On a positive note I have a friend that I know reasonably well that does a lot of international work in commodities much of which is in China but may other countries as well. I have had an ongoing dialogue with him in the past few weeks about the availability of DSO shipments to customers other than the clearly unreliable Ruifu. He has long held bad feelings about Ruifu and very recently gave me some specific information that confirmed my strong concerns about Ruifu's intentions to honour the contract with PLS.
I should mention that sometime in the past seven or eight weeks I made a prediction largely based on Ruifu backing out of the BGS agreement that they would not come through for PLS.
At that time I had very little to back up my prediction other than common sense and business exeperience /nous. Today I feel much more certain in my prediction thanks to my friends contacts. I believe that this is actually a reallyPOSITIVE outcome if Ruifu fail to carry out their side of the agreement as it will allow PLS to strike an agreement with a more reputable and trustworthy company than Ruifu. The last thing that PLS would need right now is to put in place a DSO operation and then not know for certain that their customer will be able to pay for the initial deposit AND honour their undertaking to pay for all future shipments.
In short PLS needs certainty of the customer to be able to meet their obligations. Ruifu has had prior criminal convictions and an overall shady track record. Recently KB has confirmed that they PLS are in touch with other potential customers for DSO product. Please bear in mind that 1.9M tonnes of DSO over 2 years (as envisaged with Ruifu) would go a very long way to meeting the entire (but not quite all) funding costs of the mine building exercise. I have no doubt that the company would still require a degree of funding to meet its timing of capital payments and inevitably overall shortfall in project and commissioning costs.
Having said that a DSO agreement (s) of +/- 3M tons with a reliable customer (s)would be a game changer!!. Is that possible?? I dont know right now but with lithium prices pushing through to the US $1000 a metric tonne rate for 6% concentrate, nothing would surprise me.
Just wish I could buy another million shares at the current SP. Sadly Mrs W2 just wont let me sell the house to do it.
Cheers W2
PS Screaming buy IMHO but what does a Wombat know
PLS Price at posting:
33.8¢ Sentiment: Buy Disclosure: Held
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