Notes from Proactive Forum Q&A - 17 Feb 2022

[DipSard]

Notes from Proactive Forum Q&A - 17 Feb 2022

Webinar: https://www.youtube.com/watch?v=85tgKFsk9Kk

Presentation:

* While presenting slide ‘Catalysts for Future Value’ and discussing No.2 JORC MRE
- He will cover this more in Q&A period but appreciates many of the Shareholders (SH) were surprised a Havieron (Hav) update wasn’t included in the latest Reserve & Resources report, which really became a surprise to them too when they realised NCM wouldn't be including Hav
- Originally the plan was for that to be updated together, which is always GGP’s preference, but we should have confidence in the results (assays / intercepts etc.) that have been reported since the Feb 2021 JORC Resource & Reserve update have been ‘stunning’
- Everyone should have the confidence around where that is headed.

* While presenting slide ‘Catalysts for Future Value’ and discussing No.5 Ownership
- Have the 5% Option running in the background, the JV agreement is rather specific around how you approach that
- Something we’re dealing with and dealing with it is ultimately positive for SH’s.

Q&A:
* Held our breaths when you stated making profits over $1200 USD per Oz and the AISC costs are low.
Thank you for referencing NCM’s investor update because it has been concerning some investors who are a bit worried that no reference to Hav was either forgetful or neglectful and some of the questions in the chat are related to whether relations are OK with NCM, is it all going well?
- Have a good relationship with NCM and that’s built up from the operational teams, think we also have really good connectivity across the exploration teams and into the mining teams at site and with the processing teams as well
- Try to talk regularly to Sandeep, think we have a good relationship there as well so there’s some strengths in the relationships
- Again, you talked on the Resource & Reserves and hopefully we had originally expected NCM to include Hav in the update to be open
- Now, it was a surprise when they first told us it was no longer being included, now admittedly that was ahead of the announcement and we kind of thought given the amount of drilling and the time that elapsed since the last update (think it was 05 Feb 2021), that it potentially did warrant an update because the drillings pretty spectacular, really consistently across Hav.
- So, ultimately people should have confidence that when that Resource & Reserves (R&R) table is updated, it will reflect the strength of those results of the last12 months
- And as part of the relationship we continue to discuss the 5% mechanism and I think having an updated view of the updated R&R is critical to understanding the value of Hav but people should have confidence that we have a team in place now that understands the value and future opportunity of Hav, so we are active as managers of the asset to understand and describe and articulate that value to NCM as part of that process.

* Because one of the value drivers (in slide image above) was that 5% option that NCM has, a lot of people are interested in the Fair Market Value (FMV) of that 5%. In terms of timelines, you said that the 5% option is running in the background, so when might we hear anything else about it in any significant detail?
- We have a negotiation period that we described to the market previously, that runs towards the end of this month but then at some stage we go into the process where we put forward values and ultimately that goes through an independent process, that can be a more drawn out period but I’d imagine that there’s an opportunity for the JV partners to have discussions at any time
- But I think we feel as Greatland that the best thing that we can do is go through the structural disciplines of understanding our asset from first principles and think that if we can understand value to our own satisfaction
- I think that gives us the strongest platform for engagement with NCM and I think that’s the confidence that people should have that we will approach this from the ground up, from first principles we will understand the geology, we will understand the mine planning and then how that flows into value and by doing that, that process can take a little bit longer
- But I think it’s a really important discipline for us, but ultimately that value is determined by the provisions of the JV agreement, so there are modifications within that and the parameters that we have to work with.

* And in terms of understanding your asset, any indication when we might see an updated MRE for Hav?
- I think today NCM talked about one coming out in a period of time and perhaps implying it might be around the Feasibility Study (FS) in late 2022
- From a GGP POV, I feel you really need to understand the R&R to understand and put into context the 5% valuation, you really as I said want to value these things from first principles and as part of that the R&R are absolute fundamental building blocks from that
- So, from a GGP perspective I think we believe that the parties need to find that R&R in the shorter term and given the quality of drilling and the period of exploration at some 10-12 months that ultimately this is a material update that should ultimately be released to the market, so I think people should be confident that will happen.

* You mentioned building blocks there, Alan asks when the drilling results from Scallywag and other drills outside the main Hav body might be coming?
- I talked about labour being tight in Australia before, equally exploration drill rigs are hard to get and assays are taking 10 plus weeks to turnaround in the lab vs 3-4 weeks a few years ago, so there are delays and we have some frustrated geo’s wanting to get assays quicker
- Typically what you do is prepare a program, drill some holes in, want to then get those results back in, recalibrate your program and then go back and follow up targets with a refined plan
- Those cycle times are really important to running an efficient drilling program, so it’s all a little bit slower, not just for GGP but for all parties, but we do have some more drill results expected out shortly
- And as people may appreciate, up in the Paterson you don’t typically drill through the Dec/Jan periods due to the wet season and the heat so typically we stand down but we’re remobilising rigs for the start of the June Quarter, so April onwards we’ll get more material coming out of there but we’re still getting some of the assays in from the December quarter such are the delays in the assays right now
- We’ve also done so electro-magnetic EM surveys so think there’s some positive information, some of which we’ve already been able to share but more coming as well which we think is great.

* Trying to amalgamate 2 similar questions from Timor and Barry, Timor asks what might be the revised date for the decline to hit the top of the ore body since there’s an unexpected difficulty in the rock formation encountered, there are only 100 more metres to go***, might this be achieved by 2022 year end?
***(NOTE: this was incorrect, the 277m specified by NCM for Jan 2022 is length not vertical depth)
- Firstly, we included in our RNS the progress at the decline, it’s moving a little bit quicker right now which is positive, prudently NCM and us talked about the ground conditions being softer than we’d like and somewhat counter-intuitively softer conditions slow you up and harder ‘country rock’ which is when you really get down into the mining is good as it’s held itself up, you can take bigger longer cuts which accelerates your cycle
- Right now we think it’s within budget both in cost and time, what NCM did prudently is flag that the ground conditions are a little bit softer than we’d like so that has slowed it down a little bit but right now there’s a range of things you can do to accelerate that and catch up and indeed against the timeframes originally set
- One of the things we’re doing and progressing with is a change to the route of the decline, still ultimately the same passage but spiralling down a little bit earlier rather than running across more laterally at these higher depths
- So, that’s positive, as with depth the ground conditions will get more and more positive
- Another thing to comment on is that the 277m we announced today is chainage not vertical progress so shouldn’t think we’ve got to get 400m through the Permian therefore 123m away
- That is actually how far it’s advanced and then got to factor in the incline to work out your vertical depth and also we started from a Box Cut which gave us some launch pad in terms of depth as well
- So we’re not 2/3 there, otherwise we’d be very confident that we’d have it finished inside of 2023, there’s still significant chainage links to go.

* Run out of time which is such a shame as some very juicy questions coming in about institutions, shorting, and an early buyout but will just have to leave it on that cliff-hanger.
Thank you for sharing the value drivers and hitting a lot of the questions head on.
- Thx everyone for listening and part of having a big JV partner is that there’s always going to be that speculation in the market, thanks again everyone and bye now.