Ann: Engineering Studies Commissioned for Plants, page-59

This has been an interesting one since MIN came on the scene and definitely worth discussing further.

MIN from my understanding essentially have a first right of refusal to purchase the graphite produced from the process worldwide at ‘market rate’. The higher the produced grade the higher the market rate. Being first right of refusal they have no obligation to purchase but simply have the option. In terms of our process we obviously produce both hydrogen and graphite therefore our future partners and licensees will generally be either looking for graphite OR hydrogen with very few having a need for both. When you consider the markets there’s only around 1 worldwide company who require graphite to every hundred that have a use for clean hydrogen.

Being able to go to a client who has a need for hydrogen and give them a somewhat firm number on the credits they will receive from graphite produced (if MIN offtake) and the cost of building a plant puts the prospective client in a more informed position when assessing the suitability of the process to meet their needs. The graphite shifts from being a potential problem to market etc to a constant that can be used to evaluate.

MIN will only offtake graphite that they have the capacity to make money from and from what I understand any graphite they make money from will be subject to a royalty to Hazer therefore the more they can get their hands on the better for us, likewise with pricing lower the better although dictated by market.