Why this could be your last chance to buy HIO under 5 cents, page-74

@treefeller

I noticed that you avoided responding to my comments about you acknowledging that there is good risk reward at current price levels.

I never said that HIO is without risk, but I think there is a good risk reward and you did not disagree (and your actions in buying effectively confirm that you agree).

You asked about drilling results. Below is a brief summary and why I think the results will be positive:

• ASX announcement 18 October 2023 - drilling is targeting grades better than 9% DTR
• ASX Announcement 18 December 2023 - advised drilling program to focus on the Fold Zone, an area in which there had been some previous drilling. The previous average grade of drill holes ranged from 10.2% to 16.9%.

Therefore, if target is greater than 9% and previous drilling in the area was 10-16%, there are good prospects of average grades being better than 9%.

It is reasonable to assume that their target of 9% is what they want to achieve a positive BFS plan and outcome, anything more than that will provide additional cashflows in the early years (same mining and processing cost, but more ore) and therefore have a significant impact on NPV.

Whilst in ground grades are low compared to many other iron projects, the nature of the ore is such that it grinds easily to produce something close to 70%, which will attract a significant premium which offsets additional mining and processing costs. More importantly, it is known that this can be used in electric arc furnaces to produce green steel (making it attractive to potential partners). I understand there is uncertainty if WA Hematite ores will be able to be suitable to EAF or similar to produce green steel (I suspect if they through enough money at that issue they will work it out, but it will result in additional processing costs for their ores too).