report for potential investors, page-34

So what about that capital raise? The taboo topic that traders fear and many new investors are waiting for as their entry point. I think it's worth discussing rather than treating it like Voldemort.

At some stage in 2018 it's highly likely we will raise capital, either from a group of sophisticated investors or from a committed offtake partner.

How much and by when? Given current information to hand I believe we will need ~$4m late this year to reach June 30 2019 and fund our DFS.

This is based on closing 30 June cash of $2.71, estimated quarterly outflow of $1.65, leaving balance at $1.06m as at Sep 30 and seeing the currently underway 6-8 week, 6600m drilling program complete. Previous quarter cash costs of $720k suggests with drilling complete we have funding to January 2019.

Newsflow in this 5 month period as suggested above is enormous. I will let people consider what a CR price might be should we go down that path. Of course if we raise through a steel, or better still a battery producer, all bets are off.

$4m funding for a further 6 months of met's, geo's and paying wave to sure up a DFS. It's a fair guesstimate.

Management know what they're doing, I believe we've established that by now. They chose not to raise this month in the 70's which would have been easily achievable when poor Raffintoy didn't sell his little 85c short term peak. Why? News flow and no pressure. I personally don't believe the market gets a look at this below $1. Could... should be a mile north of this but that appears to be a floor.

4m shares! Nothing! Dilution of 4.8% Say I'm way out, the market goes against us and it's double that and a 10% dilution... Ha! TMTO were up 10% on a slow news day today. It's actually nothing.

The next thing to consider if we went this way is the likely market reaction. A micro cap stock raising successfully from the market is often a very positive news story. Consider our previous (one and only) capital raising announced on March 19. Closing SP the day prior was 39c. Closing price that day, 39c. The $3m raise was anticipated though... and may have been holding down the SP (in a similar way to today) so the announcement triggered a run to a then record intraday high of 49.5c 6 trading days later on March 27. Decent little 27% run.

So... the upshot of all this, a 5% (likely) or 10% (bad case) dilution coming at some stage over the next 6 months.

If the investment comes in the form of a binding offtake agreement (which we are in a great position to negotiate with a strong PFS in a sellers market) then our project is suddenly heavily derisked. 2-4x today's value.

Either way, management have made an active decision not to raise at these levels because of the multitude of price drivers, already funded and expected soon. 5 or 10% really doesn't seem like something to hang out for - the way I see it anyway.

What does the average punter do? Probably still wait haha.

What does the intelligent punter do? Who knows but yesterday I topped up and thanked the market for it's stupidity yet again.

Only my opinion of course... with a bit of Bundy to allow me to speak of the one who's name we should not mention.