Ann: Binding Offtake Signed with Traxys, page-615

Recent Ken Brinsden tweet. If the chemicals price goes up, so does the spod price. Any margin available is flowing upstream, because it’s the raw materials that are in short supply, not the conversion capacity. That’s the beauty in Pilbara’s business today.



Hi @In4apenny. I don’t agree with your last paragraph. 6% Li2O by weight spod is currently selling for arguments sake $6000/t, this equates to $6000 for 60kg of Li2O compound.

Mole weight of Li2O is around 30 and LiOH mono is around 42, so in the chemical conversion the weight is increased by roughly 30%.

750kg of Li2O would convert to 1000kg of LiOH mono so convertor would need 12 x cost to break even as suggested by a number of commentators. Ie current spot spod prices and the converters have 0 margin selling at $75000/t

At $1500/t yes the converters have a margin but currently PLS have a gross margin of 84%, they are the ones creaming it, not the midstream converters.

This why LPD wanted to be in the driving seat by owning a mine and control of the upstream supply costs. As I know you are aware LPD is unique as compared to the spod convertors in that they have a significant by product suite to offset the costs. They will use their own cost of feedstock to leverage against feedstock from other suppliers for P2.

Regards RT