RB Energy (RBI-T)

There is this big Tesla giga-factory hype where they are going to build a lot of lithium based batteries. He is not sure that it will be lithium that the future big batteries will be made of in the long run. Not a big fan of lithium plays. Argentina and Chile can supply an awful lot of lithium at a stable price to accommodate future demand. Thinks it is a bit of a bubble tailgating on the Tesla hype.

Acquired Canada Lithium, which he held. Canada Lithium is going to cost a lot more to get fully into production, but they have started shipping lithium out of the mine. If you own at this level, he would not be adding but also would not be selling.

Lithium project in Quebec is at least 1.5 years behind because of a number of technical glitches, some of it beyond their control. Acquired Sirocco, which was really a way to acquire capital. Have done a good job in steadying the ship. Fundamentals for lithium are very good. 1 to 3 years is the timeframe you have to have in mind for them to clean up the operation and get the mine working with the backend, in terms of processing.

The merger made a lot of sense. Putting them together put them into a new ball park for investors. But they keep diluting share value with new issues. It is a value play and is the best name in the sector, although they have not executed that well from a shareholder friendliness point of view.

The risk is a little higher, but through the tax advantages it counters the risks. A lithium project that is starting up. Issues on the roaster side. An issue with a roaster not up to Canadian specs. It is a case of fine tuning things. They need to slow things down. It will bode well for the stock. The key is the ramp up and it will take a year.

He is still holding. It is really a chemical company. The merger gives them quite a bit of cash flow. Tesla’s North American lithium battery plant would really help this one as it is expensive to ship.

(Formerly Canadian Lithium Corp.) Recent merger now gives them some more size, but did nothing to fix balance sheet. They will need more cash in the next quarter or two. Tesla may build a battery plant that would take 30% of world lithium supply. There are probably better ways to play this.

An interesting lithium play. Getting together with Sirocco is really a capital markets play. Bigger is better in this market. This is one of those names that should get more attention and should get a better investment base now that it is bigger, but it hasn’t done anything this year. You have to get a change in the sector before anyone cares. Give it a couple of months before examining it again.

Just entered into a partnership with Sirocco (SIM-T), an iodine company. This is a great transaction for them because they had balance sheet issues.

They can be quite attractive when they are building out, but he has been short because these types of small companies building a big project will typically run into delays and cost overruns. They are short on cash and can’t get to commercial production. One customer has invested in them through upfront payments, which has helped. He likes the space.

Likes this. They are ready to start producing and will be the 1^st lithium producer in North America. Cheap costs. The only negative lately has been a lawsuit because of the issue of the 43101, which he thinks was an engineering mistake more than anything. Very well managed.

(Market Call Minute.) Very good story. However, valuation is right up there. Roughly about 300 million if you include debt. When the project completely ramps they will generate about $30-$40 million so it is fairly valued at this point.

If you like lithium, this is one of the best companies to own. It’s the 1^st North American lithium producer. Have started production now so there should start to be some cash flow. Sold 85% of its production this year already. Good management.

Have a hard rock lithium mine in northern Québec and is either in production or close to it. Got some Chinese financing to help on this mine. Good price.

Smaller companies starting up sometimes have hiccups along the way, so he is short. When it gets to a commercial production and cash flow, he may be interested in going long, probably within a year.