Ann: Quarterly Activities Report, page-16

Thanks for that splooge, I'm always interested in this sort of information from workers at the actual operations. Even though it is only anecdotal there is usually some truth to it. I would imagine that a lot of workers were made redundant or poorly paid through the down times at SLR and that probably simmers underneath the surface with those who remain. If the workers are skeptical of the operating ability of the company then I’d be more worried. Can you elaborate a bit more?

Often the feelings at the mine site are shared by investors, and it seems that's the case here in regard to a mistrust of management. I follow successful gold analysts/investors such as Rick Rule, Adrian Day or Brent Cook (look these guys up). The first thing these professionals look for is quality of management. Once they distrust management they get out and will probably not reassess for a long time. That has to be the number one reason SLR is stagnant. This was once a billion dollar company. Many investors lost 90% of their investment based on management’s previous promises. Unfortunately some of those who orchestrated that disaster still lurk on the board and likely deter some potential investors.

In the last 18 months I think SLR has done a reasonable job at rebuilding its balance sheet, investing in exploration/development and generally getting back on track. I think it has done enough to get out of the dog house and now deserves a bit of a chance. I’m here only for a 6-12 month timeframe. Important to remember that for the last 5 years this has been an excellent trading stock and not an investment. Money is made in short bursts and by not coming too attached. If they don’t start putting out some good cash in the next two quarters I’ll probably sell out. My main reason for holding SLR is leverage to Australian dollar weakness. Unfortunately that investment thesis has been incorrect for the last few months but I’m confident that eventually it will come true and A$ will weaken materially (and perhaps at a time when gold is strengthening in US dollars, this is the goldilocks scenario). In the meantime the stock is cheap on a valuation basis and US dollar gold sentiment lifts all boats.