Banter and general comments, page-149

Hello Figaro,

I appreciate your post and thoughts. Great to compare ideas and notes so we can all get the best out of our investment.

As I write, the SP is almost at your valuation of 30-40 cents.

I was very rough in my calculations and you are quite right, I should have taken into account tax.

However my pre-tax revenues were very conservative given the MD has stated that they are already looking at a capacity of 175ktpa + 30% without affecting capex too much. That 30% just about covers the tax, and no doubt they will be able to write down the book value of the plant a bit initially and probably have tax credits associated with exploration to utilise.

They will aggressively increase their resource size and LOM. They increased the resource 150% in 2020 alone and are drilling as we speak. There are also countless nearby untested pegmatites for them to drill in the near to medium term. So I have no doubt they can get the LOM to 20 years quickly and then 30-40 years if need be in due course.

The MD mentioned "Lithium Chemicals" as something CXO may or may not get involved in. Probably depends on their partners and what they bring to the table.

I used a modest A$200/MT margin based on Spod price of say US$450 and a cost of circa US$300/MT. Spod could go much higher than $450 and again this is conservative.

The Gold could have very significant value also - no one really knows but a decent deposit may justify a A$100M+ market cap on it's own.

I think we can get to 40-50 cents easily if Gold assays are positive, and perhaps in the 50 cent to $1 range on any big news of offtake, financing, construction or the like.

It's fascinating to watch and at some stage I'll have to sell some to take out my initial investment and pay a few bills, but I'm trying to remain patient and sell at fair value when we get there - not quite yet IMO.

Cheers,
Bluegoose