breaking out, page-4

* I should have said "mining commencement imminent". Not "production imminent". You are correct. However production will follow about 8 weeks later. This delayed timetable shows that although commencement has been delayed, the mining to production timeline is not that far apart.

"No work has been done all winter.
No pre-mine development has occurred."

The above is not correct. Management were in Mongolia recently where they oversaw much of the infrastructure works including the completion (sealing) of the road and pre-mine works. So now there is a road to the China border at Ceke (60km away). I'm happy to be corrected if you have different information from the company.

ETT the largest coking coal deposit in Mongolia started mining in 2010. Last year, 2012 it produced 3.7 million tonnes for the year.

ETT has been subject to ownership disputes and infrastructure contract issues over that period. GUF will be able to ramp up due to mining from 2 pits simultaneously later on this year.

ETT's deposits are 270kms from the China border and had NO infrastructure in place - roads, water etc. Hence the dragged out timelines.


Having said all of the above, based on the missed targets, I do understand your scepticism.

However, the company is far more progressed than 6 months ago. Only they know exactly how far to go.

Also being a cynic at times, I do question that the delayed construction start date (and resulting weakened share price) has coincided with the outwardly generous to some issue of 75m shares.

I mean, they're 'only' worth about $30m now (instead of the $100m hit possible under pre-revised management agreement). Had GUF managed to stick to their original timetable, where would the share price have been last month, and could management have taken the same 75m shares at over the resulting $1? I doubt it.

So if snouts were feeding in the trough, were they were only doing so because of the imminent (purposely delayed) upside?