Thank you for standing by, and welcome to the Arafura Rare Earths Limited June 2025 Quarterly Report Investor Call. [Operator Instructions] I would now like to hand the conference over to Mr. Darryl Cuzzubbo, Managing Director and CEO. Please go ahead.

Thanks, Melanie. Good morning, everyone, and thank you for making the time to join us today for our quarterly update. We do appreciate your interest and taking the time to dial in where we can share a little bit about what's happening in our company, but also share a little bit about our perspective on what's happening externally. For anyone that is new to these calls, my name is Darryl Cuzzubbo, the Managing Director of Arafura Rare Earths. And again, with me is Peter Sherrington, our CFO. Similar to last quarter, what we'd like to do is just firstly share with you key external events that we think are shaping the rare earth sector, both now and into the future; secondly, talk through our progress towards securing funding and announcing FID; and thirdly, Peter is going to unpack our recent announcement regarding the German Raw Materials Fund. So let me start by just summarizing some of the key things that we see are shaping the external market. Now many of you would have invested in Arafura because you anticipated exactly what we are seeing playing out at the moment as the global manufacturing regions of the U.S., Korea and the European Union get just a glimpse of the cost of not having a diversified rare earth supply chain, which is paramount to their security and economic future. For a diversified rare earth supply chain to be established with long-term certainty, it's critical that there is a functioning market rare earths price index where investors can be confident that pricing and returns will be driven by typical supply-demand dynamics. And if you look at the supply-demand dynamics for rare earths, they are exceptionally strong with demand doubling over the next decade with a pretty sparse pipeline to fill that demand. During this quarter, we are starting to see the pieces come together for the creation and use of this functioning market price index. During the quarter, we also saw an indication of what is at stake by not having a diversified supply chain where electric vehicle production lines have reportedly been shut down in Europe, U.S. and Japan. We are seeing electric vehicles worth an average of USD 47,000 not being produced because they do not have access to $70 worth of NdPr. Consequently, we -- personally, we've witnessed a shift in the OEMs where they are looking at pricing and supply security to being predominantly focused on just securing supply. An example of this bearing out is that we've heard recently from one of the traders that we talk to that pricing for heavy rare earths has tripled in response to the current situation. Whilst China has recently started exporting rare earth magnets again, we understand that such agreements are typically only for 3 to 6 months. So in other words, the rare earth supply crisis still has a long way to play out. Further adding to this uncertainty of supply, we understand that China has recently released their production quotas, which they've done in the past typically twice a year. But this time, they no longer have published what those production quotas are. If I can just now shift to the U.S. where there's been substantial events of late. We've seen the U.S. Department of Defense underpin the development of Mountain Pass in securing for the U.S. an independent supply of rare earth magnets. This now only leaves Korea and Europe as the major manufacturing hubs that do not have an independent supplier of rare earths. And as you know, they have been the 2 markets that we have been primarily focused on. So these 2 markets, Korea and Europe, today are still essentially 100% dependent on China's supply. The U.S. Department of Defense has also set a floor pricing of $110 a kilo for NdPr, which is interestingly close to an incentive pricing of between $130 to $160 a kilo that we would expect to see if we had a functioning market. Just last week, we saw that Benchmark Minerals Intelligence established for the first time a non-China-controlled NdPr price index. Now if I just bring this closer to home, the Australian government, as you know, has played a key role in helping to establish a rare earth sector in Australia through funding support and production tax incentives to encourage downstream value add under the Future Made in Australia program. The Australian government also recently announced the concept of a strategic reserve, hence enabling them to play a global leadership role in creating a functioning diversified rare earth sector by placing volumes associated with such a strategic reserve onto a non-China-controlled price index. This is exactly what is required to bring credibility and weight to such an index, hence encouraging its use as the primary price index going forward. This is something that our marketing team foresaw and have made provisions for in our most recent contract negotiations. When we last released our economic model, we included 2 scenarios. The first scenario is based upon a long-term pricing that assumes China maintains a level of control over pricing, noting that it is expected from a number of forecasters that China can't maintain supply for the fast-increasing demand. We also included a second scenario, an upside scenario that included long-term incentive pricing that would be reflective of underlying supply-demand fundamentals. In our view, what we positioned as an upside case is progressively becoming over time the more plausible scenario. Again, this all bodes very well to bringing on the Nolans Project at exactly the right time. And as we've said before, when you look across the globe, we are uniquely positioned as the most advanced, construction-ready rare earths project that processes to an oxide, hence, being able to provide a one-stop shop for a non-China FEED or magnet manufacturing. By also processing to an oxide, we don't have the radiation challenges associated with our products, which projects that don't process all the way to an oxide invariably have to contend with. Let me now talk a little bit about our progress towards a fully funded solution and announcing FID. Whilst we continue activities around reducing project execution risk, reducing capital, improving our schedule -- and we need to do these things because invariably, you come across capital pressures, et cetera, going forward. However, our primary focus remains upon securing equity as the final step required to calling FID and moving into construction. We're very pleased to report that we continue to make good progress on both securing cornerstone investors of up to 60% of our required equity as well as progressing joint venture discussions. We are progressing both pathways in parallel as fast as we can. So one pathway is not waiting for the other or vice versa. We were very pleased to announce recently that we've entered the appraisal phase for equity investment from the German Raw Materials Fund with Arafura seeking up to EUR 100 million, which is tied to additional supply from Nolans. You might remember that our strategy around offtake -- around the remaining offtake was to leave that open to pull in additional equity, and you can see how that strategy has played out in -- with the German Raw Materials Fund. This announcement is significant in that it demonstrates the importance of our project to German and European manufacturing sectors. But also, I want to point out that we are one of the first 2 projects being able to progress into due diligence since the formation of the fund. Just as we've been at the front of the queue for the National Reconstruction Fund, we've been at the front of the queue for the German Raw Materials Fund. And the reason why I announced that -- the reason why I point that out is our progress has been slower than we would have liked and slower than what we have expected. We are doing everything we can to progress this as fast as possible. And I think it says something when despite the size of our project, the complexity of the project, we're at the front of the queue with these newly established funds. As reported last time, we continue to have a clear line of sight to securing 60% of our equity with cornerstone investors, which is the higher end of our 50% to 60% target range as previously communicated. We are pursuing the higher end because, one, we can, we've got clear line of sight of achieving that 60%, plus it remains prudent given uncertainties in the market, particularly with respect to ongoing trade negotiations. The only thing I would say is as different trade deals are done with the U.S., the market volatility, as we see it, is starting to settle. We are acutely mindful that it's very important to you, our shareholders, to provide visibility of progress, and we will announce what we can, knowing that decisions to announce need to be agreed upon with other related parties, and we may not always be able to do so, but this does not mean progress isn't being made. At this point, we expect that our time line is likely to be mostly driven by the due diligence that will be conducted by KfW on behalf of the German Raw Materials Fund as well as locking in the additional offtake volumes. In other words, we expect that -- the components that make up the 60% of that cornerstone investment to be completed prior to the German Raw Materials Fund making their decision. Whilst the German Raw Materials Fund can't and won't commit to a time line, and that's because they don't know what they're going to find in due diligence, they don't know what questions or follow-up questions are going to be asked, our view is that this is likely to take towards the end of this calendar year. With that said, we're supporting them as much as we can to expedite the process as much as we possibly can. I'm now going to hand over to Peter Sherrington to unpack for you a little bit more about the German Raw Materials funding and what Peter and his team are doing to secure the additional offtake related to that fund. Thanks, Peter.

