Good to see the opening of the Reed  Mine.

FYI U3082014

"...the partners were bought out.....then HB made money hand over fist!

Mining is ever so expensive these days...... "



Management's Discussion and Analysis of

Results of Operations and Financial Condition

For the Three and Six Months Ended

June 30, 2012


Reed Copper Project Development Progressing on Schedule


During the second quarter, our focus for our 70% owned Reed copper project in Manitoba was

preparation of the site for portal development. The project is on schedule and we commenced the trench

excavation in June 2012. We have also completed the site leveling for the mechanical shop, warehouse

office, changehouse and parking lot pads, as well as camp expansions to accommodate the workforce

for the development stage of the project. Materials and equipment from the Trout Lake mine have begun

arriving at site, and we have ordered new mobile equipment and compressors for delivery in the third

quarter of 2012. We also issued tenders for the mechanical shop and warehouse.


We expect the remaining capital spending to occur over the 2012 - 2014 period as follows:

(in $ millions) Q3-Q4

2012 $24

2013 $39

2014   $3


Total future capital spending $66


Total spent in Q1 and Q2 2012 $6


Total $72


We expect initial production at the Reed copper project by the fourth quarter of 2013 and anticipate to

ramp-up to full production of approximately 1,300 tonnes per day by the first quarter of 2014.


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