time for another crack, page-27

Without knocking the long term prospects of SDL, we are in for a couple of rough months due to the following reasons.

- The DOW and World Markets appear to be heading south, following news from Greece and other uncertainties.

- The ASX appears to be heading south, based on the DOW and World Markets.

- The ASX has also appeared to have taken a battering as a consequence of the Henry Review. Although the review mainly effected Australian Based Miners, the impact on their share price has driven the overall market down. There is also a question mark over the impact this will have on Australian Economy overall.

- A lot of experts are tipping the ASX could head back to 3000 and below, so a dip in the market like we have experienced over the last week, could trigger some panic selling.

Although the Henry Review may have worked in SDL's favour, it is hard for SDL's share price to fight against the weight of all of the above points. On top of this, is the fact that any loss of confidence in world markets could affect the chances of SDL securing a strategic partner to fund the project.

In regards to SDL itself, I am not expecting any announcement on strategic partners until August at the earliest. At the moment we know:

- SDL have stated that Finance will be arrange by the end of 2010.

- SDL have stated that the Defintive Feasibility Study (DFS) will be completed by the end of 2010.

- It is believed that the securing of stategic partners is dependent on SDL proving up its resources through drilling.

The main reason as to why I think that an announcement of strategic partners won't happen until August at the earliest, relates to the last point about drilling. SDL recently announced that it had purchased a 4th drill rig, which will not be in operation until June. For SDL to get any benefit from this drill rig, they will want to have it operating for at least a month, possibly two, then they will need further time to send samples away for testing.

The main concern over the next few months in relation to SDL's share price is going to be the ASX and world markets.