Thanks, Darryl. Darryl has already discussed the changing landscape and action by Western governments that are looking to address the need to develop diversified value chains and specifically around rare earths, the need to reduce the dominance of China in the rare earth and magnet value chain. The Department of Defense underwriting a floor price for MP Materials of $110 per kilo of NdPr has been a really highly visible example of government talk being turned into some pretty decisive action. Arafura is seeing similar conviction with government agencies in other jurisdictions it's engaged with for offtake and debt facilities and also with equity facilities that are state backed. In September last year, the German federal government actually announced the allocation of EUR 1 billion to the German Raw Materials Fund. Arafura was fortunate enough at the time to be in Frankfurt when the fund was announced. We -- in September last year -- and we met with KfW at that time to gain a better understanding of the process and mandate for the German Raw Materials Fund. So KfW will administer the fund on behalf of the Interministerial Council, which consists of representatives from the Federal Ministry for Economic Affairs and Climate Action and the Federal Ministry of Finance. The German federal election unfortunately caused some delays in the commencement of the German Raw Material Fund's activities, and approval of projects to advance through to DD was deferred until the outcome from that election was known. As Darryl mentioned, Arafura is 1 of 2 companies selected to advance to appraisal or DD phase once government was formed and the IMC meeting or the Interministerial Council meetings were recommenced. We've applied for a total equity investment of EUR 100 million. Half of this amount will be linked to our existing offtake agreement with Siemens Gamesa Renewable Energy. Arafura will seek additional equity through the supply of a further 500 tonnes per annum to the German market. So we're already partway through the commitment on offtake and working to expand that out to secure the total investment of EUR 100 million. The commencement of DD by the German Raw Materials Fund combined with the AUD 200 million or USD 130 million investment from the National Reconstruction Fund, which was announced in January, demonstrates Arafura is delivering on its strategy to leverage the strategic nature of NdPr to secure the cornerstone and strategic investment required to deliver on our equity strategy. Darryl has already talked about the objective of securing up to 60% of the total USD 790 million of equity required to fully fund the Nolans Project from cornerstone and strategic investors. Potential investment from the German Raw Materials Fund and the National Reconstruction Fund represents approximately 50% of that cornerstone investment target and indicates or provides -- demonstrates significant progress on the execution of that strategy. With due diligence commencing on the German Raw Materials Fund investment, our sales and marketing effort has increased the German focus to ensure we can secure the additional 500 tonnes of NdPr offtake required to target the full investment amount of EUR 100 million. Historically, our engagement with German offtake partners and others has, in many instances, focused on offtake with linked strategic investment. With the German Raw Materials Fund investment opportunity, there is now a reduced emphasis on the direct investment with potential German offtake partners. We already have a number of prospective groups that we have engaged with in Germany, and we look forward to providing shareholders with additional updates on strategic investment and the remaining offtake as and when these arrangements become more certain. That's all I've really got to talk about on the German Raw Materials Fund and the related offtake activities around that. I think I'll pass back over to the moderator, and we can go to Q&A.

