Ann: Quarterly Activities/Appendix 5B Cash Flow Report, page-8

I think its far more possible than is reflected in the share price, but there's still no certainty HPMSM will progress. The share price basically says that HPMSM won't happen or won't happen on financials that look anything close to that proposed in scoping studies. A fully owned single train HPMSM plant is modelled to generate circa A$100m of EBITDA each year starting in only a couple of years. Two trains are US$155m EBITDA. Clearly if the market thought that would happen with high or full E25 ownership, E25 would have a multi-hundred million market cap (before factoring in any value to Butcherbird). The MC is massively below that so you are not alone in having doubts.

The key to why something is likely is the Inflation Reduction Act. If a company can secure all the battery minerals, jump through the percentage hoops and avoid China in doing so, they get a US$7,500 tax credit for their customer purchasers of EV's. You can have a sticker price of US$40,000 and be "cheaper" than someone selling a product at US$35,000 that doesn't allow the tax credit. If you are close to completing your supply chain, the last missing link could cost your customers hundreds of millions. To be priced competitively that cascades back to less profits/higher losses (many OEMs will have early EV phase losses). Say you were planning to selling 100kt of EV's each year (which is a modest volume for the US market). Your customer value proposition on those sales is improved by $750m / yr by having a complete supply chain. That's a lot of reasons for closing the Manganese gap in your supply chain. If doing NMC batteries you need Lithium, Nickel, Manganese and Cobalt and Graphite. If going for the chunkier density that LMFP delivers over LFP, you also need lots of Manganese in the form of HPMSM.

A modest one-off investment to assist E25's project into production gets rid of one of these problematic metals. Both General Motors and Stellantis have realised this problem and want E25's project to progress so they have a solution. This isn't your typical situation where a project stalls because of a low share price.

One of the huge wildcards is where Telsa is going to get IRA compliant HPMSM from (making the presumption they will want to make IRA compliant vehicles). Who is going to produce that HPMSM and where? If its E25, what does that mean for the share price? If its someone else, does that effectively take all their supply off the market for all remaining OEM's?