Ann: Financial Year 2019 Results Presentation, page-272

Hi MD,

At the strategy briefing day on 21 Nov 19, SH stated that they were after a partner to satisfy one or more of the following criteria:

1. Offtake partner
2. Experience operating in brine
3. Experience operating in Argentina



As point 3 (experience in Argentina) is only relevant to brine anyway, SH's statement indicates to me that any potential candidate that satisfies more than one of the criteria is an existing brine operator. Therefore, I would assume one of the following (in no particular order):

1. Livent
2. POSCO (not an existing producer I know, but on their way)
3. SQM
4. Albermarle

I don't include ORE on this list because they are already heavily committed to their expansion and downstream conversion (Nahara). I believe that Livent or POSCO are the most likely candidates; however, I wouldn't rule out SQM or Albermarle. My opinion only, but I suspect that an investment in SDV would be a good hedge for SQM or Albemarle in the event of further environmental/water issues in Chile.

All that being said, it's entirely possible that GXY only satisfy point 1 (offtake partner), in which case one of the following would seem logical (again in no particular order):

1. Panasonic
2. Samsung SDI
3. LG Chem
4. CATL
5. BYD
6. SKI
7. Any existing auto manufacturer (VW, Tesla, Daimler-Benz, etc)

My reasoning for these particular companies is simply that they are "household names" as per @Snowy66's conversation with SH. I think the real key now is what kind of price these potential partners offer. IMO, a 30% interest in SDV would warrant a minimum of USD$200m based on current lithium prices. Anything lower than that would be a slap in the face, at least as far as I'm concerned. I would hope that an investment from a partner would yield somewhere in the USD$250-$300m range in order to fully fund SDV through to stage 3 (25 ktpa). Lofty expectations I know; I guess we'll see. At least any offer whatsoever will give Macquarie analysts reason to reassess their position ($0 value for SDV).