Iofina Share Discussion Threads

[superg1] 08/4/2015 14:29

Before you ask AWOL it's strong on the bid once more and weak on the offer. EG 25k sat on 35.5p.

IS it a game with the seller sitting out letting it go up to sell a few higher up?

[superg1] 08/4/2015 13:49

Nice post Che, good to see so many like yourself getting a grip of understanding the business.

Re SQM and CORFO.

Even if SQM win the case, they still think CORFO will change the terms and make in unviable for them.

If folks go back to previous posts I mentioned how Ponce Lerou (SQM boss) became a billionaire. H was the son-in-law of Pinochet the president and for no clear reason other than being family became the boss of CORFO which is part of the government.

From that position Ponce Lerou awarded cheap land and leases to himself and mates as described in detail. Cheap take overs etc etc,, some on CORFO loans which were never repaid.

So with the new president Bachelet who was imprisoned by Pinochet, I suspect they want their pound of SQM flesh. One way they can get part of that is the breach of the lease agreement.

IE CORFO are probably all out to screw SQM in whatever way they can. I suspect 90% of SQM investors don't know the history.

Not forgetting that SQM 'won' that recent lithium tender which ended up being rescinded and the mining minister resigning and now facing prison. That was going to be a another corrupt act in favour of SQM.

So there is more behind the CORFO SQM lease squabble, than is admitted too by SQM.

SQM have been swatting it off as saying they are likely to win. Even if they do win they expect some pain in some form on the leases.

As I recall the gov wanted Coldelco on the lithium.

[spike_1] 08/4/2015 12:05

IG is 34.67 to sell (cash price to sell is 34.75), and they haven't been taking new long positions for many months so spread not an issue.

Best wishes - Mike

[awolagain] 08/4/2015 11:50

I just noticed IG is 3p spread!! What are the MMs up to this am??

[jaykaytee] 08/4/2015 10:43

Morning folks,
Hi SuperG. you have prev mentioned Starcom.
Have you seen the update from Starcom, and the share price drop?
What do you make of it? do you see it as a long term buying opportunity?
Very much interested in your opinion.
Cheers

[ridicule] 08/4/2015 10:07

7.3% bid/offer spread!! The MMs are at it again. Pity we did not get any Q1 results this am. It would have put them in their box and avoided T20 margin traders from having to exit to cover.

[awolagain] 08/4/2015 09:27

hxxp://www.woodbridgedaily.com/sociedad-quimica-y-minera-s-a-analyst-rating-update/32818/

[che7win] 08/4/2015 08:51

Superg,
Also on lithium leases, SQM have a quota that they are allowed to produce up to, it would be easy for Corfu not to increase that quota even if they do retain leases.

Changing the subject, on first quarter production for IOF raw iodine - I agree, Q1 is the coldest quarter.
I note they produced 47 mt for Q1 last year (with no fracking disruption on io2 and of course less plants). The cold was a factor last year.

Surely we can assume a 100% increase from last year (now including the three new plants), that gets us to 94MT for first quarter 2015 as a lower range forecast.
Note they did do ~109 Mt last quarter of 2014, so if we have similar fracking disruption as that quarter, we would probably do less than 109Mt Q1 with the colder weather.

They need average 110MT each quarter to meet estimates for first half of 220MT minimum level forecast and they have previous years achieved the best production in the second quarter....
That means production should be weighted to the second quarter rather than quarter one to meet the 220MT target.
So if they were anywhere near your 120MT prediction, they would be set up for outperforming the 220MT lower level and a possibility of surpassing their forecast IMHO (that would be a first!).

It will be interesting to see if they can get to your estimate, but anything around 90 MT this quarter will be sufficient to keep them on track for meeting forecasts IMHO.

I'm just trying to work out overall iodine production this year, a 100% increase year on year for first quarter production would read really well, regardless of anything else.

Of course, I would hope for more (I expect fracking should have declined), but forecasting is hard to predict with IOF....so just throwing a few thoughts out there.

[superg1] 08/4/2015 08:22

Awol

I was reading up on SQM last night but need to read a lot more.

Re their lithium leases. They are in a court case with CORFO (government) who want to rescind the leases after a breach of the agreement.

SQM say they expect to win the case. However they use the word likely, rather than confident.

I wanted to establish if it was a case of a belief based on backgrounds chats. It's not, it's on a point of law.

This is where the system (worldwide) is nuts as no doubt the case is costing a small fortune and creates so much court time and delays.

