This is maiden drilling. High risk high return. There could be...

This is maiden drilling. High risk high return. There could be deposits which PLS would covet. The sky is the limit.

Some initial thoughts on the release are below. Some of it is new, some is not.

What is not new:

The x5 PoW news was largely expected, at least by those in the know within the industry and familiar with DMIRS processes. We were already told on 21/4/2022 that the applications were registered so there are no real surprises here for the seasoned. No changes to the area to be drilled (25,000m). But it is important to remember this is a large drilling programme. For example, PLS’s RC drilling in 2016 at Pilgangoora was only 15,000m which at the time was considered a ‘big lithium drill campaign’.

What is new:

1. Drilling contractor: 12-month drilling contract with Foraco Australia Pty Ltd. This is the Australian arm of a French business. They are in 51 countries, truly global. The Australian arm is in Kewdale and have about 150 employees and generate ~$38m p.a. in sales. As an international business, they are the third largest driller in the world. Very reliable. Interesting that George chose this company, probably learning from what was sub-optimal with previous contractors PLS used. For example, PLS’s drilling in 2016 and 2017 was undertaken by a smaller company Strike Drilling Pty Ltd using a KWL1000 truck-mounted rig and SDR04 rig mounted on a VD3000 Marooka track base. Foraco is a big improvement. And it is consistent with our aggressive approach and confidence in the resource.
2. Timing of the RC drilling: this is slightly delayed if you compare the 21/4/2022 announcement with today’s. Back in April it was anticipated that at least some drilling might start over the Tambourah North and Coondina Projects from June. Now, we are told it will be ‘late July’. This may be due to one of three reasons. First, as has been going on in the industry, ongoing COVID delays have been affecting things slightly and pushing back timelines. Second, alternatively, it may be that the few weeks delay is something which was a trade-off in getting a world class contractor. Lastly, it could be to do with the fact that the Heritage survey is scheduled to take place in the 2nd week of June and drilling cannot start until that is signed off in respect of disturbances etc.
3. Focus of the drilling: the confirmation we have received now is that initially the drilling will concentrate over all identified pegmatites hosting visible Spodumene and Lepidolite mineralisation over the northern and southern section within the Tambourah North Project. This makes good commercial sense.
4. The Native Title Heritage Agreement: signed with Nyamal Corporation over Marble Bar Project areas.
5. Nyamal Heritage Survey over Marble Bar Project areas to commence in June 2022.

George means business and is clearly delivering on his promises about fast tracking things and progressing an aggressive approach.