Ann: Makabingui Gold Project Update, page-28

Hi Gycor I think you maybe a little optimistic in your estimates. Given the fact that our processing capacity ( supposedly 300,000 t/p.a of raw material) is not going to change due to the present upgrade of the existing plant.

I expect a recovery rate of 95%, so BSR will be able to process 285,000 t/p.a that will actually yield some gold at some g/t rate that is still unknown. This would equate to 23,750 tonnes of gold producing raw material being processed per month all going to plan. Ha Ha

If this mining returned a yield of 1g/t we would expect to produce 23,750 grams per month. As there are 31.1035 grams of gold in an ounce of gold this would in turn equal production of 763.57 ounces per month (23,750/31.1035). Using this g/t rate, total revenue (adjusted for royalties Ect. of 5.5%) and at today's rate of $1,559 US$ would be ($1,473 US$ X 763.57) = $1,124,739 US$ a month. And that is the gross income. I really don't have any idea of what the real all-in sustaining costs will be at this time and it would not surprise me that Management don't either. But considering this Managements' take on the relationship between time and money, IMO it could be significantly higher than the figure they have been serving up to us. I believe their figure equates more with the cash cost so to speak.

Using the same figures from above if the average yield was 2g/t you could simply double the figures to 1527.14 ounces and 2,249,478 US$ per month and so on. If you feel my simplified calculations above are wrong I would be happy to hear about it.

Gycor based on your thoughts of achieving 25.000 ounces in the second half of this year, all I can say that this would be equivalent to the production of 4,167 ounces per month, requiring a yield rate of 5.45 g/t. From what I have calculated, I believe this average would be impossible from Pit 2 and they themselves have never predicted a rate this high from this pit. Also, I now believe the 7.6g/t stated for pit 1 in the revised feasibility study will also unlikely be achieved. IMO the average g/t will be more like 3.6g/t generating a gross income of 4,049,060 US$ per month.
I find it hard seeing them meeting the finance terms (18 months) by the end of June 2019, given production could still be at least 3 months away. I do not believe the Mining contractor although tenders closed on the 30/6/2019 has yet been announced or is even on site as I speak. I am not really concerned though, given our Chairman's penchant for the gift of the ** and making a deal no doubt he will get it sorted.

I do not believe the production capacity of the plant will be increased significantly within the next 2 to 3 years, so I will leave it up to you to throw in your own yield rates and find one that makes you feel good about your investment. I for one now realise, all the time I have spent doing these calculations during the past 5 years has in all respects just been a waste of time. The proof will be in the pudding, we will all be the wiser when some actual production reports are finally aired whenever that may happen to be. Possibly, sometime in May just prior to Managements' performance bonus deadline.

Finally, can everyone please stop talking about the potential untapped gold resources in Makabingui North, South, East and West and for that matter Konkouto. Presently, any statements made as to the potential size and quantity of these possible gold deposits ( maybe Africa's El Dorado? ) is simply pure speculation and conjecture based on inconclusive evidence and hearsay. To get that conclusive evidence IMO, is still millions of dollars and many years away. Time we always appear to have plenty of, dollars not so much. To me and the market at large, it is all just a distraction from the task at hand getting BSR producing some positive cashflow. Just consider how long that is taking. All other thoughts at this time are just bull---- as far as I am concerned, Management have not produce 1 ounce of the 176,000 ounces they have know about for the past 7 years and we are talking about future potential. Why? Given the time it takes anything to progress in this progressive country called Senegal, the only way I or my kids will ever see it happen is if reincarnation is in fact not a fallacy. It may all happen quicker, but I am bloody sure BSR or it's present Management won't be the ones doing it. That could be another likely possibility shareholders could face in the future.

That's my thoughts for now. Cannot wait for the next quarterly report due out soon just to see how broke BSR actually is. Hey, thank goodness for the CR on New Years eve. More CR's around the corner I guess. Good news, I hear Alex is back in Senegal spurring on the troops.