LKE..................Chart thread only, page-528

Hi beisha

thepilot plant is a pilot for the lilac process only.

its purpose is to provethat the "beads" can selectively recover lithium from the brine rushing by at volumes greater than the successful laboratory scale tests (i.e. scaling up). the lithium rich "eluate' will also indicate the level of remaining impurities which information will be used to finesse the design of the "standard"down stream operating plant to produce carbonate .

the eluate from the pilot plant will be processed off site presumably in a commercial laboratory using standard well established materials and methods removing the remaining impurities and producing 99.9% battery grade lithium carbonate

The Lilac design direct extraction pilot line would not be incorporated in the main production line at a later date. that unit will be many orders of magnitude larger again. it will however be very useful to produce small volumes of eluate for processing into battery grade lithium carbonate samples for evaluation by various battery manufacturers ("offtake partners" - or in plain English "customers")

realistically i personally would not expect to see product from the pilot plant until well into January

but that is not a problem. the results can be reasonably predicted from Anson's experience reported on their website (ASN) which is where my info comes from. (thank you Anson) you will read they havegone through the same procedure and already successfully produced 99.9% battery grade carbonateat their Paradox (Utah) oil well project a month ago.

it must be a dissapointment that has not yet been reflected in the market but they do not yet have anything like Lake's 4.4 million tonnes JORC number (nor potentially a second and possibly third viable projects)

the Paradox brine had a much lower lithiumconcentration (only 180mg/L) compared to Kachi and high Iodine and Boron levels.(all of which is available from their Anson's ASX announcements) bycomparison Kachi brine is "clean". if the Lilac process is successfulwith relatively poor feed-stock it is highly unlikely that it will not be equallysuccessful with Kachi brine.

the results from Lakes' Lilac pilot plant at Kachi will also be used to finesse the final plant design in the DFS

most important now is the PFS to confirm overall feasibility, capital and operating cost including how much of the large cost savings from elimination of evaporation ponds be offset byt he Lilac cost.

Lilacs' total operating cost prediction was USD 2,600 +/- 30%. Forget the minus 30% that wont happen. Work on plus 30% = USD 3,390 (less some) and we will be in great shape compared to our peers and ahead of the spodumene hard rock operators. Brine production costs will also put producers in better competitive shape than spodumene IF there is a period of oversupply.

but the halcyon days of USD17,000 / tonne for carbonate will never return although many financial analyses carry that number forward.

IMO as an increasing number of brine projects come on stream the scales will tip permanently to sub USD 10500/ tonne prices. spodumene / carbonate producers will be first to feel the pinch

Confirmation of all technical and logistical aspects by Hatch, plus hard CAPEX and OPEX numbers and Ansons' results will clear away the confetti and encourage partner and customer interest

and (gassed) that is what is required to attract finance at less usurous rates than is possible with an as yet unproven concept particularly in risk adverse Australia .. which you would know if you have tried to fund any project with a "new idea" .

you take what you can get knowing that it an inevitable cost of doing business with startups. the alternative is to waste time knocking on doors and talking to deaf ears while the real business of developing the project is left undone. that is the best way to go out backwards . best to chew gum and admire the ceiling !!

point of interest the direct extraction technology will increase the "life" of mine by 70% compared to evaporation viz 85% plus recovery compared to (say) 50% from evaporation

every day passed is a day closer to the PFS and the birth of Kachi