Ann: Alliance South Mine Update, page-89

I'm now out for a material loss but having learnt a lesson on BSM (throwing good money after bad) I feel okay about it.

ORS has simply not delivered on any of the outcomes that I originally invested in the company for only several months ago:

When I invested:

(1) Pearl Croydon was supposedly weeks away from production with a forecast net cash flow of c. $8m over 24 months
(2) Maldon was shaping up as a high grade reef with historical potential for 50-70k oz
(3) Burns was potential blue sky
(4) Various Victorian reefs to supplement the Maldon Mill using cash flow from Pearl and Maldon to dertermine reserves
(5) POG trending +$1,500 AUD

Subsequently:

(1) Pearl Croydon shelved for spurious reasons - real reason IMO is that it wasn't economically viable
(2) Maldon grade confusion and there was never enough capital available to get to a stoping stage even if the 1100 drive had of delivered the required grade
(3) Burns struck out and will require serious money to drill further for unknown outcome
(4) Various Vic Reefs will not be assessed now as there is no cash and represent high risk due to nuggetty style and small nature
(5) POG sitting c. -$100 AUD lower and stable.

Quite simply I don't know why you'd invest in ORS now other than for either the lottery ticket that is Maldon or the firesale value of the assets.

I would be very surprised if ORS get anywhere near their $2.2m requirement. Look at how poorly BSR did recently and their prospects are far better than ORS.

Even if Maldon's 1080 drive does find comparable grade to the 1100 level I think the operation is too small to support the corporate overheads and won't make sufficient free cash flow for shareholders at the current AUD POG to justify the risk. I have told management this.

Good luck to those buying shares now and for those intending to support the Company in the capital raising. I genuinely hope you make money (especially if you bought my shares).

Cheers
John