Vanadis IPO, page-389

Okay growler, I'll play this time - This is how I see things possibly playing out. Tiris will be our short term play with the DFS completed this year and the report announced in the first qtr? I see the Haggan, Vanadium, SS being completed around the same time? (based on what the Coy has told us) These news item's may give us the uplift we need going into funding Tiris ... which in turn could help fund the Haggan development. I have been talking with a couple of respected investment friends about the benefits of holding Haggan vs IPO'ing it and I am now swinging back to the view an IPO may capitalise on the current market move a lot better? This could benefit Aura in the short term by providing equity toward financing Tiris. I don't mean to sell down the stake in the IPO but because our 70-80% holding will have a measurable value. In any funding deal, I suspect we will need a 20:80 split between equity and debt? As we look at AVL, they plan to produce around 22.5m lbs V2O5/a. The capex is $360m +/- 35%. The opex is $4.13 +/-35%. They give two price assumptions and base the NPV on these assumptions (so a couple of scenarios). NPV of US$1.1B based on US$13/lb and the market price at the time...NPV of US$2.4B based on US$20/lb. They then present a low ball price of US$8 which gives a NPV of US$191M.​

Our higher grade zone of 90m tonnes contains 840M lbs. Within that is "a coherent and large zone of mineralisation of 49 million tonnes at +0.4% vanadium pentoxide" or possibly 457M lbs? (worked out on a percentage basis) AVL will produce 22.5M lbs for 17 yrs. Based on our 457M lbs, we could produce 22.5M lbs for over 20 yrs...and that is just based on a portion of one higher grade zone. Now we don't have the details of the Scoping Study because the ASX JORC Code requires a measured and indicated portion be reported before a valuation can be placed on the inground resource. Now if the Haggan numbers can come in similar to AVL's numbers, we could say Aura's coherent and large zone of mineralisation of 49 million tonnes may compare favourably to AVL's project? Then we have 14.75B lbs more Vanadium in our global resource at Haggan. We can use a Vanadis IPO to help fund Tiris which in turn will give us the cash to quite frankly, what ever we feel like. I guess the most important thing is, we have a number of options. Are there risks? Absolutely, but with two great projects in two bull markets, we have the opportunity to use one, to help the other. Could we finance haggan if the Capex was like AVL's (in our current state)….No, but Tiris is far more manageable. Will we have a lot of dilution...Pete has said in the past that he is apposed to dilution unless there are no better options. Peter ran corporate finance for years and knows the ropes. Of course, if the SP ran to 20c on a number of very good announcements, we could fund Tiris from equity and still have under 1.5B shares. Imagine that? AVL will already have 2B shares in Dec and will need a mechanism to raise the equity to gain funding. I think they may struggle compared to Aura. AVL has received far more positive attention than Aura...and we've had a lot of selling to contend with. It will be interesting to see how many of those converted AVL options hit the market? PEN, VMY, BKY and KRC are other peers that haven't faired very well. I believe that having Tiris and Haggan will give us an advantage which will become evident when the main milestones are reached. At $18m market cap, Aura is an absolute steal. ​

Let's see how the Scoping Study comes out and perhaps, we can argue about and compare both Vanadium projects then. Agreed?​