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 welcome to CEO insights I'm Marilyn dezman with investing news.com I'm speaking with Ian Roger CEO of gindel lithium Hi Ian hi thanks for having me thank you uh thanks for coming um I guess I think we can start our conversation with just uh getting your take on the current dynamic in the lithium Market um what do you think is driving this uh the change the the pricing and you know we recently we've seen some uptick on the unin prices like can you give us your take on that yeah I think what we're seeing is a rundown in

prices uh driven you know primarily between a runoff on on Chinese inventory not just I guess inventory um of withum chemicals but uh you know Cam and and and cells in the withiin supply chain and the second half of last year and that was in the order of sort of 200,000 tons uh a year in in a market that might be a million tons um size so it's quite material then we saw the sort of run up in prices across 21 22 and that induced a lot more um Supply so sort of mismatch in supply and demand um as well as sort

of a run up in um sorry run down in in inventories and so that's resulted in you know the price coming off um particularly um in China and given that they they currently dominate the market we've seen those low low prices like you indicated there's been sort of a bump up in the last uh couple of couple of days I guess um we think this might be green shoots and we're at the bottom but I guess time will tell and I think for us we're more focused on the longterm the fundamental the fundamentals haven't

really changed yeah like I think abam put out some uh forecast in their last uh set of results that even with softer softer uh roll out of EVS there's still a big Supply deficit towards the the back end of the decade and I guess that's our Focus and as the market matures ex China we'll see less volatility um due to the the restocking and destocking sort of behavior in that market so we're really looking forward to the end of the decade yeah so yeah you mentioned China so the decoupling of

the lithium supply in China uh could be a gamechanging dynamic why is that and how is that how will that impact your project well what was saying in the United States in particular is just focus on reshoring and decoupling uh I guess the the US market from from China in particular trying to build some Independence there and that's partly why our assets strategic but I think you know a lot of the behavior we've seen from from oems and groups is securing oft um uh direct from you know projects

that are you know in North America or in Australia or areas where they that aren't dependent on the China supply chain and at the moment there is limited X China processing capacity to take um to take particularly Hard Rock mines but even um we're obviously a clay deposit and there's yet to be an operating uh clay mine but certainly from A Hard Rock Point of View there's limited capacity it's being built but over the coming years there'll be a build out and and um I guess uh growing maturity in

particularly the North American Market where um they'll have their own separate supply chain and a different pricing Dynamic we hope which will be U more stable and certainly some of the strategics that we're talking to uh have ended IND at that the offtake Agreements are there looking at um you know less linked to spot and and you know more based around what what would be a more natural incentive pricing which I think is positive for us over the longer term um I want to get you in uh take as well

with you know you mentioned the EV supply chain the value chain for the EV is um is the I guess performance of lithium in terms of supply and demand uh how much of that is being driven by um the easy market and you know I think we've I've you know we've been seeing some slowdown in the uptake of of uh electric vehicle yeah I think the Press coverage has been pretty pretty bearish on the EV thematic you know they've had you know a series of really strong growth years I think like last year was

still 30 plus% the year before was 60 odd perc so we're coming up a really really low base and the growth's actually been quite strong some of the negative sentiment coming out of uh the big oems in North America they're actually quite minor um minor uh players in the in the EV EV space and their forecasts are sort of pushing out some of their some of their production which affects the me term but the longer term you know trajectory Remains the Same EVS are a large part of the lithium demand

uh the biggest I guess uh sorry you know um I guess particularly from a battery point of view um at the moment with a with a low price there's been some you know rapid growth in stationary storage But ultimately the even um thematic will be what really drives the you know the the the growth in demand over the over the medium term so let's talk about your project M dermit uh lithium project could you provide an overview of that and what makes it a compelling asset yep we it's a cementary

hosted lithium deposit it's about 30ks uh north of lithium America's sta pass deposit in the mcdermit Caldera we're um the main deposit is is on the uh just on the Oregon side of the the Nevada border we sort of pegged it in in 2018 and then through a series of drill programs have uh built up what is the largest resource in North America so it's an exciting project um we're uh we close and an analogous to to lith Americas there are some sight differences but um we're sort

of riding uh on their coattails a certain extent on you know their flow sheet development and and being able to sort of Leverage our Engineers to sort of um TI to prove up our project the the reason it's compelling um you know strategic location on the doorstep of the EV supply chain and like I sort of touched on before this uh thematic around reshoring and you your North American buildout uh really plays into you know why the asset is interesting and certainly from the conversations with groups um that potentially

interested in off take and Partnerships down down the line at the scale is really attractive instead of being out having to do multiple deals on on smaller assets like our asset potentially could be a real um meaning contribution to North American Supply so I think that's why it's interesting you know we like a lot of our peers we're trading at um very low multiples we're we're probably the best valueable lithium stock um in that in in in I guess the US on a on a dollars per LC in

the ground component I think we're getting we're getting marked down um a little bit for our location in or Oregon but we're really um optimistic about how we can uh pursue the the per the permitting in in Oregon and we think we're uh we offer tremendous value and leverage to lithium recovery what's the um plans for 2024 any upcoming catalysts certainly so we kicked off the pre- feasibility study the middle of last year and that's due for completion in the middle of this year and so we're

completing we completed a lot of them metalogical test work but we've got the back end of that as well the as as the engineering and cost estimates as well as the the M planning the M planning work ultimately we've got a very big resource so we're you know focusing on you know the uh the first 5 to 10 years to maximize margin and the economic return as part of the the the P the PFS so that's going to be a key a key milestone for engagement with you know what of these kind of strategic groups

we haven't put we haven't put uh parameters in the market yet so this will be a really really key uh piece of work and a catalyst for us along the way we we we''re increasing our engagement with a lot of the US state agencies uh around technical cooperation and perhaps perhaps uh grant funding opportunity so we're optimistic about that and there's none none of those are confirmed but we hope that turn outs some of that um towards the middle of the year um potentially the technical Corporation

earlier um but we know we continue to push push push forward push forward on that and then I guess the another milestone for us will be producing within carbonate as well from our from our test work which will H which will probably happen in line with our pre- feasibility study so we' got a we've got a busy year ahead and um hopefully it's a watershed year um we know we get a lot of this work done in a in what we hope is an improving with your Market towards the end of the year and into 2024 right

so we're at pdac and you're talking to investors I mean you've got you've done a pretty good job outlining the uh your project and the the you know why that's compelling uh you're talking to investors what makes um gly you know a compelling investment opportunity at this times and the years to come well I think there's lots of there's lots of catalyst to come we're trading at a very low valuation we've got a big strategic um asset and so the Leverage is The

Leverage is huge and you know we've got to you know uh walk before we can run but we've got a couple of Milestones that we they working through this year like I said in terms of the PFS which we believe are going to be a real sort of value uplift um opportunity so I guess now's the time to sort of get in um when the price is is really low um and to have that leverage to the upside and that that'll be my message it has been my message to to the investors who engage with it Pac all right well thanks

e for taking the time to speak to me today thank you very much thank you and thanks everyone for watching join us again next time for another engaging conversation on CEO [Music] insights