bouncing round like a basketball!, page-27

Thanks guys,

"I agree that as long as it is real (not another Bre Ex) then it is a shaping up as a world class Uranium project"

Please correct me if I'm wrong, but I thought that Bre-X was the whole reason for tightening up JORC standards? Studying the NI 43-101 technical report on the Zone 1 resource, ISTM that pretty thorough methods were used to guard against fraudulent samples. For example,

"Data collection methods applied by Extract have been reviewed in the field by Coffey Mining and, as such, have been directly assessed...

Calico sample bags with draw-strings are used for core sampling, identified by sample tickets. One half of each ticket (identical halves), which has a printed sequence of six digit sample numbers, is placed into the calico sampling bag. The technician completing the sampling annotates the hole number and the sample interval on the remaining portion of the sample ticket. As part of the quality control protocols, the technician verifies that the metre interval marked on the core matches the metre interval written on the sample ticket, and also matches the metre interval on the sample form. The technician also verifies that the corresponding sample number on the sample form for that interval matches the sample number on the ticket and also matches the sample number written on the sample bag.

Sample intervals are generally one metre in length, though sample intervals can be reduced to 25cm or multiples thereof within suspected mineralised zones. Once the entire metre, or fraction thereof, has been sampled and placed in the calico bag along with the sample ticket, the bag is tied firmly.

Samples for each hole are placed into large polyweave bags, with approximately 12-20 samples per bag. The bags were then numbered and labelled with the enclosed sample numbers and then taped closed.

In batches of approximately 1,000 samples, the polyweave bags are loaded onto a truck and sent with a dispatch sheet to the Genalysis preparation laboratory in Johannesburg, South Africa...

Check samples in the form of standards, field duplicates and blank samples are inserted into the sampling stream with their sample IDs forming part of the general sample sequence. Standards are currently inserted at a rate of 1 in every 100 samples such that sample numbers ending in “00” are standards. Field duplicates are taken at a rate of 1 in every 50 samples such that sample numbers ending in “26” or “76” are duplicates of intervals ending in “25” and “75”. Blank samples are inserted at a rate of 1 in every 100 samples such that sample numbers ending in “50” are blanks...

Coffey Mining has reviewed Extracts sampling procedures and observed the drilling and sampling practices in the field and found that overall they were of a high standard. All technicians appear well trained and are effectively supervised by Extract staff.

It is recommended that the use of an umpire laboratory be continued to gauge inter-laboratory accuracy. The umpire assaying of pulp rejects and/or field re-splits should be undertaken...

All drilling samples are kept under supervision of Extract staff at their exploration camp until dispatch. Samples are currently transported directly to Windhoek, and then freighted to the Genalysis preparation laboratory in Johannesburg. Due to the remoteness of the exploration camp and the supervision by Extract personnel, Coffey Mining considers that there is little opportunity for sample tampering by an outside agent...

Extract submitted field duplicate samples at the rate of 3 duplicate per 100 samples for the RC drilling. A total of 702 data pairs were available for analysis...

The RC field duplicates exhibit very good precision, with 87% of the samples returning within a 10% Rank HARD precision level. Likewise the laboratory pulp repeats exhibit very high precision levels with 92% of the data within a 10% Rank HARD precision level. No umpire duplicate data was presented for analysis."

ISTM that Coffey have inspected Extract's sampling and assay procedures pretty thoroughly and found them to be "compatible with accepted industry standards". They have observed sampling on site and checked that it is difficult to tamper with samples between them being taken and assayed.

I would rank fraudlent samples and assay results as pretty low amongst the risk factors. The two biggest risks in my mind are:

1. That a bid does materialise - but why would Dattels get so uppity with RIO (and commit so much of his own cash) if he weren't pretty confident of making a sale?
2. That future drilling disappoints. More infill drilling is needed to a) verify the Zone 1 resource; b) define the zone 2 resource. I think it's more likely that this process will lead to upgrades rather than downgrades, based on what I've read (and because the intial estimate must be conservative until verified by additional drilling), but the latter outcome is not impossible.

As time goes by and more data accumulate the risks reduce and I'd expect the share price to reflect that in due course.

Best regards,

Mark