If the point of your post is things take time that is an obvious observation. The key issue is how the projects could be developed - see below. I am going to speculate here.
OHD is something I am learning. I have not ever phoned GPP management or talked to GPP management in relation to GPP so the following below is essentially my opinion. Just needed to say that as your post may have inferred I have talked to management in the past. To aid discussion I thought I would yabber about development scenarios, whilst saying how I see OHD fitting into that.
Potash
Of the three projects GPP has, the potash one I feel is the one that will require more time to determine viability or not. The most recent Ann it provided indicates too me how much more work is required, noting that similar projects in the NT - see Rum Jungle - are still in the assessment stage and have been there for many years.
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23121749
Lithium
With Morabisi there is still a lot of work to do, but if the samples come good then drilling. If the drilling results are good suspect it will be a fast development approach because all potential lithium projects are trying to enter the market whilst there is a supply demand imbalance, and this provides the best time to get new greenfields projects up.
I would say they would be wanting to be in the mining stage, assuming they have sufficient grades, within the next three years, because if they do not enter that window IMO they will miss this development cycle and will wait for a number of more years. That is greenfields projects are on the radar because i.) brownfields projects cannot cover the gap including the hard rock Greenbushes project, ii.) brine projects cannot produce the purity required in the growing lithium hydroxide market, but iii.) that won't be the case in three years time (as the new greenfield 'hard rock' developments become brownfields devlopments and brine sorts out its issues which at the moment IMO makes it unviable in the higher grade lithium applications that the market wants that can only come from hard rock).
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20874761
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20874785
My personal view is if the project is developed that it will be by JV. Will there be a CR required - yes for the diamond drilling stage but thereafter, development, well will depend on what profit we are making from OHD, assuming that project is a goer - see below. I also don't think they will be in a position to define a JORC resource for about 6 months - 12 months as well.
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22902785
OHD
This IMO is the best project and most developed project GPP currently has. If viable I think the proceeds will help fund the needs of project 1 and 2 above IMO. The issue though is that OHD is saying it needs to move first to a pilot plant which might not happen to the 2nd half of this year (a decision to build been made). However given the strength in results to date this might actually be bypassed as a stage IMO and a move straight to commercial development (yes I am speculating here) might be made. Given the interest, well suspect it will be done by a JV and all development costs will be met by the JV partner (meaning no costs to GPP or need for a CR IMO). Again speculating here, but do expect development in a JV framework.
If OHD reduces costs by 1/10th and increases yields (doubt the 300% increase in the lab will translate to the broad acre field but even 100% increased yield would be huge, especially the cost advantage. Now from my reading even 100% is better than your competitors.
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22649858
Now I would suspect the pricing would be built around 20% - 30% below the competitor's to encourage uptake. How does that translate to profits - well it will be huge, and will be difficult to fully evaluate here. As a guide, the MC of GPP on OHD alone, if the technology is proven and indeed costs are 1/10th of competitors, in itself would mean the MC would be significantly significantly greater than what it is now without Potash or Lithium. I would say above $500 million MC IMO but time will tell if the results are what they are.
From the article:
http://www.farmingahead.com.au/cropping/ctl-fertiliser-trials-a-success/
"
Typically made from seaweed or kelp, bio-stimulants such as Seasol generally retail for between $3500 and $7000 per 1000 litres wholesale, but Greenpower’s production costs are $350-$700/kL."
Now, the money making potential here is huge. The potential to undercut all your competitors and take market share is huge and any estimate I think is going to be quite low. The value of the broad acre fertiliser market is in the multi billions, even taking 5% of this market is going to be a huge result IMO. But to reiterate, it is time that is the factor here and whether GPP moves to a pilot.
Personally I wouldn't be surprised if potash and OHD become linked further down the track IMO. IMO right now the lithium project doesn't have a natural linkage of the three projects to each other. So I am speculating here - I wouldn't be surprised if lithium is there in sufficient quantities that that project is sold of, or GPP seeks a JV partner to develop it meaning GPP becomes a minority holder in that project and uses proceeds for OHD development. Just a thought.
Finally, GPP has spent funds developing OHD and is years ahead of any potential new mover here, so if OHD works that too me is going to be a money making deal here. It might not hold the patent but is is miles ahead as a licence holder (see attached post below). The more I think about it and understanding that Morabisi needs to enter the market in the next few years for that project to release its value, the market IMO is still asleep here where the true value of GPP is. Obviously that can change in an instant if the Morabisi sampling results are excellent and a resource area has been better defined in that sampling work (see one of the posts attached here above).
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22907042
All IMO IMO IMO
Anyway, my thoughts and blabbering whilst drinking VB, knowing the kids are now sound asleep. Peace and quiet. After reading this myself should have created a new thread to discuss development scenarios but I'll save that for another day. "May the VB be with you" (apologies to Star Wars fans).
