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Gold/Mining/Energy : PLAYFAIR MINING - PLY . V -- Ignore unavailable to you. Want to Upgrade?

To: russet who wrote (221)	7/20/2001 1:30:09 AM
From: Elizabeth Andrews	Read Replies (2) \| Respond to of 505

I don't think that, generally, what you have proposed is the correct way of looking at the exploration risk of a grassroots property like this one. This is a huge dilemma for the junior company. One way or the other, the junior is going to have share or property dilution. The business decision is when. Majors are majors because they have the producing mines. They have the producing mines and they have the resource that juniors do not have-cash flow. It doesn't matter how this happened, it is reality. Does the junior drill the property and risk the long odds of a first good hole, then do a deal with less dilution? Or do they allow the major to earn a controlling interest in the property up front? Or do they drill it, miss, as the odds dictate, and have to issue a bunch more shares at lower prices to continue? It is still called dilution. I'm in favor of selling a large part early to a major as the risk of getting more money is too high given the odds of an economic drill hole. I'm going to check the history of the deals that management has done and see if a pattern emerges. Are they motivated to diligently find a deposit or just to get money by selling paper? Then there's serendipity!