Ann: Battery Grade LithiumCarbonate Produced from Sepeda Petalite, page-59

Hi,

Don't consider myself a lithium expert by any means but happy to comment.

I actually thought today's announcement was really good and had me taking a second look at DKO. The test work that shows lithium carbonate can be generated from Sepeda petalite with low levels of impurity is certainly a de-risking event in my opinion.

My main problem with DKO is the same one I have always had, the processes for dealing with this deposit are a lot more opaque than an equivalent spodumene resource.

If it was a 4.4% spodumene concentrate then obviously that would be quite poor but petalite is different. The maximum theoretical grade is around 4.5% so producing a 4.4% concentrate is very good and highlights it's purity.

So the questions that need to be asked in my opinion are more about economics than metallurgy. I think this announcement shows the metallurgy is sound. What you need to figure out is what the sale price is going to be for petalite in the market. On a tonne for tonne basis producers will need to buy more petalite concentrate to produce 1 tonne of carbonate. If you have two lots of feedstock, one petalite concentrate and one spodumene concentrate that can both make battery grade material then economics would dictate that the petalite should be cheaper as it contains less lithium. So the question becomes how much cheaper. Is it as simple as saying it sells for 4.4/6.0 (73%) x spod price? I don't know. This depends on things like whether it is quoted on a FOB or CIF basis. How far end users have to transport the extra material, whether there are any further conversion costs etc. It might sell for only 60% or 65% of the amount.

Can this be mitigated by DKO building their own carbonate/hydroxide plant.

In the current pricing climate I don't see that as an issue. However let's say the analysts are right and spod prices at some point go back to $550/tonne that means Petalite concentrate might sell for less than $400/tonne. Then it needs to be considered how the economics stack up. I will be interested to read the FS as it will hopefully address a lot of this stuff.

Apologies to all if some or all of the above is known or has been discussed, I keep an eye on the stock but don't follow closely enough to know all the details. Happy for anyone to elaborate on or challenge any of the above