My take on the quarterlyThe tungsten price is rising which is...

My take on the quarterly

The tungsten price is rising which is good (we are still the only ones actually producing tungsten). The feasibility study (FS) is due in the September quarter which will give a very clear indication of the financial metrics, however it won't include iron duke.

The Quarry is still producing but BAMA didn't restart collecting after the wet season until last week in May. That means only 1 weeks worth of $ were received in this quarter as they pay 30 day in arrears. There is $1.1m outstanding that will be in this quarter.

The XRT Sorter is still in testing phase as part of the METS program (Qld Govt grant) with the stockpile with good results 10X upgrade, but it's not at full production.

The Retreatment plant usage has been changed to 7 days on, 7 days off which allows stockpiling of the product from the stockpile to be then processed. This is improving tungsten output and grade when compared to running the tailings at 70% of the time. Apart from working with old gear, the low value of the tailings has been part of the problem. Looks like Kevin has recognised this and made changes. This happened late in the quarter, so benefits aren't in this quarter.

They have been upgrading equipment where they can but it's got to fit within the current tight budget.

Not surprised by the cashflow deficit, given capex and feasibility study and drilling program. Also BAMA money not all in the can. If you think this is the fully fledged operation then you don't know what you are investing in.

Cash from tungsten sales was up 58% from the last quarter which would reflect a) higher tungsten price b) higher grade -stockpile is a higher grade than tailings and c) higher production, but it's still well below where they want to get it. One major advantage we have over others is, end users are using the tungsten (not all tungsten is the same).

Overall, this is still in warm up phase until we get the FS completed and then they can get funding to add crushing capacity, more ore sorters, larger process plant, more drilling and actual mining equipment.

As Chris Brown from Morgans said in his research notes. The risk in this project has been dramatically reduced as the FS has actual working examples to assess rather than thinking what might happen on a greenfield site or at an old empty hole.

The Iron Duke is a game changer with more tonnes and likely higher grades which is still open at both end and at depth, but it won't be part of this feasibility study.