Interesting comments by Simon Hay on the future of Sal De Vida.
In one part stating that Stage 1 doesn't require a partner, but then in the next part indicates that once the company has emphasized the value of the project by that being complete that it will be the ideal time to sell down ownership in the asset.
In some ways what the company has done today is placed ~10,000tpa on the table as going into production with production commencing end of next year and indicated the possibility of a further 20,000 to 40,000tpa on top of that... But then in the statement made by Simon, perhaps more indirectly has indicated possibly removing anything beyond that 10ktpa until further 3rd party investment is made.
It's a pretty ballsy move, as it could be anything between the company waiting until it can afford stage 2 right through to the company being acquired so that someone else can carry on with stage 2 & 3 in the sequence they prefer picking up wherever James Bay might be at.
Let's not forget that a company like Tesla could pick up Galaxy with a fraction of its spare change in the console by comparison to their market cap and easily from James Bay have enough supply to feed their converter in Texas.
It would be an easy fit for them.
Let's see where they are at once Semi and in house battery production commences and then how many reservations they receive for the US$25,000 electric vehicle. Those 3 things are going to increase the strain on the lithium market and I wonder what vertical integration savings they have worked out might occur if they had ownership of some sources of the raw materials. Or maybe Volkswagen will save them making that decision and take action sooner. Depends who is going to need that additional supply the most.
GXY Price at posting:
$3.53 Sentiment: None Disclosure: Held
