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First the story. Out of the blue

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partysasquatch   Thursday, 12/06/07 08:43:06 AM
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Post # of 115162 
First the story. Out of the blue and after using me to get his trip to Russia, Ditter calls me. Ditter wants 2 million dollars to split a 10% deal of Dovgan and Company. This is after he is removed from the Russian deal as a member. He also is offered control of Aurus on the board. Control of Aurus must be from his mining experience. He has mined the exact same amount of gold that Aurus has: ZERO.

Valentin wants money for his shares in Aurus. That is why the scam continues. He is most likely looking for the fancy merger after the buyout scam made famous by Makarov, Parkin, and Papa of NORD, FLST, and ACMG. But first you need to find the victim. Note the giant profit margin after taxes. 1.5 million dollars for every 50 million dollars. That's right baseball fans! Those are no where near boasted margins of 220/oz in Russia by Aurus.

Anyway, he forwards the materials. Like that did not get immediately forwarded to the SEC to show the 50 million in revenue and the missing pieces of the Aurus puzzle, lol(This guy is stupid). Here is a lesson for Ditter. After all the secret PM's and all the underhanded hiding of what Aurus has and does not have; as well as the private solicitation of money from shareholders to further perpetuate the scam, I bet someone will want to talk to this guy down the line (and probably a few more from this board), lol.

Pay special attention to what the board is on this world class company that boasts the 5th largest mining asset in the world (sound familiar, like the 8 billion in Aurus assets and 13 billion of Nord oil). Meet the board:

1) Valentin,
2) Mr. Ditter,
3) Sergey Salnikov (of RSM top audit fame of Volganeft, Nord, and Aurus),
4) Mrs. Ditter,
5) Kolesnik

Board of Directors – Founding Members
- Chegenev Valentin A. (President, COO – Gen.Dir. Of Operations Management Body.) RU
- Ditter Paul J. (V. P., COB – Dir. Of Corporate Development & Governance) USA
- Salnikov Sergey V. (V.P., CFO – Dir. Of Audit & Financial Affairs.) RU
- Tseragorosteva-Ditter Anastasia V. (Exec. Secretary, - Dir. Of Int’l Communications) USA
Kolesnik Vladimir Aleksandrovich (Director, Deputy Chairman of Management Body


Private Equity Placement Offering Outline to Memorandum:
(A subscription of Golden Share Co. OJSC being organized under the laws of the RF)


--- Moscow, October 2007 ---

This offering memorandum relates to an initially-private equity placement to investors in the Russian Federation and to qualified investors in offshore transactions in certain other countries outside of the United States in reliance on Regulation S (‘‘Regulation S’’) under the United States Securities Act of 1933, as amended (the ‘‘Securities Act’’), and outside of the Republic of South Africa and Japan and is for information purposes only and is not a prospectus prepared or filed with any registration or other governmental authorities in connection with the registration of the issue, the offer or sale of the Shares described in this offering outline to memorandum including its subsequent expansion of memorandum with important cautionary notes to forward-looking statements, various risk factors, the inclusions of regulations of the gold mining industry, share description and requirements in the Russian Federation, and material tax considerations, distribution or transfer restrictions gold supply/demand factors, political or cost risks, among others.
FINAM INVESTMENT COMPANY JSC (‘FINAM’) having being retained by GOLDEN SHARE CAPITAL CORPORATION, hereinafter referred to as (‘GSCC’) with FINAM having successfully executed a bilateral MOU with GSCC and whom hold the position as lead underwriter to organize and manage a private and subsequent public offering (of not less that $50 million USD combined) of GSCC together with its assigns and affiliates (the ‘Company’) whereas FINAM hereby suggests to investors to participate in the initial private equity placement (‘PEP’) of Company’s equity in an amount representing up to an aggregate of 10% equity stake convertible into shares (‘subscription’) in the combined assets of the Company. The initial subscription is anticipated to close by end of November, 2007. The proceeds of which are scheduled to be used for low Cap-Ex, high-yielding growth of gold volume output & group operational efficiencies. Simultaneously, the implementation of new processing technologies for its “Mayskaya” group sites providing for some first-ever capabilities & greater operational efficiencies; Secondly, its significant continuation towards full-scale development, engineering & operations on its world-class , “Shturmovskoye” licensed gold mineral deposit. -The “Shturmovskoye” site is the single largest licensed deposit held by the Company containing 168 tons of Au reserves, as GKZ approved in cat- C1 alone. Hereunder, the “Shturmovskoe” mineral deposit is put better into comparative perspective as would be ranked worldwide to another in particular, as was recently analyzed.

This private equity placement is the first step in the process of enhancing the market capitalization of the Company prior to its subsequent IPO. In addition to its current significant gold reserve base of combined licensed assets, this initial PEP shall provide the means of first increasing the volumes of current gold production output as maximally appreciable towards attractiveness to pre/post IPO investors alike and before implementation of its planned IPO strategy in Russia as is currently targeted for listing initially on the Moscow Interbank Currency Exchange or (MICEX) and potentially simultaneous to it or thereafter, a future equity listing internationally floated secondarily on a stock market exchange outside of Russia.