[Operator Instructions] We are showing no phone questions at this time. I'll now hand back to Lewis for the webcast questions.

Thanks, Mel. The first round of questions comes from John Parkinson from Rare Earth Exchanges and reads, "What is the expected time line for the dysprosium and terbium recovery test work? Could a successful pilot lead to a near-term revenue stream or be integrated into Phase 1 ramp-up?"

Yes. So let me answer that. It's a good question, John. So we talk about nearly 90% of NdPr being controlled by China. And the reality on the heavies, it's 98% to 99% controlled by China. And as we engage with OEMs, the heavies, whilst not significant in terms of revenue, have been strong in terms of creating engagement with the OEMs because as you know, you cannot create a high-performance magnet without heavies. So just coming back to your question, so we've got about 6 months of flowsheet testing and development around these heavies. We think we can increase our heavies somewhere in the order of 30% to 40% for a very modest amount of capital. We will then do the engineering, which is a further 6 to 9 months. But the aim is to have this additional heavies be incorporated into our Phase 1 for a modest amount of capital. And when I say modest, we're talking in the low tens of millions of dollars.

Thanks, Darryl. The next question from John reads, "Can you provide more information on the JV opportunity and the terms of any potential transaction? How do you ensure any JV deal won't delay FID or undermine the existing debt and offtake terms?"

Yes, sure. Good question, John. So if I just take a step back, so our strategy has always been to pursue multiple options and pathways to create, I'm going to say, a level of competitive tension, but also choice so that we, Arafura, can choose what's in the best interest of the -- long-term interest of the company and also our shareholders. So by having options, we have choice. Just coming back to your JV question, at the end of the day, we're running the JV pathway and the equity in parallel. I'm going to say whichever one gets there first is best positioned to lock in, if you like, the final solution. It's important that any JV that we do enter, if we do get to an agreement, is structured around our existing debt terms and honors the offtakes that we already have. So we don't see any conversations with the JV delaying our primary equity path, and we're seeing it fitting in with what we've already secured by way of debt and offtakes.

Thanks, Darryl. John's next question reads, "Retail holders often look for alignment between management incentives and shareholder outcomes. Can you speak to how recent equity purchases or lack thereof reflect your confidence in the project's near-term trajectory?"

Good question. So if you look at our Board -- including myself, right? So when I first joined the Board, we all bought into Arafura stocks. And now with the Board, we have changed the Board mix to reflect having construction and operational skills as we go into the next phase. I think all Board members have actually bought into Arafura bar one, noting that there's a lot going on at the moment. So the trading windows for Board members have been limited.

Thanks, Darryl. John's next question reads, "What tangible changes are you seeing in your commercial discussions post the U.S. Department of Defense transaction with MP Materials? Are any of your new offtake proposals now referencing the floor price under this transaction or BMI's ex China index?"

Did you want to take that one, Peter?

Sure. So look, there's been some significant changes in the engagement with offtakers since the Department of Defense transaction was announced. I think the key thing is that we are seeing less resistance to referencing different pricing mechanisms. There's probably a view that referencing a non-China pricing mechanism in contract negotiations is now becoming more acceptable, and we're focusing on that in our new offtake agreements that we're engaging or our proposals that we're engaging in. We also have discussion around existing contracts, looking to make sure that we have a pricing mechanism that is valid. There is a risk here that the China mechanism either disappears or becomes less relevant as it focuses mainly on internal transactions in China. So it's been a catalyst for discussing different pricing mechanisms. And there's much more acceptance that offtakers see the need for a sustainable pricing mechanism within the offtake agreements. So yes, it's definitely had an impact.

Thanks, Peter. The next question also comes from John, "Can you provide an update on the permitting strategy and timing for Phase 2? Have any third-party Australian juniors expressed interest in feedstock partnerships?"

