Largest cobalt resource with lowest valuation, page-87

Eric,

0.048% is a very low grade as an average over the 805Mt. And the orebody it is associated with 0.7% Ni.

Most cut-offs for the Cobalt players in Australia quote mineralisation using a .05% cut-off.

The average is below the typical cut-off.

ARL's KNP Ni-Co mineralisation is predominately laterite and as such that the orebody shall not be mined or processed till the Ni price rises. The chemistry here is straight forward. Heron's projected cost of processing the lateritic ores in 2009 was $5/lb. Nickel price is less than $5/lb.

However, for the 50Mt @.12% there is GOOD promise IMO. This Co Oxide is still not as simple to process as Cobalt Sulphides but for that tonnage a viable process is being investigated by ARL and expert Kevin Reynolds. This is not a simple straightforward process required and has been looked at since 2000-2001 when first core-drilled and involved the CSIRO in 2009.

The prospects may be very good if a suitable process is developed. Australia can continue to be a leader in high technology minerals processing. (as CLQ is also showing)