Lots of good information which helps address some of JCap's "questions" came out of the AGM.
1/7 What are the reasons the Lilac demonstration plant is performing significantly below the expectations of the Pilot Project Agreement?
It isn't! The Demo Plant results for the LiCl concentrations were actually BETTER than the Pilot Plant. "The Kachi Demonstration Plant continues to produce in-spec LiCl solution between 1900 and 3800 mg/L. Previous testing on Kachi brines at Lilac’s California headquarters Oakland delivered 1400-2354mg/L." That is a 35-60% increase in the concentrations achieved at the Demo Plant. Stu stated in the AGM that there seemed to be some confusion between the concentrations before and after the reverse osmosis (dewatering) part of the process. The results reported in the Kachi Update Announcement on 21st Nov outlined the concentrations before the RO process. The standard RO process was not built at the Demo Plant as this part of the process did not need "proving". If the 1400-2354mg/L concentrations in the Pilot Plant resulted in post RO concentrations of 30-60,000mg/L, what will the 35-60% better 1900-3800mg/L pre-RO concentrations result in post RO?
2/7 What is the recovery rate of the Lilac ion exchange medium in each cycle? Is it less than 10%?
They know this is Lilac IP and that the recovery rate of the medium will not be disclosed. I would ask them where their "10%" came from.....and I'd bet it was an arbitrary, low number purely used to create FUD. This question will not be answered and they know it. Their "con" is in the unsubstantiated implications of their question.
3/7 How many cycles has the ion exchange medium been used for in the demonstration plant on site before being replaced?
Who says it has been replaced? Again, a question involving Lilac IP that they know will not be answered. And again, their "con" is in the unsubstantiated implications of their question.
4/7 Has there been a problem loading the ion exchange medium where the "ceramic beads" are being crushed?
Seriously, where does this stuff come from? More unsubstantiated implications purely coming from the question that they are asking. If they were aware of a problem where beads were being crushed upon loading, JCap would come out and state it rather than asking a loaded question.
5/7 In LKE's and Lilac's new contract amendment mentioned in the November 21 announcement, what are the "amended timeline" and the "testing criteria" for Lilac's technology to perform?
Again, a question they know will not be answered as it has been stated that this information is "Commercial in Confidence". Both LKE and Lilac are happy with the amendment, and this has resolved the dispute and allows them to go full steam ahead - that is what matters here.
6/7 Has LKE received any further correspondence from the UK Export Finance (I think they mean the UK Export Credit Agency) since March 1, 2022? Has the funding been "confirmed" or is it still "at the start of the application process"?
No direct correspondence between LKE and the UK ECA has been disclosed - nor does it need to be. Lake has stated that the UK (and Canadian) ECA offers are EOI's and that there are conditions precedent - such as the Demo Plant performance being "proven", the release of the DFS, etc. to be achieved before they are "confirmed". Both EOI's remain non-binding until the conditions precedent have been satisfied. The status of the finance discussions are certainly NOT "at the start of the application process"! Again, this "question" has been framed in such a way to present completely unsubstantiated implications to those that are not well researched....aka to promote fear, uncertainty and doubt.
7/7 LKE now has offtake agreements for 300% of planned capacity. LKE dropped Hanwa and Ford offtake MOU's from company announcements and presentations in early October. What is the status of the MOU's with Hanwa and Ford?
Stu explained this clearly in the AGM today. Ford and Hanwa were first to the negotiation table and agreed non-binding offtakes....subject to the standard conditions precedent. They were given an "exclusivity period" within which certain details were to be finalised. Unfortunately for them, that exclusivity period closed and it opened up the opportunity for other potential offtakers to present better offers. Stu mentioned that there were 6 potential offtakers that had come to the table and SK One and WMC's offers (both including the purchase of a 10% stake in LKE) were the best offers presented and they now have the current standing MOU's in place for the 50,000Tpa available capacity from the Kachi project. Ford and Hanwa missed out on the first 50,000Tpa out of Kachi....but that doesn't mean they can't take a place in the queue for capacity out of Cauchari, Olaroz or Paso.
Apologies for the long post.....but the detail is worth covering to demonstrate the completely ridiculous and unresearched attempt made by JCap to try to unsettle the AGM proceedings today as well as to attempt to promote FUD to assist their own short position in LKE. Half of their "questions" could be answered with some research and the other half a) they know cannot be answered for IP and Commercial in Confidence reasons, and b) are framed in such a way to imply something is wrong. IMO, it's no wonder JCap base themselves in a jurisdiction that makes it near on impossible to go after from a legal perspective!
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