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Gold/Mining/Energy : Big Dog's Boom Boom Room

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To: tommycanuck who wrote (19622)	3/4/2003 1:59:35 PM
From: Claude Cormier	Read Replies (1) of 206089

<Please fill me in on how the Canadian Royalty Trusts are replenishing their reserves...> Well, I have spend enough hours in studying those trusts in the past several weeks that It seems that they do replenish reserves. Most of them keep 20% of cash flows to develop lands. As well they use reasonable credit to expand their business. So, although you are right when you say that properties are more expensive, they are still acquiring reserves and production. <The trusts have had the luxury of buying cheap, quality reserves over the past few years but have little access to those anymore. > Yes to the first part. But as far as I can tell, they can still make good acquisitions. <The purchases now, their only visible means of adding to their reserves, are much smaller and of lesser quality than previously.> This is not the conclusion I reached after studying Advantage and Shiningbank. shiningbank.com advantageincome.com < They are mandated to spend little on the continued maintenance and development of the assets they have. > Where do you see that such is their mandate. On the contrary, they have to expand both reserves and production so to optimize current and long term distributions. <They have run the gamut...the easy money has been made and significant risk exists in my mind. > The older trusts are 15 years old and still growing with heafty distributions.

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