The major issue was limiting the project to 20mtpa and not...

The major issue was limiting the project to 20mtpa and not having a back up plan in place.
They were led on by 'experts' that the 20mtpa project was viable until it wasn't.
One of the many consultants should have said we should mitigate the risk and continue to proceed with both options.
That was the time to raise funds to expand the scope of the BFS. Which would have been very well supported by the market.

Would we be in the current situation if that happened?

It really is an unfortunate situation, the company tried to save money limiting the project to the desired outcome.
I do feel we have been blindsided by our consultants.
I guess we will never know the full extent of these internal discussions to see who really pushed this direction.

Everything that has happened since has been a result of that mistake.
We all knew we needed more funds sooner rather than later to work through this period.

I can see why BOD have opted for this fast cash option.
They have concerns raising funds for working capital / LDA fees from hurt shareholders.
For them its a safe bet to move the company through this period.

The project isn't de-risked enough for partners. That doesn't seem to be an option until the completion of the BFS.
They prefer to pay a premium for certainty. I think what is unfolding is proving that.

Personally, I would have preferred it going to shareholders.
I believe HIO still has a lot of shareholders willing to support the company.
5m would have been taken up. The risk is if it wasn't the company was dead.

It's only 5m, it's not the end of the world.
Lets see the review and what funds are required for the amended BFS.