General Discussion Topics, page-112996

When you say "We are a long way apart on costs of production" how far apart are you actually alluding to? You make reference to my calculations based on a $600t cost of production, but I also provided the percentage economic benefit to PLL if the cost of production was $750t and there wasn't a great deal of difference from it being $600t. You have made clear your assumption that the JV will be selling to PLL at a loss, so I did my same calculations, but instead substituting cost of production of $900t instead of $600t and came up with the economic benefit of 64.1%, which is based on a $90t loss. I kept doing some more calculations until I came up with PLL having a 70.6% economic benefit (ignoring what they'd lose in their 25% share if all 226,000t was sold at market price & the loss in equity value from their major share holding) and the loss of production needed to get to this 70.6% economic benefit figure is $1,200t.

I am well aware that the cost of production is going to be higher during ramp up, but I am looking at looking beyond that stage . Are you saying that in the 3 or 4 years following ramp up that the JV will be selling to PLL at $810t from a cost of production of $1,200t (or even greater than that)? If you are then why would they do that? Surely as a JV partner Keith would not subject SYA to that position. JV partners are suppose to work together for the benefit of both parties and the benefit of the JV as a whole. You don't cut off the hand that feeds you.