Key Highlights the Market Is Missing About Nevada Lithium

0:08 Hello, everyone, and welcome to the Nevada Lithium live event hosted by 6. I'm pleased to introduce our speaker for today, Stephen Renschler, the CEO. He'll talk about what he believes is still unknown to the market about Nevada Lithium and Bonnie Clare. And after that, we'll be accepting questions. As a reminder, you can submit your questions in the chat at any time.

0:28 As always, the summit is being recorded and will be available to watch shortly afterwards. Without further ado, handing things over to you, Steve, so that we can get started. All right, beautiful. Thanks, Max. Thanks to everybody for taking some time out here to listen to the event. This is going to be probably some, I guess, old news or news that's understood by a lot of you who are watching. But take this in the context of the recent marketing trips that I made over the course of the past, call it 3 and a half, 4 months. So out in Vancouver, then Toronto, and out in Zurich. And it's essentially something that I've come to realize is that I've been hearing a lot of the same sorts of questions, the same sorts of statements, et cetera, that's telling me that we still haven't done a good enough job on the basics of what we have at Bonnie and Claire.

1:18 And I wanted to reach out today and probably talk about 4 major points that I consider to be important. I wanna make sure that people are understanding and also for this event to sort of act as a repository for newer investors to come and be able to quickly get to sort of what are the drivers of the value proposition that we're seeing anyway from, you know, where we are at Nevada lithium. So I think the first thing that I want to start with is, the question I often get is, okay, Steve, you know, this all sounds great, saying you have a massive deposit, you know, you can make battery grade lithium, all this kind of stuff, but there are no sedimentary deposits that are in production. You know, why is that? So I just want to sort of frame this in the context of developing commodities. So people understand it's not as if there's a curse on the clay or the sedimentary deposits or if they're technologically unable to be developed or anything like that.

2:13 It's just simply a question that they weren't needed in the past. When you think about the lithium cycles over the course of, oh, let's call it the past 15 years or so, EVs really were not envisioned in any of those cycles and the massive demand that they're expected to bring on as we go and say the next 5 years or so, nor is any of the demand that's starting to be really talked about now for essentially stationary power requirements for these huge data centers are driving AI and all this sort of stuff. None of this was existent back, say, 10, 15 years ago. At that time, you had salars down in South America. And essentially, you would say, well, you pump up these lithium-rich brines and you evaporate them.

2:59 Water really wasn't a concern that it certainly is now throughout all mining. And you condense your lithium, you take it to be processed, et cetera. You know, before for small personal battery driven items and medications and things like that, it's fine. And then a few years ago, as the EVs sort of started to rear their heads you started to see the hard rocks come along. So this is your lapidolite, your spodumene, all the things that you see in Washington, you see in Quebec, you're starting to see a little bit in the US as well. But that's sort of the secondary phase coming on. And so they started to be developed. And obviously, we've seen some, some material come on. But of course, one of the big issues with with that is that you're making a concentrate of that material that needs to be shipped off somewhere to a refinery.

3:48 And that's fine. For now, it's a necessary thing that's going on to essentially get supply and demand to balance. But until I'd say last year or whatever, I think with the demand numbers that are starting to basically be shown year over year basis for lithium carbon equivalent, it's becoming more and more clear that these sedimentary deposits, the ones that I will just say are predominantly hosted in Nevada in the U.S. Where we are, they are now going to be needed. We're now getting very, very close to when essentially that production should start to come out. When I say very close, within a couple of years, because we've seen what's happened at the Tacker Pass with their long commitment for the government. You've seen Iron Year start to make some progress with its issued draft EIS from the BLM, the U.S. Government in Nevada.

4:42 All of this indicates that these sedimentary deposits are going to come to fruition. And again, I would have just said that pure supply and demand, if you believe in the demand numbers, you would have had to have said that these sedimentary deposits are going to come into production. So that's one of the main reasons that you've never heard of Bonnie Clare. Now, one of the other main reasons is because we had a split ownership. And split ownership, for lack of a better word, just makes everything very, very difficult. When you want to negotiate with investors of any type, it's sort of like, well, who's in control? If you want to sell offtake, well, who has really the rights? All these sorts of things just become an order of magnitude more difficult. And we took care of that essentially in the middle of last summer, June, July, where we put the 2 halves of the project together under essentially the leadership of Novato lithium.

5:31 That is one of the big things when I talk to investors who sort of hadn't heard about Bonnie Clare or had lost track of Bonnie Clare, they think back in their minds and they say, oh yeah you know you own 50% of that project. And of course now we're trying to essentially get everybody to understand that that's all been taken care of and we're going forward in one direction, which I think is very, very auspicious, and we're doing it as an accelerated pace as we possibly can. Now, These evaporitic or sedimentary deposits or claystones, whatever you want to talk about, or call them I should say, they really are very much in Nevada. And this is where I'll just talk about jurisdiction for a minute. Jurisdiction is arguably one of the most important elements, I would argue, in the risk reward trade-off that you make as an investor.

