Absolutely true TT, however what we need to remember is that due to the PLL offtake contract, we can't sell a hypothetical 332ktpa of 5.5% SC for $4000/t as they would get half of it (166ktpa) for $900/t.
Whereas the carbonate in this example, well that will fundamentally end the spod offtake anyway as per the conditons of the contract so the whole 38ktpa of carbonate could be sold at full market price of say $25k/t-$35k/t.
So because of the PLL offtake, there is absolutely every point in converting it in this case in order for us to realise the full economic value for NAL (SYAQ).
By increasing the spod output of NAL, we massively enhance our revenue come the point of going downstream...
SYA's real money will come with the more intergrated downstream product we can produce as well will get 75% of profit.
Now, all of this does bring us back to the cabonate vs hydroxide argument too.
If in my hypothetical situation we were able to get 332ktpa of 5.5% spod out of NAL for example, well, can our older half build carbonate plant actually run that much spod and be capable of producing say 38,000 tonnes a year of carbonate. Is it large enough? 23ktpa has always been talked about, I would hazard a guess to say no.
Now as we should know, hydroxide requires less tonnes of spod per tonne of hydroxide to produce, so instead of a 7.88 ratio, you're looking at more like a 6.5 ratio I believe.
Now, how much hydroxide could we get from 332,000 tonnes of 5.5% spod in a brand new plant?
Now this imo is where Amos comes in.
If we would build a state of thr art new hydroxide plant within the existing vast papermill building, well then yes, I think we could convert 332,000 tonnes of spod.
If we used the better hydroxide ratio of 6.5, that would then actually give us about 51,000 tonnes of hydroxide.
Sell that at the same price as cabonate per tonne and, well, there's your economic argument for going hydroxide over our existing carbonate plant....
You could build a 2 x 25ktpa train hydroxide plant there and utilise all possible increased spod production from NAL.
Then, at only $25k/t which is uber realistic/conservative, well we would be looking at a revenue instead of US$1.276b.
Our profit margins per tonne of would improve also as need less tonnes of spod per tonne of hydroxide....
All food for thought hey.
Our future is very bright, but there is merit to the hydroxide argument based on this if that all makes sense.
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