From twitter
View attachment 16094
SP: $8 to $11 (15%error margin).
PE=5, SP~$8
PE=10, SP~$16
PE=20, SP~$32.
2027-2032: (10 yearest. from 2022).
With CDL added, AVZJORC be 3x of 2020 DFS. NPV (10% dis) = 16 Billion, IRR = 324% (post-tax),Length of Mine = 210 years.
AVZ's Spod (1.4MTPY) and PLS (90 KTPY) most likely as: 2025 - prod. begins to 2027: Take-Offs:Export 24% CATH (China) 15% DRC/Africa, Export 20% each for USA, EU and Japan.---- NPV: 5.8 Billion, IRR 108% post-tax (from 2022 revised BFS without CDL JORCest.)
... During the US Secretary of State Mr.Blinken delegation meeting with
#DRC Minister of Mines last month, US has made itclear that they want to invest knowledge AND money to make batteries in DRCgiven no corrupt politicians benefit from it.
Post-3: CautionNumber-1: I invoke my second amendment right from the US Constitution for anindividual privilege to free speech, expressed both in verbal or in written, topost the following multiple short Twitter messages as of Sep-2022.
Post-4: ... Though ihave attempted to write these messages using the best of my professional andpersonal competence with the intention to share useful information, from andfor, in equity markets, with others. It is possible that these messages may be ...
Post-5: ...neurologically biased or written in a specific state of mind and can thereforeresult in loss of monies, or in some cases, loss of the entire wealth. I holdAZZVF (AVZ) since 2H-2017. Please be careful, if wealth is an important aspectof your living.
Post-6: CautionNumber-2: If DRC's President Felix is out of power and authority from itspresent highest level for any reason (constitutional demotion, acute healthsickness, voted out in Dec-2023 or assassinated (God forbid absolutely not)then I shall have …
Post-7: ... have nomonetary investments in DRC within one business day of that unforeseen event.Request Number-1: I have attempted to compute numbers here with due diligenceto back up yesterday's posts 1 and 2. However, there may be errors and omissions,…
Post-8: ... perhapsyou can find any and share with all to truly benefit all AVZ long term holders.Request Number-2: If you can find concerns, kindly back-them with reasons andsources, so i could amend the original for benefit of all.
Post-9: MajorPremises: - All monies in USD. All dates in MON-YR. All weights in Kilo Tons(KT). - Dathcom Corp: AVZ 75% + DRC(CAMI) 25%. DRC tax rate 35% but for theproposed AVZ SEZ permit, post SEZ permit taxation is about 15%.
Post-10: ... - SC6 Operation: DMS @ 56.5%; Recovery @60%; Strip Ratio @ 0.48; - PLS Operation: front-end only of the entire hydroxide plant(Calcination stage) and therefore a modular design for downstream off takers tocomplete the last stage locally.
Post-11: ... - SC6will not be exported (not a significant demand from AVZ for CATH to agree to),instead PLS shall be shipped via both east and west marine ports (FOB only).SC6 may be sent within Africa - southern and eastern industrial partner zones.
Post-12: ... -pricing is for only battery quality lithium which is 6% (and not 5.5% thatPilbara auctions at $6k+ a ton Spodumen and Chinese converters are facingrecent challenges spec'ing BQ to cathode OEMs). - PRs 4029 and 4030 (100% AVZ)not included here.
Post-13: ...Sources: DFS, pgs 1,61-62 (APR-20). Other assumptions (Pilbara, Africa economictrust zones, battery quality Lithium, PLS pricing) are public info. For EBITDAcalculations, following 4 metrics are explained and used: ...
Post-14: ... Metric-1: Total Mineral Deposit(PR15339, RD+CDL+5 other smaller Pegs.)=1.5 Billion Tons. Sources: US CanterFitzgerald's chat with AVZ, tonnage at TS:18m.40s (Nov-21):
https://youtu.be/1w_AR-TKGec ...
Post-15: ... Wiki, Under Discovery and Occurance,last para. (Sep-22):
https://en.m.wikipedia.org/wiki/SpodumeneMetric-2: Total Mining Duration (in years): From Jan-25 to Indefinite. 20 yearsLoM is due to the lithium price forecasting constraint placed by Roskill LLCand ...