6:19 And Nevada has got a tremendous history of essentially mining gold, silver, copper, etc. And the local government in particular, I want to say local, let's call it state, we'll start at the state, The governor, very, very adamant that they want to extract value from lithium going forward. And I think the reason is because it is a mining-friendly state. And because there is a historic understanding of mining, the government understands the value that is there with this transition to EVs, etc. And understands the natural endowment of Nevada and is there to make sure that as much wealth is extracted for its citizens, so these are Nevada citizens, as can be had. Now, if you're an international investor and not from the U.S., the nuances of things like in a state-to-state basis can be pretty pronounced and very much it's not as if it's the only place in the world where this occurs. Obviously in Mexico you have different areas that are more friendly to mining, Peru, etc. Well, of course, in the States it's the same thing.

7:22 You know, you have a number of these Western states, California, Oregon, etc., who might have natural endowments, but they are definitely not friendly to mining. As a general rule, It's just much more difficult. It's sort of as if on the East Coast, if you were to try to develop an asset, it's much harder to do. And that's just because of politics that have developed over time, population density, all these sorts of things. Nevada and Arizona are owned overwhelmingly and as a percentage basis by the U.S. Government. So people see that as a double-edged sword type of a thing. The BLM, the Bureau of Land Management, essentially is one who administers all of the, let's just say the environmental prospects going forward. And that's because of the federal ownership. So our project will have to go the NEPA process, the National Environmental Policy Act, as I would argue almost all of the other projects will have to go through, Nevada and Arizona, et cetera, just because of originally federal ownership of the land.

8:21 This is something that's understood. It's going to have, it's times where, you know, you're going to have ebbs and flows in terms of public reaction to these sorts of things. Okay, is there an endangered species? Of course, in the sense of Nevada lithium, we don't have any endangered species. Are there indigenous cultures or societies who are nearby? In our case, not really. So, you know, these work to your benefit, but even if you don't have something that you might say, well, this is going to be problematic, the idea is that people are going to have their say on it, and that's fine, but it's well understood. And although we expect that things won't necessarily go according to a timetable that we put out there as, you know, the best that could possibly be, they will be worked through over time. And I want people to understand that about Nevada. Just because you're on federal ground doesn't mean that there's an issue. It just means that, frankly, the law of probabilities has showed its head, and that, you know, 85% of the time you're going to be on federal ground in Nevada.

9:23 If I transition for a second to something at a smaller level like just specific to Bonnie Clare I want to talk about the fact that one of the things that we know at a very, very early stage in the development of Bonnie Clare is the metallurgy. And metallurgy, if you haven't been around natural resources or metals, stocks, whatever, this is the aspect where once you get the material out of the ground, how do you get it into a form where you can use it? I always like to go back to copper and talk about analogs because I think it's a pretty good one. But with copper, You know, you can get to 99.9% copper or 99.95% copper, and you're going to pretty much be good to go. You can put that into wire, you can put that into tubing, a lot of other things, etc.

10:13 Many people talk about lithium mineralization and ultimately the products that you get to. So now we're talking about lithium carbonate and hydroxide in general terms as the 2 main ones. It is much more of a chemical process or a chemical outcome, rather than say, let's just say a smelting outcome. And that's because the precision that's needed, okay, the high levels of purity, we already know we need 99.99% purity of the lithium. The issue is that there are often other elements that sneak in, and now we're talking about parts per million. So I think we're talking about 0.00001, I think if I'm correct, types of levels where you can have, for example, boron, calcium, magnesium, I'm making up what they actually are, but hopefully you get the idea. It's just these other elements that have to be eliminated. And that is very, very specific to the geology of an individual project. So, not every project is going to have exactly the same flow sheet, which is also known as the recovery sheet, as another project.

11:22 One of the things that we did over a year ago at Nevada Lithium was put considerable money and effort, honestly, into getting material over to the metallurgist to prove from a very early point that we could produce what would be considered a battery-grade lithium carbonate. So it hit the spec sheets of, I think it was 2 or 3 different major producers that we could find. Now, the only thing that we haven't done is being been able to produce enough of that material to start sending it off to essentially battery labs so that they could prove that it will work in their particular chemistries. That's the kind of thing that we will be doing going forward. Essentially, we need a pilot plant to develop, essentially, enough material to make it worthwhile to send off. And that's the kind of thing that, frankly, all cost millions of dollars, and it would be something that we would do after preliminary feasibility study.

12:15 But conceptually, and at a larger than a benchtop scale, we have produced battery grade lithium carbonate, and not a lot of companies can say that, particularly not a lot of companies that only have a 30 or $40 million Canadian market cap. So that's one thing that I think really is not understood. It's a nuance, that's for sure, but it's a very, very important nuance that I want to make sure that investors understand. We already know that we can do lithium carbonate at the battery-grade level, and we continue to work on lithium hydroxide at the battery grade level. I've told people before we're very, very close to it. I don't know when it's going to occur. We have some other things that I think of a little bit of a higher priority right now, and I'll talk about it in a second.

13:02 But the point is that we really have not found the impediments to 1 out of the 2 major products, lithium carbonate, and I think we're very close to the second. And I know that that's a big differentiator than a lot of the other projects that are out there, certainly at our stage, or frankly, even more advanced. One of the big things that people I still don't think quite understand, and part of it is because not everybody can get out to to Bonnie Clare and put their feet on the on the ground. It's the size of what we have. And if you look at our investor presentation materials, you'll see that I often try to equate it to something that people can conceptualize. And that's the size of Manhattan Island. Again, if you went all the way down to Battery Park, down at the very southern tip of Manhattan Island and all the way north.

