fundamental analysis, page-13

badjelly

yes though will just stick to small talk methinks

Back to mulgabill's original question.

After comparing to so many I have found that an explorer with a proven gold resource or have a potential gold resource of around the 1 million ounce mark range in market caps between 28 and 33 million.

For example BMM have a market cap 29 million but only 1/2 mil ounces of gold but have the money in the bank to prove this resource upto an expected 1 million ounce resource. the mine is in an area that has previously been mined though so not all will be open pit so KAL will have an advantage in cash costs.

A1 minerals, about the same market cap, does have about a 1 million ounce resource which would be comparable to KAL before this current re-defintion of resource. Basically higher grade for open pit but very high percentage inferred and smaller resource.So plus one, minus another.

Wez market cap 31 million, smaller defined resource but once again potentially around the million mark. Lower grades, not economic in 2006 for the BFS on circa 1/2 million ounces.

So I have come to the conclusion that you start with a fixed cost for explorers that have inground value simply to cover the costs plus basic profit associated with proving up a resource. So they can all start out equal because costs are the similiar whether the mine will be underground, whatever the grades etc.

So imo this should have been the ball park starting point for KAL rather than the ending point.

My belief is that after starting from the same plate then value is added by doing further exploration to upgrade inferred to indicated, to grow the resource, to improve grades all of which KAL is currently doing.

Once done, then it can be valued at a per ounce sale price. ie. How much would a bigger miner pay for it?

Or if the company plans to go ahead with mining itself then cash costs, mine life et al should be considered.

It is my expectation then that KAL by the end of December should have a higher market cap than the aforementioned based on the success so far of the current drilling campaign. However logic of some market caps escapes me so may also depend on hype or fear. KAl has seen both this week.

If anyone would like to disagree with my thinking feel free as we all would like to understand better and understand our investments. But I will ignore anymore bizzare downramps based on fiction. Only so many in a week you can take. Whoever does so may not realise how many there have been and not understand it is not a personally against them alone.

have a nice day everyone, I am off to seek my next little beauty :)