https://ceo.ca/dan?80327da5a69a
@EpsteinResearch I can't understand why $DAN is not moving higher. A Moroccan phosphate rock benchmark price is up to $176.67/tonne at 12/31/21 from a low of $70.75/tonne on 4/30/20, +150%. Inflation is running hot (good for hard assets / commodities), and Arianne is funded through 2022, and well into 2023. The cycle for most food commodities like corn & soybeans has turned positive along with fertilizer prices. After the Omicron wave passes, we could see a strong Spring planting season, further supporting prices.
Arianne has been approached by more than 1 battery supplier and/or Auto OEM about supplying high-purity phosphate concentrate to the LFP battery market for electric vehicles. This is a segment with demand growing at a 25%+ CAGR that didn't even exist when Arianne did its BFS/DFS back in 2013. There is only a handful of phosphate rock projects in the world that have similar concentrate grades & size. Mgmt. claims to have the single largest & single purest (concentrate) in one of the safest jurisdictions. Regarding purity, very low radioactive & heavy metal content vs. peer projects.
ESG mandates suggest that Arianne's production will readily find a home in the U.S. & Canada -- edging out less secure supply from Asia, northern Africa, & the Middle East. Arianne's output of 3M tonnes/yr. will NOT flood the market, but would generate ~C$500M/yr. in EBITDA at current prices. With the help of a strong strategic/financial partner, this project could be in production in 2024 or 2025.
Does N. America want to rely on security of supply over the next few decades from N. Africa & the Middle East, where 75% of phosphate rock currently comes from? This seems like a no brainer, trading at under 10% EV/after-tax (NPV(8%). I challenge anyone to find a cheaper valuation for a BFS/DFS stage company! A company with 2 off-takes, signed First Nation agreements and a fully permitted project, with expected strong support from the Quebec gov't & various investment funds active in Quebec & in Canada. What am I missing?
0 12 Jan 2022, 08:22
@InvestThor I have enough shares until the approaches lead to something 0 12 Jan 2022, 08:30
@fl @EpsteinResearch where are you getting your numbers from? North America (US since no domestic production in Canada) is a net exporter of phosphate. Fertilizer commodities are primarily driven by logistics to market.
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