13:50 That's the kind of length that you have. Then east-west works essentially in a similar way. There's a massive footprint here. That massive footprint gives us a lot of optionality to see what is there at Bonnie Clare. Now we did a PEA, essentially let's call it at the end of 2021, early 2022, that had drilling in it that went down to various depths, some of them to 2,000 feet, but a lot of it at shallower depth. And the way that the mineralization works at Bonny Clare, again, is one of these sedimentary hosted types of resources. Again, this is not a brine, It's not a hard rock. This is a very, very expansive, sandy type of material.

14:36 They sometimes, again, call it clay. But it's miles long by miles wide, and it's very deep. Well, the first shot at the PEA that we did gave us a resource that was a tremendous size. Now the exchange commissions are starting to get very very. Tight about you know making claims about who's the largest in this and that you can simply Google Bonnie Claire and you'll see third parties talking about just how large it is. For my purposes here suffice it to say we are very large one of the largest. What happened at the end of 2022, coming into the end of last year, was we had done some additional drilling. As we got some money that we could put towards it, And then we put the 2 halves of the company together. We did some additional, additional drilling.

15:22 And we started to find that the material that we were encountering was becoming a higher grade in lithium in areas as we started to progress essentially to the east. And the deeper we went, these intercepts, right? So the height from the top of the, where we started to encounter a very, very high grade lithium down to where it ended was starting to get tremendously wide. So we're talking hundreds of meters, even more hundreds of feet type of a thing. What we essentially received within 2 weeks ago was a final report from experts in our drilling technology that is proposed for the PEA. This is called hydraulic borehole mining. And what that came through in the consultants report was a big question being answered was, hey, can we access this material at depth?

16:14 And when I say at depth, not only in sort of the sweet spot of our mineralization at say 1,500 feet to 2,500 feet, but even further if we needed to down to say 3,000 feet. And the answer that came back from the experts was yes, there really is no reason from a technological perspective that you can't access that. Frankly, it's a horsepower sort of a trade-off. You need to essentially put more power in it to get the material back up. But the reality is if the grade of the material that you're bringing up is higher, then the cost essentially take a second place to the value of the material that you're trying to access. So we knew from a technological perspective we could access that and the reason why that's important is because we're going to update our PEA.

17:01 So the PEA that we currently have again is 2 years old. It could not have known about these holes that we have drilled subsequently, in which we've encountered materials that instead of an average of say, you know, a thousand PPM or 1200 PPMs, And again, our overall resource as it stands now is massive and the average grade is around 1,000 ppm, right, parts per million. But the tonnage is just tremendous. Well now, those intercepts that we know we can access are 3,000, 4,000, 5,000, in some cases 6,000 parts per million. If you've been around mining at all, you know that if you start throwing material through any sort of a plant and your grades are magnitudes of an order higher, then you know that the profitability should be substantially higher because the only thing that you're changing is essentially the value of the ore that you're throwing through. And just, let's just say in rough terms, You take the taxes out and all of that will then fall to the bottom line. You're net present value, all these sorts of things.

18:07 So our PEA we think is going to incorporate some of this material and there are 2 ways that you can essentially make PEA better And I'm not a mining engineer, I'm not going to tell you what the outcome is, because I don't know what it is. But I do know that we've got a number of things going in our favor. And 1 is the grade, and we see all that. And we know that we can access it according to the engineers. And The other thing is that these holes that we've been drilling have been step outs in the order of sometimes kilometers, sometimes 500 meters, and the high-grade mineralization that we have is open in 3 directions still. And we're really nowhere close to the boundary claims on Bonny Clare. This goes back to the footprint overall and what I would like people to make sure they understand is that this is a massive footprint and it lends itself to doing different things.

18:57 So I would say over the course of the next 2 months, somewhere probably in 2 months, we will have an updated PEA that I think is going to incorporate not only that drilling, the new drilling that we had with the grades and the footprint being taken into account, but also the fact that we have the metallurgical flow sheet that was developed that gave us the battery grade lithium carbonate. And I think it's also going to reflect a higher lithium price because even though for those of us who watch lithium prices every day, we've seen this crazy skyrocketing, say from 13,400 hour lithium, which is where our PEA was done, up to 80,000 and then right back down to essentially 13,000. Now, I think it's at 15,000. Well, one of the levers that we have in our value proposition is the sensitivity to lithium prices.

19:50 And I think that in particular for retail investors, this is another nuance that sometimes gets left in the dust. I think it's more the realm, frankly, of the professional portfolio managers, but I think it will serve everybody well to sort of remember. I would say right now, Bonnie Clare looks like she's gonna be a middle of the road type of a cost. Even though theoretically, I don't know how you determine a cost curve in an industry that really doesn't exist. But somewhere in where it's $6,000, $7,000, I think, all in costs for a ton of lithium carbon equivalent.