The “SHTURMOVSKOYE” Gold Mineral Deposit – Its Rank Worldwide by Gold Reserves

In the most recent noteworthy reserve analysis and related research of world production news commentary from Kitco, of the large mineral deposits tracked worldwide -- by comparison, the massive high-grade (~21.g/t) reserves of the licensed “Shturmovskoe” gold mine deposit, ranks ‘fifth’ in the world of largest gold mine deposit sites; Moreover precisely positioning this Golden Share Group site deposit just in front of the analyst’s duly noted #6 ranking site as was recently declared this October of 2007, being located in China as was recently noted as follows; ...”The “’Yangshan’ gold mine (with 6 tons less comparably)...which has 162 tons of gold and ranks ‘sixth’ in the world”... (Source: industry public data and www.Kitco.com October, 2007 analysts’ commentary as reliably referenced.)

About the Company and Structure

Pursuant to the Company’s founder meeting and agreement, GSCC was incorporated in 2007 and has its registered office in the State of Nevada, Unites States and is a foreign managing minority shareholder, its representatives, board of director members together with the Company’s Russian majority-shareholders of Russian native citizens and its affiliate’s of Russian base origins, whom also are managing board of director members of the Company. The principal aim is to increase profitability and volume of gold output by attracting substantial funding while also providing for substantial regional benefits to its local Social and Economic Development, through affiliated enterprises’ growth of base-operations and further expansion upon and continuation of growth in exploration, development and production of metallurgy mineral properties and projects as currently all are exclusively located within the Magadan Region of the Russian Federation. The Company collectively manages and controls the assets of two long-established gold mining entities located in Magadan: that of “Dovgan & Co.’s” LLC and “Mayskaya” LLC, both legal entities incorporated in the Russian Federation and owns specific property & rights accounted for in a separate balance sheet. It may acquire and exercise property and personal non-property rights on its own behalf, bear responsibility, be a plaintiff and Defendant in court. Pursuant to the reorganization and its general shareholder meeting the Company, along with this equity subscription and prior to placement and subsequent IPO, shall cause its State registration of “Golden Share Co.” OJSC as prepared for its new administrative office situated in Moscow. The Company’s current administrative & operations offices are located in the city of Magadan. Its combined Russian-based affiliated entities exist with operations ongoing since 1972, within the Magadan region and overall Company gold production over 20 tons. The arrangement combined experienced mining and strategic management teams, as the group “Mayskaya” LLC is now incorporated into “Dovgan & Co” LLC and is its 100% affiliate as mandated, the latter also reorganized pursuant to the same and shall collectively arrange for its subsequent IPO, under the succeeding OJSC registration as its 100% affiliate. Pursuant to Russian Federal JSC Law & the Civil code of the Russian Federation, the management bodies of a JSC are the general meeting of shareholders (the supreme governing body), the board of directors (supervisory board), the executive body (the general director and the management council), auditing commission and Company Charter. The functions of the BoD shall initially be performed by the general meeting of shareholders to centrally manage & control the Company’s operation & assets within the Russia. Pursuant to the Company’s Charter, its corporate governance policies & principals, among other things has appointed Independent board Directors, identified herein & will maintain a minimum of 3-Independents & 7-total consistent with Russian NCCG code standards, practices.

Major economic activities of the Company’s affiliates; “Dovgan & Co” LLC and “Mayskaya” LLC are focused on production and sales of gold by means of direct sales exclusively on domestic market in Russia. The majority of sales (about 50%) is underway to two Russian banks: AVANGARD OAO Joint Stock Commercial Bank and VOZROZHDENIJE, OAO Joint Stock Commercial Bank. This is executed primarily under the agreements between “Dovgan & Co” LLC and indicated banks that stipulate the volumes of delivered gold. The said agreements are registered according to the applicable Law with the Ministry of Finance of the Russian Federation (GOKHRAN State Agency).

Currently the Company’s principal assets are the placer deposits of “Sportivny” and “Shakh Creeks”, of left tributaries of Khatynkh river and its ore gold site of the “Shturmovskoye” hard-rock gold mineral deposit, a high-grade (Au) mineral deposit in the bed of Orotukhan river – all of them located in the Yagodinsky area of Magadan Region. Magadan boasts a rich inventory of near-surface oxide (accessible-to-mine) 7 hard-rock deposits, allowing for low costs of production and growth in the territories of the Far East Russia. This, along with the Company’s many nearby sites, its ore gold concentrations and total gold reserves are very compelling incentives for foreign & domestic mining investment. This South-West hinterland of Far East Russia encompasses a historic mining territory that in the 1990’s yielded as much as 26 tons of gold per year – the lion’s share of Russia’s total output. This is where there are over 2,000 past and present placer gold operations. There are also dozens of known undeveloped hard rock gold and silver deposits.

