HC "Rules" for Posting, page-9

Hi @bdell,

Sorry if you felt I was implying you were impolite, this was not the intent - I was actually agreeing with you that some others had been impolite to you. That's the problem with the written word I guess, the intent can sometimes be unclear.

I do, however feel that your dismissal of my analysis is significantly incorrect - as may have been pointed out by the others. However, let me explain why:

Averaging of numbers misses a key understanding from last announcement. Our plant recovery rate didn't double in last announcement. It QUADRUPLED - when you account for doubling of processing and doubling of recovery. You need to read the data to understand this. This is why I was so desperate to add another mil to my holding - because nobody seemed to realise this detail. If the recovery rate remains consistent with last announcement, then we'll easily achieve my numbers.

1. Your calc of 766 carats per day = artisinal and plan recoveries combined.
2. Plant processing has doubled recently (and this was a doubling from prior improvement). Assuming a straight line average will understate this massively as the increases have happened in the later months - even by adding 1500 ct/wk to the number is understating.
3. Further, the recovery rate has improved from 0.2ct/tonne to 0.36ct/tonne since mining of the new lease. This is the biggie you are missing. If this remains the case, then averages are massively understated.

I assume the artisinal recoveries will remain at a steady rate.This may be incorrect and actually, writing this has me thinking we need to understand the capacity here. But in the absence of other info, this seems a reasonable approach for me. Your averaging assumes the same thing more or less anyway.

Further, what gives me comfort in my mining estimates is that the current rate (using the inferred carats per tonne) is within the advised recent recoveries now the plant is running.

Also, the artisinal recoveries seem to vary significantly, so I admit my averaging over a period has a possibly higher deviation - but will be less of a deviation than assuming the two are combined.

The main difference in our numbers comes from the increase in the recovery and amounts of material the plant is processing. To dismiss this is somewhat naive in my view.

But, either way, we can agree that the recoveries are improving and we're investing in the right place.

Cheers
Capt Amazing