EQR Research BUY $0.12c upside 166%, page-34

“They've hadproduction updates in each of their quarterly cashflow and activities reports,the last one being the end of October. Not to mention their AGM update (whichis where you pulled your 135t number) also had a production update, that cameout November 22, 2022, not even 2 months ago. So by my count, we've been gettingproduction updates once every month or 2. They haven't gone 'silent' by anymeans.”

ThanksPBlonde out of all these production updates can show how much was produced /sold for either October / November / December. That number should be by yourunderstand greater than 75t which would be another record production number.

“Up until the end of September 22 theywere expected to hit a rate of 62.5t per month at the high end of theirestimate with 41.67t per month on the low end, which as you noted theysurpassed in Q1. From the beginning of Q2 (October 1) for the next 9 monthsthey are expecting to hit 75t per month at the low end and 100t per month atthe high end. They weren't expecting to hit that number in Q1 so comparing theactual results against that means you have accidentally misquoted at best orare being disingenuous.”

That’s notmy understanding. That run rate was to start on competition of the power lineupgrade and 24/7 production. Which was done at the start of 2022. As per theASX“UPGRADEDPOWER LINE COMMISSIONED LEADING TO RECORD PRODUCTION” on 10^th JAN 2022 Which is now 12 months ago. A couple of quotes from it.

“QueenslandTungsten producer EQ Resources (“EQR” or “the Company”) is pleased to announcethat the commissioning of the upgraded power line at the Mt Carbine site hasbeen completed. The upgrade has allowed the XRT Sorter to operate on a 24-hourbasis and led the Company to achieve a new monthly production record oftungsten concentrate from its rejuvenated Mt Carbine mine, 130 km north-west ofCairns. A successful debottlenecking strategy and Early Works investmenttargeting the crushing, screening and XRT sorting capacity contributed to theproduction of a record >40 tonnes of 50% WO₃ concentrate in December 2021, showing the positive impact of the continuous improvements at Mt Carbine.”

“Withthe Early Works being completed in the coming weeks, we see ourselves right ontarget with the production upgrade towards +/-90 tonnes of concentrate permonth.”

Andpart of your post replying to me in back in March.

“Significant expenses were incurred in the half year related to increasing throughput and ramp up of production (now operating 24h) so we should also see an increase in product and sales with the bulk of the costs to setup and get that running incurred in the previous half year. Did you read the operations report attached to the half year financials? We will likely be cashflow positive from Ops or close thereto in thefirst half of 2022.”

Then move to the 75 -100 on completion of the early works program, which was done in June. As per the images i posted above and the quote from Scottm.

It was also discussed previously the needfor a cap raise was due to funding from the government being delayed and needfor short term funding so as to not delay any further development/exploration.

YesI understand the issue with the delay in receiving the government grant. Thathas now been offset by the 1.5 mill director loan and 4.5 mill placement. So thatis back to being fully funded. But they have deferred the repayment of thedirectors loan and received 2 mill from the grant as well as 5 mill from regal.With another 4 mill from the grant and 5 mill regal to come. So the balance of that is 16 mill of extra funding.

Whatis your guess of the production number for Q2 and do you think Ops will be cashflow positive?