The gold production is carried out by the Company’s’ owned operational mining assets and resources of the combined enterprises on its multiple licensed sites.
The number of Company employees is currently just over 200. With adequate funding and newer technologies now available, the company is well situated to further capitalize on the many nearby opportunities that are well known by its all Russian-native long-established Magadan team network of administrative relations, management, engineers, geologists and seasoned operational general directors.
Table.1. Combined Affiliated Entities -- Exploration -&- Production Licenses Held
No. License Reg. # Term of License License Issued Notes

For “Dovgan & Co” LLC

1 МАГ 02923 БР Expires December 31, 2008 Administration of the Magadan Region Activity - geological exploration and gold production from placers of Sportivny and Shakh creeks.
Valuation of the probability of the prolongation of the license - favorable
2 МАГ 02576 БЭ Expires December 31, 2023 Administration of the Magadan Region Activity - geological exploration and gold production from placers
of left tributaries of Khatynkh river, production of hard rock gold of Shturmovskoye mineral deposit
“Dovgan and Co’s” LLC
The above (2) aggregate Mineable Gold Reserves of C1 + C2 = 224.8 tons Au**

For “Mayskaya” LLC

1 МАГ 024263 БЭ Expires December 31, 2017 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
2 МАГ 02427 БЭ Expires December 31, 2010 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
3 МАГ 02437 БР Expires December 31, 2017 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
4 МАГ 02440 БЭ Expires December 31, 2010 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
5 МАГ 02441 БЭ Expires December 31, 2010 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
6 МАГ 02442 БЭ Expires December 31, 2010 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
7 МАГ 02937 [BR] Expires December 31, 2008 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
8 МАГ 02953 БЭ Expires December 31, 2008 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
9 МАГ 03169 БЭ to 31.12.2010 g. Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
10 МАГ 03304 БЭ Expires December 31, 2010 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
11 МАГ 03284 БЭ Expires December 31, 2017 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
12 МАГ 03506 БЭ Expires December 31, 2017 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
13 МАГ 03723 БЭ Expires December 31, 2009 Territorial agency on [nedropolzovaniyu] on the Magadan region ([Magadannedro]) Production of the precious metals

МАГ 03802 БЭ
Expires December 31, 2009
Territorial agency for Subsoil Use of the Magadan Region (Magadannedro)
Production of the precious metals
15 МАГ 02441 БЭ Expires December 31, 2010 Territorial agency for Subsoil Use of the Magadan Region (Magadannedro) Production of the precious metals
“Mayskaya” LLC
The above (15) licenses Mineable Gold Reserves of A,B,C1 + C2 = 19.72 tons Au**

For “Mayskaya” LLC
16 МАГ 1214 ТРДЭХ Expires December 31, 2030 Territorial agency for Subsoil Use of the Magadan Region (Magadan) Activity - water supply in gold production
17 МАГ 1215 ТРДИХ Expires December 31, 2030 Territorial agency for Subsoil Use of the Magadan Region (Magadan) Activity - water supply in gold production
Source: Russian State Agency Nedropolzovania -- Territorial authority for Subsoil Use

Table.2. General Financial Data, USD – *Periods Prior to Consolidation of Enterprises
2006 6 Months 2007 2007 Pro Forma*
“Dovgan & Co” LLC “Mayskaya” LLC Total “Dovgan & Co” LLC “Mayskaya” LLC Total
Revenue: 5 242 470 44 054 369 49 296 839 3 142 019 37 004 013 40 146 032 80 292 065
- sale of gold 5 242 470 43 997 980 49 240 450 3 142 019 36 818 994 39 961 013
- other sales - 56 389 56 389 - 185 019 185 019
Operating Cost: (5 215 117) (38 598 056) (43 813 173) (2 960 622) (32 355 179) (35 315 801) (72 467 485)
Expenses for extraction (2 988 208) (32 284 475) (35 272 683) (1 697 324) (29 081 293) (30 778 617)
Commercial & administrative (1 049 804) (2 845 982) (3 895 786) (595 974) (1 006 022) (1 601 996)
Expenses on research, explorative and road heading works

(52 424)

(440 748)

(493 172)

(29 600)

(774 172)

(803 772)
Depreciation (1 035 559) (2 916 642) (3 952 201) (587 394) (1 461 237) (2 048 631)
Other (89 122) (110 209) (199 331) (50 330) (32 455) (82 785)
Gross Profit 27 353 5 456 313 5 483 666 181 397 4 648 834 4 830 232 7 824 580
Due Interest (3 837 857) (3 837 857) (3 797 871) (3 797 871)
Other Earnings 603 089 4 742 882 5 345 971 9 451 94 038 103 489
Other Expenses (513 613) (2 586 751) (3 100 364) (9 219) (112 410) (121 629)
Profit Before Taxes 116 829 3 774 587 3 891 416 181 629 832 592 1 014 221
Deferred Tax Assets 830 121 830 121 1 889 232 1 889 232
Deferred Tax Liabilities (63 651) (63 651) (45 728) (45 728)
Current Income Tax (3 232 793) (3 232 793) (43 577) (1 712 394) (1 755 971)
Net Income 116 829 1 308 264 1 425 093 138 052 963 702 1 101 754 2 320 440
Ratio E/S 0,022 0,029 0,028 0,043 0,026 0,027 0,028
Ratio E/ Operating Cost 0,022 0,034 0,032 0,046 0,029 0,031 0,032
Source: Financial data of the company

