AVZ has plenty of what matters-indicated and measured reserves(compared to other companies who have more inferred) to upscale our output and increase our market cap rapidly! In other words why do you think AVZ can justify a 10 Mtpa start up plant???
which is 2 times greater than PLS's 2 plants combined
who have a market cap of 8.2 billion
AVZ is the real deal-large amounts of readily available lithium which is homogenous(little internal dilution)/ lowest strip ratio, at and near the surface, and with the lowest impurities. It is therefore no accident that "SCT, which has designed about 85% of all the hydroxide plants in the world, have said they've never seen such a clean product."(see below) Therefore collectively AVZ is in the lowest cost quartile to mine and cheap and efficient to convert lithium to battery grade products.High-level independent metallurgical test verification of Manono's lower iron, fluorine and phosphorous levels - and projected significantly lower open pit stripping rates - underline the incredible latent value in the DRC project.
"We think this project is completely different to every other project out there because it is so large - we're not talking about 10m-wide zones, it's 200m," says Ferguson.
"But it's not just about being the biggest in the pack, it's very much about that scale translating into value, which comes back to quality.
"It's the nature of the beast at Manono, with such a big, wide [pegmatite] body; it's cooled slowly, so we've got large crystals and a cleaner pegmatite. We've literally got, one side to the other, a single zone, and the wall rocks are black,and the pegmatite is white … so we can just strip it down either side and not worry too much about dilution. It's pretty much 1.65% all the way through!
"SCT, which has designed about 85% of all the hydroxide plants in the world, have said they've never seen such a clean product - just really high grade and no detrimentals of any issue whatsoever. We have low fluorine, very low phosphorous, the iron is down to 0.4% in the product … and we'll probably get that down further with more tweaking. There is 2-4% mica in the body itself, but once it's processed it's down to … less than 1.5% mica, and we'll get that down further too."
This is not to mention our exploration target of 1.5 billion tonnes that Managing Director Nigel Ferguson says I quote, " can be achieved easily". Remember this, that Roche Dure which is the pegmatite that our world's largest resource has been derived has only been drilled 1600 metres of its 2600 metres strike length or only 40%
Also it is has been predicted there will be a structural lithium deficit by 2022 so lithium prices will only continue to increase and AVZ will be right in the sweet spot when it produces in 2023! As well AVZ has the 3rd largest tin resource globally, and tin prices are going through the roof, tin being a most important metal(solder) in the electric vehicle/energy storage revolution!
Short Term Rerating Catalysts:
-collaboration agreement and HEPP
-extra funds means that the extra 15% equity in Manono from the government can be negotiated from a position of financial strength
-SEZ-tax, royalty and duty benefits including VAT exemption and tax holiday increasing the economic bottom line and decreasing an already amazingly short payback period
-mining licence
-BFS-expecting major increase in already stellar NPV/IRR, plus shortened payback period with massively increased lithium prices than when original DFS was done, increased resource from wedge drilling, tax benefits from SEZ, the huge increase in output to a 10 Mtpa plant (2 times greater than PLS 2 plants combined!
-more funding(now 90% funded) so in a position of financial strength to negotiate more funding from African DFI's to add to our $400 million from CATH(CATL-the largest lithium ion battery maker in the world needing AVZ's lithium to meet their multibillion dollar contracts)...also expecting 2.1 billion overall according to the DRC Industrial Minister Julien Paluku, I quote:
-feasibility study for hydroxide plant...(hint the extra billion funding mentioned above
-further offtakes to add to our already huge binding offtakes secured with big hitters to supply CATL, the world's largest lithium-ion battery maker
P.S.
No comparison when you compare the AVZ deposit to our competitors
A picture truly paints a thousand words.
Compare AVZ's homogenous/no zonation/lowest strip ratio and close to the surface deposit with other deposits that have thin veiny intercepts with a lot of overburden and underburden. like some of our major competitors. and how much cheaper it will be to mine AVZ's deposit just looking at the physical aspects of AVZ's deposit not to mention its quality(high grade/low impurities) as described above. I think also it is very important to consider that AVZ's lithium is readily accessible-large amounts at and near the surface and homogenous which is why CATL the biggest lithium-ion battery maker in the world wants and needs our lithium to fill its humunguous multibillion dollar contracts.
AVZ: homogenous and close to the surface largest hard rock lithium resource in the world, and 2nd in grade to only Greenbushes, low impurities( no mica issues/ low iron content)....Yes and look at those intercepts close to 300 metres and high grade....too good to be true but it is!
No deposit compares!
PLS: Inferior compared to AVZ: thin/veiny intercepts steeper sloping with much higher strip ratios-much greater overburden and underburden, questionable JORC reporting of iron content!, cannot produce battery grade because of expensive cost to convert due to impurities.
LTR: Again a much inferior resource to AVZ of their flagship Kathleen Valley. Veiny thin intercepts of lower average grade and their main orebody is 350 metres below surface that will require an expensive underground mine which by its very definition(shafts) will not be able to access all of its mineable reserves.
The world is going into a structural deficit of lithium and AVZ with a projected 25% of global supply by 2025 and growing will go along way to addressing this deficit as we expand and increase output in the future(see below):
AVZ will be producing right in the sweet spot in 2023 of structural lithium deficit and increasing!
***Very Exciting Times for AVZ as we count down to major re-rating catalysts with maybe the mining licence before Christmas which according to the Managing Director Nigel Ferguson will 'probably be signed by Christmas'(and if not it is I.M.M.I.N.E.N.T. ) which will put a rocket under the SP because it will be a trigger for further major funds to invest and trigger other imminent short term catalysts as described above.
Therefore the count down to Christmas should see a lot of buying activity with AVZ now in major indices such as ChiX, VMIX, the US OTCQX market, Van Eck ETF and now the ASX 200 with major funds scrambling to get a position before the mining licence and other major re-rating catalysts about to hit! e.g. today it is the last day for Van Eck to accumulate its share quota!
No time to be sitting on the sidelines because with major rerating catalysts, particularly the mining licence, it is not fanciful for the AVZ share price hitting a dollar and beyond short term!
Interesting the timing of indexes purchasing their shares this week and Van Eck rebalancing their fund with the final day for purchase todaywith the comments from Managing Director Nigel Ferguson 'that the mining licence will probably hit by Christmas.'
Only 5 trading days before Christmas.
Trading Halt Monday???
AIMO
Running discussion on SP, page-60470
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