20:26 When you have something that is not at the bottom end of the cost curve, So arguably those are your most profitable operations. If you start essentially putting in higher and higher prices for the commodity, so in this case, say lithium prices going from 15,000 to 20 to 30, et cetera, the responsiveness, or we call it the optionality, of the net present value, or the overall value of the project, is much greater for a project that's sort of in the center of the cost curve than it is for something that's a low-cost producer. And that's essentially because a low-cost producer is going to be profitable at any low, essentially low price. I mean, they're the ones who are going to continue from day 1, no matter what the price is.

21:11 But I would argue that as an investor, particularly when you're looking at our value proposition, where you have an unheard of company with a $30 million market cap sitting on one of the largest resources in the greatest mining jurisdiction in the world. Oh, then we're looking at high grade. Well, I would say that having something that's very leveraged to lithium prices is something that gives you an extra bang for the buck. So going forward, I think what I'd like to tie that into is finally how is that going to manifest itself in the overall lithium landscape going forward. And normally when I talk to investors, I start at the big picture and I work my way down. So I'd start with the lithium industry and then work my way down to Bonny Clare because I think that's typically the way people understand almost any story.

22:02 But here, since I've started with the nuances of Bonnie Clare, I'd like to just sort of tie it in right now before we take questions as to what I think the overall supply demand dynamic looks going forward. Because right now everybody is following lithium spot prices. Clearly the sentiment over the course of the past 9 to 12 months has been nothing but that. And when an industry is just starting out, right, so essentially everybody's feeling their way around what is supply need to be, what is demand going to be, and you have fits and starts, particularly something like the electric vehicle industry, which is just getting going and is being essentially tossed about by different things legislatively, by things that are going on with regards to the financials, all these sorts of things are going on.

22:51 You have producers who are pulling back on production to try to make supply and demand balance. You have traders who are being caught at times with inventories and the prices start to fall and then they can make matters worse by starting to bail out. Well, you can follow all of that and you can try to get ahead of it, I guess, if you're a professional investor, though I will tell you that the odds of doing that are very, very low if you're trying to do it successfully. Or you can, again, sit back and I think simplify, essentially, your investment proposition. And I think fundamentally it comes down to 2 things, which is your belief in lithium demand going forward, which I think still is mainly about electric vehicles, even though I do understand that the data centers and again the stationary lithium demand is going to be there. I think it's going to come a little later after the real maximum onslaught of the electric vehicle penetration.

23:49 But it's if you believe in that, and you believe in the fact that if you try to develop any natural resource anywhere in the world, it's only getting harder. So you're not going to instantly be able to snap your fingers and bring a mine on somewhere in 2 years. Now you can bring on arguably an advanced brownfield development. So that's something that's, let's just say an existing producer has, and this is just an example of it. You might have a little bit of extra material that's right over the fence line and you know that if you go out and you start digging it up you can shovel it through your existing plant if you add a little bit more capacity. I mean that's really what a brownfield is all about. Doesn't mean to say it's easy but it's considerably easier than trying to develop greenfields which are all of these new projects that you see being talked about.

24:35 Before any of the new demand could essentially be changed in any way, let's just talk about, well, what if the state of batteries, solid-state batteries or some new combination of lithium and the anode and cathode comes on and you don't need as much lithium, that could destroy the demand profile, et cetera. Well, what I would say is, everything that I've seen, it's every bit as complicated to essentially change those battery chemistries as it is to basically bring on new mines. In my mind, by the time something ostensibly could come on that could radically change the outlook for lithium, we're already going to be in production, quite honestly.

25:20 Because these kinds of things take years and years and years to develop. And what I would argue, and here is where I think it's different than copper, is if lithium prices get high enough, there's still not the substitutability that there is, say, with copper, where if copper prices continue to get too high, right, one of the biggest substitutes that you could do is go to aluminum, and that should bring copper prices down until the whole thing rebalances. But with the cars, it's sort of the same old thing, which is that, well, hold on, you're telling me lithium is this expensive, I'm gonna have to put in a new battery. Well, you've got to find a new battery, you've got to test it, you've got to find ways to install all those sorts of things. In the meantime, there is no substitutability of lithium in these car batteries. What is the opportunity cost of not being able to put a car in the showroom?

26:08 And what I argue with people is I think it's essentially infinite because a Ford or GM, whomever you want to pick, can't put a car in there. They're going to cease to be car companies. So remember, with supply demand imbalances, you don't need to have massive imbalances, right? So you don't need to have massive supply deficits to have a positive effect on price. And that of course ties into a buoyancy in lithium prices that will then tie into the optionality in Bonnie Clare's net present value and make the value of this project go even higher. All you need is one more pound of demand and supply and you get that natural buoyancy. And from everything that I'm reading right now, this sort of deficit, this destocking that's occurred over the course of the past 6, 9 months is coming to an end. And it looks like we're probably going to go into a period now of deficit, et cetera. And that's great, because I think that's clearly going to help near-term sentiment. But to me, the eye on the prize is still looking out 4 or 5 years where you're asking essentially global supply, lithium supply, to rise to 2, 2 and a half, 3 million tons a year from I think 500,000 tons last year. That type of compounded annual growth rate is just, it's unsustainable.

