He is right on the M&A score, I have been having this...

He is right on the M&A score, I have been having this premonition for a while but I reckon Rio is going to come knocking on our door as soon as the dfs is done. They will want that done just to avoid the small chance the reserves/ resources are not there then they look like dickheads and its career destroying to make those M&A mistakes. Rio could pay a couple billion for us and its still like minor change to them ( their FY 21 profit alone was $ 21 BN USD - let that sink in with an operating cashflow of $ 25 BN USD - so for them paying $ 2 BN or $ 3 BN is around a month of cash earnings at their current run rate , and their Balance sheet is about $ 100 BN with them paying out $ 15 BN in dividends in FY 21 ).

I would like us to make it to production as if we do we will be well north of $ 10 per share , hell maybe even $ 20 per share ( given so far we have managed our Shares on Issue well - actually on that score Rio is a great study on how if you manage your shares on issue well as you grow , you can really grow a huge share price - RIO only has around 360 M shares on issue ) but I suspect it will be too attractive to a major within the next year not to make a play for it.

Remember too BHP and RIO have been very slow to the lithium space and so they know they have to catch up. A lot of them held off because they were never fully sure until very recently that lithium ion batteries were going to be the preferred battery mode for battery electric vehicles and in turn whether even battery electric vehicles were going to be the preferred car engine technology ( as opposed to things like hydrogen fuel cells etc, that race but is now run and battery electric has won in terms of cars at least for the next 30 years and arguably maybe longer if it becomes the defacto standard like ICE has been for the last hundred years) . They will pay above market rates now ( which is a message I hope our board gets, which I am sure they do) just to get the green washing points with the institutional investors they have. It's all a game of virtue signalling today, honestly none of it makes a jot of difference to the climate, but they all think it does, and that's all the matters in the scheme of things. You have Rio now just putting out to the market annoucements like " Our Approach to Climate Change". So they will pay a big premium .....

On the cost of LFP vs Higher Nickel Cathode chemistries I am pretty sure I read somewhere recently but cant remember where that at above $ 50,000 per tonne for lithium, LFP has lost all its cost advantage ( that would be assuming I would say a Nickel price of around $ 25,000 per Ton , its recent price level ignoring its temporary blip due to a short squeeze to $ 100 K a week or so back for a couple of days that broke the LME) . I maintain the view there will be plenty of room for both nickel and LFP chemistries with both likely to settle around 50 % market share as lower cost will be the preference to Chinese consumers whereas range which is much better with higher nickel chemistries will be the preference with most consumers in European and US markets.

As for price I suspect what we will see as Lithium is not really a commodity but more a speciality chemical, is that after this period of shortage where the price will stay up now for the short term now (2-3 years) due to pure supply side constraints relative to rapidly growing demand, as we move forward beyond this period, price stickiness will likely come to exhibit and prices may well hold up to a large degree and not just collaspe back down to say the $ 10 K level per tonne as customers will get used to paying more and if your plugged into an integrated supply chain and delivering a quality to spec product, there should be less price pressure in the long run. Those further along the chain are more interested in your ability to supply consistently on spec and on time rather than worrying about haggling over a few K per ton, and you see that in many value added supply chains.

All of that said but this is why I hope we explore the Eli process for lithium extraction developed by NeoMetals ( lol - shameless plug for Neo admittedly which I am invested in too) which can be used in brine operations. This tech would let us from what I have read produce a much cheaper hydroxide product as well as carbonate, and its hydroxide that the nickel chemistries need. That would make us more battery tech agnostic and give us greater flexibility in terms of securing offtakes.