Good question, John. So when we announced Phase 2 after a preliminary scoping study, we said that our plan with Phase 2 is we want to get funding secured for Phase 1 and move into construction. And as soon as we'd achieve that, we would then pursue the engineering and the approvals for Phase 2. And the reason we're doing that is, one, we just want to stay focused, right, to get into construction as quickly as we can. But secondly, it makes sense that Phase 2 follows Phase 1 for 2 reasons

one, that as we ramp up Phase 1, we will learn of debottlenecking opportunities that will allow for a much -- an improved capital-efficient Phase 2. So we want to factor that capital efficiency into Phase 2. And secondly, it makes sense that Phase 2 is funded out of cash flow from Phase 1 so that we don't have to tap the market for additional capital. So that is our plan, remains our plan as we see it today. Now in terms of offtakers, we're not going to engage with offtakers until we're progressing with Phase 2. But if you look across Australia, there's a number of rare earths projects. We are very centrally located to those projects. So we think we will be able to secure offtakes. But right now, our focus is on securing the funding so we can move into construction of Phase 1.

Thanks, Darryl. John's next question reads, "In Table 1, offtake overview in the quarterly report, the 730 tonnes per annum allocation to OEM, wind, auto, Tier 1 and trading is the largest outstanding segment. Is this tied to a single advanced strategic partner? And is it fair to say that finalizing this agreement is the last hurdle to reaching FID?"

Thanks, Lewis. So look, the remaining uncontracted volume is allocated 500 tonnes to German Raw Materials Fund-linked offtake and then 730 tonnes allocated to OEM, wind, auto, Tier 1 and trader. It's possible the German groups we're targeting for linked investment to German Raw Materials Fund's will want more than the 500 tonnes tied to the German Raw Materials Fund. So the remaining volume of 730 tonnes or less will likely be contracted with 1 to 2 of the remaining groups. Notwithstanding support from the German Raw Materials Fund, we will still prioritize product or NdPr to groups that have an interest in linking equity contributions to the final offtake volume. So if there is a chance to secure funding over and above what's from the German Raw Materials Fund, we will be pursuing that as well. So it's hard to say if that will be the last hurdle to FID. It could be a combination of things. It could be the German offtake, it could be the German Raw Materials Fund investment decision and obviously securing funding over and above the cornerstone group. They're all likely to play out close to that final investment decision.

Lewis? Lewis has just had a power outage. So just bear with us for a minute. [Technical Difficulty]

Thank you, Darryl. I'll just jump in if my line is [ clear ].

Yes. Go ahead, [ Penny ].

Great. Darryl, just perhaps in reference to the Australian stockpile. Can you please provide us information on any movement that you've seen regarding the proposal by the Australian government? And do you expect that, that will be able to act as an anchor for the NdPr price?

Yes. That's a good question, [ Penny ]. And I'd like to welcome [ Penny ] as our new Chief Corporate Affairs Officer. So the Australian government announced the strategic reserve concept during the election campaign. They are establishing a task force to assess different options, and that is progressing quite well. We're actually in Canberra only last week presenting how we see the strategic reserve being very helpful in creating this non-China-controlled price index. And if you just take a step back, the #1 mechanism that China has used to control the rare earth sector is preventing a functioning price index. So Benchmark Materials Intelligence (sic) [ Benchmark Minerals Intelligence ] has established now, only last week, this non-China-controlled price index. But for that to have weight, to have life, we need to put volumes onto that. And I think the Australian government can continue to play a key leadership role across the globe in putting any strategic reserve volumes and rare earths onto that index. And we presented that -- we've presented that to a number of industry players as well as to the federal government. And that concept has been very well received. And we will progress that through the task force that's being established by the federal government. But to date, we have not had any -- how do I say it? We have not encountered any opposition or concerns with that concept.

Thanks, Darryl. And apologies for the technical delays there. I just jumped out of the meeting for a second. The next question comes from [ Fifi Jiang ] and reads, "When will the final investment decision for the Nolans Project be officially announced?"

Yes. So as we said last time, so we're not in control of the due diligence process. But as I mentioned in the voice-over, there's a number of steps to securing the 60% cornerstone investment. We think that the step that will take the longest is related to the announcement of the German Raw Materials Fund and then completing their due diligence ahead of making a decision. Now they have not committed to and they can't commit to a time line because it's very difficult to obviously put a time line around due diligence because you don't know what will be covered by that. But our sense is that is likely to take towards the end of the year, and that will secure our 60%, which then allows us to raise the 40% from the public market, which is typically a 6-week to 8-week process.

Thanks, Darryl. The next question comes from [ Stefan JVR ] and reads, "If the GRMF appraisal phase extends beyond the next 6 months, does the team have any concrete mitigation strategies in place to avoid a dilutive capital raise?"

I'd say it probably goes -- so [ Stefan ], this probably goes back to what I was saying before, and that is we're pursuing multiple options so we have redundancy, we have choice. I also mentioned that we've got a clear line of sight to 60%. And assuming those pieces fall in, we should be at a good place, we think, by the end of this year. But we're also pursuing a potential JV option. And there's a number of benefits of a JV option. And one of that is it would reduce the capital that we would need to raise significantly and hence, dilution. But at the end of the day, it also comes down to what the JV partner brings to derisk our growth trajectory and also how they value the company, not just Phase 1, but Phase 2. So it will be a trade-off between what they bring, how they value the company versus if we go at it alone. But what I can say is -- so whilst there's uncertainty in how this may all land, we are doing what we can, which is to progress as many options as we can in parallel. So we've got competitive tension and we've got choice where we can make a decision that's in the best interest of our organization and our shareholders.

