20+ Reasonsto Invest in QPM, updated Jan24 by QPM optimist MthMusic.Apologies forany Word document format transfer glitches…
1.Significant Investment Project bythe QLD Govt
Update: Equity finance pending.
The new Premier, previously deputy, Minister for Environment and Heritage Protection, and Minister for National Parks and the Great Barrier Reef is across the TECH Project (see 2.) and will be motivated to demonstrate industry and The Reef can coexist, and not endanger its World Heritage status, which has been in peril. A progress report on the implementation of commitments made must be submitted to the World Heritage Committee by 1 Feb 2024.
Still a reason to invest? Strong yes
2.QLD Govt prescribed project
Update: Two year extension granted in Sept23 by the current Premier ,then Minister for State Development, Infrastructure, Local Government and Planning. Confirmed active in 18-July-2023 Premier Trade Mission to Korea press release.
Still a reason to invest? Strong yes
3.Debt financing
Update: 28-Sept-2023 announcement indicated in addition to govt agencies, seven commercial banks have submitted indicative term sheets. No update on K-Sure, the only pending debt component, and significant at $250M/terms similar to EFA. Interest rates have levelled, with a reduction pathway ahead. Affirmationthis week from Resources Minister of Australian nickel’s importance in a sustainable and ethical world.
Still a reason to invest? Yes, though slow going for this critical path. May federal budget, National Reconstruction Fund support and nudging the US for some concrete IRA investment other avenues for the Australian government to back their talk with walk.
Still a reason to invest? Yes, though understand skepticism towards govt& in current industry cycle.
4.Stage 1 & 2 offtake secured under binding offtake agreements with Tier 1 partners (US, Korean)
Update: No detrimental change. All downstream parties committed to US-manufactured IRA friendly nickel-rich battery chemistries. Chemistry advances such as single crystal positive since list post. 4680 format still underperforming. Further advances in anode through silicon provide further potential for NCM/NCA to outperform LFP. Sodium ion for around town; best solid state chems will likely incorporate nickel, with the main changes to the electrolyte.
Still a reason to invest? Firm yes
5.Ore supply secured with binding, diversified agreements
Update: 2023 French New Caledonia nickel review found ore exporters profitable whilst processors not so. Supply to QPM even more important to NC miners in present climate. Pricing linked to underlying price of Ni (LME) and Co (metal Bulletin) – beneficial to QPM in current low cycle, which our MD should highlight in 2024 presentations. We are not a miner with relatively fixed costs.
Still a reason to invest? Stronger yes. NC restructuring news imminent with Glencore finishing up end of Feb24.
6.Ore fatale overburden laterite from New Caledonia
Update: See 5. Positive for QPM. Low cost waste product, only 5 days shipping away. Assists NC miners/processors by diverting from storage/tailings dams.
Still a reason to invest? Strong yes
7.Gas supply from MGP
Update: Steady start to operations since acquisition. Supply increased through well workovers, new tie in points and further wells to be drilled startingApr24 under the Dyno Nobel funding. Supply to TPS now supports combined cycle mode. Focus on Northern Hub at Lansdown, MOU progression with Ravenswood Gold& Agripower to grow third party gas sales.
Still a reason to invest? Yes, converting MOU’s to sales would greatly alleviate need to rely on TPS & bad weather for revenue.
8.MGP revenue
Update: May miss Dec23 forecast, but strong start to 2024, with $1.677Mgenerated on 21-Jan-2024 alone & over$8M in the till over the last 30 days.
Still a reason to invest? Strong yes, looking at the evolving picture, rather than focusing on the initial startup period.
9.TECH Project 1M tonnes carbon negative
Update: Unchanged, though seeing ESG FUD in MSM, particularly US. FutureGas Strategy may provide further incentives for projects that reduce coalmine methane emissions now Australia is a signatory to the global methane pledge. Strong US lead on this front. QPME ahead of the curve here.
Still a reason to invest? Strong yes
10.No waste nickel refinery!
Update: Still haven’t seen definitive announcements that all aspects ofthe TECH’s flowsheet produce to spec (cobalt, landfill residue outstanding AFAICR).Lenders due diligence reports would pretty much all be finalised now. Expectingupdate in Dec23 quarterly this week.
Still a reason to invest? Zoom out this is the QPM storyline. Stronger yes if met, and updated messagingfrom SG appreciated, such as highlighting the status quo could result in asimilar outcome to this week’s Brazilian court ruling for BHP & Vale to pay$15B in damages for the Mariana tailings dam collapse in 2015.
11.Eight sellable TECH products,providing a counter to cyclical price movements in Ni & Co
Update: Super important in low period in commodity price cycle
Still a reason to invest? Strong yes, as high cost WA miners andprocessors currently going into C&M attests to.
