TAW (ASX) AMAL announcements and articles

Originally posted by Haplo ↑

Joe Lowry article that was recently published.

Lithium: Taking Stock of Q1, 2017

His notes on financing of lithium projects are worth reviewing.

Of world class projects, only the SQM/LAC JV developing the Cauchari project in Argentina has both a clear path to production and the financing to execute. At their recent investor day, ALB upped their demand forecast – showing a 2021 number of ~370K MT and they did it just a month after I posted my very similar number on Linked In – but I digress. The point is needed projects like Galaxy’s Sal de Vida and those of PLS and Altura are not financed. Despite the near term oversupply predicted by several banks, the reality is a continued tight market or full blown shortage is much more likely than oversupply.

So even though the spectra of a CR has been discussed in this thread, it should be highlighted that at this point in TAW's development it should be welcomed and not feared.

At most TAW/AMAL will need to raise $40 - $50M (2Mtpa) for the pre-production construction phase and that's not taking into account what they will be able to received in prepayments for offtake agreements. So a CR to achieve obtain any shortfall in funding will derisk this project even further and provide a clear path to production.

Personally I think they will receive at least half of that in prepayment offtake agreements which will leave roughly $25M to raise. Hardly a show stopper figure to raise for a company to be in production before the end of the year.

Haplo

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TAW and AMAL have some serious institutional backers who could easily shore up any shortfall in funding from offtake prepayments. We also have this mystery shareholder who backed up Lithco in setting up the JV, from initial JVA announcement (3/6/2016):

"Upon completion of: (i) the Expenditure Commitment; (ii) the Capital Expenditure; and (iii) the capital raising exercise in the Company for an amount of not less than S$5,000,000, in which a shareholder of Lithco would be involved (“Capital Raising Exercise”), Lithco will be entitled to a 50% interest in the Project and the Company will continue to hold the remaining 50% legal and beneficial interest in the Project. "

It'll probably be a mix of private placement and SPP.