Running discussion on SP, page-56297

I spoke with a few MD's from lithium companies today to test the assumptions of the LTR SC6 and Hydroxide price.

Apparently they've received the same November report. They confirmed to me that the contracted long term price in that Roskill report is ~930usd/t. The $1400 from derived from what the expected spot market might be.

Noting that no project can be financed based on spot pricing for sales. That's why offtakes exist. They guarantee revenue, which is what anyone looking to finance via equity or debt will want to see.

They also confirmed that the cannacord and Argus contracted prices were lower at around $850usd/t and 736usd/t. Long and short the economics are underpinned by used the highest forecast, used the spot pricing and then projected it across LoM. It's borderline irresponsible without investor understanding the huge risk of underpinned economic based on spot prices.

With all that said, 80% of it's post-tax NPV. If funding 500M odd will need to factor that dilution into the economics as well.

If any other lithium company used $1400usd/t i'd be equally critical. The same as the LoM projection of hydroxide at all time price. Make no mistake the project has been one of the best ROI across the entire ASX in the last couple years - but this probably confirms the MC as fairly bloated when the post-tax NPV needs ballooned figures. Rest of the sector has much better MC to NPV ratio's IMO and looks like the early market impressions are the same.

A couple other lithium projects have much better RvR. More advanced. More upside on lesser economics.
They're the ones i'd be holding and AVZ is one of them.

SF2TH