Ann: Mt Carbine Infill Drilling Reveals High Grade Ore In Cutback, page-47

Agree Gopher

Other points I picked up.

A number of significant players. Cronimet, Masan, Oaktree, QIC and Aust Govt have undertaken many months of due diligence on EQR and the projects and they all have agreed to the viablility of the projects. However, restoration of a mine is probably like renovating a house. There is the plan and then there is the reality of what you face and at times it can be challenging. The hardest part was always going to be the start as they build towards full production over a number of years.

The plan has been to ramp up the projects over time, which has meant the capital investment has been relatively low compared to other projects but this has meant continuing to build as they go along. This has affected production to-date and as he said, they are nearing breakeven at current levels (which would suggest Carbine around 200t and Saloro above 150t. Carbine has hit record production over recent weeks as higher grade ore is processed.

Kevin is in Spain and he acknowledged the fix has been harder than they originally thought but they have rebuilt the whole process and he gave the impression that he has it nearly solved. The pre-ownership was recoveries below 40%. They are now around 50% to 55%, but looking like he can get it to 70%. The grade is fine, which means, if they can get the recovery and reduce the processing costs via ore sorters then in Kevin's words, "this project likely to exceed our expectations".

He emphasised the QIC deal was important as it allows Carbine to go underground and drill out the deposit. Expecting the underground to add 25 to 30 years as the open pit is less than 20% of the resource. He said recent drilling had given them confidence that the grade gets better as you go down, which could lift the overall grade of the deposit.

They are looking at downstream processing which gives them the opportunity to value add and they have been approached by many players as they with Masan are the two biggest non Chinese producers.

Kevin gave some insight that he had been working with ore sorters since 2009 and they identified Tungsten as the best mineral to ore sort (not all deposits can ore sort). That's how they found Carbine.

The 400m plus decline will be open soon (which could save them $10m+, not having to dig it out). With the QIC money they will drill from the tunnel and trial some mining (hopefully targetting some high grade zones).

If you want to understand this project in more detail. Worthwhile listening to the 19mins.

The other observation. If they can deliver at Saloro, then it opens the European investor interest. You have UK brokers VSA Capital, SP Angel and Hallgarten all writing about EQR in recent weeks.