Ann: Quarterly Activities Report , page-12

The report is out. They maintain their hold. A less than exciting write up to be honest. I'm still not convinced Fat Prophets completely understand MEY and in line with previous reports, some parts of this write up seem to demonstrate that.

The report was largely positive, but they remain cautious. In short they are waiting for the resource upgrade and a rerating and will review the stock then.

They noted the Valencia resource, which is a similar low grade resource (albeit larger at 77Mt @ 119ppm) which is valued at US$3.80 per pound compared to MEY's US$1.60 per pound on current resource.

They continue to comment that the project in not economic at current spot prices but provide absolutely no basis for those comments. They also make no mention of some recent announcements and their impact or potential impact on the economics, such as the 25 Nov announcement advising that test work confirmed potential for ore upgrade. And irrespective, I'm not sure that Areva would be entering in to agreements at spot prices, but rather long term contract prices of $60+. So the relationship with Areva or another big player might change the economics in itself.

Seems to me like Fat Prophets are having a bet each way. I think they have been recently burnt by Bannerman Resources where they got it wrong. In one breath, they don't want to commit because members will want more of their blood, but in another they say it is valued at half what neighbouring deposits are trading at on a per pound basis. Therefore, if they increase their resource by a further 30% (for want of a better or more accurate figure) and then can realise this additional value, well people can do the sums. It's a much much higher share price. Then factor in a takeover premium and we're quietly doing pretty well.

A waiting game for the upgrade guys. Looking forward to it.