General Discussion Topics, page-85264

Great discussion. Just for the record , here is my take on things again. And I'll stick to the spod side of it for now.

And for good reasons I guess as I had previously preferred to tackle the question of ' FIRST PRODUCTION ' spodumene numbers from the point of view of reverse engineering if you like of the ' Cost of Production ' via the recent rail and mining contractors costs from L. Fournier & Fils as well as the Drilling and blasting work being carried out by another local Québec company, Dynamitage Castonguay. And of course ALL of these visible and known cost structures versus those of which can be interpreted from the NAL PFS. ( not yet DFS ).

In other words not just the ' Concentrator 's ' output perspective , but from the actual cost numbers which can be tied back to it. So this is a great way to validate the forecast ' output ' numbers , and then from there what is then possible given the previous ' Ramp-UP 'from the previous failed NAL operations.

And so the reasons for a lot of what has already been mentioned here. Being the ramp up which is required in any production processing environment , the dry stacking of end product , the ramping for FIRST delivery tonnages , the early expected as well as ongoing testing of spodumene production ,the ROM stockpiling and grade separation steps.

And so all of this and more before the actual circa 33% blending from Authier even is assumed to be included at this stage.

And we already know from my earlier post highlighting the confirmed pre production ' Annual ' ( pre / or post Authier ) tonnages of product ALREADY sitting ready on the ROM pad as per Sayona's December update.

And so we also know from the PFS , the estimated nameplate of 168,000 tpa which has been targeted and that obviously from the historical comparisons , that reaching nameplate is ALWAYS going to be on a slower and gradual ' ramp up ' compared to that of ' Steady Production ' . So given this fact , we now know that ' roll off production ' which is virtually ready to go from the ROM perspective will most likely be rolling off in larger quantities by latest 31st March 2023 and therefore production in terms of how it is considered from the the off-take perspective has to be calculated from a ' rolling ' 12 months basis from this time-frame . And this is what I have been stating for ages now.

We also know that just prior to NAL falling into Receivership in 2019 , they had reached a figure of 114,000 tpa in around 5 months of operation which was well on their way to their stated commercial nameplate of 168,000 at that time.

So we're miles on our way to being ready on the ' Front End ' of the required production ramping at 2 months into the start-up of mine activities - ie December.

Ok , so now we have the visibility of the revised requirements of the Tesla / Piedmont re-worked Off-take .....which just so happens to align itself with some of their ( Piedmont's ) alleged comments re the 180,000 tpa figure.

So following on then from all of this , and referring back to a few of my earlier ' First Production ' posts again ( see posts below ) - Here's perhaps what we can do or asset in terms of ' back-filling ' the Piedmont stated 180,000 tpa.

Post #: 63988051

Post #: 64562532

So was the production number from Piedmont meant to be stated at the 180,000 tpa being 90% of the nameplate , thus making it 200,000 tpa . Or was it really meant as 162,000 tpa being 90% of 180,000.

So let's assume it was the 162,000 tpa. So the difference between the 162,000 and 113,000 is conveniently the ALMOST 50,000 agreed for supply to Tesla in the FINANCIAL year of 20223 commenting at the 9 months mark ( September ) as per Piedmont's and Sayona's previous statements.

So let's come back to my earlier estimates of First Production of 41 - 45 thousand tpa between March 31st and 30th June 2023. This would be of course split in terms of the revenue and profits according to the JV percentages and would make perfect sense in terms of the early ' Cash Injection ' for the SAYQ and NAL operations.

Moving on from there and assuming then the 12 months from July 1st 2023 through June 30 2024 , we have a couple of scenarios which tie back to BOTH the PFS as well as the first production figures posted by NAL before its final receivership in Feb - March 2019.

The FIRST scenario would be that in that ,.... lets call it FIRST 12 month FISCAL period of production , that the production then falls under the 113,000 tpa output and therefore is split 50% / 50% with Piedmont at around 56 tpa each. Under this scenario , it would obviously tie-in more or less to the recent revised Piedmont / Tesla offtake of 50,000 tpa in each FINANCIAL year. So in this scenario Sayona would obviously also get its 50,000 tpa in the 2023 - 2024 Australian financial year.

In the SECOND scenario , we could then assume the 162,000 tpa being achieved for the 2024 - 2025 financial year with Piedmont receiving its 113,000 tpa and Sayona its additional right and participation in another 49,000 tpa - So that's around the maximum ' conservative ' amount of 98,000 tones being potentially sold at US$6,000 per tonne or the equivalent of A$852,173,913 in total ' Top Line ' sales between now and 30th June 2024 of which at 75% would bring to account around A$640 million in sales and ' Free Cashflows ' before further CAPEX of perhaps as mucha s much as $350 - $375 million in what amounts to only 9 months from now.

And so , this is just additional reasonings why I am happy to stay with my previous suggested estimates of 41 - 42 thousand tonnes being potentially sold off as ' FIRST PRODUCTION ' from now until 30th June 2023 , and which would also no doubt be a very pleasant surprise uplift for the SP should that eventuate...........

Of course where the ' Equivalent ' spod goes in so far as targeted Carbonate of Hydroxide destinations is another story which will emerge more strongly when the feasibility studies are completed by Hatch in March or April 2023.......or by Easter I would think......... And like some have stated , by then we will definitely have a better handle and know exactly what has rolled out of the Conentrator , and how much more likely the ramp up from there going forwards will be. And still 2 months left to end of June 2023......