It is satisfying to see some of the assumptions and projections made in this post have aged well.
With the latest quarterly now being digested by most, hopefully Sayona's emerging strategy is being clearly realised.
Add to that the stellar contributions and time consuming research made by some of the LTH's, namely SB and Split, etc.. add further pieces to the puzzle and start filling in the gaps, left by the mediocre comms.
So I am glad to finally see some comms from SYA, that specifically mention Carbonate, without tacking on the token hydroxide comment....
'The restart of NAL operations will signal the start of revenue generation for Sayona, another step on its
journey to becoming a leading North American lithium producer. Combined with the company’s emerging
northern lithium hub, NAL will ensure Québec is at the centre of lithium carbonate production, becoming an
axis on which a successful battery ecosystem can be built'
Because it all starts falling into place, when you start considering the real reasons behind some of the ambiguous and sometimes contradictory messaging from the company.
CARBONATE-
And why would'nt you go after the fastest and cheapest route to a refined product?
Even Crawf with his, grade 6 level maths skills can work this out.It makes so much sense to me, to produce a refined product ASAP.
Not only is this a massive revenue stream, with deficits and record prices of refined lithium products into the foreseeable future, but it will release the shackles of the PLL offtake. (Maybe the reason this Q2 2024 date has been buried deep inside a previous announcement, with no fanfare or gravitas. A longshot, but, Is sayona keeping EVERYONE in the dark, to keep PLL in the dark?)
So a compounding effect of not only a hugely increased revenue, but also retaining the majority of this windfall.
As I have previously stated, under earlier stewardship, NAL was always destined to be a carbonate plant.
Originally platted at 20kt Carbonate, SC6 was just a means and a step in the carbonate production cycle.
Other under the radar comms confirm this, with the target now published to be aimed for Q2 2024.
CAPACITY-
So the next piece in the puzzle was the capacity of the plant.
Figures of 186kt, 163kt, 220kt and 226kt have been published at various times.
For me the tip off was always the 113kt/50 % off take witrh PLL.
Which turns out is the arrangement IF we were successful with the NAL bid.
So does that then mean that 220/226kt WAS ALWAYS the target f or SC6 production at NAL?
PROBABLY.
And with the increase to 4200tpd AND the improvements in the processing circuit to around a 75% revovery rate, 226kt SC6 should be achievable.
My post 4/7/2022
I have seen in some media outlets reporting about Sayona, throwing around the 226kt sc6 figure.
To find it in published literature, I had to go to the half yearly report ending 3/12/2021, but announced 17/3/2022.
Half yearly report 31/12/2021......published 17/3/22
A definitive feasibility study (DFS) is underway for the profitable production of spodumene concentrate at NAL, combined with production from nearby Authier. The integration of NAL with Authier will transform both operations and create a world-scale Abitibi lithium hub from which the Group aims to produce220kt of spodumene 6%or 30kt LCE (lithium carbonate equivalent).
(BTW-still only mentioning carbonate!)
Obviously, an upgrade from 168kt/180kt to 220/226kt, needs to be planned and Sayona has been chasing this for a while.
And it falls into place because it goes some way to explaining the reason for such a LARGE cap raise.
BUT...$190 million???My post 03/07/2022
CAPEXpg21-
The total capital expenditure (CAPEX) proposed for the project is estimated at C$91M, including a
C$14M contingencyallocatedacross the first two years.
The present costs estimatepertaining tothis study
as Class 4 – Pre‐feasibility Study Estimate, as per AACE recommended practiceR.P.47R‐11.The accuracyof this CAPEX estimate has been assessed at ±30%.
So, 84mil if we remove 1 year of the contingency, then add in the PLL contribution that Keith has openly admitted to have budgeted for US$20mill. Or C$26
14 mill over 2 years, so 7/year
Our capex contribution could be as low as 91- (7+26) = C$58...
So if we ONLY need around $58 million for the capex, most of which has been already spent, and say another 15 million for exploration and studies, 25 million running costs= 98 million, what do we need the other 130 million for?
They need it for the CARBONATE PLANT.
As stated in the Quarterly-Over 195 million still in the bank, PLUS from SB's post
Post #:62827555 , circa another possible
27 million from various sources .
Also keep in mind that the long lead, high capex items we are upgrading the processing plant had already been budgeted and payed for.
Current Quarterly-
'During the quarter, the Company spent approximately $3,440,000 on exploration and project evaluation
costs, primarily on its Québec lithium projects. In addition, the Company spent approximately
$10,038,000 on plant and equipment in relation to the NAL refurbishment.'
THEY ONLY SPENT 10million!!!!
