Description

Short SGML                                                                                                                                      

We recommend shorting Sigma Lithium (SGML Equity), a lithium development company that’s hoping to transition into a lithium producer in Brazil. We believe lithium price will fall from the current $40k/t to $13k/t in the next 12-24 months as supply growth outpaces EV demand growth. We expect the ramp up of Sigma’s Phase 1 production will take 9-12 months longer than management guidance, and as a result Sigma will miss the near-term opportunity to generate outsized cash flows under an unsustainably high lithium price. We believe the normalized operating cost of the mine will be $900-$1,000/t, more than double management’s projection of $400/t. The asset has negative NPV under our base case of $13k/t lithium price, and the stock would be worth $0/share (-100% downside from $37/sh today).

Thesis

1. We expect lithium price to fall from $40k to $13k

• Demand: We estimate 14mm EVs sales globally in 2023, a 30% increase YoY to 17% penetration. Chinese EV sales doubled in 2022, driven by government incentives. We think Chinese EV sales will only grow 25-30% in 2023, and global EV growth will slow to 30% as China accounts for ~60% of global EV sales.
• Supply: There are currently ~30 Lithium mines in operation globally, and we estimate another ~100 are currently being developed. The supply growth in 2023-2024 comes from low-risk brownfield expansions.
• As a result, we expect Lithium price to decline in 2023 and 2024 and reach a new equilibrium of $13k/t. We believe SGML is pricing in $22k/t Lithium price.

2. The mine plan has several fatal flaws that could hinder the ramp-up

• We believe Sigma management took several shortcuts when designing the mine, likely to save upfront capital investment. We think these shortcuts will catch up to them and expect ramp-up challenges and cost overruns compared to projections. Major design flaws include:
  • The phase 1 Xuxa plant risks flooding by the river that runs through the deposit.
  • DMS technology employs 3 fractions instead of the traditional 2-fraction process, which increases operational risks.
  • Dry stack tailings circuit is a first in the industry and has high operational risks.
  • The mine plan is designed using construction equipment instead of mining equipment, which lowers capex but is grossly inadequate for a mining operation of this scale.
• We believe Sigma’s promotional management team lacks technical expertise to properly run the project.
  • CEO is a stock promoter and lacks mining experience. Founder and former Co-CEO abruptly stepped down in January 2023, shortly before phase 1 commissioning.
  • We question management’s integrity when it comes to promoting the project and engaging in self-dealing transactions.

3. Sigma is a high-cost operator and its through-cycle EBITDA will be negative

• We believe Sigma’s lithium project is low quality with a high strip ratio of 15x, a short mine life of 13 years, and high transportation costs driven by a lack of domestic railroad to transport the product to the port, and the long distance from Brazil to Asia.
• We hired a mining consulting firm to appraise the project. Their estimated opex for the project is $900-$1,000/t, more than double management’s projection.
• At $13k/t Lithium price, spodumene price would be $800/t. At a cash opex of $900-$1,000/t, Sigma will have negative EBITDA. The project is worth zero under our base case.

Lithium Price History / Outlook 

Lithium price ranged from $5-7k/t historically. In 2015, price started to surge as subsidy-driven Chinese EV demand outpaced supply additions. By 2018, plenty of new supply was brought into operation, driving the market into surplus; Lithium price crashed back down to $6k.

Lithium Long Term Price Chart:

We believe cash costs are around $9.5k/t, and the long-term incentive price for lithium is around $13k/t based on our bottom-up build (assuming 30% capex and opex overrun compared to management targets; applying a 15% return on capital). We use $13k/t as our through-cycle price (which equates to $800 SC6.0 price; ($13,000 / 110% (assume 10% conversion plant GM) / 1.13 (VAT) - $4,200/t conversion cost) / 8 (SC to LCE conversion factor) = ~$800/t). At the current $40k/t price, all existing and announced projects are in-the-money. We expect this to incent a massive supply response, significantly increasing lithium supply in the next years.

