'morning all &
@PieChart.
Thanks for the um, compliment. I should let you know
I look pretty tall small, but my heels are high short
Your assessment of other posters I disagree with.
Our regular posters IMO are an informed, well-researched & balanced bunch that do provide links to complete articles on a regular basis.
To your other points:
* Project funding - financiers will as you say be looking at the data.
They are funding a project with a life of 20+years, so will definitely be considering the long term forecasts.
Nickel chart as a refresh:
Both QPM and its customers will have agreed on a price that is mutually beneficial.
GM/POSCO/LGES will not (and cannot) pay KMart/Indo prices if it means QPM go out of business.
Nor will QPM put GM/POSCO/LGES over a March22 LME nickel price spike barrel.
* IRA - we stand by to see how Chinese dominance of world nickel producing is massaged in/out of the tax credit scheme.
I'll not add to this, except to refer you back to
@Gmatt949's excellent posts
https://hotcopper.com.au/posts/68458102/single &
https://hotcopper.com.au/posts/68458435/single* Red herrings -
This also ties in why I think the gas is a red herring because sure we could add $150mil in revenue from the gas. But how much is lost from price of nickel / cobalt and what happens if HPA gets left out?It looks like we SURE CAN add $150M from waste gas! So go ahead and add that to your spreadsheet
.
Loss from pricing - here are some basic figures:
Nickel AFS = 15,992 * 25,000^ = USD $399.8M
Cobalt AFS = 1,746 * 62,000 = USD $108.2M
Total Ni & Co AFS Revenue = USD $508M
Nickel TODAY = 15,992 * 21,182^ = USD $338.7M
Cobalt TODAY = 1,746 * 29,525 = USD $51.5M
Total Ni & Co TODAY Revenue = USD $390M
Revenue difference = - USD $118M (^ Ignores sulphate premium)
So certainly at present while the macro is in a trough with global inflation/COVID/Ukraine war the metals prices have suffered.
SG and the team have mitigated this with the MGP, and the focus on further value engineering to reduce capex and opex.
The MGP revenue looks like it would substantially cover any downturn Ni & Co shortfalls (being conservative/allowing for mine connections & ramp up).
The AFS Table 10 Operating cost breakdown also notes the annual non-nickel revenue is AUD $523.8 M, so the TECH project has a diverse product portfolio to counter cyclical swings.
Re-read the AFS's Gas Supply Chain on p21-22.
QPM had been looking at monetising carbon credits to capture value.
The team IMO have now looked all the way up that supply route ad realised that vertical integration is a better way of both securing supply and maximising revenue; and now bingo, QPME is going to fight for a top four revenue line item with 4N HPA.
BTW the HPA is not being left out (of revenue). The AFS p29 explains this:
If you're new to the QPM threads, I'd caution you to factcheck all posters to ensure you
Won't Get Fooled Again!
(20min delay)