here are my notes from the conference call

For what it is worth, some might be interested in my notes from the Conference call.

Len Jubber

1. Operating costs have 'an interesting feature' in that they won't escalate much over life of mine. This is due to the deposit being particularly long - cf to other open cut shallow deposit (ie depth 200m-400m) apparently.

2. They expect to intend to length mine life specifically gave the Hyena example. They also believe Osiveli - Onkelio is one continous 6km deposit. They expect by 'the back end' of the march quarter (later confirmed to be march in Q&A) they expect another JORC update - with a focus on increasing inferred to indicated for DFS. They talked about a 'uniform conditioning' method of resource estimation that suggests grades could rise (albeit slightly) and their experience - which they intend to confirm with testing in a specific area - is that the inferred grade 'is likely' to improve marginally up toward the measured with infill drilling.

3. Len talked about progress over 2009 and confirmed (as a way of explanation for the PFS delay I suppose) the first 6 months PFS focused on heap leaching and it has only been in the later half they have looked at floatation concentrate leaching. The last 12 weeks confirmed their 'earlier results' - such that board approval for floatation PFS granted. Proviso is successful locked cycle flotation testing, which is likely to be completed over january. Pilot test in february; expect that floatation process can be confirmed for DFS by march.

4. Explained that the aim of floatation (combined with HPGR crushing) was to produce a concentrate at 3500-4000ppm. Obviously reduces reliance upon sulphuric acid and also 'presents an opportunity to consider marketing concentrate perhaps alongside or instead of U oxide'. Would be interested to investigate this - any thoughts anybody?

5. 'Very leveraged project, as per most large low grade projects'. Thus BMN will be looking for mining efficiencies to 'increase the margins as we go forward' via:
i. further studies re whether to be owner of mine process or operate via contract mining;
ii. Trolley assist haulage - ie electricity straight to trucks - thus reducing time on diesel;
iii. Optimising processing flowsheet - opportunities re flotation kinetics to increase recoveries and use of agencies;
iv. Even left open the consideration of toll treatment.

He also talked about existing interested parties re synergies and outsiders contributing capital. This was left very vague. In fact my biggest criticism was that this PFS, for all the delay, was very much a preliminary document! Obviously exact costs wont be known but at this stage BMN, for all its confidence that 'it will mine', seems uncertain over a huge amount. Note in the Q&A, they reveal that '5-7m lbs may not even be the optimum size mine for a floatation project. So lots still to be determined!


6. Len made the valid pt that they have a strong relationship with Namibian Govt and Erango region. They expect to lodge their mining license by yr end (ie 'next week'). I wouldn't anticipate any particular problems here and he emphasised the jobs/community benefits of the project and govt familiarity with U.

7. Financing - have 'historically had a number of approaches' and now that PFS public, can actively look to further this. He talked about looking for a strategic partner to aid in debt financing. He made the point quite strongly that management will be focused upon limiting dilution. He also explained that management has been chosen specifically for their experience progressing projects to development.

Analyst Q & A

Duncan McKeen (Macquarie):

Q: Expected Increased in resource size
A: obviously cannot comment. Hope to convert inferred into indicated. Not expected to be as substantial as previous ungrades
Q: Desalination plant and historic conversion rate:
A: 75% of mineral resource is 'mineable'
Areva have confirmed desal has been commissioned - in action by 2010
NamPow is also considering one


Paul Adams (DJ Carmichael):
Q: Re offtake discussions - when?
A: Perhaps 'strategic partner offtake' as part of a transaction (had a number of approaches from 'broad array of parties' or 'standard offtake' - progress second half of 2010- early 2011
Q: 100 ppm cutoff. Have you looked at opex of running at higher ppm (say 150ppm)?
A: That is exactly the 'kind of thing' we will be looking at in the coming months. Be aware this would effect stripping ratio. We will be considering whether 15mt throughput is optimum for flotation concentrate.

Simon Tomkins:

Q: What magnitude of cost savings are you targeting?

A: Probably as much as we could get - contract pricing exercises; owner mining; grades. From my large scale low grade background - comfortable that there are opportunities to capture 5-10% reductions. Unable to say whether it may be 5% or 30%. 'We are of the opinion that their are opportunities to be realised in the next 3-6 months and as soon as we have that information we will comment on it'

Pat Donnelly (Solomon Partners):
Q: CAPEX and OPEX breakdown

A: See p9 of release:
CAPEX:
328m processing plant: vast majority is in the crushing, grinding and flotation circuits.
41m mining - vast majority of this is pre-stripping (8-9 months pre mining)
97m infrastructure - power & water access primarily. Truck access for floatation rather than rail for heap leap - power from NamPower as per their quoted rates (both for capex and opex numbers); water primarily water charge from nam water utility. Also include a backup facility 'about 15-20%'
OPEX: (41/lb
just over half relate to mining ($22-23/lb) - includes owner and contract costs
15/lb processing costs 'around' 'aprox'
site infrastructure makes up balance

Undecided re: owner or contract mining - at this stage costs are similar. Will decide based on cost and risk. Have both owner and contract experience 'comfortable to go either way'