IPO - Brazilian Rare Earths Limited - 21 December 2023 #, page-57

As noted - post spending $500m on Mt Weld, they are now mining and processing the lower grade apatite resource and remaining high grade monazite together

Lynas haven’t included the low grade apatite into their reserves…maybe because it will highlight a potential issue, or that (as you noted, their cut off is currently 4%…so will be a red flag on margins)

In addition, for reserves they should be disclosing processing yields. They haven’t done this since 2010. Maybe to cover a major underlying issue - who knows?. Their drilling results on the 22nd January were also not compliant with ASX Chapter 5 listing rules, so maybe they are getting an easy run by the exchange.

Apatite typically has far lower processing yields than monazite

As you know, just like ‘revenue is for vanity, profit for sanity and cashflow is reality’….head grade is very important, but
so are processing yields.

If 50% of the head grade is reporting to tails, or god forbid 90% like Bryan Obo…then the underlying project economics are destroyed

Coal companies get loads of criticism - but at least they typically report reserves and ‘marketable reserves’ which takes in account the processing yields