What do you think

There is alot to take in with this all-scrip scheme of arrangement and capital raisethrough SOPH’S and brokers.

Firstly, Ithink it is a win win for Poseidon Nickel Limited (POS) shareholder who werenot going anywhere with their share price. Nickel, at the moment, is not worthdigging up while Indonesia has heaps of it and selling it so cheap. Maybe in 10years’ time when their stocks decline a little the price may go up, or theyfind a greater need for nickel in the future.

The mill atBlack Swan currently a 2.2 MTPA on care and maintenance needs a lot of work andmoney spent on it. The cost will vary on how much of the 2.2 MTPA input is used.Maybe half that to start off with, say 1.1 MTPA. This could cost 30 to 50million dollars which could be funded by HRZ two contracts with the jointventures with the toll millers over the next 12 months or so, already in place.

Hopefullyby the end of toll milling in say 12 to 18 months’ time, and the Black Swanmill will be processing gold from our own tenements. This is when the shareprice will really take off, HRZ with 1.8 million ounces at 1.84 GPT with moreto come when drilling recommences.

Now say theBlack Swan mill puts through 1MTPA with a grading average of 1.84 grams pertonne this would give you a minimum of 65,000 troy ounces at todays value of$4,000 per ounce equals $260,000,000.00 per year gross. Less mining &production charges of course.

IMO, youcould double this if the capabilities of the input 2.2 MTPA are used.

This issomething POS shareholders may want to think about instead of just selling off.

Secondly,for HRZ shareholders its also a win win. We finally have a production mill eventhough all of the profits from our two contracts to produce 30 to 40 milliondollars over the next 12 months will all go into refurbishing the mill.

Ok –dilution from the credit raise and the script to POS shareholders. This will benothing compared to the value of a company such as HRZ with 1.8 million Oz andso many of these tenements still underdeveloped with more drilling we will havea mine life of 15 years plus.

When thePOS mill is completed in 12 to 18 months and we start production what price doyou think a mid-tier producer would be with 1.8 million Oz of gold within 60 to70 kms range of Kalgoorlie with good roads, power and water and a gold price of$4,000.00 plus.

HRZ’sclosing price was 6.3 cents with a market cap of 70.46 million dollars onTuesday 22^nd October. No doubt there will be a bit of a sell-offwhen the market opens. Although I can see 300 to 450 million dollar market capcoming up in the next 12 months or so. IMO.

Mostproducing mid-tier market caps are between 350 million to 1 billion dollars andwho knows if nickel takes a run one day what a bonus that will be.

I think HRZmanagement have done a really good job putting this together and look forwardto the ride to come.

Finally,welcome POS shareholders – and looking forward to your posts DavybabyK whichare very informative.

I, myself a long term HRZ shareholder are looking forwardto lift off.