Ann: Chairman's Address to Shareholders, page-6

Fellas, fellas, get your feet on the ground, please.

I think that it is time for another reality check.

- It is with great pleasure that I am able to update you

How on earth can he have "great pleasure" in telling us that, in the main, all scheduled and completed milestones were late or have not yet been completed. See below table.



IMO, this year has been a disaster, share wise. OK for the company's progress; they have worked hard for these achievements. You judge for yourself as to whether or not you think this has helped the capital value of your investments.

Now this Ann. Just a lovely little dissertation on the years progress. And of course, it has a cute little passage designed to inform and titillate the faithful. For me, it achieved neither. (See following paragraph from the Ann.)

Since Daelim’s involvement we have seen a huge upsurge in international interest in our Company from two perspectives. With potential investors and partners and also in taking our process to their countries. To this end we have had two international companies at site this week and are working closely with an additional two international companies.

Oh good, Interest in "two perspectives", one from potential Investors and partners, and the other from parties with an interest in the NRZ process. All good, but I hope that they do not get sidetracked at the expense of their core business, as they have tended to do in the past.

Now let's have a look at the FID and pre-FID funding.

I still don't know what pre-FID funding ($50 million-$100 million) is for, but it must be important.

I now quote from Cheyne's above post, Post #: 64981525

At the end of today’s AGM, Justyn answered a few questions. The two main points for me :

1. They are hoping to have Pre-FID funding squared away by Christmas.
2. The BFS, project funding and FID are still all on track for completion in Q1 23. Though if the project funding does blow out a little further, this obviously means that the FID will too.

If they pull this off, particularly in relation to pre-FID funding and timing, it will surely be a couple of "upward surprises" in my mind.

What is the financial situation current and looking forward?

Funds required - 1 Jul 2022 (Start of Sep quarter) to FID (Mid to end Jan 2023)
AUD 30,344,146 (Balance of DL's Initial Services Fee)
AUD 15,554,452 (Balance of Pre-FEED Services)

Funds required -1 Oct 2022 (Start of Dec quarter) to FID (Mid to end Jan 2023)
The above $46 million less $15 million (Estimate of above paid in Sep Quarter)
Leaving approximately $31 million fees plus general expenses of approximately $4 million payable by FID

Total funds required is $35 million.

Fund available at in current quarter
$6.27 million Opening balance (see Sep 5B)
$3.76 million Private Share Placement (before transaction costs)

Total funds available is $10 million.

A shortfall of approximately $25 million.

However, there could be another $5 million still up for grabs, subject to Investor's approval.

Do we need a CR or pre-FID funding by Christmas? You're darn right we do.

Cheyne, despite the AGM discussions, I think a slippage in the FID timing might be a blessing in disguise, giving them more time to get their finances sorted. Pity about the share price.

My thoughts only, the best I can do given what I can glean from the announcements. It is your company guys so strong constructive critiques are very welcome, even if only for your own benefit. Get you thinking.

J L.


The rest is just reference material if you want to test my assumptions. Ignore.

8.8.2 Sep 5B - Answer: Yes, additional funding for operations has been secured as per the ASX Announcement 24 October 2022 “Private Share Placement”. Additionally, as per the ASX Announcement 30 September 2022 “Annual Report to shareholders”, the entity is in further discussions regarding a number of funding options

Private Share Placement - $3.76 million (before transaction costs)

That's a grand total of about $10 million.

However, there could be another $5 million still up for grabs, subject to Investor's approval.

What are the costs between now and FID?

EPCC Contract and Offtake HOA between the Company and DL E&C (DL)

DL will perform the engineering, procurement, construction, and commissioning of the urea production facilities.

Initial services provided under the contract require total payments of USD 29,265,000 to DL, payable in four milestones, as follows:

1. 30% of the Services Fee, payable after the Company issued a Notice to Proceed on 2 August 2021, paid as at 30 June 2022.

2. 30% of the Services Fee to be invoiced on or after the first date on which the process design packages for both the ammonia
(including sulphur recovery) plant and the urea plant comprised in the Works have been delivered to DL by the relevant Licensor.

3. 15% of the Services Fee to be invoiced on or after the date Services Completion occurs; and

4. 25% of the Services Fee to be invoiced on or after the date that the Company’s board of directors makes a FID on the NRUP
Fertiliser Project.

Milestones two to four have not yet been met, and there was no payable owing at 30 June 2022 for initial services. In addition, the
Company is required to pay for Extension of Time and associated costs during the year, the amount for which has not been agreed
at the date of this report

Estimated Initial Service Fees between 30June 2022 and FID - 70% of USD 29,265,000 =AUD 30,344,146

On top of this we have Pre-FEED Services (This should now be history, but ???)

In April 2022, the Company approved the appointment of ammonia and urea licensors (KBR, Merichem and Stamicarbon) for the
NRUP. KBR, as integrator, will deliver the Basic Engineering Design Package (BEDP) and Final Piping and Instrumentation Design for the NRUP, a critical requirement for DL to complete its commitment to provide a FEED package. Under the EPCC contract with DL, following the appointment of the licensors, an additional USD 15,001,280 is payable, as follows:

1. 30% after the execution of the licensor contract, paid as at 30 June 2022.
2. 30% on delivery of the Process Flow Diagrams.
3. 20% on delivery of the Piping and Instrument Diagram
4. 10% on delivery of the Draft BEDP
5. 10% on delivery of the Final BEDP

The FEED should be over by now and the balance of 70% USD 15,001,280 = AUD 15,554,452 should have been paid.