Ann: Company update, page-52

Sorry if the tone came across as passive aggressive - I was just responding to the discussion upthread where a poster basically asked "show me a profitable mine with a head grade of 7% EqZn" - which is a fair question to ask in my opinion. Another poster came up with the example of the 3 Vedanta mines in India and I was just pointing out that they were already established, constructed operations in a low cost environment with vertically integrated captive smelters owned by the same company. Something that Citronen won't be. Unless people are saying that Citronen will be a low cost mine?

I would agree to the statement that Citronen may be a med to low cost mine once the construction and infrastructure is funded, built and in place.

I was also just saying that in my opinion, and experience, the promise of Chinese funding is actually an impediment to development rather than an assistance, look at the numerous recent cases of mines, development projects and transactions that all stalled by Chinese interests.

Look I reckon IBG have a decent deposit and once they find a partner who knows how to construct mines and not play silly games, at this current share price its speculative but its not the worst Zn play on the market.

In reply to Upmarket - the 2013 Feas. Study is indeed a very large and detailed document, would be difficult to break it all down in detail except to say that I agree with the majority of the study, the actual mining and processing operations (once established) are reasonably straightforward except for a couple of things that raise questions in my mind.

Firstly is the expectation to use prefabricated component equipment from China in construction, I would be wary of this, especially for critical items in the mill/processing plant as other operators have found that the quality and reliability of this equipment has caught out other development projects recently and if there is a major failure or fault with a large component then that can be a show stopper.

Secondly - is the more sovereign risk component of the Chinese involvement, broken into two sub-parts, firstly is the actual funding and getting the money out of China at all, which is indeed an opaque and unpredictable challenge, and secondly if IBG think that the Greenland Government won't react to a large Chinese contractor workforce operating in Greenland then they should closely monitor this.

Thirdly - some of the exchange rates, price of fuel and metal prices may need to be tweaked/updated, they will vary over the life of the project anyway but as long as they are suitably conservative then the project should be able to survive one or two moderate "shocks" such as an increase in the price of oil or an exchange rate fluctuation.

Fourthly - while the logistical challenges are well described and understood in the document, any unexpected logistical challenges will most likely occur in the construction phase with logistics tending to blow out the timeframes and recoveries from any delays. If indeed - their all in production and shipping costs are US$ 0.68c per lb then I think that would be a sufficient margin against any unexpected temporary price movements in the Zn price.

In the past the lack of a mining lease was the show stopper for IBG and Citronen, now, in my opinion, the Chinese and the construction phase are the show stoppers.

If IBG signed a JV with either Glencore of Nyrstar and got rid of NFC completely then it would be mostly de-risked. Not intending to downramp - just pointing out a few potential bumps on the road to look out for....