Thanks, Darryl. The next question also comes from [ Stefan ] and reads, "The Traxys agreement is binding subject to conditions precedent being met by 31 December '28, including the completion of construction, commencement of commercial production and ramp-up. Given the slow progress Arafura has made to date, is this agreement being renegotiated?"

So we have continuous engagement with all of our offtakers, whether they're already secured or they're potential offtake partners. And that's really important to have that engagement going to inform them of where the project is at. Obviously, to be honest, that engagement has increased through the China magnet export restrictions. And our offtakers are very aware of the strong link between raising the equity and when construction commences, which drives when production commences. And in most instances, we're also engaged with them on the opportunity of equity as well, even where their offtake is already secured. So they are very aware that the equity is the critical path to when construction commences and when they get first product. And we have constant dialogue running with them on what that -- how that process is running. They have a fairly good view through to the need for the strategic equity as part of that process, understanding that where China has managed to keep pricing low, it's to discourage downstream investment in the rare earth magnet value chain. So suffice to say they have a good understanding of where our target production time line sits, where the critical path is heading on securing that equity. And in some instances, they're on that critical path if we're pursuing them for equity as well. And obviously, if there is a need on a contract to negotiate those first delivery clauses, they will be renegotiated and set once there is good certainty around when construction will commence. So yes, that is something we need to manage with all offtakers, but there's a fairly significant engagement process that runs with all of those groups to keep them informed of our progress.

Thanks, Pete. The next question or round of questions comes from [ Bernard Ho ]. The first one reads, "With CapEx requirements for the project projected to be USD 1.2 billion and debt secured of USD 1.05 billion, why do we need to raise so much equity to the tune of USD 790 million? It would appear we only need half the amount of equity."

Yes. That's a good question. Let me make a couple of comments and then -- and Peter can add a lot more specifics to it. But -- so firstly, the plus USD 1 billion of debt includes completion support, cost overrun facilities. So that's only available if there was a budget or a schedule overrun. But secondly, we need to fund not just the CapEx for building the plant, but we need to fund working capital, interest repayments, et cetera, until we're cash flow positive through the ramp-up phase. So when you take all of that into account, we're raising the minimum equity we need to get through that and to support the requirements of the lenders. But Peter, please jump in and add to that.

No, I think you've covered it, Darryl, in terms of the total funding envelope is larger because of the working capital requirements and the need to fund costs like interest during ramp-up and that of those debt facilities, some of them are not drawn under the base case. And so therefore, they're not counted as part of the base case funding. They are contingent facilities or overrun facilities.

Look, just one thing I would add, we had a choice, right? Every rare earths company has a choice. Do you go with a low CapEx solution, but that kind of means you've got to send your product for processing in China as it exists today? Or do you go with a higher CapEx solution where you can bypass China? We've gone with the latter, which I think recent events have shown the much better strategy. But it means we've got to raise more capital. Peter and his team, our strategy has always been to minimize equity, minimize dilution and maximize debt. So we're very conscious of that, and hence, well, we've maximized our debt as much as we can.

Thanks, Darryl. The next question from [ Bernard ] reads, "Apart from the German Raw Materials Fund, are we progressing with any other government equity contributions? And if yes, how are we going with this?"

Yes. Good question, [ Bernard ]. So the answer is yes, right? So as I said, we're progressing multiple pathways. We know that as shareholders, you want visibility of that. So we are progressing as quickly as we can, and we're encouraging announcements around that, but we can only announce such things when there is agreement with the different parties around that. But just if I can bring you back to the comment -- we made the same comment at the last quarterly. We have a clear line of sight to 60%. So we have a level of confidence that we've got the pieces progressing that will get us to the 60%. And as we've shown more recently with the German Raw Materials Fund, previously with the National Reconstruction Fund, we have cast a wide net to tap into new funding that has been established in supporting projects like ours to establish a diversified supply chain for critical minerals.

Thanks, Darryl. The next question from [ Bernard ] reads, "What are the reasons why you limit the cornerstone investment target to 60%? Would you raise this to a higher percentage if there is appetite to do so?"

Absolutely, [ Bernard ]. Yes, absolutely. Yes. So there is opportunities to go over the 60%. We've said to the market that depending market conditions, we want to get within 50% to 60%. We have a high confidence of getting to the 60%, but there are possibilities and options to go beyond that.

Thanks, Darryl. The last question from [ Bernard ] reads, "With the maturity of AI technologies now permeating into the workforce, what can you see as opportunities to apply AI into the development of the Nolans Project?"

