Earnings Labs

Sigma Lithium Corporation (SGML)

Q1 2023 Earnings Call· Mon, Aug 14, 2023

$20.46

-1.21%

Key Takeaways · AI generated
AI summary not yet generated for this transcript. Generation in progress for older transcripts; check back soon, or browse the full transcript below.

Same-Day

-1.73%

1 Week

-0.06%

1 Month

+7.84%

vs S&P

+7.34%

Transcript

Ana Cabral Gardner

Operator

On the first page, I'm citing the disclaimer. We're going to make a number of forward-looking statements here. So I encourage you all to read the disclaimer regarding the forward-looking statements. Sigma became the first global producer of zero carbon, zero tailings, zero chemicals, green lithium. In other words, we're enabling a transformation in the electric vehicles industry. And that's the excitement of what I'm going to share with you. Ultimately, we achieved the golden crown of sustainability by basically focusing on the impact on land that tailings dams would have, focusing on mitigating the impact on air by lowering our GHG carbon footprint, and on water by not using chemicals in our hazardous -- not using hazardous chemicals in our production plant. Here's an aerial shot of our plant. You can see the dense media separator and the tailings third module to your right next to the thickener, which is the first of its kind to dry-stack ultra-fine tailings to 12%. Here is another aerial view of our plant. And you can see it from the view of the ROM pad where we feed the first module, the crusher, with this spodumene ore to be transformed into a battery-grade Triple Zero Lithium concentrate. Here is the deliveries and on every front, we have successfully ramped up. And more importantly, we are on our way to expand this plant to triple production capacity. So there are 5 aspects of the call today, and I'm going to try to cover them to some level of depth here. The first, we're confirming guidance, reaffirming guidance of 130,000 tonnes of concentrate for ERM. So by December '23, we're going to reach this target. The ramp-up has been a success. We have successfully managed the dry-stacking module, which was the last module to be…

Ana Cabral Gardner

Operator

So another question. So can we talk about the decision to use trucks versus heavier mining equipment for pit work and hauling ore? Did we assume higher maintenance downtime or OPEC? Is it worth the ESG specifications if you don't get compensated for that with the product price? Well, look, the cost of mining here is negligible compared to the overall cost. I mean, as you can see, it's $2 a tonne to mine this. And you saw the slides. So it's an important point here. We're talking about negligible cost elements. Negligible, $2 a tonne. The product is $3,500 a tonne final. Even with the bear market projections, it's a $2,000 a tonne product. So it's important to understand that mining is a feedstock to the industrial operation. And where do we really manage cost in the industrial operation? So our processing costs are the key. By choosing this meter separation, we put ourselves way out there, way ahead in terms of advancing, in terms of advancing, just keeping those costs low. Because dense meter separation is a relatively simpler process than flotation and therefore, inherently, intrinsically, it has lower costs. So as a result, when you compare mining with plant, I mean, the decision to add trucks was a social decision. And you can see how bad the social license of the industry in Brazil is and how much resistance, even stigma encountered this perfect company, environmentally and socially, as it initiated operations. What was the resistance? We never had the benefit of the doubt. Here it is in Brazil. You start a mining operation, you presume guilty. And we proved everyone wrong within 2 months of operation, but it was tough going. So, what we had going for us? The significant number of members of the community…