Ann: Lorena Gold Mine Update, page-6

The Grade of particular interest is the weighted average @3.70g/t for ore treated in the plant. This clearly includes some stockpiled higher grade ore because average grade delivered is 3.39g/t. My two concerns at the moment are lower than anticipated gold recovery @79.2% and the disparity between the expected grade of greater than 6g/t and the delivered grade of 3.39g/t. On the positive side of the ledger, gold in circuit is significantly increased and is now 1627oz. If we were to engage in wishful thinking, we could imagine that this gold might account for the lower than expected recovery but they should have accounted for this gold when calculating recovery rate.

An independent review should provide us with some insights on how operations might be tweaked to improve outcomes.

Another positive is the provision in the ann of tables of mining data over past months. If I get time I will give it some analysis.