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Gold/Mining/Energy : Crystallex (KRY) -- Ignore unavailable to you. Want to Upgrade?

To: E. Charters who wrote (7415)	3/24/1998 9:19:00 PM
From: charred	Read Replies (1) \| Respond to of 10836

Come on Charters; < Don't be a fool. A hundred year gold mine is worth the same as a 5 year mine? Come on deep thinker!>, Give me a break. If I was an investor I want the gold as quick as possible. Where did you hear $50 per ounce probably the lawyers of KRY. Stick to the facts. Please don't say you heard it private. How will Albino prove a million ounces? After 4 years on the property they said they had over 300,000 ounces. Why haven't they proved the other 700,000 ounces. You can't use time as an excuse.

To: E. Charters who wrote (7415)	3/25/1998 9:52:00 AM
From: Pete Schueler	Respond to of 10836

I would like to see a more rational way to value gold in the ground (GITG) that would eliminate some of the wide variations thrown out by hypesters and detractors. Does anyone know of a formula that purports to do this? If I were to develop this formula it would contain the obvious key variables such as initial capital, cash extraction costs, etc. that can be estimated. It would also contain some projection of the future price of gold vis-a-vis extraction cost. But when it comes to the discount rate used to calculate net present value (NPV) of a future gold mine I think it has to be looked at differently than other ventures. The discount rate must reflect the return needed to justify the risk of investing up-front capital in an uncertain world. Gold mining is a unique product that seems to have unusual risk factors. Gold does not become obsolete (at least not for investing history). Gold retains its long term value compared to currencies so that risk of inflation is very small (or could be seen as nil since appreciation is just as likely as depreciation). For instance the lease rate for gold is normally about 2% which reflects the absence of the need for inflation protection. There are other risk factors that are probably more important to the NPV calculation such as political risk at the mine site, technical risk for new extraction methods, environmental and commercial risks, and any other risks that could impact the project. These are just some ideas to improve the quality of estimates that I see flying around various threads which have no disciplined approach. Anyone have some comments or a proposed formula? Pete