I am kind of reading this thread with incredulity. Particularly as I'm used to there being all sorts of snakes in the grass in HC but also there are a lot of long term posters blowing smoke that I thought might have slightly cooler heads.
A caveat - this could absolutely go t*ts up with macro conditions pretty weak right now and tightening monetary policy worldwide. And I acknowledge we've waited 24 months already and comms on the 'why' have been pretty weak. Someone, I think Ddog, mentioned that Joe had said 'december' now? I did not see and if true I eat this post entirely and it should be ignored. If there is a link to it I can't find it but maybe its a random comment on a video?
However:
1. As I and other have posted previously, this is a
complex deal - lots of stakeholders and geographies involved:
- Rocks mined in Namibia
- Shipped to UAE to be processed in a simple albeit, unproven at scale facility
- Multiple end products with wildly different markets (Li, Caerium, Rubidium, other peripherals) sold to Europe, USA, potentially others, across), in a lithium market which is dominated by contract pricing and therefore not as transparent as say, the iron ore market, and a rare mineral (caesium) market which is basically opaque
- Finance options are endless and time is needed to sort the best - whether by offtakers through upfront revenue, private debt and equity, DFC which is cheap but not pressured by time to the same degree as others, sovereign wealth funds
This all means heaps of moving parts for all involved to get across, and competing agendas, both commercially and politically in places, or both, and LPD in the middle of it all trying to filter it all through the shareholder value distillation system. I kind of lean on the comments Joe made about not going for the sugar hit of a brand name offtake deal like Tesla because the price per tonne would be discounted as influencing how challenging this 'distillation' process is. He strikes me as Mr Methodical, pulling apart offers, endlessly testing alternative structures, which in some ways shts me to tears because i just want to press the go button and stuff it if we leave 20% on the table, lets worry about that at P2, but I don't think that's the kind of guy he is. Anyway. I digress with my uninformed psychological bullsht assessments.
2. The project is
a first and as such will attract higher scrutiny - this is not financing Rio Tinto to drill out more iron ore. A known play. Okay bad example in the current iron market but you get it. It's a semi established commodity and a new process, albeit with, as previously mentioned, not a terrifying new process like a new class of drug that might kill people if not dosed just right or a SpaceX launch. Any financier worth their salt will need more time than usual to understand the deal, the risk profile and make a call no matter how good the numbers look, and then add in the complexities as noted at point 1 above. They have no prior frame of reference to apply and I expect therefore they will take longer than 'normal' to scrutiny.
3. We have been told they are trying for finance this quarter.
It remains this quarter at time of drafting. Once it is July, it will not be this quarter (I went to a school for the gifted). Then we should start having a tanty. I'll be spewing but still a hold for a few months post unless an announcement comes that we've utterly sh*t the bed. But ultimately if its been 24 months by July and then in August we get funding after another month... my general feeling will be... ehh we got finance, glad I held on.
As for the sentiment from some that the claim on foot will kill finance, I'd like to understand how that position was arrived at. It's a cash claim that won't affect operations, and if paid in full and with immediate effect, which I view as unlikely (I stress I don't know the deal well, that's pure conjecture based on the expiry last year and the suspicious timing and my understanding of commercial strategy), amounts to a 2% sensitivity on total finance. I can't imagine old hands arranging finance haven't seen gambit claims before like this.
So can everyone calm down. A little. I think we can fairly fling sht for bad comms, but look at the bigger picture - macro demand for EVs due to climate worries/fuel supply chain issues, UAE and US's geopolitical need for the product, End users need for low carbon supply chains to satisfy ESG demands, plus the fact that, although slow to roll out, there hasn't been any colossal missteps by the board to date (in my view). Past performance is not an indicator of future performance but... it's the best we've got.
All in all I'm a hold, the delay is exasperating but not totally inconceivable for the opinion I hold above. Just really hate opening my LPDODs and seeing that green indicator of days to expiry keep winding down.
(20min delay)