Australia's largest stock trading and investment forum Australia's #1 stock forum

GXY

Click for more information

0.00%

$5.28 galaxy resources limited

With a bit more cashing-up including a chunk of James Bay a...

First 4 Last

Share
Profile

Follow
Gekkko

2,201 Posts.

1084

05/09/18

08:46

Post #: 35419694
Share
Originally posted by Pary ↑

This morning article on this subject in THe Aus:

Lithium producers face new Argentina export tax

Argentina Finance Minister Nicolas Dujovne explains the new measures in Buenos Aires yesterday. Picture: AP

Matt Chambers
Senior Resources Reporter

12:00AM September 5, 2018

3 Comments

Australian lithium companies operating in Argentina are facing an unexpected 8 per cent tariff on export revenue after the embattled Argentine government said it would impose an export tax to regain investor confidence and attract financial aid.
Orocobre, the biggest Australian lithium producer in Argentina through its Olaroz brine evaporation operation, went into a trading halt before the market opened.
Argosy Minerals, which is building the Rincon lithium brine operation, stayed trading but said it was seeking more information.
Read Next

Trite phrases aren’t ‘all good’
Jason Gagliardi

The administration of President Mauricio Macri, which has struggled to cut the deficit amid high inflation, a shrinking economy and a falling currency, expects to start collecting the temporary export tax later this week, according to The Wall Street Journal.
Argosy said the tax would be three pesos per US dollar of export value, which is about 8 per cent, based on current exchange rates.
“The company is seeking more information from its Argentina-based advisers on this matter,” Argosy said.
“Argosy further notes that the Argentine peso has fallen by approximately 50 per cent against the US dollar so far during 2018, thereby substantially reducing the US dollar equivalent costs of any locally incurred capital and operating expenses.”

Argosy shares were unchanged yesterday, probably because the tax is slated to end in 2020 and Rincon is only at pilot-plant stage. Orocobre did not estimate the impact of the tax.
“Orocobre requests an immediate trading halt of its securities on the ASX pending an announcement concerning media reports from Argentina that have flagged the potential imposition of export taxes,” the company said.
The tax on exports would raise an additional 68 billion pesos ($2.5bn) in revenue this year, and 280 billion pesos in 2019, Finance Minister Nicolas Dujovne said yesterday. It would end in December 2020, Mr Dujovne added.
Shares of Galaxy Resources, which last week agreed to sell Argentine lithium tenements to Korea’s Posco for $US280 million ($391m) to finance its nearby Sal de Vida brine project, fell 3.7 per cent yesterday. The company did not address the export tax.
Lake Resources, which has four early-stage lithium projects in Argentina, fell 6 per cent.
On top of the tax, Mr Macri also slashed the number of ministries in his government and will cut spending on public works and government payrolls as part of an effort to reduce the federal budget deficit, excluding interest payments, from a projected 2.6 per cent of gross domestic product this year to zero in 2019.
Argentina’s peso plunged to new lows against the US dollar last week after Mr Macri said he would ask the IMF to speed up disbursements from a $US50bn bailout package. The announcement spooked markets, and Argentina’s central bank reacted by raising its benchmark interest rate to 60 per cent, from 45 per cent, to support the peso.
Argentina faces $US2.8bn in debt payments in foreign credit markets next year, plus much more at home. The measures announced this week will help Mr Macri meet his commitment to cut the deficit and should help convince the IMF to advance disbursements to the government, which are needed because financial markets are reluctant to lend to the country, according to Gustavo Rangel, chief economist for Latin America for ING. “The measures show the government is doing its part by reducing its funding needs,” Mr Rangel said.

Expand

With a bit more cashing-up including a chunk of James Bay a billion $ in cash provides a nice war-chest. After paying us a distribution/special dividend we'd have plenty spare to acquire a nice-portfolio of local lithium projects. I just bought a position in Hannan's HNR for a very-low entry point 1.4c. I purchased to diversify my lithium set..I'm still buying GXY lower..I'm sure there are other potential candidates aside from HNR which has market-cap of $27 million and they may get cheaper if Morgan Stanley keeps spreading their lies about a lithium glut. Buy in gloom. GLTAH
GXY Price at posting: $2.63 Sentiment: Buy Disclosure: Held
1 Upvote

0 Great analysis

Reply

Top Stories

Palladium's the newest geopolitical hot commodity. But ASX exposure is limited

The Altcoin Landscape (Part 1): Key alternative cryptocurrencies to watch

Making money: How many microcaps should be in an investor's portfolio?

Bitcoin hits fresh record as instos pile into BTC ETFs – and Trump helps, too

Aussie inflation seemingly hit a 3 year low. So why's the ASX200 red?

There are more pages in this discussion • 46 more messages in this thread...

First 4 Last

Add GXY (ASX) to my watchlist