Ann: Retraction of Scoping Study Announcement of 24 June 2014, page-18

It would pay to note that this event does not really detract from the underlying quality of the project. It just relates to the practices of the management team about releasing information to the ASX.

However, the problem with using exploration targets as part of a study is that they may not come to fruition. In the case of LMB it would blow the project away if future drilling did not confirm the additional resources. They only have 7Mt in resource but a designing a 2Mt plant which plainly overdone. They have purposely included the exploration target to maximise the size of the operation at an very early stage of resource definition. If the resources are not proven up they would have to go back and totally rework the studies and lose a lot of credibility (and money) in the process.

Fast tracking can be done successfully, but the company has to avoid getting ahead of itself as the traditional industry path of scoping/prefeas/feasibility is all about adding confidence and getting the eventual project design right for the specific size and nature of the project - and this is a de-risking process for investors/shareholders.

Cheers
Gosouth