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To: LLCF who wrote (105135)	5/28/2001 12:46:26 AM
From: tyc:>	Read Replies (2) \| Respond to of 436258

There is a concept in the mining industry described as "the option value of a mine". I am trying to determine how such a valuation might be determined. I likened the cost of production to the strike price of an option. I don't think it is stretching too far to say that if the mine cannot meet its cash costs of production it will shut down. That seems comparable to an option holder saying he will not exercise if the strike price is higher that the price of the stock. What I am really trying to determine is whether an interest rate factor should be reckoned into the option value. Or should we just figure in the price volatility of the commodity ? Hence my interest in the arbitrage involved. Thanks again for your interest. I guess I must abandon my quest .