LPI Has the Best Pre-developed Lithium Resource on the Planet, page-226

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TheGekko

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11/02/18

00:40

Post #: 30972292
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Originally posted by Skattie11 ↑

Many good points, however, I keep seeing inflated NPV numbers quoted. The NPV model keeps everything static and changes single variables. If production is increased to 25ktpa the post tax NPV, assuming $600m capex, is +-US$1.1bn. For 30ktpa that will of course increase. These are well above the 20ktpa NPV of $731m shown in the original model but less than $2bn.

There are many milestones to look forward to:
- stage 2 LC samples
- upgraded Maricunga resource (3.5 - 4mt)
- improved final FS using upgraded resource
- drill results from AUS hard rock exploration assets
- offtake / Sichuan Fulin negotiations

All within the next 6 months with no further capital raising required. The valuation at which MSB sells an equity stake to a partner will impact the LPI share price. That Bearing Lithium currently trades at a 50%-60% EV valuation premium to LPI whilst only owning a minority stake is interesting. Perhaps it simply just boils down to the relative strength of share registers?

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You are not seeing inflated NPV numbers. It depends on the choice of pre or post tax numbers. See pages 266 and 268 of the PEA. Also, what the data shows is that if you increase production to 25k, the AFTER-TAX NPV is US$1.449 billion, not your estimated US$1.1 billion. The before tax NPV for 25k production is US$2.033 billion.

LPI Price at posting: 41.5¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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LPI Has the Best Pre-developed Lithium Resource on the Planet, page-226

Top Stories

Cauldron discovers shallow uranium up to 2km at WA's Yanrey

Harvey Norman clocks subdued gains as Echo Law's junk warranty class action kicks off

HotCopper users smell capital raising as 88 Energy says "significant update" at Phoenix

FDA hands Paradigm Biopharma guidance to re-jig phase 3 osteo trial – or is it a delay?

BPM Minerals hits high-grade gold at the Claw Project WA; shares jump 86%

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