AVZ 2.04% 5.0¢ avz minerals limited

Understanding lithium demand, page-11

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    I find your response disingenuous. The purpose of me creating this thread was to provide information on the factors associated with lithium demand and potential supply sources and whether there was scope for AVZ to enter the market, not to shy away from a debate with you which frankly I thought had ended. Now, in the PLS thread your post was this - Post #: 37791841 - too me btw and I answered your post as well - Post #: 37793550 - as did other PLS shareholders after me. Your post didn't give NeoMetals example by the way but I will address it below too.

    Now I didn't shy away from the debate, I thought that debate was concluded and some in that thread did have a go at you which I stayed out of btw.

    For avoidance of doubt, I opened this thread as a AVZ shareholder to provide my research here and expansion of research within a AVZ context given I was not a PLS SH. But for consistency I stated the following in my reply to you then, which I have not departed from in the opening post in this thread:

    1. Future demand for LCE will predominantly come from EV passenger vehicles, but also from the 'other category like EV scooters and batteries in household energy storage market'. I also provided you clarification on what the EV sales figures were in 2018 - since you asked me and others can open up the post above in 'thread view' to see that discussion and that those sales figures accounted for 1/3 of LCE demand in 2018. I stated IMO I expected LCE demand to increase significantly based on the literature.

    2. In dealing with demand forecasts size of battery assumptions and battery efficiency is a key assumption in such forecasts, which I again have pointed out.

    2. The question for new entrants becomes can the existing suppliers of spodumene/brine selling to those producing lithium carbonate or lithium hydroxide ramp up production to meet the expected demand to stifle new producers entering the market. And critical to that is the demand forecasts.

    3. In terms of this thread I think there is scope for AVZ to enter the market by 2025 but if it doesn't get its act together it will miss the boat, and I have been consistent with that view too for some time.

    Now in relation to NeoMetals, lets be frank you have done no research as to whether that is the main reason. If you look at Greenbushes, you might notice that both Tianqi and Albermale are going to build hydroxide facilities sourcing gas from the Dampier to Bunbury Pipeline that is located near the coast in an industrial area close to Fremantle and Bunbury Port. We also note PLS is thinking about a facility as well, and suspect it might be closer to Port Hedland.

    Now lets look at NeoMetals, well it wants to build the facility at Kalgoorlie which is served by the Dampier to Goldfields pipeline - question for you does that pipeline have the capacity for NeoMetals proposal and what is the price of that gas (you can do your own research). Secondly it intends getting its feedstock from Mt Marion and guess what there will be question marks on that to. You see Greenbushes is high grade and PLS is ok grade (and certainly AVZ is high grade), and they all have a good size resource level, but the grade at Mt Marion is good in parts butsemi-ok in others, noting the contracts they already have to serve take the best parts of the deposit (so what is available for the proposed hydroxide facility).

    Reason for the above is 6% grade spodumene is essentially 75% spodumene the rest junk, but if you produce spodumene from a lower grade more than likely the 'junk' 25% might be harder to take out in a lithium hydroxide process than 6% grade produced from higher grade ore. This is an opinion but I will do more research here to verify.

    Next point it is a proposed 10,000 tonne per annum LCE hydroxide facility been deferred by NeoMetals by the looks of it, and to be frank it looks relatively small at 1/3rd the size proposed by Tianqi and Albermale above - google is your friend if your interested but here is what NeoMetals is proposing but you can do your own research on the others https://www.neometals.com.au/kalgoorlie-lithium.php. Economies of scale might be a factor here too, but obviously proposing a plant of that size suggests they don't have access to a lot of spodumene too me (especially when you compare that to the current proposals of Tianqi and Albermale Stage 1 hydroxide facilities to boot which is proposed to be triple the size each compared to this NeoMetal proposal). And it is a hydroxide facility they are deferring, not a spodumene mine so need to understand here proposed installed capacity and where that increased capacity for producing LCE is located.

    Apologies to NeoMetals investors because I don't want to be debating NeoMetals decision here btw but that is my view Esh. So there might be something else going on here that your post doesn't allude to and/or NeoMetals is not indicating.

    In any event IMO your blowing your trumpet in the wind to be frank. This thread is to open up debate so in the interests of opening up debate maybe you should put your demand forecasts here (i.e. which ones you think are reasonable) and map that against potential supply sources of 6% grade spodumene (or brine) and state why you don't think AVZ can enter the market say in 2022 or even to 2025.

    Obviously we are assuming here the AVZ PFS will be positive and they will have an appropriate transport route to market. So entry in the market by 2022 to 2025 then becomes a question of demand and supply, which is the basis of this thread, so over to you.

    Going back to my post in this thread, I state growth in the passenger vehicle market based on the forecasts suggests you will need 18 mtpa of additional installed ore feed capacity for the production of 6% grade spodumene just to serve that market in 2025. This is before we talk the demand increase for other usuage ares of lithium. The question is can existing producers fill this gap - if not there is opportunity for AVZ noting that in this world there is only statistics, damn statistics and lies.

    Obviously there is a risk in investing in AVZ given it has not done its PFS, transport routes to market are uncertain and the timeframe for entering the market is tight.

    All IMO IMO
 
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