I thought I would add a few comments to the discussion about Fe...

I thought I would add a few comments to the discussion about Fe percentages.

By way of an overview to show how grades are really important, in very rough terms. I am assuming that the throughput capacity of the processing plant is 100Mtpa (how much dirt you put in at the start of the processing plant and that doesn't change with the grade being processed). I am also using 70%Fe as the iron ore product when the actual product might be 68% to 70%. Assuming this:

If you process 100Mtpa with an average grade in situ (in ground) of 7%, then you will end up with 10Mtpa of iron ore with Fe of 70% (100Mtpa times 7% divided by 70%).
If you process 100Mtpa with an average grade in situ (in ground) of 14%, then you will end up with 20Mtpa of iron ore with Fe of 70% (100Mtpa times 14% divided by 70%).

I know that it won't work exactly like that, but the point being the higher grade that you have at the start, the more product you can produce through the plant each year with similar costs.

The 20% that treefeller is quoting appears to be from a post by Proxenne. The 20% is Proxenne's view on what might be required, not management's.

Management set a target of finding in situ grades of over 9% in the fold zone that was nearer to surface. Refer ASX announcements of 18 October 2023 and 18 December 2023 where they stated their target of 9%.

The drilling results identified zones above that target of 9%. Refer ASX announcements of 29 February 2024 and 24 June 2024.

My take on the comment in the announcement of 24 June that recent studies demonstrating that "the marginal economic cut-off grade for the project is now 4% DTR" is that means that the marginal cost of digging and processing and shipping dirt ore that started in ground at 4% is equal to the expected sale price - effectively a breakeven point in production.

Processing ore that was 4% in ground will not make any margins to cover fixed overheads and capital costs.

However, if the ore being processed is above 9%, then that means we will have double the output from the same work in digging and processing and the margins achieved will be around 50% (sales of say $150 p/t less marginal costs of $75 p/t for example). That leaves 50% of the sales revenue cover overheads etc. And 50% of the sales revenue from 10Mtpa at 68%-70% Fe should be more than enough to cover overheads and return a profit.

I accept that this is an oversimplification. However, what I am trying to show is that if through improvements in production processes etc, that the marginal cost is now down to 4%, then there can be some substantial margins to be made when using higher average grades.

There are some pockets in the recent drilling where average grades are higher than 9% (see example image below). If they can target a higher grade zone on start up, then that will have a significant impact on early profits and the NPV outcome of the project.