Table.3. Placer & Ore Gold Volume Output
Company Growth – Past 5 Years
Year Gold Production , Kg Growth Rate, %
2003 1,250
2004 1,250 0.0%
2005 2,150 72.0%
2006 2,500 16.3%
2007* 2,700 8.0%
* Forecasted -- Source: Data of the company

Diagram.1. Outlook on Comparable Gold Co.’s Output Growth:
Post 10% PEP Offering -- Same Period to that of Company’s of ~ 180%

Source: BMO Capital markets research

The Company’s “Shturmovskoe” gold mineral deposit license МАГ 02576 БЭ, contains an aggregate ore volume determined as a result of the calculation of reserves as of September 01, 2006,; That being 5.15 million tons with the average content Au of 21,5 g/t. See (Table. 4.) below.

Table.4 .Reserves & Evaluated Reserves of “Shturmovskoye” Gold Mineral Deposit
Vol. of Ore / Reserves / Au Grade Grams/ton Totals**
GKZ-Approved Reserves Shturmovskoe -Ranks 5th in world by Reserves
Volume of Ore, mln. t 4.13 1.03 5.15 mln. t
Average Content
Au, g/t 24.5 18.4 21.5 g/ton
Total Reserves Au, tons C1 (Ton) Au
168.6 C2 (Ton) Au
224.8 tons Au
**Source: Data of the company -- GKZ Approved Mineral Reserves (...see note on GKZ below).

**Note on Source defined as; The existing Mineral Reserve that has been approved by the Russian State Commission for Reserves (Gosudarstvennaya Komissia po Zapasam), referred to as the GKZ and recorded on the national inventory of mineral reserves and are referred to as Balance Mineral Reserves.

-- See (Diagram. 2) below for the “Shturmovskoye” gold mineral deposit site map.

Reserve Reporting Methodologies as Referred to Within This Offering

Several codes exist for reporting reserves in the international mining industry. The technical differences between these codes are minor, and results are generally comparable regardless of which methodology is employed in assessing a particular deposit. In accordance with the Russian State Commission for Reserves GKZ approved methodologies, ‘Resources’ that do not meet the standards for classification as ABC1 and C2 ‘Reserves’ may be classified as probable reserves in categories P1, P2 or P3. Such deposits have undergone some exploration, but require further geological work in order to be upgraded to ABC1 or C2 reserves. As further pertaining to the Company’s Shturmovskoe site, having undergone continued geological exploration production and examination for full site development exploitation, it shall be converted as allocated as part of the equity offering use of proceeds to the to the international JORC Measured, Indicated and Inferred Reserve classification, to facilitate a broader market acceptance internationally and level of participation with the view towards a secondary or simultaneous internationally listed IPO listing.

(This space intentionally left blank)

Diagram.2. “Shturmovskoe” Gold Mineral Deposit Site Map Location – Magadan Region

See (Table. 5) below on the Market Analysis on Valuation Comparative as a Perspective on Mineable Sales & Reserves in relationship to the overall Market Capitalization of the Leading Peer Group Enterprises.
Company Market and Competition within the Magadan Region

The Company operates in the territory of the Magadan Region, where the basic competitors are:

In production of hard rock gold – MATROSOVA RUDNIK OAO (Natalkinskoye deposit), NELKOBAZOLOTO (Shkolnoyoe deposit) , AGAT LLC (Agatovskoye deposit), SUSMANSKYJ GOK OAO (Vetrenskoye, Svetloye deposits)

Currently, the Golden Share, Company is one of the economic peer group leaders by revenues and production Output in the gold mining market in Russia. For comparison, the (Table 4.) below, represents the market share data on the industry leading ‘Public’ gold mining companies within Russia and CIS.

Perspective on Market Valuations’ to Au Reserves’ of Leading Peer Group Producers
Table 5. Leading Gold Mining Companies that operate in the Russian federation and CIS
Name Date TTL. Current
Est. Val.
mln. $ USD
Mkt. Value Mkt. Cap Value
Per / Au Reserves Sales
mln. $ USD Gold Production
Kg Gold Reserves
P+P /C1+C2 /M+I
Mil. Troy Oz Au
& ton
POLYUS ZOLOTO OAO 2006 (1)9,450 - 8,500 377 1,723.00 37,791 25.10 oz 806.96 t
Centerra Gold Inc. 2006 (1)2,899 - 1,415 419 364.52 18,226 6.92 oz 222.5 t
Peter Hambro Mining Plc 2006 3,439 157.81 8,112
POLYMETALL OAO 2006 2,440 153.85* 7,962
High River Gold Mines Ltd 2006 (1)579 - 842 306 93.38 4,154 1.89 oz 60.79 t
GV GOLD 2006 400** 285 53.23 2,705 1.40 oz 45.01 t
Celtic Resources Holdings 2006 325 34.50 2,000
(“Omsukchanskaya” GGK) 2006 (2a) 3,000 (2a) 156 (3) 54.76 2,778 19.2 oz 597.20 t
GOLDEN SHARE Company 2006 (2)(2a) 643 (2)(2a) 89 49.30 2,500 7.22 oz 224.8 t

