Yes that is my understanding as well.
The only question the MD needs to answer is the grade of ore sold under DSO and whether it comes from the top layers before the udnerground section. I suspect it is 1% - 1.2% Li20 and I am going to explain below.I think you are too hung up on grade as against process flow sheet. A while ago I posted on you the LTR thread differences in the WOF employed by LTR and LLL (and then was asked by redbarron to explain that on the LLL thread) and it was clear too me the explanation went above a lot of people's heads.
So I will explain it again as it relates to LTR and resource input into the WOF process - and you just need to look at the mining plan underpinning the DFS where the ore is coming from.
1. LTR's resource is not homogeneous - there are differences in the underground sections - where WOF is employing those resources - to the upper sections of the deposit and process flowsheets tend to operate where the bulk of the resource is. Noting, most of the resource LTR is targeting for WOF is in the underground section where the bulk of the MRE resource is stated to be in. The underground sections are thick and high grade - with sections well above 1.4% Li20 - btw as well, compared to the upper sections. The upper sections are more thinner with a lot of waste in between each section as well.
2. Because they are not attaching DMS in the process flowsheet, and therefore do not have a lot of the 'sorting' infrastructure before floatation, you need to ensure a consistent blend in the SAG and ball mill. That is ensure you have a decent and not variable blend before these elements (obviously if they sink more capex for sorting/screening etc before those sections the answer may be different). That means you can't use the upper sections at this stage, without putting in more capex IMO IMO IMO but obviously that is for LTR to explain and at this stage they are targeting the underground sections obviously.
3. Towards the end of project life, they intended some form of open pit plan, which I suspect also meant putting in place additional capex to deal with the top layers (if WOF was still used at end of life). Again IMO
So why the above.
1. The sections they are taking out now before the underground sections feeding into WOF, are not suitable for WOF - which is what implicitly I suspect they are saying (LTR can confirm this or not). They want a consistent blend and when they did the DFS, and now to be frank, they did not consider dealing with the upper sections IMO was economic (given where the price was and what price they were forecasting back then). Again IMO IMO
2. But hey presto, spodumene prices have gone through the roof and now they think well those top sections may be economic to someone else who has a process flowsheet in place that can deal with these specs. We will do some ore sorting and sell it as DSO, but because we haven't tested the top layers within our WOF, or testing required a complete overhaul of a WOF process flowsheet for these minimal tonnes, we will sell it a DSO (given it was destined as waste btw because we had no idea what to do with it in our mine plan).
3. They are not talking significant tonnes here, just the tonnage they are taking out before they get to the underground section tonnes they are feeding into their WOF process flow sheet.
Another way to put it - a lot of exploration companies are exploring on tenements where mines were in place ages ago that essentially high grade the ore - those exploration companies are now seeking to find more ore in those mines or test the lower grade ore left, which is likely to be lower grade that what was mined before, and then develop a process flowsheet for that ore (assuming they find enough of it - just look at some of the copper/nickel explorers to understand that).
The above is my interpretation - obviously LTR is best placed to explain grade of ore sold. DSO can only work IMO with ore grades above 1% Li20 btw - becaus ethat is teh grade in the thinner sections of the top layers of the deposit here.
Again these questions are for LTR to answer not random posters on HC. I have sort in my mind to understand LTR's comments, and I have focused on the deposit and process flowsheets as against grade (which is your focus).
ALL IMO
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