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Pilbara Minerals Ord Shs T.PLS


Primary Symbol: PILBF

Pilbara Minerals Limited is an Australia-based lithium company. The Company is primarily engaged in the exploration, development, and mining of minerals in Australia. Its 100% owned Pilgangoora hard-rock lithium operation is located approximately 120 kilometers (kms) from Port Hedland in Western Australia’s resource-rich Pilbara region. The operation consists of two processing plants: the Pilgan Plant, located on the northern side of the Pilgangoora area and produces spodumene and tantalite concentrates, and the Ngungaju Plant is located to the south produces spodumene concentrate. It owns 70% of the Mt Francisco project, which is located 50 km south-west of the Pilgangoora Project and hosts the large occurrence of outcropping pegmatites located nearby to Port Hedland. It is also pursuing a proposed downstream joint venture (JV) for the development of an approximately 43,000 tons per annum (tpa) lithium carbonate equivalent (LCE) lithium chemical conversion facility in South Korea.


OTCPK:PILBF - Post by User

Comment by seatleslimon Nov 01, 2015 8:40am
70 Views
Post# 24247930

RE:Intrinsic Value of Reserves - someone asked.

RE:Intrinsic Value of Reserves - someone asked.And if you hear today listening to us and listening to others, the primary question that I am assuming you are having here in this presentation today is why would you want to invest in the aggregates industry? And what we would suggest to you is there are at least six things to consider as you look at this space in which we're in. Number one for us, what are the barriers to entry, and in our business they're considerable. Number one, you need a lot of land. Number two, it needs to have an adequate quantity and quality of aggregate material, DOT specifications means a lot and it's hard to find that. But the other issues that you need to be sensitive to are land use and permitting issues. So as we look at land use, what does your zoning look like, what does your special use permitting look like, all of that matters, but you also have to be concerned with what does an air quality permit look like, what does the water quality permit look like, if you're anywhere near wetlands you need to be concerned with Army Corps of Engineers' issues as well. So the barriers to entry are considerable. The other issue that's been profound in our business over a period of time, more for a decade or so, has really been the story of consolidation. And if you look back over a three-year period and that's what people tend to do. They look in the more near-term. What you would be focused on are the much larger acquisition plays that have occurred over that period of time. By that I would be speaking of Heidelberg's acquisition of Hanson or Cemex's acquisition of Rinker. And to be sure that has affected the industry. What you would miss, however, is the important consolidation that's taken place more in the 50 million to $300 million type range over a 10 and 15-year period because it's that type of roll up in smaller markets that's truly changed the way this business looks and certain parts of it, particularly in southeast and southwest. And that takes me to my third bullet, a scarcity of supply in the Southern United States. As a general rule, it's fair to say that aggregate supply tends to follow people and people over the last decade and we contend moving forward have tended to move toward the Southeast and Southwestern United States. If you look at population trends and importantly if you look at where they are going, what you will find out is in a lot of the places where people are moving, they are actually moving to aggregate starved locations. And we put in place now long ago a long distance transportation network that helps feed those. And what we will also tell you is relative to transportation availability, what we have in place today to move stone by ship, what we can do today by moving stone by rail, and what we can do moving stone by barge is really unrivaled in our industry today. And importantly, it's not just putting your product on those different modes of transportation, you have to have a place to take it to and that brings us to our last bullet on distribution sites. On the very first bullet, we talked about how hard it is to open a quarry. What I would tell you is the difficulty in opening a distribution site today probably looks a lot like it looked 15 or 20 years ago in opening up a quarry. So, the point is if you have those distribution sites in place today, you have something that's very, very valuable. Well, those are long-term metrics that you need to look at if you are interested in this space.
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