Table Notes: Source Data of companies and the publicly available information
* Gold sales revenue; ** Estimation of ANTANA CAPITAL investment Company, (1a) Reserve data 12-2006 HGM
(1) Market Value & Reserves Data Report as of March 2007 Gold Stock Analyst – Annual Press Issue #154
(2) Projected Offering Valuation basis of initial 10%Private Equity Stake Offering, as a competitively low Market Val / Oz Au Reserve ratio, to its relatively higher Gold Reserves to its peers.
(2a) See Diagram 2a; Bema Nov,2006 data -RU/Eng.-Version Enterprise Value Mkt. Cap / Oz Au Comparative Addendum
(3) BEMA Gold was later sold to Kinross Gold of Canada – Transaction closed Q1 2007

-- Initial Use -&- Subsequent Outlook of the 10% PEP Offering Proceeds Prior to IPO –

Initially, the Golden Share Group Company will first use the proceeds from the initial private equity placement with a simultaneous strategy. First to begin the immediate construction of a state-of-the-art bio-oxidation type gold ore mining and processing plant or to enhance and significantly improve the operating efficiency of all currently held alluvial and producing placer gold mining site operations for the Company’s “Mayskaya” group properties. This relatively low CAPEX high yielding R.O.I project initiative will commence immediately after the initial PEP closing in November, 2007. It will be built through the winter months, completed and online for the nearest-term production output impact towards the Mayskaya group sites for realization beginning this coming next summer of 2008 from its 15 licensed deposits currently held. It is also a noteworthy Company milestone first-ever capability, that the installation of such new bacteria-based chemical processing plant and related technology, will enable the “Mayskaya” group operations’ to efficiently operate on its placer deposit sites year-round! – An attainable first-ever capability, since its inception in 1972 -- When traditionally the use of its’ current methods of alluvial mining site operations by floatation factory alone precluded such production opportunities in winter conditions.
Currently the Mayskaya group operates one of Russia’s eleven remaining in existence ‘floating factories’ facility still in operation within the entire Magadan Region - a remaining utilization by the Company, going on now for over 30 years. As a beneficial solution to the past typical alluvial volume and ore gold operating cost challenges and various ore processing efficiency methodologies, this ‘floating factory’ facility bearing the catchy name, the ‘Dragg-177’ will further be improved without needing complete replacement; But remanufacturing instead with newer key mechanically engineered processing components and technology & classifying improvements to maximize the existing facilities’ efficiencies. These first initiatives alone will positively impact the prior challenges of the Company’s Mayskaya grouped sites’ volume operations, profitability and operational efficiencies while allowing for the nearest-term resulting gains of gold output by the estimated increases of + 3 ton Au annually, to the Company’s yearly production output beginning immediately thereafter facility commencement. If considering the impact to the 2008 production numbers alone, then a 50% resulting increase of gold output as compared to the Company’s current reported and forecasted period 2007.

Secondly, as a further and simultaneous initiative to the above “Mayskaya” base operations’ improvements of the many and nearby clustered sites, the ‘use of proceeds’ shall also be used for the continued mining exploration development engineering and construction of mining and processing integrated operational infrastructure on the high-grade “Shturmovskoye” gold mineral deposit in the Magadan region.

The Company’s “Dovgan & Co” sites will phase out the current use by J/V agreement of a private ore processing facility as remaining available by a related party transaction to the Company for continued site exploration work and ore processing engineering development usage, as agreed with the private closed processing society “Puma”, as granted by the Company’s only outside affiliation of board director interests.
The “Shturmovskoye” hard rock gold deposit is located in the Verkhnekolymsky upland in Yagodinsky area of Magadan Region. As of September 01, 2006, the aggregated volume of ore resources was 5.16 million tons with the average Au gold content of 21.5 g/t, having a total GKZ approved balance of gold mineral reserves totaling 6.59 Mil troy ounces Au in accordance with Russian State Commission for Reserves. Gold production growth output, is projected to be executed by ongoing geological exploration production, reserve re-classification to JORC code and the finalization of engineered feasibility site plan of site operations as designed specifically for the purpose of maximizing production realization of the gold-bearing ore types of the Shturmovskoye hard rock gold deposit. The end product of the enterprise is a gold dore (90% of gold and 10% of silver and other metals) of base bullion. Current estimated annual productivity of the new gold processing plant along with the related additional mining equipment of said operations, is the realization anticipated growth output of approximately 5.0 tons of gold dore; i.e. 15 kg a day. The plant operations are scheduled to be shift team, all year around, 24-hours with two shifts.

