Leo Lithium - Simon Hay (from African Conference last night)
• $106m funding recently from Ganfeng in cash contribution. Advancing and have doubled the resource. Project is tracking well.
• Halt on letter from Mines Minister on
DSO plans (as stated in ASX release). they will release an update in 24 to 36 hours.
• Resource is open at depth, thick high grade pegmatites and open to North, South and West. 211Mt, adding 100Mt in the last 12 months
.• Stage 1 at 500kt is just the start. 500kt for Stage 2 and Stage 3 is entirely possible.
• Starter pit in operation and blasting. Producing ore now (fresh) and available commissioning early next year.
• Construction advancing on schedule with first spod back end of 2Q, 11 months away from production.
• Ball mill delivered to site and building is going up. Overland pipeline is being constructed. Costs remain within $318m budget.
Q&A:
• Why are you immune from cost inflation?
Ganfeng via China and labour rates in Mali are not excessive. DFS was spot on and Lycos have been very effective
.• What do you need to sign off on Stage 2?
Engineering is straight forward. Just fine-tuning design. Will be market related for China in terms of their ability to place the material into the market.
• What do you need for the downstream to work/what incentives do you need?
Incentives are key and the IRA will also help. Morocco - China party building a converter there as has a free trade agreement with the US. Middle East could also provide major incentives. Proximity to market is key.
.• JV view on pricing in 2H23?
No pricing discussion in the last month. Next key point will be indications around DSO sales and pricing.
Not seeing any concern on volumes. Guangzhou futures open this week (an alternative to the Wuxi as a pricing indicator).
(20min delay)