Wish you a very happy New Year. 2022 will be a cracking year, transformational for LKE and it’s shareholders.
Kachi NPV for 25,500 tonnes is AUD $2.1B. By mid 2022, we will have a clear understanding on expansion of Kachi (51,000 tonnes) and NPV will be atleast AUD $4.2B. All these are at Lithium Carbonate price of USD $15,500 and we all know current spot price is more than USD $40,000 for battery quality and 99.97% purity should fetch even more. Yes, long term contract price will not be USD $40,000 but we could expect atleast USD $20,000 (less than half of current spot price) in DFS NPV calculation. This should give 25,500t annual production, NPV close to AUD $3B and 51,000t expansion, NPV close to AUD $6B (approximately)
I expect the following announcements and impact on LKE share price in 2022.
Q1
- Kachi demo plant progress and completion (SP impact 15c to 20c)
- First Tier-1 offtake partner (SP impact 25c to 30c)
- Kachi expansion drilling progress (SP impact 5c to 10c)
Target SP end of Q1: $1.45 to $1.60
Q2
- Cauchari, Oraloz & Pesos drilling progress and resource (SP impact 20c to 30c)
- NOVONIX final results (SP impact 5c to 10c)
- Release of DFS and ESIA with revised lithium price (SP impact 20c to 30c)
- Confirmation of Kachi expansion to 51,000 tonnes per year (SP impact 20c to 30c)
Target SP end of Q2: $2.10 to $2.60
Q3
- Confirmation of construction finance (SP impact 10c to 15c)
- New BOD appointment with an offtake partner or JV partner (SP impact 5c to 10c)
- Second Tier-1 offtake partner (SP impact 20c to 25c)
- Dual US listing announcement (SP impact 10c to 15c)
Target SP end of Q3: $2.55 to $3.25
Q4
- Cauchari, Oraloz & Pesos development & and DLE partner (SP impact 20c to 25c)
Target SP end of Q4: $2.75 to $3.50
LKE SP Prediction for 2022
End of Q2 2022 expected (conservative) LKE SP: $2
End of Q4 2022 expected (conservative) LKE SP: $3
IMO, Lithium price will continue to increase in 2022, LKE will de-risk further, LKE will accelerate other projects and LKE SP will start to factor in small part of Cauchari, Oraloz and/or Pesos value.
2022 activities would be the first step towards LKE becoming 90,000 to 100,000 LCE tonnes per annum producer & Top-5 World Lithium Producers by 2028/30
DYOR. All the very best Lakers
(20min delay)