27:22 And when car, I just saw the latest, you know, essentially installed base of lithium, I think it went up by 40% in terms of demand, I think 40 or 48% year over year. It's, you know, that's exactly the kind of mismatch that we've been expecting to see. And all of this noise will work its way out, work itself out going forward. So those are some of the biggest things that I think we haven't made clear or people are, because they're accustomed to seeing, you know, hard rock or things like that. Those are really some of the biggest things that I think we haven't made clear or people are because they're accustomed to to seeing you know hard rock or things like that. Those are really some of the the biggest things that I wanted to sort of reiterate. I'm hoping that this event will go and hopefully at this library sort of repository of of information for people who really aren't familiar with Bonnie Clare. And before we go into questions, let me just sort of reiterate our value proposition, which is as it stands now, we are

28:12 in the best mining jurisdiction in the world. And you can look up whomever you want, in terms of the surveys or just the mining history, going back in time with Nevada. And Nevada wants to develop all of these projects. They understand what's going on with lithium. We have one of the largest resources as it stands right now with a PEA that says this is a very, very economically robust project at very low lithium prices. And I would argue that we're starting to see lithium prices stabilize and start to, I believe they're going to start to reflect the long term fundamentals of supply and demand going forward here. And I'm not saying it's going to be a straight line up, but I think you're going to see things moving from the lower left to the upper right. We have advanced metallurgy that has proven that we can produce the very, very high-grade lithium that is needed for batteries.

29:05 And we have some very important news that I think in the near term will be coming out that is going to show us if Bonnie Claire is something that potentially could get even better. So a lot to stay tuned to. I know I often go from point A to point C by going through other various points in the way, but hopefully I've constructed that in a way that illustrates the value proposition here. And as always, you can always reach out with questions to the company directly. And we will try to get back to you as quickly as we can. But in the meantime, Max, do we have any questions? Yeah, just before that, I like your point about the solid state, because I remember, you know, probably 10, It's been probably 10 plus years, certain companies are trying to develop that. And I haven't seen any significant progress on that.

29:54 And people are still saying that, oh, it's around the corner, it's around the corner. But It was around the corner then. I don't know what major changes have happened, but. Hey, look, this is tough stuff. I don't say it lightly, sort of like, oh, people can't. It's just this is complicated stuff. Then the other thing you got to remember is the commercialization to go to develop any new product I mean you think about it testing for liability Yeah, I mean let alone just testing the the physical attributes of things making sure they can hold up etc It's like anything else you start now you have years of money. You need to invest time It's cetera The hoops that you have to go through. So my only point is, you know, electric vehicles to me, that's clearly the biggest, you know, the biggest component of demand right now.

30:44 If instead of, you know, 30% penetration annually, you get 26%, Is that a big deal? I would argue probably not, because there's such a fundamental mismatch in supply and demand. And the other thing that I would just say, and what I would ask investors, particularly retail investors, to remember, is that banks in particular, they will come out with lithium production numbers and price, you know, price projections, etc. And these things will change over time. Well, remember what it is. When you're a professional investor, if you can beat out the competition by a tenth of a percent over something, that gives you the bragging rights. It gives you the ability to say, hey, look at my track record, and go out and raise additional money. Then you get paid essentially on those assets under management that you have, et cetera.

31:32 That's sort of a different, I would say, value proposition than a retail investor, or frankly, even family offices, et cetera. People, if you believe, if you believe in the electrification, the greening, all of this sort of stuff,

31:50 and you're content to essentially take a buy and hold position, or actually I would say a buy and add position, it's the kind you say, look, are those major influences still in place? If they are, and if the company is Executing on its game plan and I understand the game plan I should see that value accrete You know to me as an investor and I'm not so worried if somebody's beat me by a half a percent this year or I'm beating them by 2% last year or what the deal is. Because we're playing a slightly longer game here. And the reason I bring that up again is our market capitalization, right, shares times price is about 30, 40 million Canadian, whatever, somewhere in there. The value of this project is, again, is reflected by that PEA, which again, is just the first swipe of the economics. It will change, but I would say it's a big mismatch at $1.5 billion US, so multiply by 30, 35% Canadian to get your equivalent.

32:46 This is why we invest in this area of the market. Right. Again, you've heard me say it's not for S&P 500 index returns.

32:53 This is why you invest in this part of the market. Sorry to interrupt, Max. Oh, no, that's a great point. And with that, let's actually get into questions here. So is there any boron and strontium enrichment in your sedimentary lithium-rich clays? The boron is there. One of the interesting things that's happened is that we changed from 2 acid to 4 acid digestion for when we do the assays. Now, again, I'm talking out of school a little bit here because I'm clearly not a metallurgist or geologist. And I will tell you, there's some weird stuff that goes on with sedimentary samples because there's not a whole lot of them that have been done. It's sort of like the kind of thing where, well, what should the industry standard be? Should it be 2-acid, 4-acid? What are the, you know, who represents what the standard is for sedimentary deposits?

