Ann: Acquisition of UK Based Williams Advanced Engineering, page-70

Hi JB

I largely agree with your comments, lets face it we are at the bleeding edge of technology with battery output set to double per KG and hydrogen costs are set to more than halve, who knows what will eventuate. The Williams technology is that the "mining truck will be a hybrid that uses both a lithium-ion battery and a hydrogen fuel cell module. Altogether, the truck will have over 1,000 Kilowatt-hours of energy storage." Don't forget that the batteries will regenerate on downhill sections.

The conceptual work is done on the 290 ton beast for Anglo-American, but Williams Advanced Engineering (soon to be owned by FMG), also based in the U.K., will bring the truck to life with a proprietary high voltage battery system for the truck, which is currently under development. The idea is to replace the vehicle's diesel engine with a retrofitted high-power modular lithium-ion battery."We are delighted to be involved in this innovative and exciting project which showcases the scalability of battery technology from automotive and motorsport to 'heavy duty' industrial applications," Craig Wilson, managing director of Williams Advanced Engineering, said in a prepared statement.

Look my point of view is this (trucks are just a peripheral issue), FMG need to move up the food chain as 58% ($88) is worth less and less as high grade magnetite ($171 for 65%) premiums go the opposite way as the steel world moves to DRI/EAF that doesn't want FMG's type (except Iron Bridge magnetite) product.

So the best use of solar and hydrogen is to upgrade the ore, which means metal electrolysation, but why expend energy on 58% when starting with 65-70% magnetite uses far less energy and expense?

FMG IMHO, needs to pivot away from low grade hematite and partner with he likes of Hawsons and/or Iron Road etc. who are close to mining then use FFI tech to upgrade their (future) magnetite output to pellets, HBI and pig iron and pure iron powders etc using solar, hydrogen and induction to make 100% green steel product feed and eventually steel. The financial rewards from pivoting from low priced commodity to high value feedstock would be tremendous and Twiggy would get to roll out his green tech in a hurry, instead of scouring the world for partners he can find some right and get some fast financial runs on the board. The profits from this approach would soon eclipse the 58% hematite operations which of course, would continue unabated for the Chinese open blast furnace market.

FMG could dominate and unlock the increasingly vast reserves of magnetite in NSW & SA by first enabling, then taking the output off smaller miners then upgrading it to high margin feedstock products. These are worth several multiples of what 58% hematite yields in profit and the aggregation of facilities would keep costs low. Achieving the same product upgrades with 58% is trying to make a silk purse out of a pigs ear and likely require double the energy input.