Ann: Quarterly Activities Report , page-3

Moorookamick

You are probably right about the CR but I would say only if everything goes right and Talang Santo really ramps up as expected. If there are any further delays then I think a CR will happen, but a small one (hopefully).

I see the company has had to rely on Bill Philips for a $5m loan after burning through $26m of the $30m in cash in the last 6 months. I bet they now wish they hadnt paid the dividend of $12m. So yes they have $10m in cash but now have a $5m debt as well. Operating cashflows in the latest quarter were - $2.6m after removing taxes paid. I doubt they will be paying income tax for a while as they are now in a loss position.

So you accurately represent the bull case for the stock. But I am on the fence because of the slip ups in recent times. I also question what the actual sustainable profitability will be when and if they actually achieve the theoretical run rate. Total costs look to be over $1000/ounce and the exploration budget is enormous with the types of mines we are dealing with at KRM. Not to mention they only own 85% of the mine and this will be diluted in the future.

I am a keen follower of the stock but remain to be convinced. I think the problem for the stock has been that expectations were very high that this would be the next MML. But clearly it is not. In hindsight expectations needed to adjust and I think they are in the process of doing just that.

Lord