33:41 And I know this is getting a little, it's getting very nuanced, but the point is if you use 4-acid, then the boron evidently gets dissolved. However, we have had boron in the past, and we're looking at doing some additional to acid because we think that those Boron percentages are getting very very high And you know again, why could that be important? You just look at rhyolite Ridge a lot of their costs and it's a very very large percentage are covered by Creating boric acid so it's not something that's lost

34:11 on a strontium. I don't know but boron is there. Yes Another person asks here. Would you have NDAs at this early stage or just general curiosity from prospective clients? We have NDAs and we've had them for quite a while in some cases. And what I tell people, and I've made this very clear, is, you know, I'm trying to get offtake at a very early stage. Normally, it doesn't occur until pre-feasibility study. And, you know, the reason I attribute that is because essentially the end users, so the car companies, the battery companies, this is all new to them. And so they bring in consultants, and these consultants typically have their, you know, a mining background, let's just say, the blood of the, you know, the Rios, the BHPs, all of the big boys, that kind of stuff, is that makes its way into the car companies. And they've always been, oh, but you don't do anything until PFS.

35:06 And I sort of attack the question from a different way because I typically start out with the business development people under NDA. And it goes back to the argument I just made previously, which is, look at this fundamental supply-demand mismatch and what does the opportunity cost, essentially, of you just simply not having this material. So even though you would all love there to be a little bit more security, is the wrong word, but probably security and having a PFS versus a PEA, the opportunity cost of just being the second or third in line or whatever, is too great for you to take that chance. And I can show them with a net present value of a stream of offtake, et cetera, why they can make a very, very good investment decision and hopefully become involved with this. What I will tell you is it's an iterative process.

35:57 Everything that you see going on in the world right now definitely has an impact. And I'm specifically talking about our car sales higher or lower the last couple of quarters, what the UAW do. All of these sorts of things have an impact. But what I will tell you as well, as much is not lost on these end users, is how distorted the lithium, the overall lithium market is. And here we're talking about the fact that you essentially have the world divided into 2 camps. I would argue as we go, just as time progresses, this division between essentially China and non-China supply or anything that's affiliated with China whether it's equity ownership or upgrading all of that is going to become more and more pronounced. And I think the Europeans just announced they have a critical materials act. I think where they want to have I think 40 percent of their their critical materials domestically mined by a certain point in time.

36:52 Here, you see the same sort of concept

36:55 is manifested in the Inflation Reduction Act, where the tax credits go if essentially the material has been mined or upgraded in a quote unquote friendly country. However, I think you're going to see more of an advancement over time with the US government. But the point is you've got this bifurcation again with lithium prices. What's the right market? Is the Chinese spot market arguably going to mean anything for a car manufacturer that wants to sell its EVs in the US, I would argue probably won't because that that material that you know, if it's lipidolites or whatever, it's going to be as bad as it means it's Africa, some of the South American stuff, whatever, is not gonna be able to make its way here to the US. I consistently say that the traders are gonna do great because they're gonna be able to take advantage of all these distortions and trade one thing off for another.

37:44 But I think from our purposes, this is gonna be very, very important going forward to watch and see this division of essentially China and non-China going forward. So hopefully I ended up answering that question. I know I got off on China there, but I wanted to bring that in. Yeah, thank you. We got a couple of questions here from Lithium Enthusiast.

38:07 So first of all, can you talk to us what the OEMs are interested in knowing from this asset? It will help us know how to continue our investment. Yeah, the OEMs, well, it's very interesting. Again, some of the OEMs, and I'll talk about the battery people as well, have not necessarily heard about us. And that's a function of our being able to get the word out. It's very interesting. There was something done on the visual capitalists not long ago, if you've ever seen those sort of charts of what are the biggest and the best. And they're funded by essentially another company and we weren't on it. And it just happened to be because the research house that they used to get the data didn't know about us. There's nothing that we could do to redress this. I'm just saying that that's the kind of thing that quite honestly happens when a company's been busy putting itself together, getting 100% of the ownership interest, not being able to essentially get out there with all its emphasis with regards to the marketing.

39:06 So some people still don't know about us. However, I would say most of the car companies, and now we're just talking about the car companies, do know about us. But what they've really been thinking about doing and where they've concentrated their efforts was solving the near-term supply-demand mismatches that they have, right? And I started talking a couple of years ago to essentially all of them. And I will tell you that one of the biggest things that I don't want to say has gotten in our way, but one of the biggest subjects has always been the direct lithium extraction place, and particularly the Salton Seas, which is out in California, probably 4 or 5 hours away from where we are in Nevada. That's the kind of thing people expected that to already be in production and to essentially start to take up the slack. And when I first started talking to the OEMs, I said, you know, that that is not a commercialized process. I'm not trying to knock anybody. I'm just saying is that if you're gonna say that, well, no clays or sedimentary deposits have ever been, you know, have never been put into production.

40:07 Well, really, the DLEs haven't either. And that was seen as a panacea. And I understand it. It's essentially, hey, there's hot fluids out there in these springs and we can bring them up and they've got some lithium in it, we put a black box on it and no fuss, no muss. Well, tremendous operating problems appear to be there and things have been getting delayed. And I think the car companies are really starting to understand that the lithium industry really doesn't exist. And it's gonna take all of these projects, including ours, including the DLEs, including the hard rocks, to make the supply and demand match so If we wouldn't have had sort of this last let's just say I don't know What's been 6 months with with the car sales starting to look weaker, et cetera, I think that we would have been in sort of an entirely different type of an environment. But the reality is that is hit right now. I will tell you that I hear from a number of the car companies, they're uncertain as to what might happen in the November elections with regards to the US presidency.

