Rox’s Scoping Study (SS) announced in October last year had many...

Rox’s Scoping Study (SS) announced in October last year had many positive features including very low pre production costs and plenty of room in the global 3.2m oz Youanmi resource for upscaling production.

There have been 2 main objections and a 3^rd (disappointment) that tarnished the development to production story as medium to high risk. The market does not like risk and the share price plunged.

1. While the low Capex of a small 480 KTPA mill was very positive the average gold grade needed to feed the mill was 5.0g/t Au. This was considered ambitious.

2. The 79% / 21% Indicated to Inferred Resource Material in the production target plan for the first 3 years meant that a lot of inferred gold had to be converted to indicated but that seemed achievable. But for the production years 5 to 7 about half the feed has to be converted to indicated gold. This would be expensive, time consuming and challenging, One mining engineer opined that the project needed a much bigger mill that could process lower grade ore. The capex would be much larger but far less expensive infill drilling would be needed.

3, 71koz per annum production was seen as too small. The higher POG helped with this.

The current infill drilling program is looking positive with a new gold lode identified but whether it meets the required inferred to indicated gold conversion to make the Scoping Study model work remains to be seen. Rox will examine the drilling results soon and be able to calculate the additional indicated gold ozs.

But what has dramatically changed the development prospects of the Youanmi Gold Project is 3 promising new very high grade discoveries Youanmi South, the Midway lodes and Linda Gossan.

Any of these discoveries or a combination of them could shortcut the inferred to indicated drilling program. Why drill and mine Link and similarly mixed grade deposits if you can mine bonanza grade ore?

Any or all the 3 new discoveries could not just meet the SS production feed target but completely change the entire model. For example, if Y South is another Penny Gold (RMS) also on the Youanmi Shear, with around 300,000 very high grade ozs Rox will switch most of its resources to its development. Similarly, Midway could be transformative as could Linda Gossan.

Timeline for Y South next results mid May, Midway mid June? and Linda Gossan drilling still to be announced.