As per usual, Ken will write an epistle lol. Thats the result of...

As per usual, Ken will write an epistle lol. Thats the result of too much time on my hands. Early retirement after 41 years of work.
Forgive errors please, as I write this its late.

I understand the pessimism regarding deadlines relating to the completion of commissioning by end of September and the production of the first mg ingots thereafter. We have seen changes in the schedule numerous times. I think Covid was definately a major factor that had an affect on logistict of precurement, staff availability and general closures and imposition of restrictions due to rules and regulations.

There are many examples of impact of Covid. I will just give one example that impacted heavily upon myself and associates.
In 2020 I was the General Manager of a manufacturing firm that imported 90% of project components. For a very long period during Covid, shipping channels were completely at a standstill, with numerous ships lloaded with various project components held short of reaching ports. Ports that were complety unable to unload, be processed, quaranteen, etc, for weeks on end. Even under force majeure we were at severe risk of very large liquidated damages for Government and private sector contracts due to various State boarders opening and closing at unpredictable times.

In addition, my instalation teams that usually travelled to every Australian State for project instalations were under heavy constrant that stressed all staff and the business to the max. The business operations that I was responsible for were extremely complex. Installation teams had to fly to whichever State, quaranteen for 14 days in hotels, fully paid wages, accomodation and away from home allowances. Upon return, teams had to stay home for 14 days, on full pay. Im sure you can appreciate the massive cost burden and the implications for the gross profit of projects. The stress was insane to say the least.

The final result by mid 2021 was Covid had brought the company to its knees. My CEO and myself tried every trick in the book. At the end, the company folded and I was fortunate to get long service and redundancy. All my staff had to find new jobs. A very successful business wiped out in a year and a half.

The essence of this story is that we simply do not know how much Covid really impacted upon the LMG project and its lasting legacy. I think, as some have said, DP aged very quickly, perhaps the longer term impacts are being seen right now. When I read back for how LMG handled the costs and even made cost reductions and revised schedule, I cut them a little slack. There is a massive cost to pay to keep the doors open while productivity is at a standstill and the revised budget is proof of the pudding imo.

In the past, even though there where many typos and technical errors, DP was forthcoming with Project Reports, Market Updates, Community Presentations. Investor Presentations, interviews, etc. Just a quick review of the PR performed in the past compared to now, gives a stark comparison. Is this lack of communication a result of sorting delays though what would be significant re-negotiation?, Perhaps.

Does any of what I have written change the fact that investors have every right to feel jipped, not at all. Perhaps it can just influence the longer term view for what can change again. Personally I think it is a major blunder that LMG did not invest in a contracted marketing and pr entity. I'm not Robinson Crusoe.
As a relatively positive person I try to adjust (some) of my expectations and enthusiasm, proportionately. LMG are still moving, still have a grounded product and project. Things change as things change and change is a constant.

Is there a possibility that the commissioning will not be finished by end of September, of course. Nevertheless, all stops would be targeted for removal tin an attempt to achieve the schedule. Today I had a read through the last financial report. The value of the Options to be exercised by the 26th of October could be front and centre given the last increase in the project facility cap raise and revised budget.

Announcement on the 24/05/2023
24 May 2023, Sydney Australia "LMG has successfully negotiated an increase in the facility limit of its project finance facility (“Facility") by $3M to $26M. The additional funding will provide operational working capital for the first year of operations of its demonstration plant."

I understand this is working/operating capital but from what I see the 3M as extra debt now included in the budget.

QUARTERLY ACTIVITIES REPORT 31 December 2022
"Budget revised to $41.72 M from $39M a rise of only 7%, a great achievement in the current environment."
The revised budget was after "$8.5M (18%) worth of cost reduction being identified."

Given all of that, the option conversion would be a very handy cover of the extra debt.
The following is the status of Options as of the last Half Year Report:

HALF YEAR FINANCIAL REPORT 31 DECEMBER 2022

"19 Nov 2021 30,000,000 options at $0.04 expiring 26 Oct 2023, valued by Black-Scholes method, for capital raising costs"

" In addition, the company issued 60,000,000 options, on a one for two free basis for each ordinary share issued under the placement. The options were issued at an exercise price of 4 cents expiring on 26 October 2023."

"In addition, the company issued 28,750,000 options, on a one for four free basis for each ordinary share issued under the placement. The options were issued at an exercise price of 4 cents expiring 26 October 2023."

"On 19 November 2021, the Company issued 4,500,000 listed options to Peak Assets Management Pty Ltd being part of the capital raising fees in lieu of cash payment. (Exercise date?) The balance of 25,500,000 listed options were issued in January 2022 after the AGM. The options were issued at an exercise price of 4 cents expiring 26 October 2023.

Outstanding at the end of the period 114,373,962

114,373,962 x. 04 = $4,574,958

The above does not include Warrants or anything else I've missed. I cant find any other Warrants due by October this year.
2022 Annual Report

"Under the October 2019 funding agreement with RnD Funding Pty Ltd, LMG has issued 35,889,199 unlisted warrants. The warrants have an exercise price of $0.03 and are exercisable for a period up to 3 years post the drawdown date. In November 2021, 12,666,000 warrants were exercised at $0.03 by RnD Funding Pty Ltd. The remaining 23,223,199 warrants are exercisable at $0.03 prior to 15 October 2022.
23,223,199 x .03 = $696.695

Therefore a minimum of $5,271,653 to be converted prior to the mid to late October, if i'm correct. Sounds like a pretty good incentive imo.
How can LMG achieve this schedule? Well a Project Update from DP would come in very handy in order to explain. I'm not holding my breath.
I truely hope the next Quarterly does not change the projected date of completion of the commissioning.

We shall see.

...................

Ready to adjust my expectations at any time but content to hold.

Regards
Ken