TELSON RESOURCES INC SOHFD

Q4 at glance

[junior_miner]

* Overall decent quarter for Campo except for the mill down time.
* It’s impressive how low cost they can run this mine. Positive cash flow with USD 1,11/lb Zn
* TC/RC was about USD 115/t this is likely to double in 2019, judging what other companies guide at the moment.
* All recoveries (Pb, Cu, Au, Ag) besides Zn are really awful at the moment.
* looks like capital injection needed?

[shakeypremis]

Hi Junior_Miner It looks like they are just barely breaking even at the operating level. That's just my reading of the results in the MD&A. What are your thoughts? Things might well be better in 2019 given the following; 1 .Concentrate thefts have stopped 2. Zinc prices are higher 3. Theyll save approximately CAD$2m in costs at Campo due to a new renewable power agreement 4

[junior_miner]

Actually the past financing by the management was the reason I got interested in the company. It’s really rare to see that kind of support. Seeing past the Q4 results requires somewhat detailed modeling, but most of the factors move to positive side. * Zinc price about USD 1.3 vs. 1.11 * Full year 2500 tpd * TC will double unfortunately. * No concentrate thefts as you mentioned. Factoring these

[shakeypremis]

Yes, that kind of support is seldom found. Did you factor in the lower power costs in to your models? May I see them if that's possible? There are not many following this company so rational discussion and comparisons of workings is not easy. When you refer to TC are you referring to treatment/recovery costs? Why do you think they will double? Cheers

[junior_miner]

I didn’t factor in lower power costs. For the modelling, I advice you to the prefeasibility study and apply the current recoveries, mining costs and you got an idea. Benchmark treatment charges are USD 245 per tonne of concentrate this year compared to 150 or lower in 2018.