General Discussions, page-12016

G'day FreeFlyer,

"I also think RNUs capex cost as assurance for mine rehabilitation will be no less than REX minerals and could be closer to 50m or more"

"Before starting construction or mining operations, Rex must pay a $34 million rehabilitation bond which DEM will hold as security to ensure land rehabilitation obligations can be satisfied."

Those are 2020 costs I'm assuming of 34m. Unsure of how much this may have increased with inflation. Also unsure how a graphite would compare with a copper mine in their relative sizes and waste, tailings dam etc.

Some interesting observations you have made in your comparison between Renascor (Graphite Developer) vs Rex Minerals (Copper Developer)

I'd start by stating that you have compared an apple with a handpicked watermelon in terms of project characteristics, scale, location & environmental impacts in a local context. Secondly, it is important to note that there is no existing Graphite Operation in South Australia that has received PEPR approval to date for a like for like comparison (Approval has been given for various Drilling Campaigns, but not for operations)

In terms of your comparison between Hillside vs Siviour, I did find it peculiar that you handpicked one of the Largest Mining Operations in South Australia (With a complex approvals pathway) for the basis of your comparison. I guess it did suit your narrative to do so. When we break down the key characteristic tables of each project, you see the 2 are rather unrelated:

Total Material Movement Per Annum = Rex 64Mtpa vs Renascor 6.5Mtpa
Pit Depth = Rex 440m vs Renascor 120m
Area of Disturbance = Rex 1,270ha vs Renascor 830ha

I find it peculiar that if DEM calculated Rex's rehabilitation liability at $34m, that you believe an operation that is significantly smaller in scale (1/10th), has a significantly smaller project footprint (Disturbance area), has significantly smaller waste dumps / TSF facilities (Key closure infrastructure), Has significantly smaller supporting infrastructure for operations, has a pit depth that is a fraction of the company you are comparing it to, would ultimately lead in your words to a rehabilitation closure estimate of "No Less than Rex Minerals and could be closer to $50m".

I would like to hear the assumptions or rationale for why you believe a site that is smaller in scale by magnitudes, has a smaller project footprint, has smaller waste dumps, has smaller TSF's, has a shallower pit depth, has fewer supporting infrastructure in operations, has a significantly smaller volume of material that requires rehandling would have a +50% increase in its closure liability vs Rex Minerals ???

Look forward to hearing back from you FreeFlyer