Iofina Share Discussion Threads

[naphar] 27/10/2014 07:06

Engelo
it's simple enough. You agree to sell at usual market price less a discount of $X per kg

[bogg1e] 27/10/2014 00:09

engelo, i think the price Iofina charge for their iodine is based on a sort of consolidated, rolling average, which IOFs 2 largest competitors get for their iodine, being SQM and maybe Cosayach or Japan. SG im sure knows exactly.

[engelo] 26/10/2014 23:02

Monty: they may be able to fund new plants via iodine offtake agreements. The problem that I thought there might be is what iodine price formula to use, but don't think it's rocket science. By chance there was an RNS from STGR the other day which illustrates how this could be done:

"Within the initial five year agreement, StratMin and the Buyer will agree, in advance and on a rolling basis, pricing for the six months ahead. This mechanism will allow both parties to reset prices to reflect any changes in the open market. The parties have four months from the pricing reset date to agree the pricing for the succeeding six months and either party may terminate the Agreement within six months following the pricing reset date. The Agreement sets the first 12 months' volumes, grades and fraction characteristics, which will be subject to an annual review thereafter."

[monty panesar] 26/10/2014 17:02

Difficult to know on the strategic review as a lot of the future roll out depends on the amount of $$$$ they might get from a water deal. We could get interim statement on either a couple of minis or a new io being built.

[engelo] 26/10/2014 01:33

Talking to myself, but found it (RNS 27th March)

"The Board is of the view that, prior to work commencing on further full scale plants, an operational review be undertaken. This review, scheduled for completion in the autumn, will include considerations for improvements to construction methodology, reduction in total cost, improvement in time to complete, and optimal plant sizing. Construction of further full size plants will be delayed until this review is complete which will reduce short term capital expenditures and improve cash flows"

Also

"Subject to completing minor design modifications, the first two mobile units or mini WET® IOSorb™ technology plants (namely 'IOA' and 'IOB') are planned to be ordered throughout 2014 on a turnkey basis for operational deployment in the fourth quarter"

Here's hoping :-)

[arlington chetwynd talbot] 25/10/2014 20:09

Could someone please point me to a good poster?

[engelo] 25/10/2014 19:46

Have just caught up with an excellent set of posts. The old magic's coming back, and about time too, as Bogg1e said :-).

Could someone please point me to the RNS where the Autumn production review was announced? Shortly after Lance's reappearance I think, but can't find it.

[superg1] 25/10/2014 19:43

At the AGM it was said all-in costs for a pod would be about $800k. $250k of that was said to be in relation to securing power to the sites. An estimate of 8 weeks to build pods. In news they say the design and engineering is complete so the next step is to put one in place should they choose to do that.

Back to the SQM comment about the potential for disruption due to environmental changes in circs. SQM have 7 named areas which include lithium and nitrates. Only 2 on those are mentioned as being at risk, one of which is includes Nueva Victoria.

[bogg1e] 25/10/2014 19:13

crosseyed, the other factor regarding costs is the extra costs incurred when processing/crystalising the mini mud at an IO plant, which would push the opex higher than the mini production costs. Im wondering if they will ditch plans for new IO plants altogether and simpy build crystalisation "hubs". How many per mini though is a mystery. So far each IO plant can clearly crystalise the days extracted iodine, which implies surplus capacity for crystalisation exists, just wish we knew how much. Or would it still be more cost effective to continue with IO plants + crystalisation towers? Hopefully there will be more clarity in the production review, although i suspect they will delay announcing that until the beginning of december to coincide with the water permit award.

[arlington chetwynd talbot] 25/10/2014 18:51

'That sounds too good to be right.'



hic!

[crosseyed] 25/10/2014 18:17

Bogg1e,

Thanks. I have seen those figures you used regarding processing volumes and construction costs and certainly don't doubt your integrity. What does worry me is that a largish IOSorb plant, eg see , can be effectively replaced in output by, say, 3-5 Mini units which are supposedly "mobile". Furthermore it expected that each of these will run at a fraction of the cost of a plant - your indicated cost of $10/mT compares with a target of perhaps $20/mT for the plants (though presently somewhat more than that). That sounds too good to be right.

c

[ammons] 25/10/2014 17:50

The company do not even have a mobile prototype working yet. Lets hope all the theorising doesn't end up on the bonfire.