That is a great question. So I would say obviously, there's opportunities on the development side, but there's much more opportunities in the operational side and particularly for projects like ours. So if you look at our project, it is a complex integrated process plant. And for such a plant, you need to run the many elements of it in a stable fashion and in a way that is optimized for the whole. That actually has proven to be quite difficult in the past. With AI, with improved maintenance, preventative maintenance techniques, this will be one of, I think, the key differentiators that will enable us to not just ramp up quicker than we have been able to in the past, but also to optimize this plant through better information, better automation. So the use of AI will be a key plank in optimizing our asset. It will help us -- I believe it will help us much more in operations than in development.

Thanks, Darryl. The next question comes from [ Jeroen van der Peppel ] and reads, "Darryl, you mentioned in a recent podcast that you will potentially be visiting the U.S. more frequently. Can you expand on the reasons why?"

Yes. Look, so -- like again -- so we always -- we go with multiple options, right? We are engaging with the U.S. We have engaged with the U.S., and we've engaged through multiple different pathways, and we'll continue to do so. The U.S. focus has been -- so the U.S. has clearly increased its determination to secure an independent source feed for their rare earths. However, they have prioritized processing in-country, which is something that we're not doing. But with that said, we are engaged with the U.S., both from a U.S. manufacturing perspective, but also from a U.S. government perspective.

Thanks, Darryl. The last question from [ Jeroen ] reads, "I've observed recently some volatility in Arafura's share price and also trading volume. Can you please provide a comment on whether the company is aware of any unusual trading activity or has received any queries from the ASX or ASIC regarding market integrity over this period?"

Did you want to talk to that one, Peter?

Sure. Yes. So look, I'm not aware of any queries from ASX and ASIC just to sort of deal with that question first up. And we follow the register fairly closely. And whilst we haven't detected any transactions that look suspicious, what we have noticed is that -- it was widely anticipated that the U.S. would use the Defense Production Act to provide some support to MP Materials. And the breadth and extent of that support probably took the market by surprise. But what we have noticed in the lead-up around some specific geopolitical events and then more broadly some rare earth-related events, so for example, the export on -- magnet exports, the restrictions on the export of magnet exports from China and then the U.S. Department of Defense support for MP Materials. Around those transactions, there was some increased buying on the register. So I think some traders had a strategy where they identified those opportunities might emerge and took exposure to the NdPr market by investing in Arafura. And they may have done it in other rare earth projects. And that probably created some buying around the time of those events. And what we probably have seen more recently is perhaps some profit taking by those groups as a result of those announcements flowing through, share price appreciation and then reducing their exposure. I think it's probably more a view on an investment strategy rather than the underlying fundamentals of Arafura itself. I mean that's probably what we've gleaned from our analysis of movements on the share register.

Thanks, Pete. The next round of questions comes from [ Nick Stock ] and reads, "Can you explain to shareholders why FID guidance was not achieved by June of this year? And what confidence can shareholders have in guidance the company is now providing given its record to date?"

Yes. Good question, [ Nick ]. I know you're not the only one that would be asking that. Look, [ Nick ], it's just -- so we spoke a little bit about the German Raw Materials Fund. We engaged with them at the -- I'm going to use it as a bit of an example. So we engaged with them, as Peter said, in the -- towards the end of last year. And then the process was paused as the German government went through their elections. And the change in government was significant, and all that added months to the delay of establishing this fund. So these are sort of delays that we -- that aren't really in our control. Like I said in the introduction, we're one of the first 2 projects. So out of the many projects that have applied for German Raw Materials funding support, same with the National Reconstruction Fund, we were one of the first 2. So to me, that demonstrates that we're doing everything we can to progress this as fast as possible. But it's important to say a few things. Funds that we're tapping into, they're not just dealing with us. They're dealing with many companies. They're dealing with external events such as elections, such as trade negotiations, et cetera, and we're not in control of that process. And the due diligence that they're doing is very extensive. Now that will help us with securing the 40%. But just coming back to your question, we are dependent on other entities' time lines. There are external events that are impacting those time lines that we don't control, but we're at the front of the queue. So I feel like we're doing it as fast as we can to secure funding and move into construction.

Thanks, Darryl. The next question from [ Nick ] reads, "Are there any time considerations with regards to any of the loan facilities and existing offtakes? If so, how is the company managing this?"

So I think we've probably already talked about the first delivery dates on contracts. So I won't go over that again. But in terms of debt facilities, obviously, the credit-approved facilities, they all have time frames on them. And we've -- in the quarterly, we noticed that -- noted that we've been continually having those credit approvals extended. So we have a fairly extensive engagement with the lenders like our offtakers, continually update them of where we are at with the project. Obviously, we can provide more frank information to those lenders as they're under CA and they're our advisers. So they have a very good insight as to what activities we have running around the equity and how we're tracking towards raising that equity. There's also a number of ECAs who are central to the funding strategy. They probably have a very good insight as to the need to diversify the value chains. So we do get fairly strong support on the renewal of those or extension of those credit approvals. But it requires engagement and us to keep them fully informed of where we are and our views on where the market is and what we're doing to align ourselves with those opportunities.

