Replies to post #60769 on Golkor Inc (GKOR)

[Rick-UK]

Explanation of the PR...

1, VALE has agreed to pay a nominal fee of $20k to own the option* to JV with us on S&N Lucky and they'll pay a further $75,000 to keep the option going for up to three years. This is a way of ensuring both sides are showing commitment to the project, yet leaving a way out if things do not work out.

2, VALE will explore the claims during this option period, and if they like what they see they will be required to pay for a full a detailed exploration costing them a minimum commitment of $750,000, which will earn them an 80% interest in S&N Lucky and has I believe been designed to be wholly sufficient to get both properties smapled, drilled and a report filed to NI 43-101 standards, thus proving our reserves.

3, At any stage within the 3 years VALE can exercise their option to JV with us. If they do decide to JV with us then further costs will be met on an 80:20 pro rata basis I think, though I'm not certain about "with each party contributing... as per their interest".

That is how I read this PR.

What I also believe is that the exploration will start right away (if it hasn't already) and we will hopefully see some drilling this summer and our 43-101 plus VALE exercising their option by the end of the summer.

I also believe that 20% could be HUGE for KAT Exploration. It may not sound much, but if VALE want to get value from owning 80% of the mineral rights, they're going to have to build a mine, and if they are meeting all the costs and bringing all their infrastructure and expertise to bear to build the mine, KATX will be making millions from this for years and years to come. And I do mean millions, tens of millions at the very least, maybe hundreds of millions if things go well!

VALE would not be entiering into this agreement if they did not believe in it going the whole way.

*an option agreement is a legally binding commitment (by in this case KAT Exploration) to provide something (in this case we provide 80% share of the mineral rights) to someone else (in this case VALE) in return for something (in this case an initial deposit, and then a big exploration fee).