Ann: Revised Forecasts - Investor Presentation, page-24

Hi bdell,

Bankers are hard to read.

I am sure MacQuarie's intention was to get out whether PGI achieved it's original goals or not.

And I am sure that once a decision is made, MacQuarie will pursue it and to hell with the consequences for MacQuarie or PGI.

So I am not convinced that they capitulated in regards to the loan repayment requirements placed previously on PGI when they considered the consequences for PGI.

However, there has to be one of two things:

Firstly, and the most likely in my view, is that PGI has found a new lender and it's only a matter of a few days before all is signed off and MacQuarie gets paid out, or

Secondly, MacQuarie is now treating PGI as a new investment, that is, they have reviewed the prospects of PGI, know exactly what is possible and not possible based on what they have seen for the last two years, and considered as if they had never invested in PGI before, that this is a prime opportunity for them.

The only thing that makes me think that the second option is not likely, is that BJ has said in the announcement of "waived share requirements" that Macquarie will now determine new requirements for the loan repayments shortly. This made me think that PGI are not too worried about this and will not participate in negotiating these requirements as the loan will be terminated in the near future.

However what is interesting is the dredging of the lowest quality tailings for the first six months of this year. Someone suggested that this area was just part of previously prepared schedule, which I agree on to a certain extent, but I think that this decision may be far more recent considering what you would normally have expected:

a) PGI would know prior to dredging the quality of the area being worked at the moment, and BJ told us he knew that this was so at the beginning of the year,

b) you would have expected PGI would have worked a better quality area to help make the MBL repayments and to impress the US Bankers and potential investors.

But I think BJ is a superb strategist and while he has one eye on the moment, he also has his other eye firmly turned to the future.

If we reflect on what PGI is attempting to achieve in the long run, I am sure it will help interpret exactly the results that are being achieved at the moment, and may help us understand what is going to happen in the future.