Wotzon, The article referred to regarding Mt Cattlin mine performance (the start of the article), is a very poor extract of the GXY announcement made this week - that wet tonnes was omitted do not change the fact that GXY is misleading public with not disclosing what production is achieved in LCE - lithium carbonate equivalent.
The calculations below will show what I mean:
Conversion from wet tonnes to dry tonnes - in past experience the product moisture from such operation (as fresh as you mention) will be in the order of 10-15%(water) - for a 10% value taken (low end) the wet tonnes reported for July is converted to dry tonnes for calculation of potential yearly production. Time July prod. 31 days 8916 Wet tonnes 10% Water 8024 Dry tonnes 1 year 94481 Dry tonnes (This is 68% of tonnage in the plan 94,481/137,000*100)
As the company do not give details of product quality (as %Li2O), the quotation tonnage of product made is misleading. As shown below the potential production of lithium carbonate with different product quality - my guess is that the 5%Li2O final product is best fit and then the Mine production only meets 55-60% of the plan. To quote 70-80 % is misleading - in LCE please,GXY.
Mt Cattlin production Potential production Dry Tonnes (dt) % Li2O Lithium Carbonate in % The Plan 137000 dt 6.0%Li2O 17000LCE t/year 100.0 as July 94481 dt 6.0%Li2O 11724LCE t/year 69.0 as July 94481 dt 5.0%Li2O 9770LCE t/year 57.5 as July 94481 dt 4.0%Li2O 7816LCE t/year 46.0
To quote a 25% increase is also partly misleading as June was a poor month compared to May but
In an announcement 3 June it was quoted a production April/May of 12778 t - a guess if is wet or dry tonnes - also quoted 7185t for May which gives 5593t for April. In quarterly it was quoted 17792 DRY tonnes and if all is dry tonnes that leaves 5014 "dry" tonnes for June - if we add 25% to that gives 6268 "dry" tonnes for July compared to the wet tonnes quoted as 8916t, or a July production of less than May. My guess is that GXY quoted wet tonnes in the past too, without saying it. Very misleading
Please mark the wording here in the announcement (below) - output tonnage - wonder if it is wet tonnes?
Quote: Galaxy said the Mt Cattlin project was currently operating at 70-80% of annual design output tonnage and would be further optimised over coming quarters.
Point 2 Wotzon Without quoting LCE or dry tonnes with product grade - for mine production - any other numbers are misleading. The case is that quoting an increase in tonnage might not give more lithium to be processed in China as the product grade might be decreasing at the same time. The ramp-up in production is possibly complicated but it should be easy to get the production numbers correct,
Spence
GXY Price at posting:
22.0¢ Sentiment: None Disclosure: Not Held
