Global Platinum & Gold (GPGI) Message Board

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Gold/Mining/Energy : Global Platinum & Gold (GPGI)

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To: Zeev Hed who wrote (6526)	7/5/1998 9:05:00 PM
From: Richard Mazzarella	Read Replies (1) of 14226

Zeev, I've been mulling over your comment about the FA and TA not agreeing. Well, maybe they do agree based on what investors generally know. Remember the "bonanza" assay of somewhere around 0.6 OPT gold equivalent? At that time I pissed Ed off doing a valuation based on metal in the ground. 0.5 MM tons X 0.6 OPT X $30/oz / 22 MM shares = $0.41/share valuation. Notice I used an optimistic $30/ton for metal in the ground. Therefore just based on the ore pile assay, the stock is fully valued. Let's now take the recovery of 3 OPT just demonstrated. 0.5 MM tons X 3 OPT X $30/oz / 22 MM shares = $2.05/share valuation. A more conservative dollar valuation for difficult mineralization would be closer to $10 than $30. At $10/oz the share valuation would be $0.68/share valuation. That's very close to the current stock price. Maybe as more recovery data comes in we can raise the dollar value for the metal in the ground? Along those lines, last week I had a conversation with Dale Runyon CEO of Maxam. I asked him what he thought about the GPGI recovery results. He was delighted that GPGI was showing such progress, but said something that may shed some light on the stock weakness. He said that was a good result, but that seems limited with a reserve of only 0.5MM tons. I then explained that GPGI still has considerable property available. He then asked if it had been drilled for proven and probable reserves. I told him that there was some drilling, but I wasn't sure if the market would accept that work. My point here is that the market may just be considering the ore pile and not speculating about the potential for reserves. Maybe GPGI should renew PR about the full potential for GPGI, not just the ore pile. Runyon also had some concern about the screened ore pile being called head ore, I agree. Comments?

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