azx corporate governance, page-3

RC,

I agree on the drilling programme to some extent but not completely.

This is a JV and both parties need to agree in order to proceed.

My understanding is that GGG wanted to go faster in this period and AZX wanted to go more slowly. Ergo, the drilling programme that gets agreed is the lowest common denominator.

Also the AZX announcement indicates that only ~30km of the Phase 2 programme is presently agreed out of the 192km, and yes they have 3 rigs. I think this has only come about because of the pressure GGG has exerted. And, presently, I don't think AZX can fund a larger programme.

I don't know who lodged the proxies. It wouldn't surprise me to learn GGG lodged some of them. But they only hold 8m shares and there were 16m proxies against: so it wasn't all GGG in any event.

The most recent GGG fund raisings were placements I believe, not rights issues. As I understand it, all options issued to directors were not "in the money" at the time of issue.

No, the potential insider dealing issue is that they resolved to issue the 15c options in June, did not inform the market of that fact and traded the stock in August after they made the resolution and before informing the market. This sort of thing may be tolerated in Australia, but is not acceptable, even on AIM, in London.

I don't know why BS have apparently changed position - I can't imagine that GGG launched the bid without thinking they had BS on board. I agree that the chances of getting 50+% look slim. But I also think AZX's chances of raising $25m in London and getting an AIM listing are also slim. So, it is stalemate.

Having said all that, I don't think this episode is particularly edifying to either set of management and it is in the best interests of the shareholders of both companies that the structure and management issues are resolved quickly. I would support BS getting both chairmen together, knocking heads, and forcing them to come up with a solution.