Ann: Change in substantial holding from MQG, page-12

I think the plan for these guys has always been to go for the takeover but maybe they are changing tact now and looking towards production.

The good thing is from the corporate side (not the geo necessarily) this should be a pretty simple operation.

They might look at something like an 800ktpa plant. Would expect they could get capex done for around $100m. If you assume a 60/40 debt to equity split that isn't hard to achieve on either side of the fence. Small loan on a high cashflow mine and small dilution.

Resource grade is 11.1g/t. Assume 30% dilution and that means milled grade is ~7.5g/t or just above. Let's call it 7.5g/t.

Early met work says 98% recoveries, I will call it 95%.

Gives us 800,000t x 7.5/31.1 x 95% = 183koz p.a. Should easily be doable for A$800 AISC on that sort of grade.

So 183koz x A$1,000 margins ($1,300 at spot) and that gives us $183m EBITDA per annum. Less than 1 year payback.

If they decide no-ones willing to pay a fair price or they don't want the easy way out it shouldn't be hard to get the right people that want to be involved in turning this into a cash generator.