Ann: Record Month of Gold Production, Record Low AISC, page-73

I am well aware of this. I'm talking about the deposit/pit as a whole. You are going to mine the most attractive deposit first up and it is reasonable to expect that subsequent deposits/pits are of a lower quality.. If these first pits burnt cash can you expect the next ones to make money? This is obviously a generalisation so take it as you will.

I would expect that the company will have strong cashflow over the next few months as they are down to the bulk of the ore with a very low strip ratio (i.e. costs will be low). The big question will be whether BLK can sustain positive cash flow past mid this year. If I was holding I would pay close attention to BLK's performance and compliance to plan, particularly cost control and realised grade. Are they doing what they said they would do? There is hope but January's performance is certainly no turn around. They just finally got to the bulk of the ore.

I think the quoted strip ratio for the broader plan (next few years) is around 7 which isn't too bad at all. If costs can be controlled and grade holds up to plan then sure, this could be a success. I just feel that nothing has changed since December and the boys at BLK still have a lot to prove before it can be called a turn around story.

Positives - Operation running and over teething problems - opportunity to lower costs/increase productivity
- Debt will be paid - no interest obligations/threats of insolvency etc

Negatives - Lack of credability
- Question marks over long term sustainability of the project