LRS General Discussion, page-17915

I don’t think that prices will necessarily ‘crash’ a whole lot further, although SC6 moving back under $1k/t is possible this year - also, this could actually be a bullish outcome for LRS because it would ruin basically every project under development except high tonnage low opex and capex (I.e. Colina), and could even potentially mothball producers like SYA and LTR, depending on how long prices remained under $1k/t for.

Important to distinguish the price impact on different lithium companies as well. Anyone currently producing has a direct exposure to spot price movements (to varying degrees based on cap / collar, floor / ceiling prices in offtakes).

Anyone unfunded takes a hit because funding becomes harder to obtain or maybe impossible to obtain depending on the financials in the PEA/DFS.

Explorers are probably less likely to IPO or rush drilling at current prices because they know cap raises will be very tough to execute and market won’t reward drill results as favourably.

LRS is in that developer category. But so is GL1 (for example) and the market clearly views both projects entirely differently. GL1 market cap indicates the market doesn’t see a path to production at current spot price while LRS mkt cap shows a path to production (or at least an expectation).

The major risk is that funding doesn’t happen or is delayed (if an ANN comes out showing delays here, the market will punish us make no mistake). The major upside is that if we manage a favourable prepayment offtake and debt funding, then we will be one of the few to have navigated the lithium price crash without major damage.