Sigma Background

Sigma Lithium is a Canadian company focused on developing and operating the Grota do Cirilo lithium mine in the Minas Gerais state of Brazil. Minas Gerais is a mining state in Brazil with large iron ore and gold mining operations; however, lithium mining does not exist in scale in Brazil. Sigma CEO Ana Cabral-Gardner and her ex-husband Calvyn Gardner acquired the asset in 2016 through their investment fund A10 Investimentos. Grota do Cirilo contains various deposits identified that are scattered. Xuxa is the deposit being mined for phase 1. Barreiro and Nezinho do Chicao (NDC) are the focus of phase 2 and 3. In January 2023, Sigma filed the technical report on the project which includes an updated Mineral Resource Estimate and the maiden Mineral Reserve Estimate for the Xuxa deposit, as well as the NDC pegmatite, and a PFS (pre-feasibility study)-level study for phase 2 & 3 of the project. Sigma began commissioning phase 1 in April’23, and has announced achieving 75% phase 1 production throughput currently.

The technical report calls for ~270kt/yr phase 1 spodumene production and ~800kt/yr combined phase 1-3 production, which would make Sigma a top 5 spodumene producer globally.

The timing on construction start for phase 2 & 3 is guided to be immediately after phase 1 commissioning, while commissioning for phase 2 & 3 is expected in Q2’24. 

We think the mine is low quality

Management claim: Management claims the spodumene they produce at Grota do Cirilo is special, “green”, and superior to other spodumene mines, and thus should achieve a 30% premium pricing from downstream customers. Management expects unit cost of production to be $289/t, which would make it the second lowest cost spodumene mine in the world behind Greenbushes.

Our belief: This is a tier 2-3 asset in a tier 2-3 jurisdiction. Unit cost of production will be high ($930/t in our base case) given strip ratio is 3x as high as other spodumene mines and the long distance to the port as well as the end market (China/Asia) leads to an unfavorable production economics.

Deposit quality: We believe the geological formation of the project has cost disadvantages. The Grota do Cirilo project is a scattered series of nine assets each of modest scale. The phase 1 Xuxa deposit is 5 kilometers away from the phase 2 Barreiro and phase 3 NDC deposits. In order to mine and process the 3 phases concurrently as laid out in the technical report, Sigma has to deploy three mining fleets and two processing plants, which brings cost inefficiencies compared to larger scale operations. Further, phase 1 has a mine life of only 8 years and phases 2 & 3 have 12 years – we believe the relatively short mine lives make capex investments expensive on a flowing basis.

While each of the first 3 phases of the Grota do Cirilo project is of medium scale, the deposits are only 10-20 meters thick, compared to other spodumene assets that are typically 50-200 meters thick. We think this formation brings mining cost disadvantages and inefficiencies as evidenced by the high strip ratio (16.6 strip ratio for phase 1, meaning 16.6 tons of waste moved for each ton of ore mined), which is ~3x that of other projects.

We disagree with management’s claim that their product is “green”. Management often makes references to “Greentech Plant”, “Green Tailings”, and “Green Lithium”. Based on our analysis of the flow sheet and discussions with industry participants, we believe there is no such thing as “green” lithium. Sigma uses a DMS (dense media separation) system after ore crushing to extract lithium. DMS is not proprietary to Sigma – it is used by some hard rock mines in Australia and mining other commodities globally. The only major difference between Sigma’s process and other hard rock mines is Sigma does not have a floatation circuit after the DMS, which we understood is for cost-saving purposes (we believe Sigma did not have sufficient funding to add a floatation circuit when constructing the plant, and decided to take the short cut). Floatation circuits use water and hydro reagents, but are not considered environmentally unfriendly as reagents are typically processed/recycled to avoid any environmental impacts. We have found no further major distinctions in Sigma’s process that would make their product a premium one.

Pricing mechanism: Management alleges their offtake agreement with LG Energy Solution (entered into in October 2021) has a pricing agreement that sets their spodumene price at 9% of the lithium hydroxide market price in Asia on a take-or-pay basis, whereas the market price of spodumene then equates to 7% of the Asia hydroxide price. This would imply a ~30% price premium relative to market. Management alleges this premium is achieved because of the coarse nature of their product, which has a larger surface area that allows heat to be absorbed more efficiently by converters during downstream processing. We disagree – spodumene is a commodity and thus there is no such thing as “battery grade” or “green” spodumene! In our recent meetings with them, though, management admitted they are still working to finalize the agreement with LG, and a specific pricing formula had not been set in the original agreement.

