Accumulation Time - Huge Upside Potential, page-14

Hi Guys,

Both PEN and BKY have their own specific issues that must be overcome, irrespective of the sector dynamics.

In BKY's case they need to get permitting for Zona 7 to make the mine viable. Permits have been delayed and legal objections keep cropping up. The issue here is the proximity of Zona 7 to the local village and the risk that alpha particles are breathed in if dust from the mine blows into the village.

In PEN's case it is simply that their process flow doesn't work properly which results in very expensive U being produced. PEN is too high up on the cost curve at present, even if U markets revert to the breakeven cost which is widely purported to be c. US$60 - 65 lb.

PEN need to transition their operation from alkaline to acid and secure the permits to do so. The high priced long life sales contracts in conjunction with accessing the spot market gives them time to achieve this.

Higher U prices alone won't be enough for either PEN or BKY .... they need to sort their company specific issues out ... I am not saying they won't be able to do this, nor am I saying that their SP's won't gallop if the U sector starts to turn.

Cheers
john