Post-16: ... RoskillLLC and therefore can only go as far as 20 years. Sources: DFS, pg. 2, para.6,8, (APR-20). Metric-3: Yearly Production (ANSI mT): 700 KT For SC6; using PLSconversion rate of 3.5 results in (700,000 ÷ 3.5) 200 KT PLS. ...
Post-17: ...Sources: DFS, pg. 2, para. 6,8, (APR-20). Metric-3: Yearly Production (ANSImT): 700 KT For SC6; using PLS conversion rate of 3.5 results in (700,000 ÷3.5) 200 KT PLS. ...
Post-18: ... MD Mr.Furguson was 25% higher when he quoted 250 KT product to be electric-railedfrom Monano to Dar E Salam port in a recent interview (as he may have expansionplans finalised for the PLS trains 2, 3, 4 and 5 in the pipelined hydroxide studies…
Post-19: ...hydroxide studies already slated, and perhaps completed, for q1-22. Each PLStrain produces approx. 46,000 tons per year and 5 trains approx 250KT. Sources
FS, pg. 1 (APR-20). AVZ MD stating yearly tonnage, at TS: 7m.8s (AUG-22). …
Post-20: ... AVZ MD stating yearly tonnage, atTimestamp TS: 7m.8s (AUG-22).
https://youtu.be/VuybAbrmCgAMetric-4: Pricing for SC6, PLS and Li2H. AVZ to CATH has a price floor and arising ceiling for 3 to 4 year contracts in chunks. …
Post-21: ... Theremaining 76% product is for open market and will be priced in a sustainable,affordable negotiated manner guided by both quantity and quality in alignmentwith Benchmark Mineral Intelligence BMI charts as well as LSE lithium pricingonce …
Post-22: ... pricingonce it's accepted and traded (replacing S&P global Pratts and Fastmarketsdata) in 2023 onwards. DFS from April 2020 has 700 for SC6, 7000 for PLS and10k for Tin. Prices in 2H-22 are 9 times for SC6 (6,500), 11 times for Li2H (78,000)…
Post-23: ... Li2H (78,000) and 7 times for Tin(70,000). For 2025 to 2027, It is okay to use 25% of today's prices which is:1,500 for SC6 and okay to use 30% of today's price of 23,000 for PLS. For 2027to 2032, we use 1,200 for SC6 and 21,000 for PLS. ...
Post-24: ... Therefore, for the next 10 years we useavg. as 1,350 for SC6 and 22,000 for PLS. Sources: US Govt. Lithium contractprices 2021:
https://google.com/url?sa=t&source=web&rct=j&url=https://pubs.usgs.gov/periodicals/mcs2022/mcs2022-lithium.pdf&ved=2ahUKEwiKysW71IL6AhX6zHMBHQ1MD_UQFnoECAgQBQ&usg=AOvVaw1-4RZ3zk4x1ZBSTxEJ2eml…...
Post-25: ... LCM pricing forecast upto 2027 for high,base, low (and SQM) charts by Joe Lowry (SEP-2022) of Global Lithium LLC
https://globallithium.net/s/Lithium-Carbonate-price-FC-Sept-2022-v2.pdf…----------------------- Calculation per JORC mining code standard for SC6:---------------------- ...
Post-26: ... 1. {1.5billion tons x 0.5 (strip ratio) x 0.6 (recovery rate)} ÷ {250 KT (PLS peryear) × 3.5 (AVZ design for SC6 to PLS)} = 51.43 years. LoM is 51 years. Tinand tantalum credits are 5% of yearly revenue. Calculations per US GAAPstandard: ...
Post-27: ... COST:Cost of Mineral Ore to SC6 converter = $130 million. (Reference: cost of eachPLS train = $190 million.) Cost for 5 trains (export for CATH-2, USA, EU andJapan 1 each) = $950 million. Total miscell. mine dev. cost = $220 million. …
Post-28: ... Cost ofPLS production + Cost of TRC SGR Electric Rail transport, per ton (COGS) =5,500. REVENUE: Yearly cash flow = 250,000 x $16,500 (which is 22,000-5,500) =$4.125 Billion. ...
