"...also there is consensus that the best of all options for all producers it refine and develop Hydroxide plants. again PLS hasn't got the IP in this space and so is relying on its JV. how do you think LTR will approach development of this process ?"
I don't think building of a hydroxide plant requires an IP. It's not a rocket science. First of all it's expensive to build. It's a complicated chemical plant, requires a lot of technical support by the vendors of equipment, and not easy to commissioning.
The key point is that it is hard to build it in Pilbara or Port Headland because of the technical problems mentioned above. As you may know (I mentioned before as well) Albemarle and MIN JV also do not consider to build their hydroxide plant in Pilbara or Port Headland due to those reasons even though MIN want to build it there (but Albemarle doesn't accept it). It's still not decided yet by ALB/MIN.
Posco and PLS have planned to build their hydroxide plant in Kore long time ago. So their keep following their plan.
The only problem with hydroxide plant is that it requires the flow of same characteristics of spod concentrate to feed the plant. Then hydroxide process plant machines are being adjusted according to that specs and then they work fine. However the production cost will vary depends on the grade and impurities of spod concentrate.
The Chinese converters which buy spod concentrate from various lithium mines have all these problems. So their costs are quite high actually.
What I also want to mention here is the production costs; spod concentrate or lithium hydroxide.
"Low cost is the king"
The value of a projects is assessed by the production cost. If we want to sell our project, the buyer will look firstly at our spod concentrate production cost. If it's higher than the competitors the buyer won't buy it, or give a low ball offer.
Say a lithium spod concentrate producer in Australia or Canada has a $700 AISC (All in sustained cash cost) per tonne of SC6 spod. (I believe most of the mall projects have that level of cost $700/t plus)
LTR will have $452 AISC cost (that also includes gov. royalties).
And think that how that producer would compete with LTR when/if the spod price went down to $900/t?
LTR would be still making 100% profit even at that price.
That happened 3 years ago. Then Altura Mining (AJM) and A40 bankrupted.
I don't think it will happen again at least in next 10 years but we should be aware of all risks. This is why I invested in LTR; very low cost producer.
The below graph from LTR's DFS, shows the AISC cost.
But be careful when you are looking at the stated costs by the lithium projects; they should state the same AISC cost (even non of them tells that though ). Most of them only gives the processing and operation cost which doesn't include many other type of costs including gov. and vendor royalties, or interest fees.
You can see on the table below LTR's initial calculated cost is $314/t. But it goes up to $452/t when everything is included.
So, we need to look at the lithium (actually all) projects realistically.
As an example of that if you are investing in a projects at the middle of Africa you need to find out how you will find technical expertise, replacement workforce and equipment when needed, how you will transport the spod concentrate to the nearest port.
Or as another example of that if you are investing in a projects at the middle of frozen country (Quebec Canada) which everything is frozen 5-6 months of the year, then you need think about how to get the humans and machines would work there. (There are many projects out there now, including AKE's James Bay hard rock project). You need to build big domes on top of open pit grounds to protect the operations going on there.
Of course everything can be done at a cost. But what is the cost, if it's too high that projects is doomed from the beginning.
While we said "Low cost is the king" now we can also say that "Location is the king" too.
Anyway LTR is the KING of all projects IMO.
LTR Price at posting:
$1.43 Sentiment: Hold Disclosure: Held
). Most of them only gives the processing and operation cost which doesn't include many other type of costs including gov. and vendor royalties, or interest fees.
(20min delay)