Methodical delivery of MRQ results by Management, page-127

Like I have been banging on about the market is forward looking. The assays were a big surprise jump on the visual THM logging and thus created a lot of excitement over the fact Koko was looking higher grade than logging expectations. That price surge on a positive surprise was always going to get sold down once the exuberance and hot money left.

Then people crunched their numbers and waited for the next release. Maybe the logging under call was bad and getting worse, some of the higher logs of 7-10% THM might be 100% under called? That was the upside discussed on HC and anticipated by the market. The assays were no better and that disappointing expectations for maybe something better than moved the dial on minable grades. Not just were the deeper high grade strands disappointing to what they might have been, but the overlying low grade sands were generally sub 5% but could have been 6%. Sold off as the market loses hope that Koko will be 6-7% and is looking more like 5-6% over the better parts. IMO of course.

As binwood pointed out this morning, the thick lower grade makes it difficult for deeper higher grade strands to make sense. Take the whole lot from surface in a low cost operation and the average grade is under 6% for any decent size as you can see. Strip the low grade off as overburden and only process the deeper strands and the operating costs will rise enormously. How much volume of deeper strands at what grade will it take to change the current Koko paradigm?

Or, find a higher grade strand at surface, except that Koko is a thick sand dune accumulation on top of older beach placers towards the bottom. Geologically it makes sense that all the higher grade beach placers will be found at the bottom underneath the lower grade dunal sands. Maybe they jag a shallower beach placer with this southern extension drilling planned at Koko for February. The story may be different down in Corridor Sth, time will tell.