Fundamentals are, Spodumene is the lowest cost input to produce...

Fundamentals are, Spodumene is the lowest cost input to produce Lithium Hydroxide (LiOH), while Brine based Carbonate (LCE) is the lowest cost input for Carbonate.

Spodumene of course, can still be used to produce Carbonate, also LiOH can still be used in LFP batteries. Our proposed JV with POSCO is for a Stage 2 chemical conversion to produce LiOH and/or LCE. So our Spodumene can be used to produce either Lithium chemical.

Our new offtake is with Yibin Tianyi who will supply CATL, who are making a name for themselves in LFP battery production.

Ken mentioned at the last RRS Seminar that ESS is booming in China and LFP batteries are the preferred power source.

https://www.bigmarker.com/read-corporate/RRS-Summer-Series-Session-One?bmid=5137e4bbf560

Ken begins at 2m.

At 24.30m he talks of Chinese ESS boom based on LFP.


The point of this post is ... hard rock or brine ... it doesn't matter mate. Its all gonna be needed and that demand is about to swamp supply. Lithium makes up about 11% of a battery cell and down to 5% of the cost of a battery pack.

LFP battery costs are down as low as US$60 per kWh, way below the US$100kWh threshold for EV/ICEV disruption.

Ergo, there is scope for considerable Lithium price increases before it affects market dynamics for the price of end consumer products.

Bada bing bada boom.

Three years ago, when Spod prices were over US$1,000pt, we all spoke of PLS being primed to capitalise on a period of high Spod prices. I reckon its coming.

Further, our production success makes other Spod producers technical skills look questionable. If CapEx is to be spent anywhere, it should be on us ... at least to begin with.

The PLS BOD spoke of an impending resource increase of 50mt to 90mt, two years ago but went quiet. We were already gigantic, so I suppose further spending seemed unnecessary, especially as funds became more precious.

We are currently drilling the sterilised section, as well as the Central pit parameters. Apparently a boom in other minerals explorers is slowing testing. My question is, could we soon be looking at a major increase in our overall resource? Plus, like Wodgina we're untested at depth ... and then there's Mt Francisco.

With proven technical production ability, combined with a massive resource upwards of 400mt, could we look to having production plant (based on a 20 year mine life) of 20mtpa, ie 10 times Pilgangoora Stage 1 ... and therefore SC6 production of ~3.3mtpa? Plant 3 anyone?

I couldn't be more uprampish ... but at least its based on deductive reasoning of sound logical process.

PLS's resource, our proven technical skills and ability to capitalise on a period of high prices to encourage major supply increases justifies a high valuation PE. The old NPAT/PE of 8 for mining companies is meant for steady state production, with no likelihood of expansion or price increases. We stand upon the parapet of a "once in a century" energy disruption. I have no problems with my optimism, happy to be so