Hi Guys,I spent a couple of days at Cloncurry about 5 years ago...

Hi Guys,

I spent a couple of days at Cloncurry about 5 years ago looking at something else. I did not take a lot of notice but the geo's I associated with seemed to be saying the Rocklands thing was a bit different to mainstream exploration.

A few days ago I revisited CDU as I am a IVA shareholder and saw a replica of that scenario with the share price being forced below the $1.50 mark paving way for a $2.50 +/- takeover offer; so picked up a few shares hoping to pick up a buck a share in a relatively short time frame. Today I changed my mind and bailed out at taking a small loss.

I got a headache trying to work out what is actually going on. I spent hours reading HC posts and CDU reports. I think the lad who is closest to the mark suggested that M & G and Oz Metals looked at this a few months back and decided they should not be involved.

I think M & G's action in taking this large loss is not part of a takeover ploy but they feel this thing could go to go downhill badly and they should get out. IMO the Chinese are probably protecting themselves averaging down as they have paid too much and having been overly impressed in by the spectacular supergene ore. I think at the end of the day they will take it over not because this is El Dorado but to save their bacon.

The high grade supergene ore is spectacular and would put anyone in a positive frame of mind. It is easy to jump to the conclusion that if there is so much copper near surface there must be mountains of it below.


Reviewing the situation a few things stand out to me:

A. It looks like a tight high grade hydrothermal vein system with a very high grade supergene cap.

There are three very different ore types that IMO should be treated very differently both from a metallurgy and mining perspective.

i. A primary high grade sulphide vein system suitable for underground mining at depth.

ii. A very high grade supergene cap suitable for small scale mining (almost hand-picked ore) and specialist treatment given the problems dealing with native copper.

iii. A low grade halo around the supergene ore suitable to bulk open pit mining and appropriate treatment perhaps even heap leach.

B. I haven’t seen reporting that delineates and quantifies the above ore types individually and DFS’s on each of the numerous options open to pursue.

C. Globally this is nice but not massive resource. IMO it is looks like a 500 – 1000Kt copper resource based on data to hand. IMO the grade of both the primary and supergene ore is a real bonus if selectively mined. I also think could turn out to be something very exciting when tested at depth and laterally on adjacent ground.

D. Reporting consists of lots of photo's of super high grade copper mineralization and people looking very professional plus high grade drill intercepts. It is very hard to get a picture of the physical distribution and quantity of ore/grade types in this deposit.

E. Tenement holding is very tight and this mineralization IMO will probably extend onto neighbours ground. IMO its full potential should be assessed and perhaps developed in conjunction with neighbours.

F. Tonnage reserves very considerably increased by including large amounts of very low grade ore. What is the grade of the 30.3MT at 1.7% after the spectacularly rich ore is removed? In particular exactly how much copper is in the ultra high grade ore? What are the pros and cons of going after the ultra high grade first and stock piling the low grade ore that is in the way to be dealt with after a DFS when the project has been fully drilled out?

Using simple math’s the increase from 30.3MT @ 1.7% to 97.9MT @ .96% and to 272.9MT @ .62% involves adding 67.6MT @ .63% and a further 175MT at .43% respectively. These are very marginal grades at present copper prices and Australian production costs.

So I feel this is could be headed south and a better analogy maybe DML not IVA. IMO there is risk at $1.50.

I acknowledge that I am not close to this project and may well have it all wrong. I appreciate just how difficult it is to find and get a project off the ground in Australia. I have the greatest respect for those who try and if this post upsets anyone I am sorry.

I am going to leave this alone; there are simply too many unknowns.

All the Best

Tasidevil