In May’23, Sigma put out a press release announcing they have entered into an agreement with Yahua, a large lithium converter in China, for its first spodumene and tailings sale. Press release notes that Yahua operates as a converter for LG, implying this might be a tolling arrangement under their LG agreement. Based on our discussion with management we believe this is not the case, as LG and Sigma have not reached agreement on the sale price, and this first shipment is unrelated to the LG agreement. Further, management claims they would achieve a 9% linkage on their first sale to Yahua, as evidence this is a “premium” product and they have achieved the 9% linkage they previously guided to. We think this is misleading – as shown below, as lithium price exploded, the percentage linkage of spodumene-to-hydroxide has increased, due to the relatively fixed cost of converting spodumene into hydroxide, allowing upstream resource owners to capture more of the incremental profitability. The linkage of the market spodumene price has increased to exactly 9% currently. We think this is evidence this product is NOT premium – management just admitted it will achieve exactly the market price! We expect as lithium price falls, the linkage between spodumene-to-hydroxide price will fall back to historical ranges, and expect Sigma to achieve a lower linkage that’s in-line with the market.

On 7/26/23, Sigma put out a press release announcing they have achieved first shipment of the spodumene and tailings to Yahua, at a price of $3,500/t on the spodumene and $350/t on the tailings, and that is a 9% linkage to the hydroxide price. As shown below, the spot spodumene price on 7/26/23 was…exactly $3,500/t!

Various operating risks with the project

Review of the technical report: We engaged with a global mine engineering and consulting firm with experience working with >80% of the global hard rock lithium projects, to help us further evaluate the Grota do Cirilo project. They raised multiple concerns about the project.

• River running through the phase 1 pit: The Xuxa pit (phase 1) has a river bisecting the pit design into a north pit and a south pit. We learned it is highly unusual for mines to continue with the river intervened; standard industry practice is to divert the river before construction work. We think Sigma likely took a short cut to lower upfront capex to keep the river as is. They have built a bridge on top to allow trucks to move between the two pits. We believe this is a high-risk approach and while Sigma can likely avoid issues in the near term, it is possible the river could cause flooding at the mines down the road.
  
  

• DMS circuit has operational risks: While DMS is a relatively common processing method used by various commodity mining operations globally, the 3-size fractions DMS Sigma has deployed is uncommon and, in our belief, adds operational complexities and risks.
• Dry stack tailings is another high risk area: Sigma uses a dry tailings practice instead of the more traditional tailings dam. Management touts this as part of their ESG initiatives. Given this is a relatively new technology (dry stack tailings has not been done in lithium mining before), we think there are potential risks associated with ramping and running the dry tailings circuit.
  • We believe after Vale’s Brumadinho tailings dam failure in Minas Gerais in 2019 that caused 270 deaths, Sigma had to deploy a dry tailings dam to satisfy government requirements.
  • We believe Sigma is currently experiencing challenges with the dry tailings circuit, whereby the tailings clarifier and belt filter are not functioning as expected. We think it’s possible Sigma’s current clarifier and belt filter are not able to handle the throughput of the DMS circuit. The entire circuit is slowed down to match the clarifier throughput. Management mentioned they are looking to “rejigger” the circuit while at the same time exploring the purchase of a larox filter press that would only cost $5m.   
• Further, in May’23 Sigma announced they entered into a 3-year offtake agreement with Yahua, whereby they will be selling “ultra-fine tailings” generated by the processing plant to Yahua. “Green Tailings are high-purity, zero chemicals, approximately 1.3% lithium oxide, ultra-fine tailings”, according to the press release. Further discussions indicate that the ultra-fines are essentially dust and powders produced during the crushing process that won’t do well in the DMS and thus removed early from the process, which are expected to be ~18% of the volume. We believe the 1.3% grade (average head grade) guidance is aggressive, and it’s more appropriate to expect a ~0.5-1.0% grade instead. Further, it is unclear if the technical report’s 65% processing recovery rate has properly excluded the 18% of volume that’s expected to be lost during the process, as tailings sales were not part of the technical report.  
• Use of construction equipment instead of mining equipment: One of the biggest concerns we have about the mine plan is Sigma’s outlined capex for mining equipment indicate mostly construction equipment, which are smaller compared to typical mining equipment. We believe this is done to lower the upfront capex, but comes with high breakdown risks and higher maintenance costs as the equipment are not designed to handle such large scale mining operations.

Other red flags with the TR: We think the TR contains a few other red flags that undermine management’s credibility and increases the likelihood of more operational challenges down the road.

