qterly out - preety darn good., page-3

Grazer/Formaggio,

A very pleasant read indeed, a truly and sustainably profitable nickel producer at these prices. An annualised NPAT of A$20 mm in these dire times for nickel.

I did predict a week or so ago that the cash costs would be down due to higher production (to meet the annual budget they had reaffirmed). What was a pleasant suprise was the higher grades, which pushed everything in the right direction - which I why I am so excited abouted Moran. It lookes like the market is too as without it I suspect we've be thinking about a 2 handle rather than the 4 handle we are all contemplating.

Nothing much from Tropicana. With Moran we can all be patient with that. I liked the approach on building the exploration portfolio. Patient, systematic, big picture stuff with leading edge geophysics and geochemistry.

Much happier to see them aquire a data base for $1.5 mm, then spend $18 mm utilising it, aquiring permits and doing early stage exploration than to spend $20 mm either collecting their own samples, or on acquiring exploration projects or second rate second hand mines.

I feel this company's exploration portfolio should be treated like a good new wine. I am learning to be patient with the exploration. With Tropicana and now Moran (McLeay was only reserve sustaining) we can see that this company delivers substantial quality exploration results. Really appears to be a serial offender - makes you want to lock em away and throw away the key.

I hope Chris is using these times to collect some truly great explorational geoscientists.

EL