Ann: March Quarterly Activities Report, page-32

Roka

I have to agree with you that they seem to want to get the Yaoure project up ASAP and will start development next year, and that raising cash for it via a CR is pretty much a certainty given the timing. JQ pretty much said in the webcast that is how things are going to pan out, whether we like it or not.

The only benefit from commencing construction early next year is that we now have an experienced team that can be deployed for that purpose. But I do not care about that - it would be better to keep a small number of them on hand doing nothing for 12-18 months while PRU build up some cash balance and minimised the need for a CR.

Given the current debt level and production profile there is likely to be very substantial shareholder dilution - perhaps another 300-400m million shares issued. If MacBank provides the funding expect cheap options and nasty hedging deals.

Basically the company is being driven for the benefit of management and not shareholder value.

By proceeding with such a heavy share dilution its possible that the 40 cent options that would have raised over $50m may not get exercised mid 2019, and the share price will be capped going forward unless the gold price takes off above USD1400.

I am very disappointed with the arrogance of JQ. No doubt he will arrange for some bonus payments for himself and senior staff for meeting soft targets.

loki