Ann: Binding Offtake Agreement Signed with Volkswagen Group, page-41

Hi all,

A few comments on here are in relation to the share price reacting strongly to this news tomorrow. Haven’t there been a few offtakes now that haven’t moved the SP much at all? VW is big news but it’s not exactly surprising or unexpected is it? Personally apart from a bit of retail excitement (assuming S3 still send their pumpy emails) I would have thought this will trade like the rest of the Li market tomorrow - although you guys missed out on a strong trading day today, so maybe there will be some ground caught up.

To my mind, it makes total sense that all the big EU OEM’s will want to work with Vulcan, if they get to production. There’s no complex supply chain trying to get lithium from remote Argentina or the opposite side of the globe in Western Australia. Vulcan’s key competitive advantage in this way is their location - it’s fantastic.

But at the end of the day, all of these “binding offtakes” are conditional, obviously, on Vulcan actually getting into production. Until that happens they’re just promises on paper. Don’t get me wrong - they will be hugely helpful/important when Vulcan are past the DFS stage and having serious conversations with funding partners. But right now, Vulcan could sign another 10 of these agreements but none of them move the company any closer to production than they are now.

Surely what needs to move the SP from here are drills turning and progress towards a DFS? That’s the news I can’t wait for. It will really show us if they can take this project from paper to production. It will also put the allegations from the JCap report to bed far more than these conditional agreements.

No position, long or short, but following the VUL story as a keen lithium fan.

Cheers