2012 Reserve probable 3.11mt 3.42g/t 341koz 2013 Reserve...

2012 Reserve
probable 3.11mt 3.42g/t 341koz

2013 Reserve
probable 3.59mt 2.79g/t 322koz

2013 reserve cutoff 0.9g/t 2013 reserve cutoff not stated. 2012 and 2013 resource cutoff both 0.8g/t

So from 2012 to 2013 the tonnes went up 15% grade down 18%, contained gold down 5%. Clearly this was not a change in the cutoff grade, it was a change in the underlying data and assumptions applied to that data. Just reducing the cutoff grade will reduce the grade and increase the tonnes, but it will always increase total ozs.

In other words the assumptions in the modelling changed. Unfortunately H doesnt understand resource/reserve modelling as well as he thinks. There are A LOT of assumptions embedded in the black box which then uses statistics from drilling data to build a block model.

The nature and geology of a deposit itself will influence the way in which drill data is applied to blocks and the significant of individual intersections and similar. I haven't built these models myself but have been involved in the process of generating inputs to the models and seeing the way in which the output changes as a result of the inputs.

The idea the Holdonman pushes that reserve / resource is some kind of unbiased statistical data modelling exercise is miles off the truth. There is a lot of geological and interpretative assumptions which are used and these can be conservative or aggressive.

Sometimes models under perform and other times they outperform.

I don't know exactly why the 2013 model grade changed but I do know that the combination of outperformance in practice, the previous model output and the historical mined grade suggest the new open pit grade is likely to be on the mark.

With regard to underground recovery of the open pit reserve lost, that recovery will not be 100%, nor will it be zero. Somewhere between 20% and 80% is likely in my view.

Nothing worse than intellectual arrogance applied without real understanding in my opinion.