12.Government support
Update: Where we all consider success or failure to hinge on. Australiannickel industry on the ropes, and Governmentsunder pressure to both inject support and champion our cleaner productworldwide.
Still a reason to invest? Yes. If only because There’s No Other Way.While government insists it hasn’t got a big bag of cash to sprinkle across thesector, downstream assistance such as productiontax credit or royalty relief would assist financiers signing onto the TECHproject.
13.TECH supports ESG provenance requirementsEU Battery Regulation and Battery Pass’
Update: EU launched an anti-subsidyinvestigation into Chinese BEV’s in Oct23. The Commission may find it is inthe EU's interest to remedy the effects of the unfair trade practices found byimposing anti-subsidy duties on imports of battery electric vehicles fromChina. Investigation is due to conclude by Nov-24.
Still a reason to invest? Yes. EU’s move should support good ESGpractices in the BEV supply chain, of which QPM is an industry leader.
14.Enable downstream partners to gain maxIRA subsidies
Update: Since 2024 new content rules started, the number of BEV models eligiblefor subsidies has over halved. The critical minerals content rules ratchet up10% a year, so automakers need to be looking ahead for non-FEOC supply. QPM asan Australian company and project with <25% Chinese ownership are an IRAlock for Ultium/GM’s future nickel and cobalt needs.
Still a reason to invest? Stronger yes. As @Venge’s Post #: 72076917 shows, the majority of Indo nickel processors are FEOC compromised.
15.Townsville workforce
Update: Updates on Zero Investek’s alleged ownership and plans for ClivePalmer’s Yabulu facility have not been updated to the market in over 13 months.
Still a reason to invest? Strong yes.
16.The Lansdown Eco Industrial Precinct
Update: Slowdown in progress, but in line with TECH delays. Tender forinstallation of the new water pipeline is six months overdue AFAIK. However,a late 2023 TCC meeting video commentary discussed new allocation of funds toLansdown was incoming early 2024. Can’t find it in the minutes though.
Still a reason to invest? Yes.
17.Safeguard Mechanism supporting QPME
Update: As the Mechanism’s penalties show up on the books on any minerswho are not reducing emissions, the more inviting hooking up to the MGP willbecome!
Still a reason to invest? Strong yes.
18.TECH most advanced project using DirectNickel
Update: Lastweek Altilium and NGM confirmed a strategic project evaluation andexclusivity agreement, to produce a comprehensive preliminary feasibility studywithin the next 24 months.
Shows QPM are advanced by 3-5 years on these guys.
Still a reason to invest? Yes. Giddyup!
19.Nickel-based lithium ion batterychemistry preference for long range & heavy duty applications
Update: Most challenging categories for electrification, and furthestbehind in uptake. BEV use in settings outside highly urbanized locations,trucking, heavy machinery, trains, shipping, aircraft etc are in their infancy.Whilst battery chemistry advances are a 21st century arms race, nickelrich cathodes still dominate in alleviating range anxiety, a key block toquicker EV uptake: https://electrek.co/2024/01/26/median-ev-range-270-miles-weekly-commute/
Still a reason to invest? Yes
20.German suppliers CollaborationAgreement
Update: Little to date. Expecting details in Dec23 quarterly this week, withthe Independent Technical Expert & lender DD programs due to wrap up. Performanceguarantees would greatly alleviate lender concerns.
Still a reason to invest? Yes (Key one)
21.QPM share price presenting excellentvalue
Update: It’s not news it’s taken a hammering, and does not fairly valueits subsidiary, let alone the TECH project’s progress.
Still a reason to invest? Yes. Not financial advice.
22.QPM’s visibility in the investmentworld
Update: See 21. Perhaps it’s the word nickel, which is a dirty fourletter one at present. Perhaps it’s because QPM is not a miner, or doesn’t haveTwiggy to champion it on page one’s around the globe. Our MD Stephen Grocottthis week has a clear opportunity to kick off the new year with a re-invigoratedfresh message at the Benchmark Melbourne conference in Wednesday.
Still a reason to invest? Tentative yes (C’mon SG!)
Others added some extras which I can’t put my finger on just now, butclearly recall quality of management as one. This perception has taken abeating this past year, particularly with the discounted CR and frequency/depthof comms. I’d say this has been the biggest disappointment from all holders,myself included. Pre-FID run up underway now; board and mgmt. need to swing their Agame.
The optimist in me recognises the closer to the finish line you get, theharder the work and perhaps the investor relations component has not been seenas such a critical focus as the technical and financial tick boxes. Dwaynecalled the QPM investor loyalists out during a 2023 Crux interview as one ofour three pillars. Here’s to seeing that recognition returning in the allimportant final straight.
Hope that assists @lukeandrew1 and all, MM
(20min delay)