hard rock options, page-35

binbin,

you stated: "In fact, it wouldn't surprise me at all if the company has already stopped production from tailings in order to make the necessary changes to the Tailings Plant."

I would be surprised to see them do this without informing the shareholders about it.

"No doubt this will make Average Daily Production numbers look terrible again but if they manage to fix the problem, I personally definitely wouldn't be complaining."

Agreed, production rates will take another hit but we have to go through this anyway and clearly the sooner the better! The longer the low production rates persists the more money CNQ will lose. So each morning when I turn on the computer to see what news is released I hope to see an asterisk next to CNQ. But the last thing we have heard is management was assessing the situation.

"In terms of CNQ's cash position, another capital raising is a possibility but not necessarily a definite certainty."

That's right, it is not a definite certainty unless it is announced. But that could happen as soon as Monday morning and the longer the low production rates continue, the more likely it becomes. Had CNQ not run into what I deem extraordinary ramp up issues, we would not even have to think about the possibility of a cash raising at all.

At the time when a cash raising is announced it will be too late to sell out and buy in at lower levels. In fact I am afraid it is too late already since the market appears to have priced in the bulk of another cash raising already.

Those who anticipated a cash raising early (there was at least one poster who said so earlier than I did) and sold out at that time spared themselves the loss that we took during recent weeks. They could re-invest the proceeds of their sale after the announcement. As we all know cash raisings happen at a discount to market prices and after it is announced the stock price hovers around the issue price for a while in most cases. This is exactly what happened when CNQ did its latest cash raising earlier this year. And I would prefer to not go through this kind of treatment again.

"As I mentioned before, your assessment of the company's cash position has failed to take into consideration the cash inflows from the bulk shipment post June 2012"

That's just not true. It is my opinion that even with revenues from future shipments the company could be running out of cash and have to tap the capital markets.

"other cash inflow items that you may not be aware of, the $2m placement and the outcome of financing discussions with Mitsubishi."

Well, I stick to the facts. The $2M are reserved for long lead items and can not be spent on the front end of the plant at the same time. Once Mitsubishi provides CNQ with cash, I will take this into account at that very moment but certainly not befor it actually happens.

"You have also assumed that the repairs to the Tailings Plant will cost a fortune which may not necessarily be the case. Time will tell."

Well, could you please define "fortune"? This is your choice of words, not mine. I said CNQ's cash could be insufficient to cover production costs AND costs of fixing the plant. That doesn't necessarily have to be a "fortune" in my book. But it still could mean another cash raising.

"In the end, to me, it's all about getting the Hard Rock Mining phase right and things seem to be travelling well on that front as evidenced by Mota-Engil's willingness to become a substantial shareholder of CNQ."

That may be true and this is why we are investe here, isn't it? But this is not what our discussion was all about. In the very long term I am as hopeful as you are. But short term I do see more problems and whether CNQ has do to another cash raising or not is not at all unimportant to me. I, for one, do neither want to see my holding diluted nor the share price tank again.