RE:RE:RE:RE:RE:Conference call My Summary "Key extracts" from listening to conference call:
This is a huge miss in terms of target completion(both Capital and timing), which generates ADDITIONAL CAPITAL REQUIREMENTS.
We got a “heads up” on February 14, 2023 when Guidance was withdrawn.
Updated capital costs Increases:
Estimate Q2 2022 $104.2 million Materials & Equipment $ 25.6 m
Construction in-direct $ 10.1 m
Existing Equipment
$ 5.1 m Re-baseline Low $155.0 m Construction in-direct $5.8 m
Other $3.4 m
Contractor Fees
$3.2 m Re-baseline High $167.4 m "Increases have been driven by scope expansion, inflation and supply chain disruptions."
IMPORTANT NOTE: “the fully operational” Cobalt plant is expected to be in the region of 4X to 5X the EBIDTA from Black Mass EBIDTA.
Electra have re-prioritized the sequence between Cobalt processing and Black Mass processing.... Accelerating
Black Mass Strategy to now take priority over Cobalt processing.
Black mass Processing:
- $8.1 million Capex required
- To produce MHP (Mixed Hydroxide Precipitate) from used Lithium-Ion Batteries feed
- Currently large plant scale trials underway with focus especially on improvements in recoveries of the hydromet process… (example) Probably will put a Sodium Crystallizer into the process
- Procure long-lead time delivery items with “target” commissioning to start around October 2024 and completion(hand-over as fully operational to pre-agreed measures, at 2500 tons/y production) by February 2025 (writer's interpretation !)
- MHP is an intermediate Nickel-Cobalt product and higher-value products should evolve through time, the idea being to get the Cashflow and demonstrate that Electra can do this on a continual basis and build from there.
"Commercial and Governments are the focus on Capital Funding" of the Funding shortfall, but Take-Over by more experienced, proven, accomplished, operating company might also be a hostile "opportunity" here
Peace,
ElJ