sp

Try not to despair too much regarding the sp. The inferred resource when it is announced later this month is likely to be circa 4 million tonnes at 3 percent Cu equivalent - this is based on published info on geometry and grades. This is unlikely to set the sp on fire but it will be an important milestone to have a JORC compliant resource.

I am a thirty year veteran of the industry (mining engineer) and in my humble opinion this deposit will be mined at some stage - the drilling results are too good for it to be left in the ground. The drill results only go down to 850 metres and it is open down dip - importantly the grade and possibly the width are increasing with depth. It is quite likely that the 4 million tonnes mentioned above could double and the grade looks like it will go up as well.. I have crunched a few numbers (based on numerous assumptions) on the back of an envelope and reckon that even with only 4 million tonnes at 3 percent the project is well and truly cash flow positive - that is based on mining a reserve of 2.5 million tonnes and trucking it to CBH's Endeavor Mine.

The Butchers Dog drilling results don't sound spectacular (assays not published) but I think it is still very encouraging that "traces" of chalcopyrite have been intersected over wide intervals at depth in both holes. The pyrotite is both a conductor and magnetic and has constituted the majority of the mineralization intersected so far (pyrotite doesn't contain copper) however as Peel has stated it is often a halo to the copper mineralization. Peel and CBH have the intention to continue drilling to try and find a repeat of Mallee Bull - be it Butchers Dog is some other lens/chute/s along strike or in the hanging wall or footwall of Mallee Bull. With the funds, knowledge and real estate it is probable that they will have success over the ensuing 12 month period.

Regarding the sp in the current time it is definitely over sold on low volumes. It is just my opinion but I operate on the principle that an orebody can be valued at 10 percent of the metallic value in the ground - this assumes that the geometry/grade/commodity prices allow for it to be viable. On this basis the 4 million tonnes mentioned above translate to 2 million tonnes for Peels half share. At 3 percent Cu and assuming $6700 per tonnes Pex should have a market capitalisation of 40 million equating to sp of 30 cents - this doesn't consider Peels other projects in WA etc.

I hold a lot of Pex shares and have done so for 18 months. I am sitting on a considerable loss however I still feel that the sp cn be trading above 50 cents in the net 6 months.