letter to shareholders, page-39

Hi juju,

I understand your question, your view sounds logical. However when you talk to people in the company you begin to realize how constrained they are.

Mine drilling may continue but consider that development drilling is even limited at present as per the budget presented last quarter. Exploration drilling had to wind back several months ago. They had to consolidate finances to manage a safety buffer due to changing circumstances. Gold had fluctuated in the wrong direction when the AUD was up (RBA OCR grrrr) and Barrick decided to cut back our days in production at BGSM. All part of major risk for a capital constrained operator like the current FML.

Another example - Nepean can be many years away or ready to move forward for our benefit what do you want on that score? I guess the closer I get and the more I work out the more I realize that what Kal said below is more and more on the mark.

There are always options. Limp forward with a gold price at this level, not doing many projects justice - leaving us wide open to a full T/O on TI success perhaps and we lose all... Raise a bit of capital, $40M eg to take each step is the second option - each time a stock overhang and SPP and time and discount.

We have been doing that and nobody is benefiting except the company - not enough for shareholders and they know this. Next option is to get the right partner and move forward from a position of strength. That is the real game changer IMO. Dividends and rising SP is far closer under this deal than any option I can measure at present.

I think gold is going up, it should and it could take time and there is risk in that view. Even if it does this puts us far further in front than the dilution factor. It is not just the amount - it is the position of strength and what that changes vs where we are now.

I hope that clarifies I don't have time or space here so the report is the best answer I have to get on with that for now.

Cheers,
CW
DYOR&DD