Ann: Optimised production plan ahead of low pH transition, page-5

Not surprisingly, I hold a very dim view of this announcement.

If this strategy was to preserve the resource, this would have been part of the corporate strategy for quite sometime, i.e. there would be no reason to not announce this production curtailment during the recent quarterly webcast (only last week). Between the webcast and today's announcement, something unexpected and material has occurred in my opinion. A possible answer is that MU1 has given up the ghost. Considering the recovery of U from this MU has been less than stellar since start up it's not likely that the ore zone of this unit has been exhausted of uranium. It's reasonable to theorise that there is a hydraulic or chemistry reason for the final 'failure'. I do not buy the 'preservation' explanation. But hey, I'm a cynic. In my view, MU1 is destined for ISR heaven (or maybe hell?).

Going foward, until the silver bullet of low pH processing arrives (2 years away at least if at all), unless something is done to reduce fixed costs, all in cash costs for the miserable production volume are going to be horrible. I don't see how spot assists until it's (significantly) higher than the current sell price. In fact spot needs to remain low until the low pH utopia.

All the above is a theory. Make up your own mind.