Ann: Initiation Research Report and Valuation, page-9

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Our SOTP base case valuation is 22c per share, based on the Ancuabe scoping study (60% of our SOTP value or 13c) with a further 9c (the remaining 40% of our SOTP valuation) added based on a discounted valuation of the company’s very large additional resources at Balama and Nicanda Hill/West. Our base case valuation uses a notional 75/25 debt/equity structure to fund Ancuabe’s development, assuming equity at the current share price (5c). However, our valuation is sensitive to the share price assumption of the equity component: at a 10.0c share price, our base case valuation becomes 26c; at 15c it becomes 28c. Our Ancuabe valuation uses a weighted graphite concentrate basket price of US$1,369/t and a 10% discount rate to reflect general equity risk.