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Gold/Mining/Energy : Naxos Resources (NAXOF) -- Ignore unavailable to you. Want to Upgrade?

To: Kurt R. who wrote (13778)	6/22/1998 9:34:00 PM
From: Kim W. Brasington	Read Replies (1) \| Respond to of 20681

Kurt: There is a sequence to developing a property that adds value to shareholders. This first step is to find a geologically promising property. The next step is to lock it up under the name of the company. Following that you have to have a consistent assaying technique. Once indicators show that there are precious metals at a given geological site, the next obvious question is "how much is there?" Right now Naxos is in the verification stage of finding out how much gold resides in the Franklin Lake property. Confirmation of quantities of PM's takes drilling, and drilling takes funding. Gold has been chosen to be the base line followed by other precious metals and their quantities. Funding becomes easier the more gold is shown to be at a site. The greater the quantity, the lesser the risk, and I say this because I personally know of properties that have high grades, but low tonnage, that mining companies would not touch, and it might be considered a break-even proposition for a Ma and Pa outfit to mine. Majors want to have long life mines, and to them a one to three year mine life may not be economic at all, due to the cost of infrastructure. The longer the mine life, the more desirable a property, but to have a long mine life, you have to have at least a fairly good idea of how much gold is there. Once again you come back around the loop to establishing how much is there. Should an exploratory company walk in to a financiers office and say that they want to take out a loan, or have the financial institution buy into the company for the purpose of mining a geological site - one of the first questions that the financial people are apt to ask is: "how much is there?" I would like to be present when the exploratory company tells them - "we have no idea, because we haven't drilled a single hole at the location." :0) As of yet, Naxos has not developed inferred resources. Inferred resources or better (indicated resources) is the goal of this drill program. The more that is inferred, or indicated, the easier the next financing should be. Any type of resource cannot be deduced, but must be pieced together from drilling. Regards, Kim W.