Hi Astro (reply function not working)
For them to do it now I really have this gut feeling that they are on to something, there is more to it then meets the eye. Today's announcement is like a shot gun...bang... they are announcing no more mucking around, they going all in. Question is why all of a sudden?
I believe the missing detail is that as some have alluded to earlier your going to hear more deals in due course. I have a feeling some offtakes are in the wings and the precursor to that is a guaranteed acceleration to make sure things are in place by a certain date. This money provides that commitment, it's on. That offtaker can now use that certainty to make a deal.
As I harped on earlier today, it is the noise about JB that should be most exciting, they really yelled. Why? I think it is because GM is building a massive battery plant right next door and they want to get the house in order to make a big offtake agreement with them. GM won't want to muck around, they want to know are you in or out and this puts things in motion to talk serious.
So based on the above that is why I believe they went right now. The deals are being done in the board room, commitments are being drawn up and we will hear about the details in due course. I would have loved for them to wait longer, the market direction was heading up, I really believed in a couple of extra months the SP would be substantially higher and dilution would have been less. The interest in this stock has really changed I see it by all these new people that I have never heard of suddenly liking my posts. Momentum is changing, price is going to move up.
But, I think they simply could not wait for that to happen. Now that Biden is in, the deals are really starting to happen. Companies are changing their politics and GM is a prime example, from suing Californian government to now building a massive factory up close near JB.
We always knew there was going to be three options:
1. A capital raise - at least it is now, not before, at least we get to participate
2. SDV JV - this I was never a fan on because we would have been massively diluted by such an option and we could not even participate
3. Use Mt C cash flow slow and steady - this could have worked, but based on what I said at the top, deals need to be made not just for SDV but also for JB and commitments are needed. GXY is strong in its negotiations to show they are reliable and can deliver, so partner up with us. i think we will see this cash flow being used to get JB in motion. We just need enough Mt C cash flow to give SDV enough time to start roaring to life.
So if we look at all the information holistically, take out the emotion, we will find out that this is in our best interests. We probably won't realise why until a little while when further announcements are made. Just think about when we did a massive end of year right down, before any other spod company. At the time we could not understand why. It was not until a little while later that we realised it was so that they could devalue A40's worth for creditor negotiations. Well even though their plan did not go to plan (which with hindsight was lucky for us), things happened as chess moves. I really believe chess moves are in play right now.
As holders we just need to remember how big a year 2021 will be and how much bigger each following year will be. Look at Tesla. In H2 2020 production is going to be 83% larger that H1. In H1 2021 production is going to be the same as all production in 2020. The demand will be there. This is hard to fathom, but thanks to Biden, accelerator has just been pressed and this move is showing it.
We have Mt C in production, in 2023 SDV will be in production and in 2025 JB will be in production. At that stage I assume exploration would have also extended Mt C life substantially. So this sets us up for 3 profitable mines running full steam in 5 years time at the peak of the demand. All I can think about is how much will the company be worth then? It will be worth so much that we won't even be thinking about the CR.
So to all the longs out there please think about what I said. I'll say it again I am participating. I am glad that I can be the JV partner and not some foreign company. It is not perfect, but the chess moves are in play and I am happy about that.
Good luck all!
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