Living in hope, page-19

Below is an extract from my post on the RNU thread this morning regarding the LTR situation:

Last year a consortium of Banks agree to a $760m debt package, which included government sponsored export funding.With the fall in Li prices the Banks pulled out.

The BOD in March this year salvaged a funding package for a reduced $550m.

Yesterdays announcement replaces the Banks all together, with an agreement with Korean battery maker LG Energy..

LG is providing cheaper capital than both CBA and NAB was offering. They are tipping in $US250m via a 5 yr con note.LTR will pay interest at SOFR in either cash or shares.

The notes are convertible at $1.80 a share (95c a share this morning).
The upside for LG is they managed to extend its offtake agreement from 5 years to 15 years.

As Chanticleer at the AFR pointed out yesterday, critical mineral hopefuls will be funded by customers or strategic investors and equity holders, and propped up by government incentive programs.

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Whilst the Liontown situation is likely an outcome we will see more of as Banks find funding of the critical minerals sector too risky...and one I have been predicting for the last 12 months as end users with large balance sheets lock in their supply chain with loans that can convert to equity.

I think the situation for Liontown getting funding for Kathleen Valley project which is 680 kms north east of Perth or RNU that is in Arno Bay South Australia is a VERY different risk profile loan for LG than one where the mine/resource is located in a tier 2 or 3 jurisdiction.

This is the real problem that SYR management are yet to overcome in my opinion. The details of the US government support are not known and I feel part of the reason the SP will continue to drift until funding is completely sorted.

And I dear say the investment committee over at Australian Super are unlikely to be advancing any more capital here as they really are now holding the baby here.

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