Ann: Quarterly Activities Report , page-2

The quarterly report went down like a lead balloon on the TSX - CGX down 14 cents to CAD1.96, 6.67%.

Anybody got any thoughts on this report?

My initial thoughts are:

1. cash costs are too high at $753/ounce which is only a small reduction from $832 despite production increasing by 77% back to its normal level - no explanation given for this other than there has been a significant fall in the gold recovery rate from 90.6% to 86.4%.

2. no mention made of being compensated for previous mill failure by insurers - why, how is this proceeding? (were they told to get stuffed)

3. first time there is no mention of mill expansion to 10mtpa, which would raise annual production by 50% to 300k ounces

4. increase in cash and liquids of $10.6m to $153.9m

5. Lycopodium Optimisation Study not completed yet (expected in June quarter) - is this supposed to relate to an upgrade of the mill to 10mtpa, if it is they did not mention any upgrade is intended.

Yawn, another day to watch CGX get smashed on the ASX.

CGX may be considered a sell once it gets to $3.00, unless they upgrade the mill to 10mtpa. Management has lost its way, or is simply just collecting very good pay and waiting for a takeover offer.

loki