Ann: Independent Resource Estimate of 6.9Moz PdEq, page-93

There is a lot of misinformation flying around which I thought I would clarify.

During the 2003 BFS, the company had explored producing a concentrate. The concentrate was low grade as seen below


The toll for a smelter is approximately 5g/t for each of the elements. Clearly there wasnt enough margin in that in 2003 or 2012 @ 21.6g/t after tolling to sell that concentrate so the company had to go down a hydromet path. Because the starting concentrate grade into the hydromet was only 21.6g/t that necessitated the need for a larger hydromet plant which inflated both CAPEX and OPEX significantly.

Compare this to the concentrate that was achieved in 2015 after more metwork from PAN

This is where the real difference in the project shows. At this concentrate grade there are options. You can sell this to smelters and pay the toll with more than enough margin at say 100g/t. If the company decides to go down the hydromet path it is doing say with a significantly better concentrate starting point which means smaller plant, lower capex and lower opex.