[rogerbridge] 25/10/2014 17:24

Sounds good Bogg1e

[bogg1e] 25/10/2014 16:14

crosseyed,

The figures regarding the estimated costs come from Sam at IOF accounts and was backed up by the new CEO when the recent results were released.

I estimate one third ton per day because the ppms targeted for a mini range from about 200 to 800 ppms, but can process a max of 10,000 bpd as we know. As IO2 can produce about 1 ton per day on 200-300 ppms and 25k bpd, then an average mini on say 250ppms and 10k bpd should produce about 1/3rd of IO2s production or about 1/3rd ton per day (100 tonnes per year if one includes downtime)

As to how many minis plants' output can be processed at an IO plant, we dont know. I put the question to the company and was informed that this number is not yet known. However, its obvious that extra crystalisation units would need to be constructed. As i said, dont take the idea to seriously, the point being only to demonstrate that very rapid growth is possible. The only fear for me is whether the company can manage the expansion well.

As for the technology being unproven, i have no doubts that there will be issues but im confident that they will overcome any problems that arise when using new technology, especially as its just a scaled down version of the standard plants which are performing well. Cheers.

[bocker01] 25/10/2014 16:06

Boggles figures seem reasonable to me based on previously released info. Thought these mobiles could process 10000 barrels a day at high ppms capx seems familiar but will probably over run initially. As for drawing board, as I understand it they cut down versions of the current plants without towers and processing ability. Comes down to numbers of good sites in my opinion.

[arlington chetwynd talbot] 25/10/2014 16:06

Ah, the number crunching...

Hmmm, I work on a 5,10,20 basis in ptp/years.

This is nowhere near reaching that 1st target. Should have been on the 2nd, but isn't.

Business is a simple principal, make money and grow profits.

This isn't exploration, it's production, manufacturing and sales.

It's not difficult to make money where you are... you just have bad management that makes it look tortuous.

[crosseyed] 25/10/2014 15:10

Bogg1e,

As I understand it the Mini IOSorb units are as yet a drawing board concept. May I ask where you get the throughput figure of 1/3rd mT/day and the unit capital cost of $850,000 ?
Also, the production from these units requires further processing through a larger IOSorb plant; how many mini units will an IOSorb plant support?
What would be the working life of a mini unit? I would expect somewhat less than a full plant.
There just seem to be too many assumptions at this stage on the efficacy of these mini units. I seem to recall a similar euphoria about the mobile units that preceded the larger plants, all of which have now been abandoned.
Just asking.

c

[dcgray21] 25/10/2014 12:40

Bogg1e I would guess that kind of logic is underpinning IOF 's claims of wanting to be the world number 1 . Nice cash injection is hopefully the trigger point.

[dcgray21] 25/10/2014 11:40

Agree with you Bogg1e - you get the feeling the race is well and truly on. That's why the Strategic review I truly hope will help build the fortification around IOF making any such scenario much more expensive .We are both very much in the same boat . All my chips are in IOF and QFI . Interesting times ahead - for me early retirement options or stacking shelves at Tesco ( or more likely Aldi ) until I'm 80 :) hey ho. We need that beer in Windsor ! Take care .

[madchick] 25/10/2014 11:40

I hope plan B fails.

[dcgray21] 25/10/2014 11:34

That would give them options SG . IOF could / will be a different beast in 12 months time so clock ticking .

[superg1] 25/10/2014 11:19

A genuine risk dc and there would be nothing orderly about it if the government acted and restricted rights.

EG in their planned move to Pampa Blanca (postponed) they quoted the initial set up would take 21 months. There is no quick fix in Chile.

As they always intended to move, I believe they have never commenced an EIA process for a seawater pipeline either to NV. I think that matter was covered in an application for Pampa Blanca.

If the taps are turned off at NV, it's hugely significant to them, they have no plan B.

Perhaps that mystery $250mill loan note head-scratcher is plan B.

[dcgray21] 25/10/2014 11:06

Very interesting SG . Clearly May mean they have to move quickly and aggressively on the acquisition front as a defensive tactic .