It's a mystery to me to too. Smells like FUD.
At the end of the last announcement:
"Reward is also progressing activities to establish flow rates and brine recovery parameters from the high porosity sediments in LD to confirm brine availability for 400,000 tonnes per annum of SOP production and potential for expansion of SOP output above this level. The Company is currently sourcing a rig capable of drilling 300+mm diameter holes to 120+ metres which can operate on the surface of LD and expects to have this on site within the next month."
The previous figure of 400k tonnes/yr was built of the back of flow rates determined from a borehole on the shore as opposed to the lake proper. The increased porosity (i.e. higher flow) and the increased SOP% found in the latest cores will serve to both lower OPEX and increase annual production. This will turn out to be just as important as the massive increase in reserves we are expecting.
As for this rig business - on the one hand it does feel like there must be a bunch of rigs and crews out there begging for work given the downturn, but... Don't forget that this is a very specialised area and it's never that simple. And 'sourcing' doesn't necessarily mean buying (although given past behaviour I imagine in this case it does).
RWD Price at posting:
71.0¢ Sentiment: Buy Disclosure: Held
