TARGET PRICE, page-3

What most companies dream of.....a positive article on Bloomberg. I have made it BOLD a couple of points (last few paragraphs) which are of Strategic importance. Way to go KDR. If anyone had told us last year that within 12 months KDR will be $2 (when it was just 40 cents)...I am not sure how many would have laughed but it is a Reality. I concur Tran’s view on SP. Further, I believe we have one of the best management team whose priority is “shareholder value creation”. Well done team.


Hyperdrive
Tesla Strikes Lithium Deal From Plant That's Not Yet Built
By
David Stringer
17 May 2018, 9:56 am AEST Updated on 17 May 2018, 4:46 pm AEST

• 
  Kidman Resources to supply material for initial three years
• 
  Pact shows scramble in EV sector to secure materials: analyst

Tesla Inc. struck a lithium hydroxide supply deal with a junior Australian miner that won’t start production until next decade, underlining the scramble for the raw materials needed to meet forecast demand for electric vehicles.



Kidman Resources Ltd. will supply Tesla from a planned refinery in Western Australia for an initial term of three years, the Melbourne-based company said Thursday, without disclosing financial terms. The fixed-price agreement also contains options for a couple of three-year extensions.



It’ll be 2021 before Kidman begins producing the much sought-after lithium hydroxide under a joint venture with Chile’s giant Sociedad Quimica y Minera de Chile SA. A mine to feed the plant at Mt. Holland -- the world’s third-largest hard rock lithium deposit -- won’t be built until next year, according to a presentation this month.



“The fact that this is a deal for product that won’t be available for three years shows the urgency in the sector,” Reg Spencer, a Sydney-based analyst at ‎Canaccord Genuity Group Inc., said by phone. “What we are seeing is that automakers are increasingly willing to go all the way upstream, even to the individual mine, to secure supply.”



Galaxy Resources Ltd.rose 8.4 percent, as Orocobre Ltd. jumped 7.1 percent.

“The Tesla agreement is an important milestone for Kidman,” Managing Director Martin Donohue said in an e-mailed statement. Kidman will “continue to explore the potential for further offtake arrangements with other strategic, globally significant parties,” he said.

Kidman is seeking to agree about three supply deals and has held talks with battery manufacturers, car makers and trading houses, Chief Financial Officer Charles McGill said last week in an interview. The company aims to also retain some material for sales in the spot market.

“The Tesla deal will put a rocket under the others to agree the supply deals,” Canaccord’s Spencer said. “It’ll also help Kidman as it looks to secure financing for the refinery.”

Chile’s SQM and Kidman are targeting annual capacity of 44,000 metric tons of lithium hydroxide from their joint refinery in Western Australia. Kidman’s deal with Tesla equates to less than a quarter of the company’s initial share of production, according to its statement.

Lithium hydroxide -- as opposed to alternative lithium products -- is increasingly becoming favored by major battery producers and car makers, including Tesla, as it’s able to provide better range between re-charging, China’s Tianqi Lithium Corp. said in March.