Good News & Bad News, page-337

PLS ATH: $1.47
PLS current share price: $1.16
Down 21.10%
@6Mar21 - Down 33.67%
@30Jan21 - Down 37%

GXY 52 week high: $3.29
GXY current share price: $2.96
Down - 10.03%
@6Mar21 - Down 33.13%
@30Jan21 - Down 18%

ORE 52 week high: $6.06
ORE current share price: $5.55
Down - 8.42%
@6Mar21 - Down 29.87%
@30Jan21 - Down 17.5%

The PLS share price @31Jan21 was undoubtedly affected by the RCF selloff. However, it had rebalanced with GXY and ORE by 6Mar21.

While the PLS share price has moved in concert with GXY and ORE with rising Lithium prices, at 9Apr21 we lag them somewhat. SQM's recent announcement of product sale prices achieving lower than the China advertised pricing affects them, not us.

Rising Spodumene prices affect us, not them. Plus rising to a level to incentivize expansion. I'm a little unsure why we aren't outperforming GXY and ORE recently, rather than the opposite.


The future price of Spodumene is anyone's guess.

Lithium makes up ~11% of a battery cell and ~5% of a battery pack.

Spodumene costs chemical converters about 25% of the final product LiOH.

Therefore, Spodumene makes up ~1.25% of the cost of an EV/ESS battery pack. It would seem there's plenty of scope for the market to absorb Spodumene price increases.

As the EV battery chain streamlines, I'm not sure if downstream investment will be as important as it has seemed in recent years. Its a big investment.






When the world thinks of Oz Lithium suppliers they think of Greenbushes (ALB & Tianqi), GXY and ORE. Pilbara Minerals (and the entire Pilbara) doesn't even get a mention. Maybe the BEOT like it that way ... until they finish accumulating?

Although, I suppose the "Western" reference is to Western Australia. MIN and Mt Marion aren't mentioned either. I suppose Wodgina gets a nod via ALB.

The entire Pilbara in WA, has a defined resource of 550 to 600mts of Spodumene. With Wodgina and Pilgangoora untested at depth AND vast unexplored regions including the outcropping Mt Francisco (PLS/AGO) and Pancho (AGO), the Pilbara will eventually yield billions of tonnes.

All with no sovereign, production or chemical conversion accreditation risk. Australian mining ingenuity moving quickly and assuredly, to supply the growing market.


The ManonoNo Project in the DRC (the Lemon of Lithium), needs A$750m (USD550m) just to get started AND another A$250m in opportunity cost/working capital, to justify building a 450ktpa processing plant. The Chinese have them trapped. Sovereign risk, production risk, chemical accreditation risk. Why bother? AVZ will become worthless, as the Chinese trap squeezes.

The Chinese continue to fund infrastructure programs in DRC and will one day want quid pro quo. The Chinese have secured offtakes eliminating Europe and American financiers. The Chinese have AVZ surrounded. They are not interested in making some Australian fat piggies rich, at their expense.The Chinese will play the long game. As long as it takes.

Australia can supply Spodumene to meet market needs indefinitely. Quickly, no problems, no doubts like the African investment and no surprises.


For A$1b, PLS can expand Plant 1 and Plant 2 AND build a plant 3. PLS is already at 600ktpa AND perfected their process. With resource expansion PLS could justify a 3.3mtpa plant (ie 20 mtpa throughput based on a 20 year mine life). Then Wodgina, Mt Francisco, Pancho, etc..

PLS will get CapEx debt finance, if anybody. However, they will likely pay for expansion out of profits, with the Superprofits over the next few years. LTR is next in line but they require downstream participation to justify the investment. Downstream investment (to justify investment) adds another element of risk.