Being a realist, IMHO the capital cost of $US194m is already horribly out of date. Costs of steel and transport are up through the roof, likewise for energy costs. Any updated DFS should include these much higher costs, meaning that Leo Lithium will have to raise a lot more than most here have thought.
The increase in capital costs will also effect every other lithium company with their plans for building or expanding processing plants (and every other mining company for that matter).
Bardoc a junior gold explorer (I have no interest in it), yesterday released an update that included a 31% increase in Capital costs from the March 21 DFS, as an indication of where capital costs are currently at!!
Given the type of increase in cap costs, a re-worked/updated DFS should include a much larger plant design based on higher reserves, meaning a lot more drilling to have resources transferred into reserve category. This will be extra cost for LLL before actual mining, so again extra funds needed for this work.
Again IMHO this is one of the largest reasons for the SP being lower than others. LLL is regarded by the market as a small part of the overall FFX picture, not a large part. Our ownership is currently 40% with the deal with Ganfeng and Mali owning 20%.
Upon listing there will be further dilution with the capital that will have to be raised, compared to existing holding.
FFX Price at posting:
60.5¢ Sentiment: Buy Disclosure: Held
(20min delay)