Replies to post #8546 on Explor Resources Inc. (fka EXSFF)

[CDLGold]

Some of our board members have Market Digest Online
witth Ted Melcher.I don't have a subscription there.Maybe some
of our board members can give reviews.The Gold Report has
analysts covering stocks,in junior miners mid-tier,gold producers,and possibly majors.
Brent Cook is a geologist,so his recommendations should be good.Someone who used to work for a major joined his company,if I am not mistaken,which means he knows what majors are looking for,in junior miners for a buyout.Hope this helps.

[Gregory_]

Here is a weak attempt at some numbers for TPW:

LSG's cost is less than $800 / oz in 2013 (based on prior posts).
Gold is about $1,700 right now, leaving about $900 / oz potential profit. Let's presume it stays there and does not drop to $1,000 again or skyrocket to $2,500. (I would bet on the latter.)

I cannot recall the cost of infrastructure at LSG's mine, but I believe it was $250,000,000. I really cannot recall for sure. That is VERY relevant, whatever it is. I would not expect EXS to build a mine, but it is relevant in terms of how interested a major would be.

1M oz (what we have now)
----------------------------
1M oz - $900,000,000 in profit (based on $800 cost at $1,700 Au)
10 year LOM (life of mine) - $90M profit a year
20 year LOM - $45M profit a year

1.5M oz (what we soon hope to have)
----------------------------
1.5M oz - $1,350,000,000 in profit
10 year LOM - $135M profit a year
20 year LOM - $67.5M profit a year

3M oz (what we hope to have by the end of 2013)
----------------------------
3M oz - $2,700,000,000 in profit
10 year LOM - $270M profit a year
20 year LOM - $135M profit a year

30M oz (believed to be the potential for the deposit)
----------------------------
30M oz - $27,000,000,000 in profit
10 year LOM - $2.7B profit a year
20 year LOM - $1.35B profit a year

So, with all of that (mostly) utter nonsense said, if CD is right, and we are sitting on top of a 30M oz deposit, what do you think a major would pay for it?

Even $2 seems cheap. $2 * 180M shares = $360M market cap

From a recent interview with Rick Rule, he stated investments in the current market need a 3 year payback to interest him.
"We would rather see you do something that generated a 30% IRR with reasonable amounts of capital where you pay back the capital in three years." - Rick Rule, http://www.theaureport.com/pub/na/14773

Let us be modest then and consider a few things. If we look at a 1.5M deposit at approximately $135M in profit a year, that would mean they could possibly pay 3 years of that less the cost to develop the mine. 3 * 135M = $405M. If the mine costs $500M to create, well... that does not paint a rosy picture here. If we are looking at a $250M mine cost, it may be worthwhile. This is why the cost of the LSG mine is very important. (Can anyone help here?)

$405M profit in 3 years - $250M mine cost = $155M purchase
$155M purchase / 180M shares fully diluted = 0.8611 / share
$0.8611 / 0.11 (today's closing price) = 782% gain

If we bump it up to a 3M deposit:
$270M profit a year * 3 years = $810M
$810M - $250M mine cost = $560M purchase
$560M / 180M shares = $3.11 / share
$3.11 / 0.11 (today's closing price) = 2,827% gain

This is all exclusive of something happening at Kidd Creek, which is what I am really watching. My expectation is that Kidd Creek will steal the show, in the end, but that is all completely speculation.

[douginil]

Re Brent Cooke ( www.explorationinsights.com )

He has good list of companies that he has worked for, including Rick Rule and Global Resource Investments, Ltd from 1997 - 2002.

I plan to check more after the holidays.

I do not know his track record but if you sign up ( like the Mining Speculator, and many other newsletters) you get full access to it.


douginil