Because these are real companies (large successful companies who are actually in production who operate great brine and hard rock deposits and they still can’t make money in this current lithium environment). These companies have real costs (not some redundant figures in a DFS that is irrelevant now due to time and change in market conditions - it is a lot more expensive to operate today - opex wise and lithium price is significantly down. Galan’s track record of mismanaging funds and having to use an ATM facility to survive would indicate that opex is going to be a lot higher than people realise here. Anyone who thinks the opex is going to be the same as the DFS is a misinformed investor and has rose tinted glasses on. As I am not a holder, I can see future capital raises in stall if lithium prices remain the same as they are now and this goes into production so investors be warned.
Appreciate that no lithium company is the same in terms of grade/processing and level of impurities but how many companies that are out there in production brine or hard rock that is actually making money right now?? Based on everyone’s comments here today, Galan is the best resource on the planet… yet it has taken this long to secure a binding offtake agreement… I have various Galan holders adamant that once this company gets into production it will be making profits at a scale of 5kt per annum, I’ll believe it when I see it and I’ll happily say I was wrong (if lithium price remains the same as at today while Galan is in production, I doubt i will be).
Conservative results based assessment of various other companies in production (with a lot better management in place and I would argue some of those names I mention have a better project than Galan, they certainly have economies of scale, runs on the board and better purchasing power than Galan ) would indicate otherwise. Cheers , CP.
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