You don't need a Wash Plant. Yet.

You don't need a Wash Plant. Yet.

Every junior miner wants a shiny DMS (Dense Media Separation) plant. They want to sell high-grade product to Glencore or Trafigura.

But a plant costs R15m+. And it takes 6 months to commission.

The Starter Pit Mindset: Sell ROM (Run of Mine) or Crushed & Screened product first.

> Why? Yes, you get a lower price per ton. But you get paid now.

> The tactic: Find a neighbour with a plant who needs feed. Or find a trader who blends low-grade product.

> The math: Selling ROM at R400/t immediately is better than waiting 12 months to sell washed product at R900/t. And you may end up waiting forever, because no investor is going to trust you with R15 million plus when you have no proven record as a mining operator.

Asking for CapEx to start a mine and buy a wash plant from the word go, is like a young artisan recently employed who, instead of getting an apartment and buying decent furniture goes off to a car dealership to get a shiny German toy (usually a GTI..). It makes no sense and is in bad taste. It does not inspire confidence in the entrepreneur and their future in mining.

Cash flow is oxygen. A wash plant is a 'luxury' for a mining startup. Buy the luxury after you can breathe and have taken care of the basics.

Don't polish the rock. Move the rock.