Ann: Board Changes & Project Update , page-6

IMO, the bad news has already been factored in ti the SP and once the official
permission has been recieved to re-commence mining we should see a dramatic
lift in SP.

The McMoRan cave-in will likely have diverted the attention of Indonesian mining authorities and probably contributes to KRM's delay.

The verbal go ahead (subject to conditions) given by authorities and reported in a previous ann. is comforting. I guess the conditions, namely the pumping station and the escape shaft have taken longer than expected.

In these tough times for gold and small caps, we are lucky to have a director and major shareholder who has supported the company with 2 loans.

Nevertheless, KRM is still a very low cost producer and even at current gold prices ($1458 AUD/oz) KRM is very profitable.

Reports of bonanza grades of silver lower in Talang Santo are also very encouraging because apart from the short term benefits, this type of formation usually indicates a rich gold seam underneath. We'll just have to wait and see.

Cheers
Moorookamick