It's all down to 2 words 'material' and 'technical'.

CORFO say it's a material breach hence they can rescind the leases, but SQM claim it was a technical breach which falls short of the material requirement necessary to rescind the leases.

That's it, that's all the case is about. Technical or material breach, the latter could mean serious trouble for SQM re their lithium leases and 39% of their revenue.

I'm not sure if I'm right but I have a cost figure of $22 per kg for SQM at the moment on iodine. However they apply some like process costs across 3 products that come from caliche, so knowing them they will twist to fit whatever carries the best tax evasion option or best false invoice route.

[superg1] 08/4/2015 08:11

Just to clarify my 120mt Q1 comment. That's the mid range figure from their H1 estimate.

If they hit 120mt for Q1 then I expect Q2 to return a higher figure if bpd processed at each plant is roughly the same.

A higher return for an equal amount is based on temperature changes. Winter temperatures lower yields if it takes processed water below 40C (believed optimum temp). Iofina have mentioned this in the past.

So 120ish or higher would be very nice as they will have achieved that during the coldest period.

No I haven't a clue what they have achieved but I have gone for 40mt average as in theory there will have been less fracking, which is typical of the winter period regardless of reduced activity due to the oil price.


As for water timings I'm watching for an update on the John Ames permit, as he had a hearing the day before IOF.

[awolagain] 08/4/2015 07:50

Two companies to hold for the next 25 Yrs....
"...The primary reason that SQM trades for such a low valuation despite its strong growth prospects is that the stock is frequently treated by the market as a fertilizer play and not as a lithium producer..."

Yep...a poo stock and company...it's official and might take 25 yrs to show a return! lol!

[captain_kurt] 08/4/2015 07:13

Tuesday, 07 April 2015


No takers for RB Energy's lithium and iodine operations

[superg1] 07/4/2015 18:59

A good example of investing in Chile currently



Li3 energy

The Board of Directors approved a wide range of additional cost cutting initiatives designed to continue to reduce costs and preserve cash, which the Company believes will further enable the advancement of the Maricunga project. The cost reductions included administrative and operational expenses, streamlining various Board committees, salary reductions for senior management and the reduction of liabilities resulting in the termination of key employees. Through this cash saving exercise, Li3's management and Board remains committed to Li3 and advancing its projects.
- Li3 continues to evaluate various strategic options and financing alternatives to further strengthen its position during these challenging market conditions.
Luis Saenz, CEO of Li3 commented, "Whereas many other companies have been forced to shut down given the difficult market conditions, Li3 continues to move forward in conjunction with the positive signs coming from the Chilean government, as stated in our January 28, 2015 press release, and the lithium markets as a whole."
"We believe the work being done on the Maricunga Project and the settlement of the liabilities is a significant step that will make a considerable difference as we look at strategic opportunities, and that the drastic reduction in costs will ensure the long - term viability of the Company given its limited cash and uncertain equity markets," commented Patrick Cussen, Chairman of Li3.

[freshvoicem] 07/4/2015 16:36

We are waiting for the one that says
the Department FINALLY determines.........etc

[cyberbub] 07/4/2015 16:00

Ok good LOL otherwise the share price would be breaking 50p now... :-)

[roboben] 07/4/2015 15:40

Cyber - It's from the 3rd of October. The date is on page 14.

[superg1] 07/4/2015 15:39

That's the old decision.

[cyberbub] 07/4/2015 15:32

Joe, is that news, or just the previous decision from 4 months ago??

[joestalin] 07/4/2015 15:19

"Subject to the terms, analysis, and conditions in this Order, the Department preliminarily determines that Application for Beneficial Water Use Permit No. 40S 30066181 by Atlantis Water Solutions LLC should be GRANTED."

SG right again.

[freshvoicem] 07/4/2015 14:55

This site now gives the results of hearings.

[kattatogaru] 07/4/2015 14:06

Is there a regulatory requirement for quarterly updates? I know that the monthly updates of H2 2014 weren't particularly helpful to the management, but given the pain we went through last year I think we're overdue some reassurance that things haven't slipped back into omnishambles mode. It's been nearly 4 months since the last real update.

[1madmarky] 07/4/2015 14:06

Energy density is the big issue with it though. Going to need a very large battery if you are going to do may miles in your car before having to stop and recharge it. So limited potential in my view.

[king_roster_iii] 07/4/2015 12:08

How long before we are the producer of a rare earth mineral :)