GXY 0.00% $5.28 galaxy resources limited

I'll take a stab at why the market suggests the halt was a bad...

  1. 141 Posts.
    I'll take a stab at why the market suggests the halt was a bad idea.

    Investors love revenue streams. Plain and simple.

    Galaxy reported in May, a 'sale, which is valued in excess of A$5.5 million, represents the first significant lithium revenue stream for Mt Cattlin.' -in the article it didn't report how many tonnes of spodumene was sold.

    The Cattlin project is producing 137,000 tpa. *That's roughly 11,400 per month of spodumene, if it's consistent.
    Correction *(Cattlin achieved record production of 10,784 tonnes of spodumene during May 2012)
    _____________________________
    If the sale of 10,784tonnes of spodumene is higher than 4million(operating costs) per month, then the market sees halting the plant, as a bad idea.

    I don't have Galaxy's spodumene spot price, otherwise I could give you. However, Glen eagle's spot price is reported as
    - (Jan 12) Current market price range (per tonne): spodumene ($450/550)

    550(tonnes) x 10,784 = 5,931,200million.
    Almost 2 million over operating costs at Cattlin.
    _____________________________

    If Galaxy is using the same spot price as Glen eagle, then yes. The halt was a bad F***ing idea...

    What the market wanted to hear was, we're selling excess spodumene, until our carbonate plant is completely ramped up.

    (Then again, I'm only speculating ;)

 
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