Ann: Quarterly Activities/Appendix 5B Cash Flow Report, page-42

As always, a very good summary from your side Geofiji.

Of course, HMX and CNB should not consider each other as enemies. On the other hand, this boundary dispute is not so trivial from my point of view. I think we have to wait for the written statement of reasons before we can draw further conclusions. The fact that the authority first ignores HMX's requests and then asks for an extension of the deadline is and remains a sign for me that the decision in February is not so clear after all. As I understand it, before February the "blue rectangle" was also nowhere to be found on any CNB plans or presentations - could this be an indication that not even CNB assumed that the blue rectangle belonged to their area? So - wait a few weeks here. Honestly, I hope that there will be a clear justification and that the case will be closed. No one is interested in years of litigation.

The way I see it, Kalman has always been treated very step-motherly. This is probably because the really juicy intercepts are somewhere 200-500m below the surface. However, things have changed since 2016 and an open-pit scenario - possibly in the context of a production facility - which is additionally fed by (open-pit "satellites") - could be on the horizon here. Strategically, Kalman is in the middle of a region where the infrastructure is already in place (and not in the middle of nowhere). The increased metal prices do the rest to support such a scenario.

As I understand it, this has always been "the plan" with regard to Kalman. With this I repeat something I have already mentioned a few times: All well and good, but in principle the metal in the ground is worthless until the perception changes that it can be brought to the surface. This then raises the question of the value of such a resource. In the light of a possible production (even if it is still a long way there), I would put 1 - 2% of the value of the metal in the resource. So if we were talking about 10 billion, that would be 100-200m - and since so far Kalman has hardly been included in HMX's market cap - we would then be at the 150-250m market cap I am targeting (for now). Theoretically at least.

If such a scenario were to emerge and a strong partner were to come on board, then the "value" would take on a completely different spin. Then we are talking about future cash/flows (and possible net profits) in relation to the current market cap - then we are probably quickly talking about other "dimensions". I think the long-term plan of Ziggy & Co. would be to sell the thing somewhere at a market cap between 0.5 and 1 billion. That may just be wishful thinking or something that is not possible for another 10 years. Or - as we have also seen many times - things change much faster than we think.

Ultimately, it also has something to do with perception. HMX has delivered solid results over the last 2 years, but nothing that has knocked your socks off. I think that is what is currently missing to see a solid re-rating of the SP. So a strong Kalman update combined with some very good drilling results (in the coming weeks and months). That would be a gamechanger in my view and would quickly bring the SP to another level. However, I'll stick with it and wait and see. DYOR.