Ann: Quarterly Activities Report , page-8

Hi PP and others,

As Activity reports go it's 'adequate'; no more, no less: bit of a box-that-had-to-be-ticked sort of report.

A couple of things tho..

I don't really understand why the Feasibility Study for AN is taking so long.. Unless they are using it to raise finance from banks etc there really isn't the need for it to be so detailed and done-to-death. Some of the numbers quoted don't really add up but even so back-of-the-Envelope calcs already indicate annual revenue of the order of ~$75m pa on 11,000t contained copper. Mining and Operating expenses of a ~55tph mill will bring this down to ~$25m. Easily enough margin to indicate a go-ahead decision.

"Second hand equipment has been identified and and is being evaluated for 'potential' use" etc.. This really is old news and now possibly misleading.. I mean, ok, it's been located (identified) and 'is being evaluated'.. ANY engineer / metallurgist could do that within 20 mins of seeing it in the flesh. Why is it taking so long to evaluate it? Why is it still only 'potential use'? Floating sulphide minerals isn't rocket science.. the equipment isn't sophisticated. Almost ALL kit available these days is second to 20th hand.. and, much like Grandfather's Axe, it's all refurbished/maintained as you go along. Really.. the endless prevarication and indecision is a bit of a worry. A 50-60tph mill with installed power of about 900kW would suffice and everything built in around it. Fairly easy to find on the open market.. If the one in Brazil isn't as 'available' as they would wish then they could source one out of Canada at the drop of a hat (refurbished too).

To me there isn't much point dissecting the rest of the Ann as, unless you're a trader looking to profit off daily SP fluctuations, Stage II is unlikely to occur under the AVB banner the way they are going.

Also, for what it's worth, I regard posting pictures of cores in reports to be somewhat disingenuous: why not just give us the assays? The cores may look spectacular but then, the Bre-X cores looked similarly so...

Given our dwindling cash position I was really looking forward to reading of real progress on Stage I.. Possibly the market was too.

BT