YMYC, page-5

While this 'may' be the case fastbuck, I dont read it that way. For example, the market current values RED @$1.43. RED (just looking at one period, for now) touched this price multiple times during CY11, when the mine and plant was being constructed as well as continued drilling. Updates were a plenty, yet the price was $1.43. So the statement doesnt hold true.

RED is highly leveraged to the upside and downside. Until they prove-up production on a consistent basis the SP will stagnate. RED management even acknowledge this - their view is that only when this comes will they be "re-rated". Additionally I spoke to E&P recently and they are forecasting full scale production (in-line with previous guidance) beginning mid-Oct. I think it will be earlier if not now.

A couple of other factors that give me confidence is that the T20 are now very happy with performance, however would also like to see higher prices - this comes straight from the horses mouth. Its just a matter of time before RED is re-rated as I mentioned earlier. The other factor is that RED is a brownfields project, so it is essentially a pre-determined cashbox i.e it got off the ground as the economics were proven. This means RED has to return funds to shareholders and this is also the view of top shareholders who are also insto's which will keep management focussed and honest. Nearly every analyst covering RED is forecasting EPS of ~$0.50. At 40% payout, that represents $0.20 divs. And that is only at $0.50. In some years earnings will vary between $0.70-$1.00ps. Again, every analyst is forecasting such numbers. The key question is when will this come, as timeframes have been pushed out of late.

I am very confident of my investment based on discussions with RED.