Thanks, Pete. The next question comes from [ John Treny ] and reads, "On Page 14 of the quarterly report, you mentioned the current cash burn rate has reduced to $2 million per month. Can the shareholder, therefore, assume that the $27 million in cash holdings is enough to last past the end of the March '26, June quarter?"

Yes. Good question, [ John ]. So the short answer is yes. So we -- this quarterly -- the last quarterly, we said we had cash flow that takes us into Q1. Our burn rate is less than what we've forecast. So that cash flow runway is extending as time goes on. And also, what I should point out is at the end of Q1, we've got a healthy buffer as well. So yes.

Thanks, Darryl. The next round of questions comes from [ Fredrik Driffman ]. The first one reads, [Technical Difficulty] complete at the latest so that no further capital increase is necessary."

So Lewis, we lost you there for a few seconds. Can you just repeat the question?

Sorry about that. I'll reread that question. The next question comes from [ Fredrik Driffman ] and reads, "What is your current expectation as to when the financing must be complete at the latest so no further capital increase is necessary?"

Yes. So that's why we talk about the cash flow runway. So the cash flow runway is out to Q1 plus of next year.

I think the question, Darryl, is referring to if it takes longer to secure the funding, how does that impact on CapEx? Is it likely to cause CapEx to increase?

Sorry, I did miss that question. So [ Fredrik ], that's a good question. We continue to monitor the CapEx trends with our primary service providers, equipment providers. But you'll note that we continue to look at ways to reduce CapEx, to reduce schedule so that we're, I'm going to say, ahead of the curve. So as we see CapEx pressures as time goes on, we can offset that with opportunities. And look, we've been doing that for 2 years or more. And you can see that our CapEx has stayed relatively stable because of that.

Thanks, Darryl. The next question from [ Fredrik ] reads, "If it comes to the price bifurcation you mentioned in the quarterly report, do any of your existing offtake agreements reference the China price? And how could Arafura benefit from this new pricing mechanism?"

So as we've disclosed, as we've announced offtake agreements, they do have a reference to the China price. All contracts, though, have a fallback provision in that if that China price or index is no longer available, that we agree a process to switch to an alternate pricing strategy. We've had discussion with offtakers. And with some offtakers, there is actual agreement that the China price is not sustainable. So we have a process with existing contracts to move to new pricing should an index disappear. In contracts or proposals that are current at the moment but not executed, we have some time ago switched to focusing on non-China price referencing. So those contracts that haven't been executed, that pricing index is actually open at the moment and has -- probably some 6 months ago, we started to talk with those offtakers around bifurcation of pricing. There was probably some resistance to it at that point. Probably in the lead-up to the restrictions on magnet exports and then perhaps probably the more significant announcement around the price floor for MP Materials, the discussion has probably switched to focus to alternate references. The key thing for us will be to try to define a pricing reference when those pricing mechanisms that are now emerging are only in their infancy. So that's probably the challenge for us. I think there's general agreement with customers that a different pricing reference is becoming more relevant.

Thanks, Peter. The next question comes from [ Richard Grushanini ] and reads, "Can you please provide an update on Arafura's Korean engagement and the GE Renewable Energy MOU? Any progress on a potential JV with these parties?

Did you want to take that, Peter?

So there's 2 questions there, Lewis, just to clarify. One is on Korean market engagement, was it? And then...

Korean engagement, correct. And then the GE Renewable Energy MOU and any linkages through to the potential JV.

Yes. Okay. So look, we're not going to provide specific detail around the potential JV. The more information we provide, the easier it is for people to sort of try to speculate around what might be happening around the JV, which may create market speculation, which might not be helpful in our engagement with potential JV partners. I suppose in terms of the GE Renewable Energy MOU, so we've seen GE have reduced their market activity in the offshore wind sector. As a result of that, it's been difficult to get GE to commit to a long-term offtake because they're uncertain about what their forward requirements are for material. We've maintained engagement with them to understand if there is an opportunity to enter into some arrangement as they get a further -- as they have contracts that may settle or they may win contracts for offshore wind. There may be an opportunity there to lock into a volume that ties in with those long-term agreements. What we probably have seen is over the past 2 years is the market dominance of Siemens Gamesa Renewable Energy in the offshore sector has become quite significant. And we've noticed that GE have been reducing their footprint in France, which is where their main offshore sector sits. So whilst we wouldn't say that we won't secure offtake with GE, we note that we probably are getting less traction with them than we are with other groups. I think that's probably consistent with the feedback we provided in the previous quarterly. So it's probably pretty much as we report -- as we discussed it in that previous quarter. I think that's probably hopefully addressed [ Richard's ] question.

Thanks, Peter. The next round of questions comes from [ Bernard Hoffman ] and reads, "In relation to equity finance, is Arafura also in talks with Italy or France who have comparable funds like the German Raw Materials Fund?

I think we're in engagement with just about every country that has a raw materials fund. So yes and yes, and then plus others as well. Having said that, they're not all as prospective as each other. And we need to look at the link of offtake or other strategic alignment with each of those funds and determining whether or not that alignment is going to be sufficient. But yes, we are definitely engaged with both of those groups, but plus others as well.

