Ann: Trading Halt, page-88

I asked Nick and Simon about tables 7 and 8 in the MRE update (images below) to confirm my interpretation.

HG01 and PEP1 apply to NN and Pepper. The first 2 rows under the heading show they used a top-cut of 100 g/t. The 2nd last row shows the reduction in modelled resources from applying the top-cut ie a reduction of 18% for NN and 23% for Pepper (ie if they used uncapped data the grade for NN would have been about 10.7g/t and 13.4 g/t for Pepper and the UG resource would have been higher by about 0.573m oz or a total UG resource of 2.9m Oz - Simon mentioned that anything in double digits is conservative - ie there is upside to the grade and resources. They explained if the infill and grade control results are positive it may allow them to increase the cut-off to say 150g/t - from a statistical perspective it important they get rid of the outliers as it could result in over estimating the grade and resource.

My two cents worth is there may be upside in the grade and resource of maybe up to 10%.

I asked them about the possible head grade and was referred to the second row in table 8 titled MSO defined ie 8g/t a lot different to 5g/t. Note this excludes WW, 4P etc. IMO they will start mining NN and Pepper and then go back to NN OP, WW and 4P much later in the mine life.

Table 8 is an important table and based on my discussion with Simon in August and then with him and Nick yesterday. My interpretation, rightly or wrong, is the reserve will be around 1.7m Oz (see column 5 of row 2 (MSO defined) excluding an increase in the grade from infill drilling as noted above I do not believe there will be a reserve for any other deposits eg WW.

They are looking at a mill throughput between 1mtpa and 1.5mtpa. More on this and other things in a later post as I have other commitments today.