LME TRADING UPDATES, page-117

What can pos offtake at this present time?

surely pos isn’t going to enter into a binding offtake when it only has approximately 16 k tons of nickel in probable ore reserve

with its financial position if it got it wrong with that small amount it could be forced into the market to buy some nickel to deliver- the counter party imo wouldn’t take the risk- pos it’s not bhp

until it has significantly more ore reserves on paper it won’t restart imo - of course with drilling , further studies etc the ore reserve may increase materially or there may be a pivot with pbt where the plants are refurbished and others bring their ore for processing

again no details at present and I cant see someone injecting 10 s of millions in capital to refurbish the plants with only a small amount in probable ore reserves and the risk that nickel prices today may not be the nickel price by the time plants are back up and operational ( not to mention operational risks restarting with only small probable ore reserve)

the key imo is that pos need to deliver a substantial deposit into the proven ore category to make it economic to restart - it has done a drilling campaign and unfortunately what dropped officially didn’t live up to the initial flurry of simple drilling results-.

hopefully ore reserves significantly improve at some stage soon or some other concrete deal with pbt is announced——

but the nickel proce imo is irrelevant because there is not even one ton of proven nickel ore reserves on paper for this company which would justify a big capital investment to get mega plants refurbished and out of care and maintenance - certainly not enough on paper to justify entering into a binding offtake with pos

Hopefully some big changes to the jorc nickel reserve come along following the follow up drilling campaign - but until then it’s nothing but pure speculation and still well over a year away before any revenue could even drop imho from mining and processing

good luck