Banter and general comments, page-38108

Until recently there was one massive lithium UG mine proposal (Liontown) and it didn't provide any particularly useful comparative information for what the financials of medium and relatively speaking small UG mining proposals might look like. With MinRes now progressing on its UG Mt Marion mining proposal, more comparative information to potentially assist understanding BP33 is emerging. The ideal source is Core, but given shareholders haven't yet been provided the BP33 DFS that isn't yet available. Given Core's past DFS accuracy track record, confidence in their figures is yet to be re-established.

From MinRes's March2024 quarterly and other documents we know that MinRes have evaluated UG mining from the North pit at Mt Marion. While MinRes haven't released details around the profitability of UG mining at Mt Marion, they have started construction of the box cut and awarded the UG work. MinRes seek a robust return on capital for the projects they implement and as they have started, the UG proposal must meet MinRes minimum return thresholds. Clearly MinRes wouldn't have started if the economics didn't stack up. The implication is that UG financials can be sufficiently robust for UG deposits to be profitable at current prices - if the mine can draw on existing processing infrastructure. Both Mt Marion (UG) and BP33 allow the reuse of existing concentration plants.

Typically mining proposals use measured and indicated resource in their studies. MinRes now has 12.9Mt @ 1.27% within the indicated category. While larger than BP33's 9.4Mt @ 1.52% across Measured and Indicated there isn't much difference. The MinRes development is a similar scale comparator but may have greater expansion potential.



Because MinRes is mining the top of its north deposit through open pit, their UG working start at a deeper depth than Core's so there's a larger decline development capital cost than for BP33. In April MinRes update noted a 350m depth target in 18 months but its unclear if all of that is achieved with the $46m Develop contract. Core hasn't stated a target depth (surprise surprise), Core's box cut has however completed most of the depth reduction needed to get to the top of BP33 ore. From past drill results the BP33 ore body starts just over 50m below surface.

The BP33 early works package included some of the surface works to support underground mining. For MinRes, these are included in the underground element of the Develop contract and total A$46m. The shorter decline length Core needs for BP33 indicates Core may have a shorter post box cut FID to ore production timeframe and a lower capital cost than Mt Marion. If the projects were like-for-like (they probably aren't) this indicates the Core non-early works package of works could be sub A$50m. If Core's early works package included expensive items within Develop's $46m cost and the decline development is an expensive element in the $46m cost, Core's residual package of UG works could come in well under A$50m.



If BP33 ore is <1yr from FID and Grants has 1.5Mt of ore remaining to be mined out of it, the timelines would appear to mean some slack exists in the restart scenario. The BP33 FID can occur after Grants restart (but not much after) and still have the DMS supplied from Grants open pit until BP33 starts.