The processing works of the high-yielding output capacity “Shturmovskoe” GOK enterprise will produce two forms of products:

Base bullion gold in the ingots with 700-750 gold purity, containing silver with 150-200 silver purity;
The cathode gold-bearing deposit with 250-450 gold purity and with 200-300 silver purity.
The ratio of base bullion and cathode deposit shall be 4:1.

Further smelting of base bullion and cathode deposit (refining) and the preparation of products from them shall be executed by the KOLYMSKYJ AFFINAZHNYJ ZAVOD OAO. This shall be done based on the Government standards GOST 28058-89 “Gold in Ingots Technical Specifications” and GOST. 28595-90 “Silver in the Ingots Technical Specifications”; the appropriate contractual agreements shall be signed.

The projected plant shall be comprised of the following mining, enriching, auxiliary and general communal units, which include the following objects:

underground mine;
washing plant;
tailings dump;
the area of the storing of cake;
service complex with the vehicle garage;
oil and gas storage facility;
chemical components storage facility;
explosives storage facility;
intake structures;
habitable complex;
the station of biological cleaning;
waste storage area;
The utility networks and communications installations.

The total project development and construction duration of the proposed high-yielding plant is 2.5 years, beginning from the end of 2007. Production commencement is scheduled for mid-2010; while the Company’s planned production output of the additional gold equivalent realization of 5 ton Au annually, shall be reached within 6 months from the commencement date. The tentative construction cost is approximately $60 to $70 Mil. USD including the working capital for 12 months of reserve, the final feasibility engineering analysis and designs, operating taxes and other general and administrative means. The final feasibility study and detailed site plan is also accounted for completion from the initial completed fulfillment of this private equity offering as another key value-added component to ensure a highly successful performance post PEP and IPO market performance. It is further anticipated that with a view towards a secondary public listing internationally, the Company will also provide the statement on reclassifying its GKZ approved engineered reserve calculations’ in accordance to internationally preferred JORC standards. Given the extremely positive characteristics of the “Shturmovskoe” mineral deposit; The Company believes this initiative will also result in an increase to the current explored geologically engineered and approved total GKZ gold reserves as to the total balances presently remaining.

Brief Analysts’ Survey and Gold Market Review

By largest gold-prospecting countries of peace on the sums 2006 g. remain Republic of South Africa, Australia, USA and China. Russia preserved for itself the 6th place in the world production of gold. World volume of the output of metal in 2006 g. it was lowered by 3,1% - to 2,47 thousand tons (79 412 thousand ounces) against 2,55 thousand tons (81 984 thousand ounces) in 2005.
Despite the fact that gold production in Republic of South Africa in last 2 years was reduced by 7,4%, this country preserves for itself the 1st place among the gold-prospecting countries (production of gold - 292 tons, or 9 388 thousand ounces). Entirely a little lags behind it the USA (252 tons, or 8 102 thousand ounces), China (247 tons or 7 941 thousand ounces) and Australia (245 tons or 7 877 thousand ounces). In this case in China an increase in gold output in 2006. It composed 7,6%, in the USA and Australia the production of gold was reduced by 4% and 7% respectively.
As a whole, according to the data of the union of gold prospectors RF, industrial gold mining from the alluvial and ore (radical) layers in Russia in 2006. it was lowered to 149 tons (4 790 thousand ounces) - it is produced to 3 tons (96 thousand ounces) or to 2% less than in 2005 g., at that time as the volumes of following and second production they remained at the previous level. The total volume of the production of gold in Russia is evaluated at 165,2 tons (5 311 thousand ounces).
According to the forecasts of the union of gold prospectors, in 2007-2008 yr. further possible reduction in gold output in RF will likely result. A drop gold output in will be stopped only after the putting into commission of new enterprises on the layers “[Natalka]” and (logically, the full exploitation and continued development enlacements of world-class gold ore bearing “Shturmovskoe” deposit) within the Magadan region, the “Cupola” and “May” in a Chukotka district and a number of gold-bearing deposits within various regions, but this will be already only by 2010.
While a total drop in gold mining in Russia occurred for 2006, the output of ore-gold grew by 6 tons (193 thousand ounces) (7,2%), [dostignuv] of its maximally historic importance into 89 tons (2 861 thousand ounces), and it composes already almost 60% of the total volume of Russian gold production output.
World consumption of gold in 2006 g. were 3 371 tons (108 380 thousand ounces).
In 2006, world price range of gold was between $525 - $725 USD per Troy ounce, the mean price in the year - $604 USD for the Troy ounce. On the 12th of May 2006 the price of gold reached $725 U.S.D. for the ounce, which was absolute maximum during most past history observation, with the exception of short period from 16 to 22 January 1980. Accounting prices of gold of Russia bank during period 2005 - October 2007, reached 626 rub./gram. Mean price within the prior period indicated was 489 rub./gram. See (Diagram.2.) below for accounting RUR/Gram Au form Jan., 2005 through September 2007.

