Ann: March 2023 Quarterly Activities Report and Appendix 5B, page-21

@Names littleand what does "Commercial production facility site evaluation broadened to include benchmarking of alternative technologies to inform EGR's purification development strategy" mean?

A basic site evaluation would look at what your costs are and would note different sites would have different costs, particularly if they are in different countries, had input products that needed to be sourced locally or byproduct outputs that were only practically sold locally. Following the study you would have a good idea of what your cost of production should be. You would have no idea what potential competitors costs of production would be. In an established industry you can sometimes backwards engineer this from existing sale prices and known/expected margins. In an established industry you know the market price and know that unless you are under this, there's little point in progressing further.

Producing natural spherical graphite in European / USA locations is basically a new industry so you can't observe the market to understand the probable cost base of competitors or the market price of product. The IRA means EGR wouldn't be directly competing with Chinese product.

I'd therefore guess that the benchmarking (cost pricing estimates) is looking to guess what potential competitor purification techniques would look like with a western labour/electricity and consumables cost structure. This would be necessary to assist informing likely future margins and how aggressively you could price on medium/long term contracts. If you aim for too higher contracted price you don't get the deal. If you go too low, you get the deal but not much profitability. Understanding probable competitor pricing in this new non-Chinese market would therefore be beneficial. I suspect no bank is going to lend to you in a new industry without some sort of potential competitor analysis and any robust competitor analysis would involve having some idea of their likely cost base aka "benchmarking of alternative technologies [including purification using hydrochloric acid or other acids that can be used to purify graphite]"

A key part of the purification development strategy is how it gets financed. As shareholders we thought the $50m for Kiwiana was doing this but it appears what's left of the $50m is earmarked for Epanko and/or running a lifestyle company. Hopefully most is on Epanko. Any bank financing probably needs this potential competitor analysis as would convincing a JV partner that you know what you are talking about and the JV could have robust profitability. Past capital raising exercises have been achieved without robust competitor pricing information so this expanded scope may not be required for an equity raise.

Well that's my guess but its a far from clear statement.