41:10 And again, for what it's worth, it's just my opinion. What I tell them is I've never seen money essentially taken out from the U.S. Budgetary process. So all of these billions of dollars that you've heard talked about, whether it's 80 or 90 billion dollars over the years that are associated with the Inflation Reduction Act, et cetera, I think that they're still going to be there. To me, the trick is to how to get the U.S. To say that that money can be used for mining. Essentially, it's got to be associated with technology in some way. So you're playing, some people are playing the game of nuance, and they've been successful getting some money for pilot plants and things like that. But the real trick is to get an acknowledgement from the US government that that money is going to be available to develop the projects essentially in any way, whether it's to help with the studies, because these can be very expensive studies. I mean, pre feasibility, feasibility study, all that kind of stuff, it adds up.

42:05 But the OEMs in particular understand that they're going to have to move. I think at the second they sort of pulled their horns in right now just as a consequence of the lack of car sales. And we'll see if that starts to turn itself around going forward a little bit. I think that the US government has taken some of the heat away from the fire by telling them they can phase out the gasoline engines and diesel engines, you know, over a little slower pace. So right now, I think the way that you should think about it is that essentially the OEMs still have no choice. If they're going to have to help fund these mines, if they're going to get their secure lithium supplies. Because the one thing they also need to remember is if you sell everything that you have under offtake at a fixed price or some sort of a fixed margin, et cetera, that will ruin the optionality of the overall value of the project. And I've seen that happen in the past before. I'm not going to let it happen here, which means that if I'm going to produce 10 pounds of lithium carbonate, I'm not going to sell 10 pounds of lithium, you know, of lithium carbonate as offtake. I might sell 5 or 6 and leave a big slug of it for spot because ultimately you want investors to be exposed to that again, fundamental mismatch in supply and demand.

43:28 And so the point in all of that commentary is that the car companies I think are starting to understand that these projections for supply, that they think they can tie up for offtake, they're not as great as they might have first perceived. So that's sort of what's going on with the OEMs. Perfect. Hopefully that answers your question. So when you redo the PEA, would you be able to add the value that the fertilizer byproduct will provide to the overall proposition? At this time we can't because the potassium, we haven't investigated that enough so we don't have a flow sheet for that. That's still something I think is viable, but to us, the hierarchy was honestly, get the carbonate done, because that seemed to be what the geology lended itself to first. So we did that. Then it would be hydroxide, because frankly, the car companies still don't know if they're going to need more carbonate and hydroxide. I've seen a big swing over the course of a couple years from hydroxide to carbonate and so it's very interesting but that would be the second most important thing.

44:30 The potassium is definitely there. The other thing, back to one of the first questions we had, goes back to the boron and whether or not there's a viable byproduct that we could get out of that, because even though we're not reporting them in the assays, we know the boron is there, we think it's significant. So that's another thing that we're investigating. Perfect, thank you. Do you envision your production to be at Bonny Clare? When would you start construction of your production facility? So we still think we're on track for production in 2030. If that were the case, just working backwards, I would say would be 2 year construction. So 2028, this is another, you know what? This just reminds me of something in case I didn't mention it. I wanna make sure I make very clear to people, particularly those who may be seeing this for the first time.

45:22 When we talk about lithium carbonate production at Bonny Clare, we're talking about producing that at Bonny Clare, right? So we're not talking about making a concentrate and shipping that somewhere around the world or, you know, I don't know, maybe there's going to be a refinery that could handle our stuff at some point in Nevada. But the reality is, when we're said and done, there's going to be only, you know, 30,000 tons, the way it stands now, of material going out the door. But it will be a finished product. And that's important for a number of reasons, one of which is that almost all of the refining capacity in the world currently is under the control of China. I'm not saying that I expect that to stay that way. But even if Australia were to do it, or somewhere in Quebec, they were to put up a refineries, I would argue that those would be tailored to essentially the material that they're finding nearby.

46:12 So we've all seen about the successes that there have been in Quebec with Spodumene there. And obviously there's the hard rock on Australia. So, you know, from a perspective of we have a much more secure supply line, because we have a finished product going out the door, so we're not dependent on somebody else. We also have the fact that we have a greenhouse gas type of footprint that is going to be markedly smaller than those who are sort of forced to upgrade unless the refineries right next to where they're producing their concentrates. And we think that works in favor of, you know, particularly from an ESG profile. And I can tell you that that is also not lost on essentially the car companies. So that that's where we are with that. Excellent. And can you be more specific, please, on what exactly what catalysts exactly will happen before you take any off-take agreements and agree with any potential buyers?

47:10 Well, it's interesting because I'm not sure that there has to be a catalyst. I'm not saying that we have to get the PFS done. So a catalyst at Bonnie Clare, I'm not necessarily sure that they're- More drilling maybe, things like that? I don't think so. I don't consider there to be a resource risk, quite honestly, at Bonnie Clarence. I don't think anybody else really does. And I'll just, again, I'll say this in simple terms. Again, I'm not a geologist, not a metallurgist, none of those. Just a CEO who likes to talk. This has got, you know, this material is laid out as essentially tabularly. Again, take a sandwich, just take a peanut butter jelly sandwich and lay it on its side. The piece of bread at the top is lower grade material once you start to get a little bit under the surface, but let's just call it that. And the peanut butter in the center is essentially a sandstone that doesn't have any lithium. As soon as you get below that peanut butter, then you start to have that piece of bread below, whereas you get closer to the bottom of the bread, 2 things are happening. The lithium concentration is starting to increase, and that piece of bread is starting to get thicker, right? So you got more material at a higher grade. But the point is, is from left to right, when you're looking at that piece of bread, it's pretty damn homogenous.

