SGS comments - Latest NR

• SGS team has made significant progress improving upon the bench scale caustic bake process and an innovative, viable flow sheet has been developed for the Albany graphite deposit
• A higher grade flotation concentrate of up to 92.5% graphitic carbon (‘Cg’) was produced compared to the previous 78.3% Cg concentrate
• For the first time a fully engineered purification process has been completed providing data for energy requirements, water treatment, reagent consumption & equipment sizing
• Optimization of NaOH consumption was achieved such that re-cycling was eliminated thereby reducing costs related to introduction of re-cycling engineering & equipment; • Significant (~86%) reduction in the NaOH reagent dosage
• A technically feasible & distinctive process flow sheet was developed and work continues to fully optimize it to meet customer expectations on purity.
• The recent test work has simplified the overall flow sheet for the purification of the graphite concentrate.
• We generated a significant amount of key process and engineering data, whilst gaining a solid understanding of the analytical requirements and acceptable methods. We will now proceed towards improving the flow sheet further using the same consistent and balanced approach, with emphasis on ensuring commercial applicability whilst defining the requirements for further increase of the final product purity. This is very important for a robust and cost effective process in the long run

Aubrey Eveleigh's comments - Latest NR

• Process optimization (cost cutting, simplifying equipment, eliminating caustic re-cycling) was a success.
• Our priority is on defining the best possible process and meeting customer expectations on product quality for a broad range of applications with demanding specifications.
• We believe that Zenyatta is a leader in developing a new cost-effective process for the production of ultra-high purity natural graphite.
• Further purification test work is underway to produce a potential range of purities that are required by end-users. This is based on discussions with interested end users related to strict specifications under signed confidentiality agreements
• The Company plan is to develop an environmentally benign process for a high purity (benign) deposit. Given the feedback from potential strategic partners in the CleanTech sector, this is a critical consideration.
• Once ready, the complete process flow sheet and associated engineering data will then be fed into the PEA which is now underway by RPA Inc.
• The PEA economic evaluation is substantially complete except for the final inputs from the purification test work

After reviewing all these comments and reading the prior NR in September, I believe we are nearing the end game for ZEN as a company that owns this deposit. The PEA is almost complete except for the final purity number inputs. There is nothing negative in either September's NR or the latest one. ZEN is ensuring all I's are dotted and T's crossed before it releases what could be a historic PEA. Reason: Notice the bold and underlined section.