GXY (ASX) Open Letter to Simon Hay

I wrote this a few weeks ago but it seems relevant to repost

I view Simon Hay's appointment of CEO to be the catalyst turn around GXYs fall from grace.

* I expect any incoming CEO to outline a detailed plan to the market as to how he will implement and succeed with the strategy desired and outlined by the BOD. I expect Simon to expand and stamp his mark on the general direction, drawing on his experience of greenfield development through to production.

* GXY needs an ultra ambitious time frame for the start of SDV commercial construction. For too long the project has drifted with only cosmetic improvements (earthworks not yet lined for small capacity ponds). It has been on a go slow. It's time to be bold, decisive and accelerate the traditional evaporation pond method of brine chemical processing. Start by doubling the size of the initial ponds.

*GXY is absolutely right to continue to test possible direct extraction techniques, however given some of the highest Li concentration Argentinian Salars (732ppm) and low impurities, the evaporation pond method cost of production will be comparable to any direct extraction techniques even before IP royalties. Conventional evaporation would place the project in the lowest 25% cost of production. The 1.14mt reserves support an initial 40+ year mine life. None of the experimental extraction techniques will be commercially available at scale for at least 18 months. Furthermore unlike some startups, SDV doesn't need direct extraction to be viable. *Those who know what I've written elsewhere show how strongly I believe in direct extraction. But the best bet for GXY is to go down the pond route as fast as humanly possible. Direct extraction can be added on once its proven and as I've said for a brine source the quality of SDV its not so necessary and the ponds built will not go to waste. The two techs can compliment each other at SDV with similar costs.

*GXY has the funds to fast track commercial production through existing cash reserves followed by financing with interest serviced by Mt Cattlin operations. There is no sound reason for GXY to not invest >AU$300m in the next two years at SDV. Galaxy should aim towards 10000tpa LCE plant commissioning by Q1 2021. Followed by 40000tpa LCE by Q2 2023. This is ambitious but entirety feasible. It's only two years ahead of their stated goal.

* One of the top three Global accepted hurdles for the Lithium community is a lack of skilled workers, qualified engineers and chemists. The new CEO must actively recruit from the small pool of talent.

*The single greatest hurdle in Argentina is community relations and GXY needs a redoubling of efforts to engage the local population and assure them of best environmental practices to be utilized at SDV. Simon Hay needs to personally visit the local communities regularly to gain their approval of the operation.

* I expect Simon Hay to be a straight shooter. No more missed deadlines to very temporarily appease shareholder worries and kick unpleasant investor concerns down the road.