48:26 These aren't a lot of veins, et cetera. So that's what I'm saying is with regards to the resource risk, I don't think it's there. I think it's more about from the car companies, it's more about the car sales, the near-term car sales and the outlook for it. That's not to say that there isn't any risk in terms of developing a natural resource, because there is. I mean, this is arguably one of the riskiest things there is. This is why the reward can be so high, and there's always going to be a wall of worry. Our mining technology is the borehole mining. Some people say, well, that hasn't been done on a commercial size scale of what we're talking about. I would say, yes, I understand that. Of course, it hasn't had to be. So that can be a bit more of an unknown for people.

49:13 However, Some people prefer that to the expression of an open pit on the surface. So you see, it sort of goes both ways. I mean, I think the thing to remember about all of these OEMs and battery companies is they don't want to do any of this. You could have the most perfect project sort of lined up in the world. And I would say from their point of view, going back a couple years ago, it was the DLE stuff. And that all hasn't turned out too well, you know, arguably for them so far. So they don't want to do it. You know, You're talking to somebody whose business has basically been to purchase aluminum, as an example in a car company, typically it would be, where's my aluminum, what's the quality, what's the price, et cetera, et cetera. This is a whole different ballgame. So I think it's more about they want to see a better environment for the EVs going forward, some other exogenous factors again I'm talking about are, you know, the car company, pardon me, the US elections, you know, how, you know, is anything going to change, that kind of thing, etc.

50:16 I think that as soon as they are convinced of that, you know, then it's not necessarily going to be Oh, we need to see the pre feasibility, I think then they understand scarcity, the supply, and that whole opportunity cost argument that I was making earlier. I mean, that's my that's my feeling on it. Excellent. And just 1 minor question for mine. I don't know if you know, but how much lithium supply currently qualifies under the Inflation Reduction Act? Like what what are we looking at in terms of what are companies in the U.S. Fighting for right now? I tell you, I can't I can't answer that. And I will tell you that there's about 5000 tons coming out of Albemarle. That's their silver peak mine. That's an hour to the northwest of us. But the reason I can't even tell you with certainty is because the other material that may be coming out of South America or You know Australia right now.

51:08 I'm not sure to what extent there's there's Chinese Ownership or involvement or you know, I'm assuming all the hard rock stuff that's going to a Chinese upgrade or would not qualify right now. And South America's got a lot of Chinese ownership. So I'm not sure, frankly, about that right now. I mean, that's literally, you can see again why you had this huge bifurcation in the market is what part of lithium supply is actually gonna be permissible under the Inflation Reduction Act. I would just say right now, it can't be much. It just can't be much. Now, maybe when the Canadian stuff, they get their spodumenes upgraded and all that sort of stuff, that's still at least a couple of years away. So you know, I think that we're sitting in it, you know, in a good spot along with, frankly, the rest of Nevada.

51:55 I think Thacker is going to get done. I would expect that he's going to be the first to come along. I would hope that Ioneer is going to get itself, you know, figured out with, you know, the buckwheat that they've done a work around, you know, no, these sorts of things crop up is what I'm trying to say. And I think that they will take the steps needed to make sure that everybody is satisfied, that everything is protected, etc. But the reality is, the world's going to need all of these projects from my perspective, and we're going to be one of them. Excellent. So with that, on that note, that's all the questions that we have for today. So thank you for taking us through the updates and the Q&A. And I also want to thank everyone who submitted questions. So as always, today's recording will be available to watch on demand in the coming hours.

52:41 So look out for that. And before we wrap up, I'm just passing things back over to you, Steve. Sure, just to finish up, look, I know that was a bit repetitive for those of you who have been with the story from the beginning, or who I've gotten to talk to, etc. But I just wanted to clarify, you know, some of these major issues, because I think the value proposition is just so tremendous for us. We have news that's going to be coming out over the course of the next couple of months when we're talking about what we're going to be doing. Obviously, that updated PEA is going to be grand in terms of news flow. I think it's going to incorporate a lot of good things. So in the short term, yes, I understand news flow is clearly important. But to me, this really fundamentally comes down to if you believe in electric vehicles and you believe in the Inflation Reduction Act and the necessity of these kinds of projects, and you look at the value that we've already frankly demonstrated, there's just a huge mismatch, a huge opportunity for investors. So, I urge you to think more about us, ask us the questions. We love to have you as shareholders.

53:50 I just think that going forward, you're gonna see as we execute on the work plans, more and more of this value is going to be unveiled. And God help us, when we get a little bit better sentiment in the markets, I think Bonnyclair is going to start to fly. So on that, I'll end it and thanks again to everybody for their time. Thanks Max. Excellent. Thanks again to everyone for participating and I hope you