Speciality Metals International Limited Annual Report 2020

Speciality Metals International Limited Annual Report 2020 7 The final commissioning phase and initial ramp-up of the Retreatment Plant occurred during these unprecedented times caused by the global COVID-19 pandemic. Whilst the operation was not directly affected by any enforced shut-downs, logistical challenges for the delivery of spare parts and additional equipment were experienced which led to delays for some of the ramp-up activities. Mt Carbine Mixed Tungsten Concentrate Mt Carbine Mixed Tungsten Concentrate (under UV light) The teething challenges experienced during the early phases of ramp-up improved the team’s understanding of the process and resulted in improved stability and continuity of operations. However, those early challenges resulted in volume fluctuations in the production and inconsistencies in the concentrate grade. The XRT Sorter feasibility test work (further detailed in section below on XRT Sorter Development) is currently effecting intermittent increases in the concentrate tonnages. In accordance with the Offtake Agreement between the unincorporated JV formed by the Company and CRONIMET Australia Pty Ltd ( CRONIMET Australia ) on the one hand and CRONIMET Asia Pte Ltd ( CRONIMET Asia ) on the other, CRONIMET Asia has, to date, taken delivery of approximately 40 tonnes of concentrate. Individual production lots are tested against agreed quality parameters, upon which CRONIMET Asia determines the acceptance of concentrate. Currently, additional concentrate is pending final cleaning (that is, a process of upgrading WO 3 concentration and reducing impurities) prior to delivery to CRONIMET Asia. The first shipment was transported from site to Brisbane, Queensland in July 2020 for export to an Asian customer (refer to ASX announcement Operational Update on Retreatment Plan X-ray Pilot Production Schedule released on 20 July 2020) with a subsequent shipment sent to Europe. Concentrate production is continuing to improve on a month-on-month basis, with the Company expecting to reach sustainable commercial levels for the quarter ending December 2020 when the testing program in relation to the XRT Sorter is well underway and the scheduled installation of the impact crusher is completed. Staffing requirements for the Retreatment Plant have been met predominantly from the local region, in line with the Company’s commitment to support the communities in which it operates. As activities at the Mt Carbine site ramp-up with increased operational complexities, the Company has invested in the provision of both external and internal safety training for its staff. The Company is committed to the continuous upskilling of its employees. The Company is undertaking an assessment of its current energy usage with the aim of identifying cost reductions and lowering its carbon footprint. Upon completion of assessment, the Company expects an energy efficiency roadmap will be available for the consideration of options and the implementation of meaningful targets.