Post-29: ... NPV(10% dis.; pre, post tax)= 24.05, 20.40 billion USD (10 year only) 36.142,30.721 B USD (25 year) 39.038, 33.182 B USD (40 year) 39.563, 33.629 B USD (49year) IRR (pre, post)= 322%, 274% (any of the duration: 10, 25, 40, 49 years).…
Post-30: ... PBP=less than one year but realistically may be couple years or less. AVZ 75%interest, post-tax as below: NPV (10% dis.) = 15.300 B USD (10 year). 26.112 BUSD (25 year). 33.182 B USD (40 years). 33.629 B USD (49 years). IRR= 232.9%.PBP= <1 yr
Post-31: ... IfAVZ's MC today according to the above NPV is 33.629 B USD for approx. 3 Billionshares outstanding, then earnings per share should be about 11 USD. Then, inJan-2023 for the: P/E = 5, SP = 55 USD. P/E = 10, SP = 110 USD. P/E = 20, SP =220 USD. …
Post-32: ...However, given the thematic nature of the critical mineral sector within thelarger macro economic backdrop, the lithium industry is enjoying a much higherP/E of the likes between 90 (PIL, LKE, LTR, AKE) and 35 (SQM, LTHM, ALB). ...
Post-33: ...Considering a junior minor going into mine dev. It is okay to assume a P/E of60 for AVZ. Discounting, sovereign risk of DRC by 50%, a true P/E can beestablished at 30, And therefore, AVZ stock price should be around 330 USD atthe start of 2023.
Post-34: ... One canargue, starting with 1.5 billion ton total ore is a flawed premise, when thepresent DFS JORC states about 400 million tons. This is okay and one can usethe reduced (about) 25% factor to give a revised SP of 87.5 USD (330 x 0.25). …
Post-35: ... Note:5% of total yearly cash flow additional revenue from tin and tantalum creditsare not added yet. Upcoming AVZ Catalyst announcements (AVZ equity impact -extremely high, very high, high, medium, low, very low) are enumerated next: …
Post-36: ... 0.Litigation: Claim-1 (Comminier) was dismissed in AVZ favor by the DRCgovernment ministry of mines, 15% retained by AVZ (high). Claim-2 (Dathomir)partially (10%) dismissed in AVZ favor by the Lubanbashi court of appeals,remaining 5% still in ..
Post-37: ... remaining 5% still in dispute and can besettled for good if AVZ gives $50 million more to Dathomir. Most likely this isin deliberation in the court as AVZ refused to give any more monies but hasretained the undisputed 10% in Claim-2 (medium). ...
Post-38: ... 1.PR13359 transition from exploration to exploitation, aka license to mine(extreme). 2. Bankable feasibility study BFS, made public within a few hours toa couple days after mining license is granted (very high). ...
Post-39: ... 3.DRC-AVZ collaboration agreement (medium). 4. CATH-AVZ TIA completion &prompt money transfer (very high). 5. Li2H / PLS expansion (5 trains) study andrelease of report (high). Note: Catalysts 3, 4 and 5 can occur in anychronological order. ...
Post-40: ... Finalinvestment decision, FID issued (high). 7. First formal, third-party compiled,AVZ ESG report released (medium). 8. DRC grant of special economic zone SEZpermits Monano district critical mineral industry for reduced tax rates(medium). ...
Post-41: ... 9.Establishment of "AVZ Foundation" benefiting Monano+Kitoltodistrict's start of schools, hospitals, green areas, human shelters and foodbanks (medium). Note: Catalysts 7, 8 and 9 can occur in any chronologicalorder. ...
Post-42: ... 10. DRCapproval of hydro power plant (85 km SE) refurbishment for a total of 46 MW(26+20), AVZ has included this expense in its cost (high). 11. Q4-22 CDLresource update for the 15 km drill hole project (high). ...
Post-43: ... 12.Q4-22: Final debt-FDI funding completed most likely from a pan-Africandevelopment bank and also by a consortium led by USA (canter Fitzgerald) and EUbanks in 2023 (very high). ...
Post-44: ... 13.Q2-23: Transport routes to the east port (Angola) and to the west port(Tanzania SGR electric rail to Brundi and then to DRC) contracts finalized withcountry, regional partner governments and port authorities. THIS IS THE LASTPOST. ------------
. Do you think Neeto could be a professional analyst for one of the other big US fund managers?
