The DSO concept is based on taking high grade material (around...

The DSO concept is based on taking high grade material (around 60+%) and using a light crush to increase the grade to anywhere from 62-68% for direct shipping. The crushing process is a relatively simple, energy efficient way to increase the material to an end product with desirable specs.

DRI, on the other hand is based on taking ore from the large 200+ million tonne resource, which sits at a grade of circa 20% Fe. This material has the unique characteristics that a light crush will increase the head grade to circa 45+% Fe material, irrespective of whether it started at 16% or 26% Fe material.

In other words, it upgrades to the same grade irrespective of its initial grade which is a unique characteristic of the ore.

This upgraded ore for DRI needs to be beneficiated from 45+% material after the first crush, to a saleable 68% product via a wet magnetic plant.

It is this plant that has the major Capex component of the DRI scoping study. Apart from the Capex, the DRI process requires significant energy input (and cost) which have an impact on the Opex, as detailed in the scoping study.

So in summary, they are different propositions due to the higher grade material to be treated as DSO not requiring the Opex and Capex of a DRI operation. Hence the lower start up capital mooted previously.

I hope this makes sense.