new two year low $2.12 today, page-9

As midlife has mentioned the "vague and worrying downgrade", I've had a look at the past reserves.

As far as I can see, at Jun 30 2008
Reserves were 727,000 oz at 7.4 g/t.
These reserves were not meant to be complete but rather just what was then incorporated into the mine plan.
Production in 2009 was 98755 oz, and in 2008 was 80,570
Therefore about 548,000 oz should be there in the mine plan.

The current estimate of 400,000 oz therefore indicates a loss of 148,000 oz, but considering that new drilling is underway to extend the reserve, then it seems the loss was even greater.

A similar calculation shows that resources should be about 980,000 oz but may turn out to be only 800,000 oz.

Looking at the geology in one of the earlier announcements, it really looks to be a complex deposit, and so very hard to estimate without a full computer model.

If the new reserve turns out to be 400,000, at a grade of 7.4 g/t or greater, then that indicates about 4 years of operation, and not such a problem, as further drilling could be expected to extend this in the meantime.

Nevertheless, still a bit "vague and worrying".