• Changing drill holes: In June 2023, Sigma filed an amended version of the TR, which included two changes from the prior version. The first change was the number of drill holes performed for the Murial deposit (phase 4). As shown below, the number of drill holes for Murial was lowered from 123 to 79, with most of the change on 2022 drilling (cut in half from 86 holes to 44 holes). We find it concerning that Sigma retroactively changed what was supposed to be historical actual results in the TR.

    Jan’23 TR:                                                                                      June’23 TR:

• Environmental permit: Another major change in the June’23 TR filed was the environmental permit section for Barreiro (phase 2). The Jan’23 TR noted that Sigma has received the Preliminary License and Installation License (LP and LI) for Barreiro in July’22. The June’23 TR, however, changed the wording from “approved” to “filed” and the date from July’22 to August’22. It is our understanding that Sigma cannot proceed with phase 2 construction work until such permits are received. We do not have an estimate for when these permits would be approved, but believe it is highly likely Sigma will miss on the promised timeline of a Q2’24 commissioning for phase 2 & 3. We also note the company has yet to file for the LP and LI permits for phase 3.

Jan’23 TR:

June’23 TR:

Cash operating cost will be >2x management’s guidance

We believe the cost of operating the project will be high, making it one of the highest cost operating hard rock lithium projects in the world.

• We expect mining cost to be $6.35/t of material mined vs TR has this sized at $2.1/t based on an unnamed “contractor” from whom Sigma allegedly received a quote on. We don’t believe such rate is market or achievable. Due to the high strip ratio, tripling the mining cost from $2.1/t to $6.35/t adds ~$410/t of opex for each ton of spodumene produced.
• The other major cause of divergence between our cost estimate and the TR is transportation. Sigma expects $120/t transportation cost, which we believe only includes ocean freight but not domestic transportation. Vitoria port, which has been selected by Sigma for the project, is  ~700 kilometers or an ~11-hour drive from the project. We expect this to add $120/t transportation costs and thus arrive at a $240/t total transportation cost.

• We expect the total opex/t for the project to be around $930/t, compared to the TR at $400/t. We believe this will be one of the highest cost spodumene projects globally.

We question management’s ability to run this project

We believe Sigma is led by a promotional management team that lacks technical expertise. Former Co-CEO and Co-Chair Calvyn Gardner abruptly stepped down in January 2023, shortly before phase 1 commissioning. Press release put out on 1/23/23 only had one line about his departure, buried after various announcements about hiring and commissioning the DMS. We believe Calvyn was the real leader at Sigma and one with the most mining experience. Ana Cabral-Gardner, Co-CEO and Co-Chair, became sole CEO. Ana has a background in banking and was previously running Sigma’s IR and fundraising efforts. We do not believe she has sufficient mining expertise to run the company. It is unclear whether Calvyn’s departure has anything to do with he and Ana’s divorce.

Offtake partner Mitsui suddenly walked away in Q3’22:

In 2018, Sigma announced entering into a 6-year offtake agreement with Mitsui with prepayment financing ($30m pre-payment facility) to fund the construction of the production plant.

In Nov’22, Sigma announced the termination of the Mitsui agreement and repaid $4m that had been drawn under the Mitsui facility. Management stressed that Sigma is the party to voluntarily terminate the agreement. The press release notes “As result of the extremely robust current lithium pricing environment Sigma Lithium decided to preserve maximum commercial flexibility for the commercialization of its Battery Grade Sustainable Lithium.”

In Jan’23, Mitsui signed an MOU with Atlas Lithium for up to 100% of Atlas’ production. Atlas is a lithium exploration company with a project in Minas Gerais, Brazil. We find it perplexing that Mitsui would step away from Sigma and immediately sign an agreement with a high-risk exploration company in the same state that’s at least several years away from production.  

Audit red flags:

Sigma was late to file its 2022 annual financials with the SEC and received a letter from Nasdaq about a potential de-listing on April 10 if a plan to regain compliance was not filed within 60 calendar days. The April 10 press release blamed the late filing on the implementation of SAP that’s underway. Sigma filed the annual financials on June 13. As of today, Sigma has not filed its Q1 financials and management has communicated intent to file the Q1 financials together with Q2 financials in August.

In its 2022 annual filings, management identified material weaknesses in the company’s internal controls over financial reporting. Further, Sigma’s auditor, KPMG, issued an adverse opinion on the effectiveness of the company’s internal control over financial reporting.

