Ann: Sayona Acquiring Moblan Project to Boost Quebec Lithium Base, page-178

Mate I think it's very cheap. And I say this because after having had the the opportunity to run a quick rule over a few other recent deals and would make the some relevant comparisons as follows :-

We talked about Frontier Lithium this morning as being a possibility given its reasonable close proximity and its quality . So looking at them ( Fronteir ) who are only at the PEA stage for their Lithium Hydroxide chemicals conversion with a total of pre-production estimated costs of C$684.9 million for pre-tax NPV of $1.62 Billion - They have a total Indicated resource of only 3,361,000 @1.59% Li20 and an inferred of 15 .718 MT @1.31% with an average lithium recovery of 83.9% and a stripping ratio of 3:6:1. Currently their securities are being traded and valued at a Market Capitalization of C$166.32 million.

So they don't have any of the surrounding Plant like Sayona's NAL open pit nor have they really even started economic NPV of of their Ontario based PAK lithium project , they currently being valued at an equivalent US$8.71 per tonne.of Indicated + Inferred resource.

As another example , we could look at Piedmont's agreed investment in Iron Ridge which together with its more recent US$15 million payment for 9.9% equity has further agreed to stage equity acquisitions totaling US $102 million for what I can see as 60% of the project and a 50% guaranteed off-take of spod product.

And that has ALL been agreed upon by a Maiden JORC on IronRidge's Ghana Lithium projects of 14.5 MT grading @1.31% and of that figure the Indicated is only 4.5MT @ 1.39% .

So that commitment by Piedmont equates to a US$ per Indicated + Inferred of US$7.03 per tonne of resource. Now Ghana is an ultra lower cost when compared to Frontier so Piedmont bought into this project very very well at that price comparison.

But these deals aren't for absolute ' Control ' .....so you could argue that there is no Premium for the absolute control of the project. So then when we look at what CATL was prepared to gazump and pay over the top of it's fellow Chinese entity in Gangfeng for the ultimate control of Millennial Lithium's Pastos Grandes Project in the Lithium Triangle of Argentina. So they ended up offering US$297 million ( C$377 million ) for what amounts to ( if I've done my figures correctly ) 943,000 indicated + reserves of LCE which in turn would equated to 8 times that in 6% spodumene terms .....so that's roughly equivalent to US$39.37 per equivalent tonne of LI20 with roughly a commitment to a further CAPEX of $US442 million and a forecast OPEX of $3.388 / tonne of equivalent LCE.

So obviously they ( CATL ) don't care because they will be going straight through to the higher valued Carbonate production and now have control . Keep in mind this is a very low IRR at 24.2 % due the fact it is only at Pilot Stage at the present moment so who knows what sort of growth and ' acreage ' control premium they were prepared to pay. That IRR compares to that of the IronRidge Ghana projects of a massive 125%. based on the low strip ratio , short LOM and payback of less than 1 year.

O.K, so where does that leave our equivalent 50% of this new Moblan Lithium Project. Well for starters , it appears to be similar in size to that of Authier at around 1.5 klms strike length by currently 150 metres in width and what looks to be a massive potential in virtually all directions. It is similar to that of Authier in that it comprised mainly from a single thick tabular body with consistent HIGH ' Premium ' Grades of Li20 lithium of 1.4%.

But not only that , the strip ratio's are amazing at only 2.9 waste rock to 1 tonne of Lithium rock. And that is quite unbelievable really and compares quite favorably to BOTH Frontier at 3.6 to 1. In addition to that , the cut-off is also nothing short of ' STELLAR ' when you compare the 98% mining recovery to that of Frontier's 83.9%

So if we take the ' apples to apples ' figure of Measured / Indicated and Inferred as we did with the others , we would see that Moblan's 16.09 MT's ( times 60% = 9.6054 Mt ) would equate to a total acquisition cost per tonne of US$9.01 per tonne of Indicated and Inferred resource.

If you add in the LRC payments of US$9.5 million , you would go even lower to a figure of US$8.02 per tonne of Indicated and Inferred Li20 resource.

It even gets better if you assume that SOQUEM or it's Parent I.Q will ultimately be compensated for its remaining 40% in some other way down the track.

And if that happens you could ultimately end with a scenario where Sayona and Piedmont picked up this Li20 resource in hindsight ( without even further expanding it ) at a US$ per tonne of resource of somewhere between US$4.80 and US$5.80 per tonne.

So the deal isn't expensive at all in my opinion.