Ann: Environmental permit approved for Talga anode refinery, page-73

Gasper

Talga have approval, subject to potential appeals yet to be announced, for 120,000 tons of ore extraction; 20% more than applied for. This is the strongest indication that the Swedish authorities fully understand the importance of this deposit. This quantity of ore would be sufficient for nearly 25,000 tons of active anode material per annum. The feasibility net present value therefore needs to be increased by 25%, equivalent to Australian dollars $ 5.4 per share.

On the basis of the recent announcements the current share price represents a very deep discount that has been achieved by aggressive market manipulation. This has intensified as the 'shorters' were wrong footed by the EIB announcement this week. They are working very hard to mitigate the significant book losses they are faced with. To give some indication of their pain just look at the highs achieved on the positive news.

The short position is not sustainable, in fact it could now be described as very hazardous. Two conclusions spring to mind, the 'shorters' are fools, which they are not, or more plausibly other hidden hands are prepared to take the financial loss as a small price to pay to keep the share price down for the equity tranche of the funding that will accompany the EIB debt.