Reading for Investors, page-24

Umm so let me get this straight, it'll cost TON much much to build a plant capable of processing 1.2Mtpa? Why? I can understand the profit margins being different since SYR will process higher grades - hence more pgraphite.

In the example you gave we're talking 30 years of 15%, SYRs highest grade area is 20%. Correct me if im wrong but that isnt double.

Taken from SYRs report:

Only 1.2 Mtpa of mining required to produce 220,000 tpa of graphite concentrates

So would TON in your example expect say 180,000 tpa? Cetainly will cost more per tonne yes, but not a complete blow out.

To process that 1.2Mtpa, again from SYR's reports they estimate

Low capital cost of US$91.6 million, Mine gate cost of US$102/t, FOB costs of US$198/t at the port of Pemba. The projected operating costs are bottom of the cost curve for graphite production

So $22,440,000 total mine gate costs, if TON's processed 1.2MTpa would at 15% would that be $22.5/ 180,000 = $124/t. You expect TON's graphite to be more expensive to transport, why?

In webcasts the flake distribution has been discussed. Of course it means little until we see the metallurgy reports as you say.

Now on the Vanadium, i was under the impression SYR said in their scoping study, ill quote:

The Balama Graphite and Vanadium Project has an exceptional Inferred Resource containing 1.15Bt at 10.2% total graphitic carbon (TGC) and 0.23% V2O5 (refer ASX announcement on 27 May 2013). This makes the Balama contained vanadium resource almost four times larger than Rhovan in South Africa

Exactly the same average TON just reported. Yes i understand SYR has higher grade zones, but which did they use for the scoping study? They highlighted higher grade zones but appears it was based off the 0.23% V2O5, otherwise the reported 1.15bt is a useless figure.

Again key for TON is the metallurgical reports, which as announced are well advanced. SYR's scoping study used fairly conservative Vanadium concentrates of 2.5% V2O5 despite producing greater than 3% concentrate. As yes once again, SYR will likely make more per tonne given average higher grades.

Key is the metallurgical reports as you say. But so far so good. Given the proximity and similarities to date, im not expecting them to be too different. Sure atm (based on your example) TON wont be as profitable as the most profitable graphite/ vanadium miner in the world, but could stack up very favorably and be very profitable all the same