Ann: Expanded Lithium Soil Anomaly at Lake Johnston, page-104

There are 57.3m shares on issue, but 17m of them are in that limbo state where they can't be traded and therefore don't appear in some MC calculations. The under 40m MC figure you will have seen comes from tradable shares, but the sentiment is still correct. If there is a big deposit on TG6 ground, the share price has a long way that it could run. The difficulty for the immediate future is what probability does the market (and should the market) place on there being a big or very big deposit?

While the range of options is much wider than big or nothing, this simplification serves to show the point.

• A small/nothing deposit has low value. For simplicity I'll call it zero
• A medium sized deposit is a possibility but for simplicity in this example I'll say its either big or nothing
• A big defined deposit has a lot of value. For simplicity I'll call it $530m (but Azure shows really big in in high demand can be nearer $3b)
• At 92.5c the MC (excluding options) is $53m

On this simplistic example the market is saying there's a 10% chance of a big defined deposit. Good drill results will increase that percentage. Poor drill results will lower it. As @Gmeister correctly points out, one of the next steps after current drilling is confirming the extent of updip/down-dip extensions in the immediate area. If the market starts to think there's a better than even chance of a big deposit, MC's well past $100m are possible but in the meantime, we wait for drill results and changing that 10% slightly upwards or downwards bounces the share price around lots.