27c valued at 234c before upgrade next friday?, page-83

Blythe, your post makes a lot of sense.

I appreciate the things you have highlighted especially as this company is embarking on virgin territory and relatively complex minerology. Then you have the political landscape to consider (which seems to be turning for the better)... there are a lot of factors to consider

As you have mentioned, before any ore can be extracted, you have to fund feasibility and then construction and commissioning etc etc and that often means dilution (more shares on issue) which means less asset and less earnings on a per-share basis - and you can only build a mine that is so big

However, even you must confess that no matter how one begins to value this thing, the value of this resource cannot be sustained at just $50 or 60m - I trust that's why you are holding some stock also? It gives me confidence knowing that a knowlegeable self-proclaimed "pessimist" is also holding this ( as narrow-sighted optimists are no-good - the events of the last 2 years are proof of that)

I think it's too early to base any valuation on mining rates or earning capacity becuase we simply don't know what that will be - yet. Any figures used are guesstimates at best. So, at this early point in the game, it's conventional appraisal methadology that one values a company according to (dare i say it) in-ground resources - albeit a simplistic, "amateurish", and yes, "stupid" method - it is the only way we have of comparing Explorer X to Explorer Y. The only thing these companies have in common, is metal. And on a peer comparrison, and based on Ux resources alone, this company is undervalued (even after discounting the valuation by 50% to account for the minerology and climate and location)

So as you have correctly pointed out, A COMPANY WITH $X BILLION WORTH OF METAL IN GROUND IS NOT WORTH $X BILLION IN MARKET CAPITALISATION - But the COMPANY'S VALUATION and the VALUE OF THE DEFINED RESOURCE, are at the least PROPORTIONATE to one another

Now it would be nice if there were another REE or Ux co mining the same stuff in the same country or at least exlporing it so we could have a more relevant peer for comparrison - But we don't - And I don't take that as a bad thing, I think that's a plus. As the company themselves have pointed out, there just aint that much virgin territory around that is as prospective as this place - from a miner's perspective the world is getting smaller and smaller. And I think this mob has more chance of being taken over by a large co (BHP, Xtrata, RIO, Anglo etc) who have the money to develop this rich resource, than actualy developing it themselves. But this is ofcourse subject to the company proving they can extract most of the metals economically and safely.