Not a red flag for me at all and it’s a risk in TNG, TMT and any...

Not a red flag for me at all and it’s a risk in TNG, TMT and any other miner that CAPEX may blow out. I’d rather know that upfront in a fixed priced turnkey contract than 20% blowout in development – the latter is a company killer. If I’m SMS I absolutely want to have tested every flow process over and over if I’m taking the risk on one a fixed price EPC contract and secondly the process and product output guarantees. I don’t give those process and product guarantees if I think there is a risk. There is the risk that CAPEX may increase however in optimisation works completed in the subsequent feasibility studies, they actually found savings through eliminating inefficiencies in the process.

The pigment plant isn’t $400m however the various BOOT assumptions are around that number. For me I do see most of these sitting off balance sheet but I do think given the pigment plant will fall under German ECA funding as it is supplied by Ti-Cons (German) and built by SMS, it will likely sit on balance sheet.

Acid Regen @ $212m @ $24m pa. opex
Oxygen Plant @ $33m @ $3.8m opex
Pigment Plant @ $222m @ 25.0m opex
Chlor-Alkali Plant @ $95m @ 10.7m opex

On the financial outputs, your moving the year 1 capital outlay adjustment up but also reducing opex (increasing your cash flow) by $64m over 37 years. I reckon you might see slight under on the $2.8 NPV by 5%-10%.

Coming back to then funding the pigment plant if it sits on balance sheet, the company has given shareholders plenty to think about with regards to this without announcing someone taking a BOOT which won’t happen until you are close to bringing it all together. If the Kfw mandate of USD600 is delivered, that covers our current capex bill. Why are we speaking to NAIF, mezz lenders in Hong Kong and equity partners?

ECA cover = USD300m = AUD428m
ECA uncover / syndicate = USD300m = AUD428m
NAIF = at a guess AUD150m
Mezz = at a guess AUD100m
Equity = at a guess AUD300m

That capital stack would cover the current known CAPEX plus all BOOT assumptions being brought on balance sheet at a near enough 70/30 debt to equity mix. Kind of makes sense.

I’m not really certain I’m following your comments about pie in the sky and having to ship core to a processing plant. Firstly, it is a fact that TIVAN, along with the bolt on plants, will produce three high quality and refined products when in production. Secondly, digging in the desert and processing elsewhere not a common operation. Lynas mine in WA and ship to Malaysia. We’ve got all the infrastructure close to make it a efficient transport operation. I’m sure TNG would have processed at mine site if they had the water they need for TIVAN in the middle of the desert.