Ann: Thunderbird BFS Update, page-30

Clearly a great call comeet, holders are hoping that the price can hold around these levels the next 3 months.

Pretty clear now that between the UBS, management, staff, contractors engaged to study a new BFS and mine reserve, discussions with off-take partners, family, friends of etc that falling share price reflected a lack of interest in partnering as the project now stands. Especially volume since 20th May has been damning while UBS apparently settled in for discussions with bidders lol. Any buyers or bounces from 35c have been heavily sold into, looks like the company and their brokers have decided 35c was the price to support (back in 28th May and again today) hopefully reflecting a value line in the sand. Sad but how the market usually works, by the time market proper is informed the price has already moved to reflect reality. Call it inside trading, call it efficient market hypothesis it is what it is and always will be.

Moving forward SFX require more funds to keep the lights on. Cooking pretty hot with a half started mine site, camp, project management and a crew of staff that would embarrass the Ben Hur producers. Add to that the cost of all the consultants etc to do an official standard new BFS and SFX will be over $1M per month spend. Their broker will try and hold price up in the mid to high 30's and get a CR away soon I reckon while the markets are in a good mood near record highs. Waiting for a Trump-Xi fight at the G20 and this current short squeeze melt up market to possibly fall over in July doesn't sound very smart to me. Good managers raise money when they can, not at the price they want to.

After further consideration this new BFS is as much an exercise in distraction and playing for time as it is a cunning new mine plan. A few years delay in building the LTR is a capital saving sure but at the expense of significant Ilm revenue. An admission that the capex is too high to interest anyone to buy in, hoping that the Zr price stays up long enough to generate funds for stage 2 expansion and the LTR plant. A Zr only mine is a much higher risk in early years as the Zr price has proven by far the most volatile of all min sand products over time and falls the hardest into a demand slowdown, such as we might face short term into a protracted trade war and any financial mess. Reason is that most mines will just pump out the Zr as a by product regardless of demand and pricing. Ilkua has tried to become the worlds swing producer to even out prices but they might well squeeze out a new Zr only producer before supporting the price such is the games big bastards play.

Anyway, I digress. TB is effectively on hold for another year imo, SFX needs to raise money and hope the trade war allows enough confidence to return that partners will consider coming in on a second sale effort. My guess is this year is too soon to try again, even informally, without any competitive tension while the market sees where the world slow down, trade war, new stimulus etc all play out. Keep an eye on the Zr price is my best advice. If that rolls over significantly then TB will be delayed until the Zr prices cycles back up. This is just the reality of funding the start of a new Zr mine. Fingers crossed the new stimulus kicks the can down the road and we all get a 2016 bounce back into favourable territory for funding next year.

All IMHO, good luck