Ann: Procurement of Long Lead Items for the Great White Project, page-513

I've been spending time with family interstate this week and hence missed the webinar today. Have only had the chance to watch it this afternoon and have also gone through it a second time.

My opinion. Not advice.

ADN should have presented a before and after picture for impacts to the project economics in Friday’s announcement. They've completed the design and planning for the Starter Plant (6:51 in the video) so would know the costs and impacts to economics. What's not clear to me from this webinar is when and how they are going to inform the market of the economics for the Starter Plant element including the associated mine plan / production schedule for the starter phase, CAPEX, OPEX and NPV.  It is explained in the video (14:18) as a refinement in the DFS, so when will we see an update - or will this be via the BFS?

Whilst not happy with the slow progress on BoAs, I am comfortable with the decision ADN have made to plot a course to achieve revenue/cashflow with a more nimble startup plan.

I do think the ratio / product mix of KCM 90 and HRM will be key to monitor as a sufficient weighted average margin will be important.

The production quantities for Stage 1 of DFS were:

• 138,000 tpa Great White KCM 90
• 15,000 tpa Great White HRM

For the DFS that works out 9.8% of production towards HRM. If they can improve on this 9.8% ratio for the first processing train of the starter plant then IMO it will be much better for the starter plant economics. We need to wait and see on a HRM offtake.

I also think the announcement Friday was intended in part to achieve disclosure on 100,000 tpa processing capacity for the Starter Plant (and ADN needed that disclosure before commencing procurement - otherwise suppliers would know details of ADN’s changed plans before the market).

For the Carbon Capture plant JM in response to questions (16:36 in video) says they are awaiting certification of components and assembly. The carbon capture plant is not a benign piece of equipment. Any kind of plant and equipment in Australia needs certification by designers/engineers as well as installation and commissioning tests. There needs to be training/supervision and there needs to be ongoing oversight once operating. This is all to ensure safety of the plant before it is put into use (undergoing commissioning) and while it is in operation operation. See section 3.2, 3.3 and 3.4 of the Code of Practice (link below).

https://www.safeworkaustralia.gov.a...naging-risks-of-plant-in-the-workplace-v1.pdf

It’s not a matter of just siting the plant and switching it on. All sorts of certifications and tests for the equipment as it is assembled/installed and commissioned need to be conducted. This takes time. Probably months (although I don’t recall we haven’t been given a target date). There will be installation/commissioning inspections/tests and the records will need to be checked signed off by a competent person, issues from inspections/tests will need to followed up and rectified. Both ADN BoD and management at the University would be in serious trouble if a safety incident occurred because all the legislated safety activities weren’t done as the plant is installed, commissioned and operated.