BRE-X, Indonesia, Ashanti Goldfields, Strong Companies. Message Board

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Gold/Mining/Energy : BRE-X, Indonesia, Ashanti Goldfields, Strong Companies.

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To: william smith who wrote (7122)	3/13/1997 8:51:00 AM
From: notredame	of 28369

"Bre-X is a good long term investment". That is one of the issues on this thread I believe everybody actually agrees on. In order for us to discuss the issues which everbody disagrees on, lets attempt to attach a value to this project as well as an investment strategy given certain assumptions. Instead of focussing on who got what and how, we should be should be focussing on who has what and when. Now, Bre-X is sitting on 45% of a projected 71.5 MM ounces. Using March 12 close that is roughly 11.3 billion US in the ground or 32 MM ounces. Less the production cost of $100 US an ounce the net proceeds roughly 8.2 Billion US. Divided by the number of shares outstanding of 250 MM (NOTE: NO DISCOUNTS APPLIED) a NAVPS of 32.90 US. Now, this is not a conservative estimate by any means, but is a start. As for a strategy, covered call writes are turning out choice premiums and have been for as long as BXM and BSR have been listed. This is a good short term strategy, just be careful around the resource calculation dates. Regards, ND.

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