I did my own similiar sums on this yesterday figuring Min would...

I did my own similiar sums on this yesterday figuring Min would process this feed in their own plant , so 2ics logic is very sound . I am suspicious but that whole dfs was done to get the result the board needed to justify recommending the takeover. I think the Opx figure was cooked at 1030 per tonne . If Min is buying the asset but like the capex figure it’s irrelevant as lot of opex savings from feeding it through Mins plant and not trying to run it through a relatively small plant which only makes it far dearer .

The problem with the dfs as presented , if the numbers are truly what they claim are , you wouldn’t proceed on that basis , you would do dso , cut your capex and way lower your Opx and just take the pain in the revenue equation. Then as you firmed up more resource , produced some cashflow you might consider building a plant down the road if you’re firmed up more resource . So I would argue preparing a dfs on this basis is a bit silly . It’s a baseline yes but not probably the strategy you would follow in reality especially after getting these outcomes .

The other number I think is way to conservative is 1500 per tonne for spod . I laughed out loud when I read this in the dfs . What people are not appreciating here is the market in China is now bifurcated . Quality spod that can be pushed into higher density batteries via lithium hydroxide will continue to get a premium over lithium coming via lepidolite getting pushed into lithium carbonate .

The artisanal lepidolite producers need way more than 1500 to remain in business and arguably they are the swing producers in that channel . But as already mentioned if market is bifurcated now ,even this is to some extent irrelevant . Chris Ellison would be working on any spod he gets from ess selling it for 3000 + . You redo the sums based on this added uplift as well as capex and Opx savings and you quickly realise this asset has over a billion dollars of potential value to Ellison and min res . So if they go up to 75 cents to 1 per share the upside is still massive to Min Res .