profit guidance, page-5

Webbie,

I think you might be right about the holes to the east, looks potentially interesting. Of course the whole area is just about virgin, about time we had another drink there.

I liked the new intercept at Moran, should at least extend the resource by more than we mined at Long in the Q. Can't wait until we get in there and came drill a bit more freely further south. Can't wait for the new (presumably) cheaper higher grade production. If they keep the ore rate up we"ll get a hefty increase in nickel next FY.

Bit early yet, but I am liking the look at the Bulge, so much so that I took a stake in STB a while back. Of course I am speaking from the geological literacy of a 5 year old.

All in all, bodes well. I really think 2010 could be a big year for IGO.

Thinking about the potential for a RRT not so good.

If we paid a 5% royalty now, and had a pretax 30% margin, the govt gets 5+9=14% of revenue. We get 21% of rev post tax.

If we instead had a 30% RRT (surely not 40%), and a 25% corporate tax then the govt gets 16.6% of rev, and we only get 18.4%.

Our NPV drops 12% overnight. I guess 8% since they can't touch our cash with RRT.

Is this partly behind our big resources sell off?

EL