Iofina Share Discussion Threads

[pcjoe] 27/12/2014 16:48

Che - If I remember right it was IOCHEMS final above ground processing that was the dodgy environmental part of their production - But at circa 1000T per annum Iodine production they appear to have a proven & pretty reliable track record and are not dependant on any third party for survival

Apparently the Iodine "well" is running a little dry in their neck of the woods & as we all know IOF have a lot of the areas top Iodine hot spots sewn up by leases

Cant help but thinking that there might be some synergy re their extraction tech & know how & our processing plant - Even if just another string to the bow.....

[bogg1e] 27/12/2014 14:58

Given Lances proximity to SQM, is it likely that lance has been steering the company towards a buy out by SQM? Cheers

[che7win] 27/12/2014 09:48

I expect that we will be taken out over the next couple of years, either by SQM or a Japanese outfit.

We know IOCHEM is our chief US rival, not really a rival as they aren't allowed to expand operations due to their environmentally unfriendly extraction:



I believe their production is declining around 9% per year, probably closer to 1000MT production levels now and they are Japanese owned.
Taking us over would be a nice fit for those Japanese businessmen.

Then we have SQM, who we know are dominant in their field and therefore would not allow us to be taken over if we have a distinct competitive advantage in iodine production (see statement below).
I would say at this stage, our leases are more valuable than our iodine plants, simply because we haven't fully exploited those leases properly as we are still ramping up.

We either do a JV on iodine next year, sell to a business that can throw capital at building out plants to fully exploit those leases, or we fund capital from the water venture or through plant funding.

SQM statement makes it clear:

"New business ventures
From time to time we evaluate opportunities to expand in our current core businesses or within new businesses in which we believe we may have sustainable competitive advantages, both within and outside Chile, and we expect to continue to do so in the future.

We are continuously exploring the possibility of acquiring controlling interests in companies that have mining properties in our core business areas, and that are in early stages of development. Consistent with our business strategy, we will continue to evaluate acquisitions, joint ventures and alliances in our core businesses and, depending on all facts and circumstances, may seek to acquire controlling stakes or other interests related to our core businesses outside of Chile and Latin America, including in other emerging markets.,"

In conclusion, we need more plants, simple as that, we have capacity in Oklahoma for 12 full sized plants, or many more mobile units.
We have the know how, we have the leases, the value is there to be exploited, but IOF needs to get a move on otherwise someone else will take up the batten.

Cheap take out for the likes of SQM, I wonder what they think itf we move up to 700mt plus production of raw iodine next year? Surely worth taking us out when we are valued so low, having done all the hard work.

To me, the mobiles offer potential for us to exploit all those leases, the final cherry on top that kicks us into the hands of a rival.

[che7win] 27/12/2014 09:16

Tax to rise sharply in Chile:

"In 2005, the Chilean Congress approved Law No. 20,026 that establishes a specific tax on mining activity (Ley que Establece un Impuesto Específico a la Actividad Minera, or the “Royalty Law”), establishing a royalty tax to be applied to mining activities developed in Chile.

As a result of the earthquake and tsunami in February 2010, the Chilean government raised the corporate income tax rate in order to pay for reconstruction following the earthquake and tsunami. Such legislation increased the general corporate tax rate from its historic rate of 17.0% to 20.0% for the income accrued in 2011, which was declared and paid in 2012. On September 27, 2012, Law No. 20,630 introduced new amendments to existing tax legislation. Among the amendments introduced, the corporate income tax was maintained at 20% effective for 2013.
On September 29, 2014, Law No. 20,780 was published in the Chilean Official Gazette (the “Tax Reform”), introducing significant changes to the Chilean taxation system and strengthening the powers of the Chilean IRS to control and prevent tax avoidance. The Tax Reform contemplates, among other matters, changes to the corporate tax regime to create two tax regimes. Starting on January 1, 2017, Chilean companies will be able to opt between two tax regimes: (i) the partially integrated regime (sistema parcialmente integrado); or (ii) the attributable taxation regime (sistema de renta atribuida). In both regimes, the corporate tax rate will be gradually increased to 24% in 2016 (21% in 2014, 22.5% in 2015 and 24% in 2016). On or after January 1, 2017, and depending on the tax regime chosen by a company, tax rates may gradually be increased to a maximum rate of 25% in 2017 in the case of the attributable taxation regime or 27% in 2018 in the case of the partially integrated regime. See “Management217;s discussion and analysis of financial condition and results of operations— Impact of Chilean Tax Reform.”

[che7win] 27/12/2014 09:11

Superg,
Re the Indmin article, maybe Corfo might pull iodine leases because of this dispute with SQM. The below isn't iodiine related, but if SQM messed up below, Corfo, the government body granting the leases might look at other SQM leases (iodine related caliche ore):

