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To: CusterInvestor who wrote (28840)	5/17/2007 8:56:43 PM
From: pino_noir	Respond to of 37387

Bigpike-- Here is a document that distinguishes between "reserves" and "resources" including various subdivisions. cuadra.cr.usgs.gov The document doesn't define "attributable" but the Salman Partners report defines it as "Attibutable = Equity Share or company's ownership share of resources, reserves, or production." Seems like this pertains to the joint venture interest in a property or equity ownership interest in an enterprise that itself has resources and reserves. Like you, I'm trying to understand that implications of the Salman Partners report. Pino

To: CusterInvestor who wrote (28840)	5/17/2007 11:54:56 PM
From: pino_noir	Respond to of 37387

Bigpike-- Regarding the Salman Partners report ... this is my take. The 2 rightmost columns of page 8 are the ones to pay attention to. The smaller the number, the greater the potential value. Let's take Victory Nickel as an example. According to the statistics on Page 7, it has an enterprise value of $100 Million. It has measured and indicated resources of 667 million pounds. It has measured, indicated, and inferred resources of 1.18 Billon pounds. If you divide the enterprise value by those two figures, you get $.15 and $.08. In other words, the enterprise is valued at $.15 per pound of nickel (measured and indicated) and $.08 per pound of nickel (measured, indicated and inferred). A more straightforward valuation metric might be pounds of nickel per share. You can calculate this by dividing attributable resources by shares outstanding (154 million shares for Victory Nickel). Victory Nickel thus has 4.33 pounds of measured and indicated nickel per share, or 7.66 pounds of measured, indicated, and inferred nickel per share. There are many reasons why companies such as Victory Nickel are valued low relative to their resources. The main reason is probably that they haven't completed a feasibility study yet, which is why they don't show any "proved and probable" nickel "reserves." According to this link (http://cuadra.cr.usgs.gov/Techrpt/sta13.pdf) a "reserve" is a "resource" that has been determined to be economical. In other words, Victory Nickel has a huge resource base, which through drilling and sampling will hopefully be determined to be economical to mine (and thus reclassified as a "reserve"). Our job is to decide which of the nickel explorers are most likely to proove feasibility; successful completion of a feasibility study should result in a significant "bump up" in valuation. Anyone else have any thoughts on this? See any mistakes? Pino