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Neometals Offers 4 Great Opportunities For The Price Of 1

Apr. 09, 2018 5:55 AM ETNeometals Ltd (RDRUY), RRSSF15 Comments


  • A 13.8% share in the producing Mt Marion lithium mine.
  • A near-term lithium hydroxide processing facility probably near Kalgoorlie WA.
  • A near-term lithium-ion battery recycling business.
  • The very near-term Barrambie Titanium Vanadium Iron Project.
  • Note: China has just made lithium-ion battery recycling compulsory for electric car manufacturers in China.

This article was first published on Trend Investing on March 9, 2018: therefore, all data is as of that date.

Neometals [ASX:NMT] [GR:9R9] (OTCPK:RRSSF) (OTCPK:RDRUY) - Price = AUD 0.355, USD 0.28

Neometals is an Australian lithium producer with growth opportunities in lithium processing, lithium-ion battery recycling, titanium and vanadium, and more. I will look at each of these areas.

Neometals 5-year price graph

Source: Bloomberg

Lithium China Spot prices


Source: Lithium Americas January 2018 company presentation

Note that Neometals produces spodumene whose prices tend to track the lithium hydroxide price. Current spodumene price contracts range from around USD 850 to USD 1,000 per tonne for 6% LiO2 spodumene.

1) Lithium - 13.8% of the Mt Marion spodumene mine

The Mt Marion Lithium mine is located approximately 40km South West of Kalgoorlie, Western Australia, and is jointly owned by Neometals Ltd (13.8%), Jiangxi Ganfeng Lithium Co. [SHE:002460] (one of China's largest lithium producers) (43.1%), and Mineral Resources [ASX:MIN] (43.1%). Production began in March 2017.

Mt Marion has a JORC Resource 77.8Mt @ 1.37% Li2O, with FY 18 forecast production of 400k tonnes (~50kt LCE) of equivalent 6% spodumene (or 450kt of 6% & 4% Li2O), at a LOM forecast spodumene C1 cash cost of ~US$290/t. The Mt Marion plant is being upgraded to produce all 6% spodumene. The off-take is guaranteed by partner Ganfeng Lithium with a life of mine take or pay contract with prices linked to International lithium carbonate equivalent [LCE]. C1 costs have been higher initially but are forecast to decrease significantly as the project ramps up to nameplate production. You can view details here on page 47.

Note: Neometals has a 13.8% share of the above Mt Marion project figures.

The Mt Marion lithium spodumene mine in Western Australia

Mt Marion location map


2) Lithium processing -

This article was written by

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Analyst’s Disclosure: I am/we are long NEOMETALS [ASX:NMT]. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

The information in this article is general in nature and should not be relied upon as financial advice.

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