The Whittle assumptions on page 87 are quite conservative. For example, the assumed 80% recovery is well below that already established by SGS in preliminary metallurgical testing. $3/tonne for waste movement is conservative. $4.50 for ore movement is conservative. By all accounts, so is the processing cost, at $40/tonne.

That is the cost to process a tonne of ore, by crushing, flotation, and caustic roast.

To determine the embedded cost of processing in a tonne of product, you first need to calculate how many tonnes of ore are required to produce a tonne of product, then multiply times the cost per tonne of ore.

In words, its 1(tonne of product) divided by ((average grade(%) times recovery(%) divided by 100%) equals tonnes of ore requred to produce one tonne of product.

100%/((3.89 X 0.8 )%) = 32.13 tonnes ore required per tonne of product.

Processing cost equals 32.13 tonnes times $40/tonne = $1285

That is assumed to be the cost to process ore yielding one tonne of 99.99% graphite worth $8500/tonne.

Mining costs are separate.

But these numbers are conservative estimates. Because they are much more conservative than I expected, the project is even more robustly economic than I had assumed, based solely on the resource numbers. There's no way 80% recovery will apply. More like 98% or better. I estimated $600/tonne for processing, based on comparables, so this calculated number is also very conservative.

The project is better than I thought, because I didn't yet know how conservative RPAs ballpark numbers were. I am absolutely certain that the PEA will have much lower costs than these. And maybe even higher revenue.

Lar