Thanks, Peter. The next round of questions comes from [ Lee Birch ]. The first one reads, "What action is being taken to improve the cadence and clarity of communications so shareholders are being properly informed? What is being done to ensure accurate, consistent and timely information is shared with the broader shareholder base?"

Yes. Let me take that one, and Peter, feel free to jump in. So [ Lee ], so we know that as shareholders, you want as much visibility on progress as possible. And we push for that, noting that any announcements need to satisfy the ASX requirements, but also need to be agreed with the other parties. So we're continually pushing to get announcements that show progress. Peter, do you have anything to add to that?

No, I think that covers it, Darryl.

Thanks, Darryl. The next question from [ Lee ] reads, "How will management ensure value is preserved for existing shareholders through the funding solution for the Nolans Project?"

Yes. So same as what -- I think we got asked the same question last quarter. So look, our strategy is very -- I think, very clear on this, [ Lee ], right? So we're deliberately pursuing multiple options to give us choice, including the JV discussions, so that at the end of the day, we've got choice around choosing what is in the best long-term interest of the organization and our existing shareholders.

Thanks, Darryl. [ Lee's ] next question reads, "Given ARU's need for tolling or processing obligations to magnets, what is the realistic likelihood of securing an ex China partnership to complete the full value chain, including magnet production? Have any formal partnerships or commitments been secured?"

Do you want me to answer that one, Darryl?

Yes. Go for it, Peter.

Yes. So look, just to clarify, our offtake agreements are with the end user of the product, whether that's an OEM, an original equipment manufacturer like an automaker or a wind turbine maker or engagement with the Tier 1s, so for the component makers for those groups. Our arrangements are that the contract partner has the relationship with the magnet maker. So the contract offtaker has the tolling arrangement with the magnet maker, and our responsibility is to deliver either an oxide or a metal. We've not contemplated and we certainly have discussed and thought about the strategy around committing to supplying a magnet to an offtaker, but it just increases the level of perceived risk and technical risk in terms of monetizing our product if we have to go down that value chain to a magnet and try and project fund the project on that basis. So at the moment, the offtaker can direct us to settle with their magnet maker directly and the magnet maker will settle with us and order the volumes, but the offtaker remains responsible for the volume commitment and the payment commitment. So whilst we don't have a contractual relationship with the magnet makers, we actually have a fairly significant engagement directly with them. And through the magnet makers that our customers are engaged with, there are some instances where we have some engagement directly with them. And through the magnet makers that our customers are engaged with, there are some instances where we have some engagement going with magnet makers for offtake. We've had to be fairly selective around those particular arrangements because the magnet makers generally are not large corporates. They have quite modest margins, and it makes it very challenging for them to be bankable or commit to long-term offtake agreements. So sort of -- I hope that sort of addresses the question, but it probably gives you a bit more of a feel of how our contractual arrangements and market engagement happens.

Thanks, Peter. We've reached the scheduled...

Sorry, Lewis. So I'd just say, look, we don't need to engage with a magnet partner. As Peter said, [indiscernible] at this point, we would never not pursue an opportunity. But at this point, we just don't need to.

Thanks, Darryl. We've reached the scheduled closing time for this quarter's call. There are some unanswered questions from shareholders that we will respond to directly. But with that said, I will pass to Darryl now for closing comments. You're on mute, Darryl, sorry.

Sorry about that. Can you hear me?

Loud and clear.

Thanks, Lewis. Look, again, just thank you for dialing in to our quarterly. What I'd like to do is just reiterate some of the key points that we've covered today. So one, we've had over the course of the quarter a glimpse of the cost in having a global supply chain of rare earths that is dependent on one country with a number of EV production lines being shut across multiple regions. The cost of NdPr per electric vehicle is only $70. But without it, you cannot produce a USD 47,000 vehicle. The export agreements that have been struck with China only have a term of 3 to 6 months, hence, the rare earth supply remains tenuous. The economic and strategic imperative of an alternative rare earth supply chain has never been more apparent. The U.S. have acted decisively more recently, just as Japan did over a decade ago. We, Arafura, are well positioned to support an alternative rare earth supply chain, particularly into Korea and Europe. With the recent leadership from the U.S. setting a floor price for NdPr that was nearly double the China price at the time, we're seeing the market conditions turn rapidly to support a non-China-controlled pricing index with the creation of such an index only being announced last week. We've been able to announce further progress on securing cornerstone equity and are closing on securing the remaining equity so that we can finalize our funding and move into construction. And we're determined to finalize the funding as soon as we can and appreciate that you've been waiting patiently for this. It is evident to us as I hope it is to you that our timing is proving to be quite fortuitous. I will close there. Please, we will take -- we will answer the questions that we didn't get to. But please, I just encourage our shareholders to ask questions any time during the quarter. Thank you again for dialing in.