"Arbitration proceedings under the Lease Agreement for the Salar de Atacama, if determined adversely to us, would materially adversely affect our business and operations
SQM Salar S.A. (“SQM Salar”), our subsidiary, holds exclusive exploitation rights to the mineral resources existing in 81,920 hectares in the Salar de Atacama pursuant to a lease agreement entered into between SQM Salar and Corporación de Fomento de la Producción (“Corfo”), a Chilean government entity, in 1993 (the “Lease Agreement”). The exploitation mining concessions related to such rights are owned by Corfo and leased to SQM Salar in exchange for lease royalty payments to Corfo based on specified percentages of the value of the products resulting from the minerals extracted from the Salar de Atacama brines. For the six months ended June 30, 2014 and the year ended December 31, 2013, revenue related to products originating from the Salar de Atacama represented 38% and 37%, respectively, of our consolidated revenues (corresponding to revenues from our potassium and lithium and its derivatives product lines for such periods). All of our products originating from the Salar de Atacama are derived from our extraction operations under the Lease Agreement with Corfo.
In May 2014, Corfo commenced arbitration proceedings against SQM Salar by filing a claim alleging that (i) SQM Salar had incorrectly applied the formulas to determine lease royalty payments resulting in an underpayment to Corfo of at least US$8.9 million for the period from 2009 through 2013, and (ii) SQM Salar had not complied with its obligation to protect the mining rights of Corfo by failing to mark on site the “HM”, or milestones of measurement, of some of Corfo’s exploitation mining concessions. Based on such alleged breaches of the Lease Agreement, Corfo seeks (i) the payment of at least US$8.9 million plus any other amount that may be due in respect of periods after 2013, (ii) early termination of the Lease Agreement, (iii) the lease royalty payments that would have been paid through 2030 as compensation for such early termination of the Lease Agreement, and (iv) punitive damages (daño moral) in an amount equal to 30% of contractual damages awarded. SQM Salar asserts that both parties applied formulas in accordance with their joint understanding and in a manner consistent with the course of dealing of the parties during the term of the Lease Agreement. SQM Salar also asserts that the breaches alleged by Corfo to have occurred under the Lease Agreement would be technical breaches, and that Corfo may terminate the Lease Agreement solely based on a material breach. While SQM Salar believes that it is likely it will prevail in the arbitration proceeding, an adverse ruling against SQM Salar awarding damages in the amount sought by Corfo or permitting early termination of the Lease Agreement by Corfo would have a material adverse effect on the Company, its business, results of operations and cash flows. In addition, we cannot assure you that Corfo will not use this arbitration proceding to seek to renegotiate the terms of the Lease Agreement in a manner that is not favorable to us. See “Business̵2; Legal proceedings—Corfo arbitral claims.” In addition, we cannot assure you that Corfo will not take other actions in the future in respect of the Lease Agreement that are contrary to our interests."

[neddo] 26/12/2014 18:19

bah humbug

[joestalin] 25/12/2014 11:23

Happy Winterval everyone.

[yasharsad] 24/12/2014 21:54

I don't post very regularly. I'm a holder of iof, and would like to say many thanks to all of you for your efforts to provide up to date information.Good luck all and merry Christmas.

[rogerbridge] 24/12/2014 17:55

Happy Christmas all, I have a feeling that 2015 is going to be a great year for all IOF holders.

[bogg1e] 24/12/2014 14:29

Happy Christmas!

hxxp://www.huffingtonpost.co.uk/2014/12/23/bbc-reporter-drugs-quentin-sommerville_n_6371006.html?1419327356

Hilarious!

[1madmarky] 24/12/2014 14:29

Yeah, could have some serious fun with $4.9b. They'll be out looking for bargains from those that over extended themselves ;-)

[che7win] 24/12/2014 13:33

Nice windfall.

[bobbyshilling] 24/12/2014 12:28

Happy Christmas, and a Happy and Healthy New Year!

[che7win] 24/12/2014 10:08

TPL - it's an oiler but looks fantastic value right now at 11p.

[ansana] 24/12/2014 09:06

I would like to add my thanks to SG and Che too for so many excellent posts. Christmas or not some just share all the time. Merry Christmas everyone and if anyone from Iofina is looking in Merry Christmas to you too. Lance deserves a special mention.

[bobsworth] 24/12/2014 08:43

Yes happy Christmas everyone.

[spike_1] 24/12/2014 08:33

Indeed - a big thank you from me too. A huge amount of work (especially sg), and very much appreciated.

Have a spiffing Christmas one and all, and - hopefully - a very prosperous 2015.

Best wishers - Mike

[superg1] 24/12/2014 08:30

Cyber

Yes, it seems to have 100's of investors doing small trades, for £50 to £1500 for the bulk of them. Jumping around all over the place but it seems purely based on herd activity and nothing more.

[che7win] 24/12/2014 08:24

TNCI, I grabbed some late in the day at 15.25, even with that 30% upside nearly.

Only a punt, but hard to ignore:

[woodpeckers] 24/12/2014 08:15

Just like to say a big thank you to all who make this board so informative especially SG and che.

Great job, lots to look forward to next year.

Merry Christmas everyone.

[1madmarky] 24/12/2014 08:07

Thanks che7win - appreciate the effort

[che7win] 24/12/2014 07:51

I'll join everyone else in saying the stars are aligning nicely for 2015.
I would also like to wish shareholders a Happy Christmas and a Prosperous New Year.

Having spoken to a director in Iofina this week, I am satisfied that there will be no issues to our brine supply next year (I already was).
When I mentioned 2016, the director was adamant - no issues with brine supply for our plants (and very forceful in saying that).

Unless existing wells were to be closed in, then no issues, Iofina are in close contact with the O&G operators, that's not going to happen.

As to supergs views on water cut, they are aligned to the director's view.

Gad - glad to read your comments on the Indmin articles, I have come to the same conclusion for some time, iodine recovery will be sharp when it turns.

Stock looks poised to multibag when the market catches on IMHO, better times ahead but DYOR.

[arlington chetwynd talbot] 23/12/2014 23:26

"The stars are starting align."

Aren't they just...

[cyberbub] 23/12/2014 22:22

jamonit / superg, which share are you referring to? TERN?