Wrote an email to AVZ see below.
Probably a lot of things missing and not the most detailed of questions but couldn't warrant spending more than 15mins on it given the previous email i had sent did not receive responses.
Will share anything i hear in return.
"To Nigel Et al,
It's been a number of months since I last emailed re the below queries; which left much disappointment as no response or courtesy call was ever received.
Though most of my previous queries have now been answered or responded to in some form via asx announcements, so I do thank the team for that, and give credit as the reporting from AVZ in the last 6 months has been an vast improvement to prior.
As the AGM looms I thought I’d send out some final queries that I’d like the opportunity to seek clarification about before raising them in an open forum such as the AGM.
1) Chairman; it’s been very positive to see that the appointment has been made and that we now only await the announcement once a starting date can be clarified. My question here is; for what reason cannot the chairman not be announced formally with the start date TBA. I and the greater market grows inpatient with references or comments that 'Soon to be announced' as similar wording had been used near on 18months ago when it was first raised.
2) Additional project acquisition; When does AVZ expect to have this completed by? - I recall that AVZ was seeking sign-off from relevant authority as appointments of certain ministers were still incomplete
3) Plant Process Circuit; can you elaborate on the preference of the process circuitry. Is it with or without flotation circuit? I note that a flotation circuit will achieve much higher recoveries and additional a better grade product. I also acknowledge that the HMS/DMS circuit provides a very non-complex circuit which would likely lower the initial capex and reduce opex costs. IF the decision is HMS/DMS only; does AVZ intend to add a flotation circuit long term? My thought process is if AVZ proceeds with HMS only we will produce a similar spec product to Pilbara counterpart, albeit with lower impurities. This does however limit AVZ's ability to supply the ceramics/glass market which Greenbushes currently dominates. Can you elaborate which direction AVZ believes the initial plant will be designed - and can you clarify the reasons behind this. I.e. capex reduction, off takers/financiers preference etc.
4) AVZ 100% tenements and CDL; Can you highlight what AVZ's medium-long term strategy is with the assets outside Roche dure. Is the intention such that a 2 mine or 3 mine operation would be feasible. Using thumb suck figures if the true in ground tonnage is in the realms of 2bn. With a 10mtpa operation this will have a 200y mine life - which is realistically outside the economic life of lithium for use in EV's. Would it not be more strategic or advantageous to split tenements and sell portions whilst maintaining a controlling stake? My logic being that AVZ would obtain upfront capital which alleviates the requirement for any CR's post or pre DFS completion and additionally increases sentiment of investment in the region. I would think that the rate of economic stimulus to infrastructure or capital investment from outside companies would be bolstered by having more reputable people and companies operating in the area.
5) On-market purchases; Do the directors intend to purchase shares on-market as a sign of confidence. It's quite disheartening to see multiple performance shares awarded for very achievable hurdles. I.E. proving a JORC resource of x tonnes. Given the exploration target is 2bn. It's not really a massive performance to prove up anything less than that. We now have ones pending for DFS completion, offtake for 25% etc. Again, completing a DFS shouldn't be performance awarding. IMO that should form part of the BAU requirements as a board of directors. Additionally, there's no penalty if the DFS is late. Or for e.g. if the offtake was secured at terrible pricing. I think the directors should take strong consideration in amending the performance shares to align with S/P increase. Additional I think the board should take strong consideration in investing their own capital and buying shares on market as a show of confidence but also respect to 99% of the other shareholders.
6) Transport Routes; what is AVZ currently working on in regards to defining/refining the transportation method. It's evident that the general consensus on the market is such that the transport routes provided to do not provide enough clarity/context to instil the market with confidence that these routes are tenable. Which route does AVZ currently intend to use and is there more detail regarding the 65M USD capital that was indicated would be required to upgrade the preferred route in the 5mtpa study. Noting a road is being built from the south but my understanding is that this will be a haulage route for general traffic/parts etc. and not the route the spod concentrate would be taking. When can the market expect to have a further update/information released regarding how avz intends to get the product to port (presumably Dar Salaam) and indicate what actions/item need to be sorted to make that route viable?
7) AVZ power; I really couldn't find much on this aside from a reference that it’s a subsidiary of AVZ in the annual report. - Does this somehow relate to the Hydro Facility?
8) dathcom/Cominiere capex responsibilities; Can you clarify what the responsibilities are/will be for capital funding post DFS. I note that in the original Manono acquisition terms it was AVZ responsibility to fund the project through to feasibility study completion. Can you indicate that this is still the case and additionally indicate what the terms of these relationships will be moving forward?
Whilst I am cognisant that your time is valuable, I’d appreciate if the aforementioned points could be at least reviewed and taken on-board as I feel they are a good representation of the wider market sentiment. If AVZ intends to secure capex on terms favourable to us shareholders then it’s my opinion that a boost in the S/P will assist in leveraging such terms and negotiations. Clarification or improvement on any of the above points via formal ASX announcement should assist in achieving that and if not, at the very least should appease myself and potentially the wider retail market some of which echo my sentiments.
I’m also mindful that there could/may be a lot more progress that is occurring behind the scenes and that the board well and truly has everything in hand which aligns with their grand plan. It would be greatly appreciated if this was the case that the market/shareholders can be better informed as to the true status of their investment.
Please feel free to respond via email or contact me direct on my mobile below should you wish to discuss further.
Regards"
So we'll wait and see.
(20min delay)