reply from ceo

I have written permission post this from Chris. Fellow investors he has replied very quickly and with much detail to help us appreciate that down rampers comments on coal quality is not justified.

If they were not so straigh forward and prompt in answering our concerns i would be worried but we have a great mgmt team willing to look after shareholders interests.
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Reply from CEO

Dear xxxxx,

thanks for your feedback.
With reference to the June 24 announcement - the information for that was obtained from old Russian reports - hence the scarcity of detail on coal quality - at that point we had not drilled any holes into the project.

Now we have received assaying data for the first due diligence hole, we can start to analyse the coal quality and provide some detail that is reliable.

Attached is our quarterly activities statement released Friday afternoon. Within that there is a table comparing the quality of the coal at Nuurst with coal at a range of other thermal coal projects in Mongolia.

Within that you can see that we have quoted all of the main coal specifications. This is our first set of reliable data from the project and as we receive more assay information, our understanding of the coal quality parameters will improve.

What the table shows, based on this first initial hole, is that the product is a thermal grade coal, in most cases shown, comparable, if not better than our peer thermal projects. We have yet to conduct wash tests to look at whether the product might be improved - that won't happen until later in the exploration programme. Our current focus is to understanding the scale of the deposit - targeting a JORC reportable resource by the end of this year.

The other important factor that differentiates our project is its proximity to the existing rail network. We have a rail siding 6 km north of the tenement - this will translate into either a significant capital saving by not having to construct a long rail spur to the project, or alternatively, a significant operating saving in not having to haul the product a long distance by truck to the rail siding. Research quoted within the Quarterly activities statement shows that the rail transport cost to the Chinese border should be in the order of $14 per tonne. Given that our mining costs should be low - (large scale mining, soft material and low stripping ratios), that should translate into a low total cost at the Chinese border. We know that we will receive a discounted price for this coal, however, given what we believe will be a very low cost base, there should be a significant margin on the product ensuring a viable project.

When ATLAS Iron established itself on a low quality Hematite project close to infrastructure in the Pilbara, there were many who said their model was flawed - I have nothing but admiration for what David and his team has achieved there. My intention is to emulate his success in Mongolia (albeit in coal, not iron ore).

regards
Chris Mardon
Executive Director
TVN Corporation Ltd
Suit 6,245 Churchill Ave
Subiaco 6008
Western Australia

P.O. Box 1273
Subiaco WA 6008

Mob +61 417 961 404
Ph +61 8 9217 3370
Fax +61 8 9388 3006