Ann: Drilling Extends Shallow Strike Over 200m at Side Well South, page-36

Hi OB

Yes, I heard you say the other day that you dropped near half your GBR holdings in the low 6's. Maybe just a few days early considering GBR's recent rise, although if you were real quick you may have got into MEK few cents cheaper by doing it when you did, so may have been about even.

When you mention you like the board and potential for a cap raise, I assume you are talking MEK and not GBR. You are probably aware MEK had some fairly major CR's and option conversions recently. At the start of this financial year, they had 1.235b shares on issue and now have more than double that with 2.515b so that's pretty major dilution and apparently, according to the announcement they did it to avoid the planned gold loan, so seems they may prefer a CR.

Anyway, despite the heavy dilution the share price has still done well so investors either like management or the move to production or both. If they didn't dilute, then based on the market cap the shares might be trading at $40c now. Market cap (value of the company) has increased tenfold but share price only 4.5 times but still did well considering and the cash helps of course, but would the gold loan have been better for shareholders by avoiding all the dilution? IE share price of 40 cents instead of 18 cents? I'm not sure without looking at it more closely.

GBR and MEK were almost equally valued in July and now MEK almost 10x more than GBR so in hindsight I know where I would have preferred to be but hopefully GBR has all that ahead of them still without the same level of dilution (for now at least) but as we all know, these types of companies need cash one way or another. Ironbark getting bigger and close to production if management get serious, and can bring in truckloads of cash, enough to drill 24/7 and still pay a nice dividend. So which company has more upside from here? I still lean toward GBR as MEK has had a nice run and MEK shareholders may even consider taking profits and buying 4x more GBR than they could before with the same cash.

Goodluck OB, you have a decent foot in both camps and gold price set to surge so you should do well either way.