Welcome Klaus, Certainly worth talking about, I think the main points that everybody are missing here are that :
1) Currently there is only minimal "Separation" capacity around the World, the lions share being in China. There is already a marked shortfall in capacity so sooner rather than later there is going to be a flurry of activity in building new Separation plants. If the Euro-zone has any brains they will already be looking at building their own facility, which should then be followed by the construction of a Sintering plant, so that they can supply their own Auto manufacturers with permanent magnets. One thing that Covid has demonstrated to us, is that reliance on the USA or China to supply critical manufactured goods in times of need is a recipe for disaster.
2) This is still an emerging Industry/Technology, it is not a case of a "New player" entering an established market. Currently there are only two established major producers, China and Lynas; neither of which have the capacity to meet current demand, yet alone dominate a growing Market over the coming years. China is already importing raw feed for its plants and Lynas appears to be abandoning their traditional market (Japan) in order to commit all of their future production to Donald
3) Longonjo is unique deposit in that it hosts what is potentially the largest Independent Resource of NdPr currently under development in the free World. It already has most of the major infrastructural requirements in place and thus will be a comparatively low cost Capex operation. Pensana should therefore be in an enviable position of being able to deliver product into both the Chinese and Independent markets.
4) As to the degree to which Pensana processes it's product ? I will defer judgment on that until we see the Economics of the DFS, Certainly it would appear that the further down stream we go the better the returns. It will eventually boil down to a "Return on Capital" and/or "Availability of Capital" question. There are several growth paths available to us, at this moment we are in the Primary production phase, who knows what the future may bring certainly a "Separation" plant down near the docks at Lobito should not be outside of our thinking.
Stay safe everybody,
PM8 Price at posting:
15.0¢ Sentiment: Buy Disclosure: Held
