quick maths, page-5

Sorry, here's the rest of it:

Cales,

The target of 5,000t of Uranium is in its refined state... not 5,000t of Uranium dirt at 0.03%.... if they only had 1.5 t of Uranium... that's only about 2 ute loads! This one strike is 1.2 km long at an estimated average of 224ppm U3O8 along the entire outcrop - they have a sh#tload, not a uteload... and remember, we are only talking about one zone within one tenement of one project... they have many more target zones throughout the rest of the Lake Surprise tenements... and don't forget the 10 tenements they have at Springvale.

The Jan 22 announcement actually says this:

"For the performance hurdle to be met:

(a) an inferred resource of a minimum of 5,000 tonnes of U3O8 equivalent including molybdenum and vanadium credits counting as U3O8 equivalents at the spot prices for these commodities as at 22 January 2007 must be delineated in respect of the Tenements; and

(b) the minimum resource referred to in paragraph (a) shall have a U3O8 grade of a minimum of 0.03% including molybdenum and vanadium credits counting as U3O8 equivalents at the spot prices for these commodities as at 22 January 2007."

Your calculations went wrong when you combined the 2... you worked out 5,000t x 0.03 = 1.5 t of U. The above target is actually a total of 5,000t of U in its refined state, as an inferred resource. Full Stop. The next part says that this total tonnage of U should be at a high enough concentration in the ground so as to make it economical to extract. For example, if they had 5,000t of Uranium in the ground, but it was there in a concentration of 0.0000001%... it would be so widely disseminated as to make it not worthwhile in extracting. They are not only looking for a good tonnage of U, but it needs to be in a fairly concentrated form.

Now remember that the U in the Scarp Prospect (and all other propsects) is all at the surface... not 120m underground like it is at Beverley or 100's of metres underground like it is at Olympic Dam. As it is all at surface, the extraction method will probably be open-pit leaching, which is so much cheaper than going underground to extract it. When they set that grade target of 0.03%, they didn't know how deep the deposit would be and they were probably assuming that it would be 20 - 30m underground. Now that they know it is all at surface, an average grade of even 150 - 200ppm would probably still be economic.

They have a lot more drilling to do to get these figures firmed up, but just looking at the scarp prospect, they may well go close to reaching their performance hurdle from that one zone alone. The performance hurdle was set across ALL TENEMENTS.

If they did hit that performance hurdle, at today's prices, that would mean they would have identified USD 850 million worth. I for one wouldn't begrudge them a bonus of 35 million shares (currently worth AUD 2.45 million) if they did.