redback...reserve ann due soon., page-9

Actutle

I wanted to demonstrate RBK's sensitivity to rises in POG, and to show this under different POG scenarios.

RSG have done a DCF valuation with the assumption of gold at US$300...i discussed this in my post.

The fact is that POG is not a constant...it is very dynamic atm. I doubt it will be average US$350 during RBK's 7.5 years of operations.

It could average at a lower level (US$300... as mentioned), or at higher levels (US$400, US$600, etc)during this period.

It is prudent to show RBK's valuation under all scenarios - as i have done.