a balanced view.

Research Note:ABN AMRO Morgans Limited
17 Jan. 2006
Target price:A$0.24

"Valuation and risks to target price
We see little resource risk, with the sulphide ore exposed in the pit floor. The various
components of the sulphide flotation plant have been effectively tested, although it
has yet to be commissioned. After the issues related to the unscheduled release of
waste water during the operation of the CIP plant, there will be intense scrutiny of
the operation. The start-up of the plant will be critical. There is also risk in ramping
up to design capacity, but we see this as a function of time, rather than achievability.
The Leightons mining contract limits the potential for cost increases. The project
remains exposed to metal price movements."