Ann: Company Presentation - January 2018, page-63

I hear ya 15021981, here is my take on where we are going.

I have had a bit of an epiphany today. I have just realised that what Kogi is proposing to build in Nigeria is a disruptive technology, a disruptive innovation. And while the technology is really neither new or innovative (we could argue about innovation), it is the application to Nigeria that makes it so disruptive. The production of steel billet means that the process of importing scrap and billet will be sidelined. Now this is both a major disruption and a major efficiency gain. Local steel producers will have their raw product on demand, this brings a whole new level of efficiency to the Nigerian economy of which we do not know what the ramifications may be. The simple fact of having to always plan months and months in advance for importing your feedstock makes you as a producer very slow to adapt to demand. If all of a sudden you have raw material virtually available as needed, the difference this makes to to steel producers supplying demand in the economy is also a potential game changer. The constraint of importing steel may act like a real brake on the economy and lifting this brake could be release a deluge of demand for steel in Nigeria and surrounds. So while the company states that demand for steel in Nigeria is huge and the demand once Kogi starts producing could easily increase simply because of the efficiency gains of producing steel locally. It is easy to see now that constructing a steel billet plant in Nigeria could be a real game changer for the economy of not just Nigeria but west Africa. It is plausible that Kogi may have to continue to increase plant size just to meet increased demand and that this opportunity for Kogi is likely to continue for many years even if eventually competition arises down the track. We have the early stages of a monopolistic disruptive technology that is likely to increase economic activity in the region and create further demand. What a great opportunity for the company to be involved in such nation building and what a great opportunity for us, to not only benefit monetarily but to also see that our investment will improve the lives of thousands of people. Can you think of anything more tantalizing and what a great situation to be in. glta