Long list of related-party transactions: Sigma’s annual filing included a long list of related-party transactions, mostly entities controlled by Ana and Calvyn Gardner. We believe the risk of self-dealing is high.

Based upon audited financial statement disclosures, as of 12/31/22, there are 4 disclosed entities that are considered “related-parties”. Three of these entities are controlled by the current CEO Ana Gardner and her ex-husband former Co-CEO Calvyn Gardner, and one is owned by the company’s COO.

• Arqueana: A land administration company that is controlled by the Ana and Calvyn Gardner
  • As of 12/31/22, the company had a receivable due from the Arqueana amounting to $4.9m.
  • In the prior year, the company had a note payable due to Arqueana amounting to $1.9m. This was paid-off sometime in FY 22.
• A10 Advisory: An advisory group owned, in part, by CEO Ana Gardner
  • As of 12/31/22, the company disclosed that it made payments amounting to $122k to A10 during FY 22
  • In FY 21, the company had expenses of $2.8m related to a revolving credit facility with A10, and it paid $8.3m to A10 in commission fees in FY 21
• Miazga: A land administration company owned by the Gardners
  • As of 12/31/22, the company had $103k in prepaid land leases to Miazga, and $113k in a loan agreement related asset, in addition to $42k in a lease agreement liability
• R-Tek: Owned by the COO of SGML
  • In FY 22, the company paid $1.1m to R-Tek, and has $242k in outstanding payables due to R-Tek.

Subsequent events disclosed in the footnotes repeal the company provided a new credit facility to an entity owned by the CEO. On 2/23/23, the Board approved the granting of a credit facility amounting to $12m to Tatooine Investimentos, an entity controlled by CEO Ana Gardner. The company disclosed that the facility “aims to fund the acquisition of real estate properties located in areas of interest of the Company’s project in Brazil…granting that Tatooine leases the Real Estate Properties to Sigma Brazil for as long as required to comply with the Company’s projects.” The note also indicated that on 4/20/23, the company made its first disbursement on the facility amounting to $3.3m.

• We find the nature of this credit facility to be the most concerning. It appears to us that the CEO has engaged in self-dealing, and that she is using the company as a mechanism to finance her personal interests. Given inadequate disclosure, it is difficult to reasonably estimate this risk.

In addition, in a separate subsequent event, the company disclosed that on 3/31/23, it received $7.7m from Arqueana, a land administration company that is controlled by Ana and Calvyn Gardner, related to the amounts for drilling services. “On March 31, 2023, Sigma Brazil received R$ 28,713 thousand ($7,665) from Arqueana, a related-party to the Company, referring to the payment of amounts receivable related to drilling services rendered of R$ 19,043 ($4,881) and additional costs incurred subsequent to December 31, 2022 of R$ 9,670 ($2,784)”.

Valuation

At $37.40/share today, we estimate Sigma is pricing in $1,650/t SC6.0 price or $22k/t long-term Lithium hydroxide price at a $400/kg cash cost.

In our base case at $13k/t Lithium price, Sigma has a -100% base case downside.

• Base case target price of $0/share (-100% downside), based on NAV using $13k/t Lithium price / $800/t SC price and $930/t cash cost.
• Bull case target price of $50.47/share (+35% upside), based on NAV using $23k/t Lithium price / $1,800/t SC price and $401/t cash cost, and $36m exploration value.
• Bear case target price of $0/share (-100% downside), based on NAV using $10k/t Lithium price / $500/t SC price and $980/t cash cost.

Note: NAV assumes 15-year mine life, 8% discount rate, 15% tax rate.

Lithium price vs SGML enterprise value:

Risk Factors

M&A

Management is not shy about the fact that they do not intend to operate this asset in the long run and often suggest they are in constant dialogue with potential acquirers of the company. We believe a takeout transaction is what bulls are playing for here. Sell side analysts when asked why a transaction hasn’t happened to date despite the company being openly for sale since 2018, often give the company’s narrative which is price – that management is judicious about maximizing shareholder value, and believe they can realized an even higher transaction price once they start producing phase 1, as the stock would rerate to a higher multiple reflecting their status as a producer.

