scoping study result vs upcoming pfs..., page-16

Hi Early, no,what Iam saying is that the company will start feeling some heat as it gets towards breakeven point and will start high grading or blending at 17k aussie dollars.I do not know what the breakeven point is and it could be I would think about 16k but it could be between 15k-17k.This would only again be used in an emergency. My figures are estimates.

The high grading would only involve tin as it is the major driver of the profitability though not completely sure.

In relation to the breakeven point, the all up cost, this I would think would be more inclusive than the scoping report saying that the operating cost did not include pretax profit(which maybe none),capital costs for construction, of the treatment plant, mine site infrastructure.A full all up cost additionally would include exploration costs which have not been incurred, out of a budget to be incurred, capital running costs (eg tyres for trucks)not yet incurred but would need to be budgeted for, otherwise everything would be breaking down with no money in the kitty admin expenses and I think others.

There are miners that pursue a strategy of high grading as an option at the start of the mining process, but it runs the risk for being forced later in the life of the mine to run low grade (less than the jorc average) through when the price of the commodity is could be low hence very dangerous practice.

To an extent csd is pursuing this practice by starting with the Gillian project first, thereby chasing a strategy of hoping the higher cash flow can be used for future exploration expenditure and successes. It sounds like it is going to save some high grade material for difficult times.

So lets hope all the stars line up.