General Discussion, page-6599

It's fearmongering because, if you truly understood the situation as you imply, you would realize that omitting the word 'DSO' in the extension has nothing to do with a 'change of circumstances' that Leo Lithium first informed the market about in their initial release, as @52570 and @Vik1ng are pointing out.

This comment seems naive and only serves to reinforce the agenda of our resident trolls, claiming that there is a much larger issue beyond DSO, and consequently, every LLL investor is doomed due to this being typical "Africa," which is inappropriate and offensive.

However, if you examine the facts, the company has stated that it is solely about DSO. Considering that scenario, other equity analysts have commented on the situation, assuming what the worst-case scenario of this actually implies, and have concluded that it does not have any long-term material impact on the company, as LLL is fully funded.

The actions of the Mali State Government are similar to what other countries have done. Sovereign risk exists even in Australia, as seen with recent events involving WA, QLD, NSW, and now possibly Victoria, given the Commonwealth Games debacle.

You're better than this @tinyventures...

Wilsons
Leo Lithium (LLL) - Trading halt: "The Company seeks the trading halt pending an announcement in relation to correspondence from the government of Mali relating to plans to produce Direct Shipped Ore". The direct shipping ore DSO is the early stage material which they were planning to ship prior to ramping up the plant properly in 12 months time. It is seen as 'bonus' early cashflow. If we had to guess we would say the Mali government doesn't want them to export unprocessed/non-value add product, and wants them to upgrade it in-country - Mali is not alone in this (if it is the case), and there are many countries who are cracking down on exports of low value commodity products. In our modelling, DSO adds around US$150m of cashflow in the next 12 months. From a valuation perspective, that might only be ~10c of our A$2.50 NPV.

Canaccord

Leo Lithium (SPEC BUY, $2.45) - trading halt. Detail not yet out but headline suggesting news from Mali govt on export of DSO (was planned for Q4'23). We think the Govt (like others) will prohibit the export of unprocessed ores this wouldn't apply to concentrate).

CG had modelled (based on coy guidance) production/sale of 180kt of DSO over Q4'23/1H24, generating ~US$30m of EBITDA. This was originally going to be applied to funding mine capex shortfalls but following the A$131m placement to Ganfeng in May, they do not need the funds anymore.

Market may not like the headline and react negatively, but the DSO was never material (CGe EBITDA from Stage 1 production US$756m in 12mnths from mid'24, US$1.2bn from MarQ'25 at nameplate). Note with SC6 Platts at $3400/t last Sat morning, the implied DSO pricing that flows from that is now less appealing as a bridging funding solution in my view for the broader Lith sector.


As a side note... I'm beginning to think there is value in reposting the same material (above) each day as people seem to be losing it at the moment.