Dan Grant Article re: SYA

Hi all,

I just came across an article by Dan Grant written on 23/2/18 titled 2 Early Lithium Companies with Management to Succeed.  The full article is worth a read and can be found here: https://seekingalpha.com/article/4149992-2-early-lithium-companies-management-succeed


For those who are time poor a cut & paste of SYA info. only below:
Sayona Mining

Sayona Mining (OTCMNXF, ASX:SYA, market cap 90m AU) is a hard rock lithium miner with a defined 18.1Mt @ 1.0% Li20 resource in Quebec, Canada. They are working on completing their DFS and are set to enter production in 2019. I previously wrote an article on them back in November, and they have since progressed nicely with regular positive news releases and developments. What sets Sayona apart from other junior lithium miners is their management.

Experienced Management
If you want confidence in Sayona's future, look no further than the present successes of Altura Mining. Altura (market cap 650m AU) is set to start lithium production in Q2 2018 from their hard rock lithium mine in Pilgangoora, Australia. Sayona and Altura share the same directors.
Dan O’Neill is the Managing Director of Sayona, and Director of Altura Mining since December 2008. He is an exploration geologist with over 35 years mining experience across various commodities. Mr O’Neill was also a founding director of current Lithium producer Orocobre.
James Brown is a Director on Sayona's Board, and Managing Director of Altura Mining since 2010. He is a Mining Engineer with extensive operational and development experience in the mining industry with over 25 years experience.

Alan Buckler is another Director on Sayona's Board, and Director of Altura Mining since 2008. He is a mine manager with over 45 years experience in the mining industry and has been directly responsible for the commercialization of several projects from resource identification through to production.
Both Altura and Sayona will have an open pit mine and will utilize a concentrator plant. They will be shipping the lithium spodumene concentrate they produce to China where it will be further processed.
The experience the management is gaining right now with Altura derisks Sayona. They will know exactly what to do, and avoid any pitfalls they encountered bringing Altura to production. They will also have gained connections and the confidence of financiers and offtakers through their execution with Altura. There simply isn't a better management team for a hard rock lithium junior.

Authier and Tansim Properties
Sayona's flagship property is their Authier lithium project, which is located near the city of Val-d'Or, Quebec, Canada.

Authier currently has a defined 18.1Mt @ 1.0% Li20 hard rock resource and Phase 3 drilling is currently underway to increase this resource size. Authier has large enough resource for attractive mine economics with a NPV of 227m and a 17 year mine life.

Though not necessary, a larger resource would allow Sayona to achieve greater profits for the business and shareholders alike. On Janruary 23rd, Sayona announced they now have an option to acquire the Tansim lithium project, which is 12000 hectares and is located 82km (50m) southwest of Authier. Channel sampling confirms lithium mineralization over a large area with up to 2.77% Li20 recorded.
In the release, Sayona CEO Corey Nolan stated that "Tansim demonstrates stand-alone potential but could be developed as a complimentary satellite operation to Authier". This got me excited. Tansim could host a very large lithium resource and boost the mine economics of Authier. And being only 50 miles away allows the shared use of Sayona's future workforce, machinery and maybe facilities.

Also Per the announcement, when winter ends in April, "Field activities will comprise mapping and sampling of the pegmatites to define drilling targets." It wont be hard for Sayona to move their drill rigs 50 miles southwest to Tansim. I think we will see fast results from this property.

Financing Risk
Getting financed for production can be the greatest hurtle with any new mining company, and Sayona is no different. Starting a new mine is fraught with risk, and banks don’t like risk.
I think Sayona’s management foresaw the difficulty in getting financed, because everything about the Authier project says low risk. Authier will be a simple, open cut mine. Authier is in Quebec, Canada; a stable country with excellent infrastructure and local mining workforce, and the mine has a very low startup cost of 65m AU. Compare this startup cost to 801m CA for Nemaska, or 341m CA for Critical Elements, and Sayona looks very attractive to a bank. Add this with the fact that Sayona’s management itself is low risk, and I think you get the picture.

Conclusion
Sayona has been and still is my favorite lithium stock. I have researched almost all lithium juniors and have not found a better risk/reward ratio. If you believe in the EV revolution, and the continuing demand for lithium, than I feel Sayona is the best stock for the money.
After the DFS is complete in Q2 2018, I expect Sayona to sign an offtake agreement, and shortly thereafter, be fully financed for production. To see what is in store for Sayona, watch Altura.