Ann: ABM Secures Coyote Plant for Treatment of Old Pirate Ore, page-15

Any potential disadvantages and risks are greatly reduced with the lease and option to buy and due diligence period.

Advantages;

Very low upfront cost and low total cost for a plant which at 250ktpa will produce around 94koz/year at 12g/t. That is not Mickey Mouse production. The size of the plant is more than adequate for the size and grade of the orebody and current mine plan.

-Straight to 250ktpa rather than 150ktpa means much higher initial annual profits. This makes for a better return to shareholders because less proportion of annual profits are taken out for admin and exploration expenses. Retained earnings over LOM will therefore be higher.

-More income sooner rather than later also increases NPV further. NPV is discounted for time. More earnings sooner are worth more than those same earnings later.

98% recovery rather than 86% yields an extra 11,567oz. At spot gold that's an extra A$16.3mill/year. I expect that should more than offset the extra haulage costs.

The Coyote plant might not be perfect but the gravity plant also was not perfect even though it did an overall good job. As long as the plant is good, I see this as a very good outcome. If there is any good reason why the Coyote plant is not up to scratch, the due diligence gives them the right to back out.