(This space intentionally left blank)

Diagram. 2: Accounting RUB/gram -- Au of Russia Bank Jan., 2005 – Sept.., 2007

Source: Russia bank

In the opinion of analysts, by the key factors, which determine price of gold, in 2007 will remain unstable US dollar, reduction in world gold mining, the exhaustion of world gold-ore reserves, high price of the oil, the demand from the side of institutional and bullion investors, increasing geopolitical tension and increased acceptance of the role gold equities can play as a portfolio diversifier.
Demand for gold in 2006. it was lowered by 5% and composed 126 Mil. ounces. The reduction of the consumption of gold from the side of jewelry industry with 87 mln. became the basic reason for reduction in the demand. ounces in 2005 g. to 73 mln. ounces in 2006. [Tezavratsiya] of gold ingots was reduced in 2006. to 14% it composed 7,3 mln. ounces. In the same time the demand for technological gold grew by 11% with 18 mln. ounces in 2005. to 21 mln. ounces in 2006.
In 2006 g. the proposal of gold was evaluated at the level of 126 thousand ounces, which to 5% is greater than in the previous year. Total volume of gold mining in 2006. it was lowered on 2,5 mln. ounces on the comparison since 2005. Sales from the reserves of state funds also were descended and composed 10,5 mln. ounces, which to 51% is lower than in 2005. The entering of gold scrap grew by 25% with 28,5 mln. ounces to 35,6 mln. ounces.
The reanimation of the world market for gold led to an increase in financing geological survey works and the appearance of projects on the creation of new mines. In Russia, as in the entire world, it is present a sharp increase in the interest of financiers and owners in the gold-prospecting branch - gold production became investment attractive. In the present time continues consolidation of the subjects of market and most gold-prospecting companies specialists forecast a greater integration & mergers among gold producing companies, especially those transactions involving company’s preparing for IPO or already publicly held.
In terms of gold output as compared to other industry leaders, the Golden Share Group production volume of gold output for 2006 reached 2 500 Kg. an increase from 2 150 Kg from the prior 2005 respectively.
For 2007 and prior to PEP proceeds utilization, the current volume of gold output is estimated to reach 2 700 Kg. Hereafter full initial placement and if closing of this initial PEP in full by mid November; then it shall be possible to already obtain the nearest-term goal of just over 3 000 Kg of volume output total for current period ending 2007.

Source: Herald of the gold prospector

Restructuring, Managing Shareholders and Board of Directors

The Company recently undertook a Reorganization in order to consolidate the recent and subsequent merger of related gold mining Company’s’ assets and simplify the corporate managing structure benefiting its group efficiencies in all future combined operations. The Reorganization resulted in the unifying of a diversely qualified financial & operational management board of directors, extensively experienced mining and metallurgy directors, group mining engineers and geologists experienced technical staff and industrial workers. The following is the resulting shareholding percentages including post Private Offering of the initial 10% of total outstanding and further viewed after the subsequently planned IPO respectfully.

Shareholders as % Post Offering & IPO

*Includes 10.5% privately held by non BoD members.

Board of Directors – Founding Members
- Chegenev Valentin A. (President, COO – Gen.Dir. Of Operations Management Body.) RU
- Ditter Paul J. (V. P., COB – Dir. Of Corporate Development & Governance) USA
- Salnikov Sergey V. (V.P., CFO – Dir. Of Audit & Financial Affairs.) RU
- Tseragorosteva-Ditter Anastasia V. (Exec. Secretary, - Dir. Of Int’l Communications) USA
Kolesnik Vladimir Aleksandrovich (Director, Deputy Chairman of Management Body

Board Members -- Elected Independents
- Aznauryan Stepan Armenakovich (Independent Director) – Deputy Mayor of Magadan City, RU
- Kuznetsov Vladimir F. (Independent Director) - FINAM Investment Company, Director of Corporate Equities/Financing Department, RU
T.B.A-Audit Committee Chair, prior to IPO

Corporate Governance

The Company has adopted a strong commitment towards strict corporate governance code adherence, consistent with highly recognized international governing standards through asserted managing director principals and policy implementation as equally envisioned by the Russian “National Council on Corporate Governance” as membership planned activity participation with NCCG group professionals’ association as parallel with the invaluable informational exchange among its corporate governance leadership members.

The Company’s commitment to Corporate Governance policies and initiatives are summarized as follows:

Quality Management Systems Integration of its recently combined enterprise management such as;

the Establishment of Golden Share Group Ltd., the Management and General Directors by Majority Shareholders Meeting, the;

Policy Implementation on Election & Installment of, Independent Board of Director Members;

Policy Implementation by Preparations of combined Company annual IFRS Audited Accounts of Financial Statements and made publicly available for transparency and confidence of its investors accessible with other key project data, management, operational information and investor relations support through the;

Policy Implementation of the Company’s forthcoming public internet site as is reserved for along side its IPO initiative underway and in creation for future exploration at www.GoldenShareCo.com

Policy Implementation Continuation of Social & Economic Development and Priority Investment Attraction inline with Presidential Decree of Priority for the Magadan Region – Commitment to human resource attraction to the Company according to overall initiatives of Offering, by modernizing of production, growth of enterprise & employment and improvement of management systems...Providing socioeconomic attraction towards Regional self-sufficiency & development by optimization, motivation, promotion and enrichment to its personnel and its community;

Commitment for Committees on the Board of Directors formed in compliance with international standards;

Commitment for internal control systems improvement and;

Commitment to strategically maximizing Company profitability and further declaration of the planned Golden Share Co. Dividend Policy implemented at the earliest time feasible thereafter.

