Neometals - Simply Making Money

Interview with Chris Reed, Managing Director of Neometals (ASX:NMT). Making the Complex Simple.

Fascinating and rewarding approach to making money in the mining space. Neometals team invested A$3M in to their Mt Marion lithium project, brought in some partners at various stage to fund the development of the project and realised a A$200M return. A result of good timing for sure, but very much definitely a result of a good strategy which focuses on de-risking and developing long-life projects. Plus a focus on cash and picking the right partners and building a team of people who know how to integrate down the value chain. No debt, dividend paying (have returned over $45M to shareholders) and sitting on over A$110M. Lots of optionality. Lots to like.

We Discuss:
They have three projects:
1. A lithium-ion Battery recycling project to recover Cobalt, Nickel and other materials from spent or damaged lithium batteries. Currently working on testing a pilot plant and signing up partners across the food chain. We looking to see who they end up working with but large strategic partners bringing in money and existing infrastructure and network is an important part of the plan. This is the most advanced of their projects. The idea is to use the same business model as employed at Mt Marion. Not sure many shareholders will argue with that.

2. A Lithium Refinery project - progressing plans for a lithium refinery to supply lithium hydroxide to battery cathode industry, underpinned by a binding life of mine option for 57,000 tonnes per annum of Mt Marion 6% spodumene concentrate. An MOU is in place with an Indian Group, again Neometals is employing the same business model. If it's not broke, don't fix it.

3. Barrambie Titanium and Vanadium project - It is one of the worlds highest-grade hard-rock titanium-vanadium deposits. It is also a huge resource. Chinese groups all over this. Repeating the model again.

We really enjoyed hearing this business model. It's just smart. They have made money. The are focused on making money. They are technical but they have recognised the need to simplify the way they talk to investors about what they do. This is one to pay attention to.

1:59 - Overview of the Business
2:51 - Reflection of Mt Marion: What Was the Root of Their Success and How Can They Replicate it?
5:05 - Thinking, Strategy and the People Involved
13:11, 29:33 - Success and Shareholders: How are They Growing the Company?
14:40 - The Barrambie Asset
15:16 - The Lithium Refinery Project
21:09 - Battery Recycling Project
37:05 - Reasons to Invest in Neometals

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