General Comments & Banter, page-9153

Morning Crumble ... and thanks for asking. I'll give it a shot, though I do want to point out I'm not an expert on this subject.

First point to note is that usually the PEA would have happened a lot earlier in the piece, when factors such as costs and revenue would be much more theoretical.

Costs
However (as we know), AGY have not only already built ponds, pilot plant and produced a product, they've told us for several months now that they have been refining the process to improve both efficiency and quality (ie reducing costs, refining operating plant and processes, increasing quality, etc). Hence I think it's safe to assume that AGY have a pretty good idea of their key cost factors, ie capital investment for assets, process and harvesting costs for feed stock (ponds) and processing costs to produce the final product (including knowing processing times, output quantity and achievable quality).

Revenue
"The marketing and forecast analysis report was prepared by an international lithium market and forecast consulting company Benchmark Minerals Intelligence Ltd." (ref Sept Quarterly).

BMI are a respected entity in the lithium sector, in particular with respect to lithium pricing and contract negotiations. They do a lot of work compiling data on lithium sale prices, and I suspect are privy to prices and conditions in various contracts that aren't common public knowledge (see below link). As such, I think AGY's PEA will have very reliable revenue calculation. If nothing else, AGY told us in the 6th Aug ANN that the most relevant pricing reference is the FOB Sth America - however, there's every reason to anticipate that a unique product that meets specific client specifications will attract a higher then average price point.

IMO AGY's PEA is going to be in a unique position of being based on actual known factors, as opposed to forward looking projections several years out from now.

Which leads into a good point that was flagged with me last night - many investors see a PEA as a forward looking statement, and think there is still work to be done building ponds, plants and securing clients. Obviously this is not the case with AGY.... so when the PEA is released, there might be a a bit of marketing required that promotes how far advanced AGY is in their journey to production.



https://www.benchmarkminerals.com
(there's a video on the home page from their presentation to the London Metal Exchange... worth watching from around the 9 min mark to hear about their role in lithium pricing)
Benchmark is a price data collection and assessment company specialising in the lithium ion battery supply chain.

Our team offers price data, analysis and forecasting services for lithium ion cathode and anode raw materials particularly lithium, graphite, cobalt and nickel. We produce the monthly lithium reference price.