Mitigant: we disagree with management’s narrative. As shown in our NAV analysis, we believe the stock currently prices in $1,650/t long-term spodumene price on a derisked basis. This implied LT spodumene price is higher than many current producing assets are pricing in. We thus do not think the stock should rerate higher from here, especially as management already press released the buyer for its first shipment and guided to a very robust project ramp-up timeline.

We believe potential acquirers are well aware of the fact that the company is for sale. Any potential acquirers have likely already evaluated the project. The fact there has been no news on the company hiring a banker or entering into exclusive talks with potential buyers, while management is busy meeting investors trying to hype up the stock, indicates to us there is likely no real buyer here.

We think any serious potential buyer would, like we did, hire a mining/consultant firm to evaluate the project. It shouldn’t be difficult to discover the myriads of potential issues with the asset upon diligence.

The argument for Sigma being a good M&A target is it offers immediate lithium production, which could be attractive to buyers desperate for lithium supply today. However, given the short mine life we think there are better projects out there for patient and rational buyers. Given it is unclear Brazil’s status under the IRA (currently not included) we think North America based assets are a safer bet to take advantage of US policy support. We understand Chinese players currently favor African and domestic lithium sources given political certainty.

We ultimately cannot 100% rule out an M&A transaction here despite our belief this is a promotional management team trying to hype up its stock price. There have been many rumors about Tesla mulling an acquisition of Sigma, as well as several major Chinese players (Tianqi, Ganfeng, Zijin) all preparing for financing to take out Sigma. In the event an M&A happens, we could envision a 20-40% premium to the stock price. This risk is balanced by -100% downside in our base and bear cases.

Supply delays / demand acceleration causes Lithium price to stay higher for longer

• Supply:
  • China lepidolite projects were temporarily shut down earlier this year due to environmental concerns and inspections
    • Mitigant: our research indicates production has resumed and the impact of production loss is limited. We believe the local government is incentivized to keep production going.
  • Brine and spodumene projects could take longer to ramp
    • Mitigant: We haircut management projections in both commissioning time and production rate in our supply build. While it is possible supply comes online slower than we expected, the magnitude of supply surplus in our ’23-‘24 expectations gives us some cushion.
• Demand:
  • Chinese EV demand could reaccelerate driven by government stimulus
    • Mitigant: We believe there is a large amount of ICE and EV inventory built up in China that should absorb some of the demand recovery. EV subsidy expiring has worsened affordability, which should weaken EV demand. Consumers may also trade down to smaller vehicles or PHEV which use less Lithium content per car.
    • What if we are wrong: We take top-of-street forecast for China EV sales (8.5mm in 2023 and 11.4mm in 2024) and run it through our demand projections. We estimate ~130kt cumulative incremental LCE demand through 2024, which indicates the lithium market would remain in tight balance in that scenario.
• Mitigant: While temporary S/D imbalance is possible, it does not change our long-term lithium price forecasts. We think by 2024/2025, it is highly likely that Chinese lepidolite and recycling capacity, as well as global spodumene capacity expansion would exceed demand growth. Given our view Sigma will face ramp-up challenges, we think it will fail to capture the opportunity to generate outsized free cashflow in the near-term.

Resource upside with phase 4

Management has indicated there could be a mineral resource update for phase 4 (Lavra and Murial deposits) in the near term. It is our understanding that the street expects a relatively large increase in the resource amount. A positive update could embolden the bulls.

• Mitigant: Vast majority of the stock’s value is in phases 1-3. An increase in phase 4 resource amount has been well telegraphed and should be expected by investors.
• Mitigant: Murial and Lavra have lower lithium grades (1.14% and 1.09% respectively) compared to phases 1-3 and thus likely higher opex per ton to process. We believe these projects are uneconomical under our base case spodumene price assumption of $800/t.

Appendix

1. Mineral Reserves & Mineral Resources

2. Management Case Mine Plan

Disclaimer: The author of this memorandum presently has a position in securities of this issuer and may trade in and out of these positions without notice.  This memorandum is for discussion purposes only and is not intended to be, nor should it be construed or used as, financial, legal, tax or investment advice or a general solicitation.  This memorandum is as of the date posted, is not complete and is subject to change. The data contained herein are prepared by the author from publicly available sources and the author's independent research and estimates. Certain information has been provided by sources believed to be reliable, but has not been independently verified and its accuracy or completeness cannot be guaranteed and should not be relied upon as such.

Catalyst

Delayed mine ramp up, higher operating costs, falling spodumene prices