably March 2022. Geotechnical appraisal being done on the side, needed specialist support. That latter process will take as long as it takes to update reserves. Hopefully up to 300 million tons to help support a larger operation. Increase reserves is intended in part to increase SP.
- Plant Construction time? Two year build process – not a lot of difference between 4.5/10 mil construction. 10 mil would be ramped.
- DRC export rule of raw material– Chinese being hauled over the coals for continuing to export copper concentrate. Its something we need to be mindful of, but remember it’s a bulk commodity, and we intend to progressively move more and more to PLS
- What’s the status of the Battery Council? – out of our control. My understanding is that discussions are ongoing, including where SEZ will be located for Battery Development. We hope to have a say in what’s going on – hopefully supply our product to it whether PLS or even hydroxide.
- Do we have enough manpower? For current construction, yes. We’ll be bringing more people in when we have more certainty – and certainty is ML.
- Why have we been inactive on social media?– no comment. There’s no need for airing dirty laundry, doesn’t serve any purpose. That’s our plan til ML delivered. Maybe down the line you’ll see some fireworks
- Production schedule: Delayed yes. Perhaps mid-2024. If we get licenses quickly.
(20min delay)