Po's and Con"s, page-8

Hi landzt.

i'm a GUN shareholder, that's all. I am top 40 by my estimation. I've been in and out of holdings in GUN for maybe the best part of a decade now. I follow it closely, too closely perhaps as it worries me significantly that we are in a constantly parlous cash flow position. I do not work for GUN, Hartleys or Strandline in any way.

The new story has ALREADY made a difference. The general notice stated that Hartley's have raised $2.2 million. The existing stories struggled to raise $800k earlier in the year. Presumably there are a number of new shareholders coming in. I think we would be mad not to run with this - unless something else pops up in the meantime which seems unlikely.

We know how the money will be spent over the next 12 months, it's all in the disclosure. The Tanzanian assets are almost pure blue sky. Exploration there has a good chance of creating value for us.

I've been doing a lot reading of late about strandline mineral sands. (In our context we're mainly talking about fossil systems, remants of ancient shorelines and river systems). The strandline is the high water mark of coast and river systems. That's where you see the flotsam and jetsam left behind when you walk along the beach after a king tide or along river banks after floods. In the case of mineral sands, strandlines are where the heavy minerals like zircon get left as the water loses it's power to suspend it and then retreats thereby stranding the heavy mineral sands.

The important thing I am learning about strandline deposits is that because of the way they are accumulated they tend to be consistent in grade unlike other types of deposits eg metals. Simplistically, the power/fading power of the water tends to sift and sort deposits. Why is this important? Because when the geos find a strandline deposit their early assays give a good indication of the overall grade of the system and it becomes a matter then of determining the scale of the system and the viability of extraction.

This is significant to us because the Strandline (company) geos have turned up solid early grades already on a number of locations on their tenements. This gives us geologically valid reason to expect continuity of grade and so we are looking for scale. In Australia strandlines seem to be the major sources of productive deposits - the Murray and Eucla basins both carry extensive systems of strandline deposits. Some are not individually big but there are a lot of deposits of sufficient scale to support major industry. Strandline deposits are not generally as big or as simple as dunal deposits as Peppie has pointed out but in the right system (ancient river or coast) there can be numerous deposits like the 2 australian systems above.

This is massively speculative on my part but with Strandline's early or even first mover advantage in Tanzania, it may be possible that we are acquiring the dominant position in a system like the Murray and Eucla basins. If so that will be of acquisition interest to the majors along the way or, even better, if we can get Coburn up we may be able to fund ourselves to one day be able to match it with the big players like Iluka and Tronox who both have enough deposits under their control that the can idle or ramp to suit market conditions. Now that would be luxury - one can dream right?