So, another 222 million????
available for capex, opex, exploration, studies.....before ANY revenue streams come online.
That would go a long way to getting that NAL carbonate plant, which was already plated for 20kt/pa, upgraded, modernised and ready to produce30kt PA Carbonate, by Q2 2024
Revenues for SYAQ could be nearly US$2 billion
(30kt x US$65k= 1,950,000,000)
which could put our MC in the 8-15 billion dollar region.Current Quarterly-
'This will allow Sayona to launch production ahead of other North American projects, generating sustainable
cash flows and putting the Company on a fast track to go downstream into value‐added lithium hydroxide or
carbonate production. Québec is rapidly emerging as a leader in the battery sector, benefitting from its clean
and sustainable hydropower, world‐class infrastructure and proximity to market.
At NAL, the overriding development objective is for the restart of production, with the benefit of
supplementary ore feed from Sayona Québec’s (SYQ) wholly owned Authier project, located just 30 km from
the NAL site.
Initially, NAL will produce a lithium concentrate for general market conversion, however NAL will
become a primary feed source for SYQ’s integrated downstream refined lithium products.
Sayona aims to produce 220kt of spodumene 6% or 30kt Lithium Carbonate Equivalent (LCE) from its Abitibi
lithium hub, which combined with the Company’s emerging Northern Québec hub represents North
America’s largest lithium (spodumene) resource base.
Additionally, there was no doubt we were all suffering from CR fatigue.
So to that end, I believe the decision around the last CR was based around going hard one last time.
Accumulating enough cash in the coffers to be able to implement everything they want to achieve in the next 12-18 months, INCLUDING REFINING.........without finance and without having to go back to the market and ask for more money.
(On a sidenote- Please also consider, that there is scope to produce BOTH carbonate and hydroxide at NAL.
If you take the carbonate product and-
'By slurrying lithium carbonate with calcium hydroxide in water at room temperature, it can be converted to the lithium hydroxide. After filtering out the calcium carbonate by-product, the lithium hydroxide is purified by crystallisation. '
Not a difficult process.
A processing circuit that can be designed, engineered and built, while still producing revenue earning SC6 and carbonate.)
CARBONATE PRODUCTION AT NAL, ABITIBI HUB
HYDROXIDE PRODUCTION AT MOBLAN, NORTHERN HUB.
Now, if you had an opportunity to build a brand new, clean sheet, purpose built mine and refinery, you would definitely be aiming toward the cleanest, cheapest solution possible.The initial time spent with Richard Hunwicks ICS process and the relationship we have built with them and the CSIRO will hopefully lead to the Moblan hub, being the most advanced, vertically integrated lithium hydroxide refinery in the world, possible by 2027/2028.'Enter Richard Hunwick and his ‘earth-friendly’ hard-rock lithium ore refining process. Richard ‘leaped outside the box’, believing nitric acid could form the basis of a superior process for recovering lithium values from hard-rock silicate minerals. He discovered that the use of nitric acid uniquely allows for the convenient and economical conversion of the lithium values into lithium oxide (lithia). Lithia is the ideal starting point for the manufacture of pure, marketable lithium chemicals including lithium hydroxide & lithium carbonate (the forms preferred by battery manufacturers), as well as the much more valuable lithium metal. Critically, Richard’s carbon capture and mineralization expertise helped him process the hard-rock silicate minerals in an environmentally sound way; recovering and recycling the nitric acid along the way. The resultant process is economically more attractive than standard hard-rock lithium ore refining processes. Richard’s approach produces no hazardous waste, then captures and utilises CO2 emissions in order to produce the lithium carbonate product.
So no hazardous waste and due to the extensive recycling in the process, it can save about US$1000/tonne, in refining hydroxide.
A perfect fit for MOBLAN.
A perfect fit for Sayona
and ..
A perfect fit for a leaner, greener WORLD.
So what I really think we are seeing here, is the rapid evolution of Sayona's emergence as a world class Lithium refiner.
Reading between the lines, an art necessitated by being a Sayona investor , I get the feeling that SC6 production is in the bag.
It is a given and the fat lady has sung from the rooftops- '“Le Lithium d’ici” The plant will be commissioned within the next 4-5 months/ Q4 and We will most probably be producing SC6 by Q1 2023.
The team is now focusing on the next challenge of refining.
The cash is on hand, the studies are being progressed and the team continually being built and expanded.
So why not????
It has now become a distinct possibility.
One that has probably been planned for from early 2021, and as we know, is mandated by the Quebec government from 2025 on.
So, Why not indeed.....
And to think, this is just one of the irons in SYA's fire!!!!
Good luck everyone...