soc pmr annual rpt, page-25

Hi happypappy

I have heard it twice now from SOC, the first time when I spoke to Michael Leu and the second at JM's presentation ... SOC is directly and publicly comparing Mt Adrah with Northparkes.

This, if confirmed, will give SOC an enterprise value of about $1/share [valuing the inground gold @ $20/t] on the Mt Adrah asset only [i.e. Northparkes is an 8 million Oz deposit]. Might take another 12 months of drilling to get to that JORC but that is the expectation SOC is putting out there.

That $20/t rule of thumb is something I stumbled across in my reading. Mt Adrah might do better than that because it potentially will become a low cost mine. The workforce is local, so no FIFO, the infrastructure is already in place and the intention as it stands is open pit mining with minimum processing [i.e. the ore will only require coarse crushing and the gold will mostly be captured by floatation to produce a concentrate] so capital costs will not be exorbitant.

Beyond that who knows what the step-out drilling will reveal ... a few high grade reefs can make a lot of difference.

The current drill plan, as I understand it, is squarely aimed at providing the required data to progress to a PFS. The next step is to apply for a mining permit. In 3 years time Mt Adrah might well be producing, which is quick progress in mining.

The drill results can only disappoint if this is not an IRGS, in which case the dream is over. The chances of that happening though, IMO, are remote.

We will know pretty soon.