Madison Enterprise, MNP/VSE Message Board

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Gold/Mining/Energy : Madison Enterprise, MNP/VSE

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To: russwinter who wrote (262)	4/27/2001 11:26:25 AM
From: Elizabeth Andrews	Read Replies (1) of 285

Show me where the company has said that these are true widths and that there's continuity between the intercepts. I'm not saying that they haven't drilled some decent holes but this appears to me to be a very complex structural setting and it ain't going to be simple to mine as there appear to be significant internal dilution and identifying the economic grades from the waste may not be easily done other than assaying everything before mining it. I'm also not saying that this isn't a good property even after factoring in the considerable country risk. You may be right this probably will be a good speculative buy at some point. Here's what I'm looking for before I would consider buying it. The company has 45 million shares issued and about C$2 million in cash. The interesting thing is that insiders still own 22 million. The market cap at 12 cents is C$5.4 million. Looks cheap especially if you accept that the deposit is 25 million tns grading 2.2 grams au and about an ounce of silver say 2 million equivalent ounces which the market is saying is worth C$3.4 million or about US$1.10 per ounce. This assumes they own 100% but they only hold a 65% interest in Mt.Kare which is subject to the PNG govt being able to purchase 30% at any time. With respect to the country risk, in particular there has been a complicated series of title disputes and litigation in recent years which has in the past affected orderly exploration and development of the property. There can be no assurance that additional title disputes will not arise and in such event the Company's ability to explore, develop and exploit the Mt. Kare Property could be adversely affected by factors unrelated to the geological potential of the property. So this looks to me like a candidate for re-structuring as in order to develop the Mt. Kare Property, it will be necessary to build the necessary infrastructure facilities, including electricity, transportation, etc., the costs of which could be substantial. Dilution? And it's just a penny stock.

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