“The Golden Share Group Ltd. management, firmly believes, in order to achieve ‘complete’ success of the many interconnected elements mapped from initial Strategy -- and-- to ‘completely’ fulfill its commitments and realizations as forecasted; -- is simply; The complete fulfillment of Strategy; ...Every step of the way.”

An introduction to the...
Management Team of Directors, Mining Specialists & Dept. Leaders
Chegenev Valentin Anatol’evich
Managing Group Director and Chief of Operations
Director Head of “Dovgan & Co’s”
Kovalenko Valeriy Nikolaevich Director Head Mining Specialist for Government Technical Supervision Agency of Russian Federation
Ditter Paul Jahn Non-executive Director, Strategic Development & Corporate Governance
Kolesnik Vladimir Aleksandrovich Managing Director of “Mayskaya” LLC
Kovalenko Aleksandr Nikolaevich Director Head Chief of Engineering Department
Chicherin Anatolij Efimov Director Head Chief Geologist with Honors of R.F.
Salnikov Sergey V Non-executive Director, Audit & Financial Accounting Affairs
Naddachin Leonid Konstantinovich Director Head of Legal Department
Drobishev Nikolay Yakovlevich Director Head of Safety and Security Measures
Vershigora Gennadij Evgen’evich Director Head of Material/Technical Supply Department
Zinchenko Aleksey Semenovich Deputy Head of Mining Engineering Dept.
Tseragorosteva-Ditter Anastasia V Non-executive Director of International Communications
Smol’nikova Olga Nikolaevna Assistant to Director to Financial/Economical/Accounting
Panfutova Svetlana Valer’evna Assistant to Group Managing Directors

A Welcoming Statement, Historical Reference and Commitment to Potential Investors, from BoD Member Chairman

Dear Colleagues,

First, it brings me great pleasure to reintroduce the long established and dedicated founders of the newly combined Company, namely the General Directors of the societies of “Dovgan”, lead by our COO, Valentin Chegenev, whose efforts were instrumental with combining the “Mayskaya” enterprise. The latter of which enterprise was duly noted in 2003 as one “Economic Leader of Magadan Region” and who’s founder in 1972, served as the General Director through 2002, was awarded – The Honorable Miner -- of the Russian Federation; for his many achievements; I would like to hereby recognize, Nizhnikov Anatoly Ivanovich (right).

Additionally, let us also recognize his successor in 2003 and current director of our related operations still today, Vladimir Alekseevich Kolesnik (left) whom also received a medal and Award of Honor, being publicly listed as “the Best People of Russia” for his deserved reputation as the reliable partner having extraordinary foresight and ability to achieve business advancements and growth to his native region. As a result he attracted a team of skilled experts: geologists, mechanics, skilled miners and engineers, bringing the enterprise to maximum capacity in 2007 and greatly improving the economic and social successes and contributions within his native Magadan region.
Note: The above referenced back-round can be viewed at: http://www.llr.ru/

As now combined, the Company through our specific project initiatives outlined above, our immediate and ultimate strategy to maximize shareholder value simultaneous with Company profitability, while delivering accelerated growth-rates of gold production and sequentially decreasing operating costs directly resulting from the adequate funding provided by this initially-private equity stake Offering and through the related execution of all strategies planned, implemented and committed to, hereafter.

Thank you all for your attention and consideration of investments in this truly ‘Golden’ share opportunity. With highest regards to you all,

- Paul J. Ditter -
Golden Share Group
V.P. Chairman,
Member - Board of Directors;
Strategic Development & Corp. Governance
Golden Share Co. OJSC

(Market Cap Per/Oz Au to its Peer Group – Broad Based Reserves Comparison)
Presentational Addendum
Russian/English- Enterprise Value Mkt. Cap / Oz Au of Reserves
(Diagram #2a)
Diagram #2a:
Золота Корпорация - Comparison $ США EV / золота (Au) Mineral Reserves
$ США EV/Gold Oz Reserves –November 2006– Gold Spot @ $645/Troy Oz США

The «Голден Шер» Private Equity Offering = 10% Equity Stake of ~ $64.3 mln. США
Golden Share Co.
Корпорация «Голден Шер»
= Only $89/Oz Au США - EV/ Золота Oz Reserves

Корпорация «Голден Шер» = $89 США /Oz Золота!
$ США EV/ золота (Au) Oz Reserves

(Market Cap. $ EV США/ Oz Au Reserves)

30.11.2006 -- золота @ $645/Troy Oz Au США

Party on dudes!!!
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