Ann: Response to ASX Query, page-9

Good to have that question asked and answered.
Thinking outloud here...

So, Shaanxi still takes the off take, and onsells it onto the Chinese market. Price is already set with AJM. If there has to be discounting to move the product, Shaanxi will probably have to absorb it. AJM still gets the price that was contracted. DFS assumptions remain valid.

Worse case, Shaanxi goes under. The holding in AJM would be an asset surely, that could be sold from liquating Shaanxi. Probably getting picked up by a competitor. It doesn’t really affect AJM. Its debt funded, not from shareholders..

The offtake could be looked at the same way. An asset. Guaranteed spod at a set rate. What converter in China would turn down additional product? Why would it have to be just China? Japan or South Korea anyone?

Shaanxi look desperate to hold the offtake agreement and not let it lapse. Who knows, maybe they”ll restructure out of making batteries and go to onselling spod instead onto other Chinese companies.

AJM don’t seem to be in a hurry to find a new offtake partner and I don’t think it would be hard to find a new offtaker if Shaanxi falls through, judging by the lolly scramble for spod other developers have experienced.

As for Stage 2, I m fairly sure JB told me at a shareholders meeting that it was looking to fund it off Stage 1 revenue. So don’t expect dividends for a bit. Funnily enough CE, the ops man also said they had a whole lot of people involved with commissioning Mt Cattlin for GXY, commissioning AJM’s plant. That might explain the higher grade product on startup as they were looking to avoid the problems GXY had on startup.

The BOD are up to their old tricks again. Quietly and diligently ticking off goals and working to steady state nameplate production. Sure there has been delays, but nothing that fundamentally affects the DFS assumptions.