Good to see another Creeker that's been there from the start.
You could easily do a few back of the envelope sums and come up with valuations of $3, $4, $5+ - but there are many variables and unknowns at this stage.
Commercial discussions are continuing, and we expect these to go to another level tomorrow when LCK are expected to be granted the first PPL in the western world. I don't even think management could tell you exactly how the cookie will crumble - but I believe there are many options on the table as the MD discussed in the previous Zoom interview (the juicy bit's were in the Q and A and weren't recorded...).
They were able to commit 1 billion dollars for a transaction that didn't go ahead - could LCK achieve a large portion of the capex through debt with these tier 1 financial institutions?
Could they do it all through debt?
With the involvement of a strategic partner - what will be the profit split - 30:70, 50:50, 60:40.... What portion of the profits will go to LCK?
Are there other moving parts and variables that could impact this process that haven't been reported?
They are working off a plant capacity of 1 million tonnes to start with at the moment (as per recent announcements), but is there the potential to sign a large offtake with XYZ in Australia/overseas, then sign a strategic partnership with a North American or European company and go straight to nameplate capacity - 2 million tonnes? The partner may want to export a further 1 million tonnes of urea into the Asia-Pacific or the Australian market straight off the bat.. I wouldn't imagine urea being sent anywhere else as it would be too expensive.
In production, the valuation will be a billion +, but how many shares will it take to get there? I think this is starting to get to a point where this may really start to run, and run hard. There will be pullbacks, they will need to more than likely raise again, and things have taken longer than we would have hoped - but if the fundamentals remain, I'll be riding a large portion of my holding into production.
Planning on having an early night - the downrampers may be out in force tomorrow
...
