Most of us are familiar with the 3% (sometimes 2%) heuristic used to approximate the value of an underground resource, particularly in early stage copper discoveries. This rule-of-thumb is increasingly used for spodumine discoveries. Based on this, Roche Dure's upgrade to 550Mt at 1.65% alone has a value of between US$44 billion and $US66 billion. Mid-range is $US55 billion. Using this approximation, and not taking into account Carrier de l'Este or other potential pegmatite sites at Manono:
AVZ (75% pre-CATH) is worth approx AU$18 per share
AVZ (51% post-CATH) is worth approx AU12 per share
I know, it's a very simplistic calculation that does not take into account a wide range of variables such as sovereign risk discount, the inferred value of the Capex incl crusher/concentrator, or the cost of rejuvinating the hydro power plant and upgrading roads and bridges. But at the same time it affords zero value to Carrier de l'Este.
Today Stockhead published a separate rule-of-thumb that is used Euroz Hartleys to value early spodumine discoveries. It goes like this:
Today is the first trading day of the new financial year, which hopefully is a bumper lithium year for us all.
Cheers
F
AVZ (75% pre-CATH) is worth approx AU$18 per share
AVZ (51% post-CATH) is worth approx AU12 per share
I know, it's a very simplistic calculation that does not take into account a wide range of variables such as sovereign risk discount, the inferred value of the Capex incl crusher/concentrator, or the cost of rejuvinating the hydro power plant and upgrading roads and bridges. But at the same time it affords zero value to Carrier de l'Este.
Today Stockhead published a separate rule-of-thumb that is used Euroz Hartleys to value early spodumine discoveries. It goes like this:
- Each 10 million tonnes of potential spodumene resource = $80-$100 million of exploration value.
- Each 10Mt of resource that has a clear pathway to production = $150-$300m of speculative development value.
- Each 10Mt of inventory (when in production) = $1.2 billion (at spot prices).
Today is the first trading day of the new financial year, which hopefully is a bumper lithium year for us all.
Cheers
F
Last edited: