Ann: Changes to Financing Arrangements , page-2

I guess this was to be expected given the delay in opening Talang Santo
and the drop in the POG which would affected the hedge.

We are very lucky that we have a director like Mr Phillips who steps up
to the plate when needed. As shareholders we should be very grateful that our holdings have not been diluted at these very low share prices.

In a years time we'll all probably sit back and say "what worry" once
KRM is back on track producing 4000 ozs gold equivalent a month
with $20+ million in the till.

I have disregarded most of the news media gold bears and concentrated on the
fundamentals which have taken gold from $250/oz to today's $1350 and
not only have these fundamentals not changed; there is little prospect of them
changing over the foreseeable future. So, IMO, gold will go back up.

The USA is accrueing more debt, The Fed is printing $85 bil/month, US unemployment is staying high and the IMF this week downgraded its
US forecast for growth.

Europe is worse that it was 2 years ago, again with an IMF downgrade.

Japan has responded to the US money printing by printing an even higher
% of notes vs its GDP than that of the USA.

So in summary, once KRM is back mining in Talang Santo and the POG
gradually retraces to $1600/oz we should be in a very strong position to
earn serious money.

My impression is that the March Qtr will have red ink but it will be accompanied by the official authority to restart Talang Santo.

Best regards to all long term holders and a special thank you to Mr Phillips.

Moorookamick