Ann: APPOINTMENT OF FLOTATION SCOPING STUDY PARTNER, page-2

Well it makes sense. The recovery rates are in the low 60% due to processing fines and natural fines (P2). If Spod rates were sub-$1,000 and you were trying to make this project work you would probably look at a DMS only flowsheet. I agree with Atlantic's expectation that the spod price is going to remain comfortably above $1,000/t and potentially many multiples of this. At these prices you don't want to leave lithium units behind and incremental capex for higher recoveries is worth evaluating and the likely outcome is clear.

Crushing fines are already reduced close to the size needed for a flotation circuit so the cost to extract and crush has already been incurred. The natural fines aka P2 material have terrible recovery via DMS and should have vastly improved recovery rates via a flotation circuit. IMO the three issues with flotation are the higher capital cost, the modest additional operating costs and the more complex / longer commissioning time before they generate robust revenue.

• Because DMS only is commercial at Ewoyaa, a DMS only commissioning scheme can get Atlantic EBITDA positive and fund the capex
• If EBITDA positive when commissioning, flotation has vastly reduced operational risks relative to it needing to be ramped up to cover the bills
• While there's more steps in a flotation plant, it can and should be very economic as most of the digging/crushing costs are already covered by the DMS operation while other operations like SYA/LTR have shown adequate economics inclusive of digging/crushing.

If you look at GL1's Manna scoping study (Repeated below) they are running material via a DMS. The floats from DMS and crushing fines are then recombined, put through magnetic separation to deal with high Iron and then put through a flotation circuit. Ultrafines are removed as they clog up the flotation circuit. Atlantic is following the pathway of WA miners like GL1, except that by getting DMS operational first it can be funded from operational cash flow and there won't be the same commissioning risks if it takes longer for flotation to reach nameplate. At this stage its just fines / Middlings that Atlantic are looking at rather than all floats so the capacity of the plant should be a lot smaller than the 2.7Mt DMS.


From Gl1's Manna scoping study - 14 Feb 2023: