Pricing AGY, page-195

Finally some worthwhile discussion!
Thank you!

My 2 cents:

Resource expansion can obviously have massive impact on NPV. We are slow-playing this imo and I see no reason why we could not acquire adjacent tenements once we push deeper into what we already have. Double/triple no problem imo.
The guys that own those tenements around us don’t seem to be doing much with them! Also worth noting the significant differences between this type of resource and typical mining - this is mobile and replenishing to some extent. Start drawing down and you draw in surrounding brine.
So, potentially massive upside from the perspective of resource base.

Secondly, with a larger resource, red hot demand and boosted prices in a handful of years, there is also no reason, imo, that we couldn’t keep expanding our production rate. More ponds, more plant “modules”. Look at everyone scrambling trying to work out their processing.... if we have the process nailed then it’s a no-brainer imo to continue expansion into a red hot market. Buy out half of the salar and grow to 20ktpa / 30ktpa ... why not?

Thirdly, price forecasts are very interesting imo but when I examine the disruptive growth evidence from the likes of Tony Seba (outcomes that blow away most expectations), combined with supply-demand forecasts from the likes of BMI (indicating massive supply deficits ahead), then I can’t help but see prices being well higher than some of those price forecasts suggest.
I’ve shown before how a doubling in price of LCE from say $10k to $20k per tonne equates to less than $1000 impact on EV price.
Imo there is no reason that prices can’t increase dramatically whilst still allowing reasonable end-product prices. An earlier example I gave re pricing hikes to incentivise new mines (or to accomodate a scramble for limited supply) was this: do you think people would pay $36000 for their EV, and have it today, or insist on only paying $35000 and be happy to wait in line for 3 years because not enough Li is being mined? Consider that in the context of people happily ticking the $2k metallic paint / premium sound / sunroof options. Perspective.

Other options are on the table and they often come out of the blue. Tonopah is a great example. Drop some holes and sell it to the neighbours? Cut/paste Rincon plant with some tweaks if required and develop it ourselves?
Beyond this, people should consider, imo, what actually happens to our opportunities for growth when we’re making say $100M per year from a 10ktpa operation.... yes, this is getting a bit ahead of ourselves at this stage but imo it’s worth pondering what that allows wrt expansions and new developments. ..and dividends of course!

It’s early days, but as JZ reminds us, we have the process, and that is the key.

Gltalth
DYOR