a broker also asks if rms is miner or investor, page-15

Talentless,

Why are you talking about PRODUCERS now? Your original post was about DRM compared to an explorers. I quote you:

"Even if they quadruple the resource base they wil stil be the highest valued explorer around base on an EV/resource oz."

Regardless, you will not get an argument from me that DRM is more highly valued than its EXPLORATION peers...this is clear, on several valuations (the most irrelevant being $EV/oz). In fact the majority of my whole post was pretty much aimed at the inadequacy of using the $EV/oz valuation measure (if it can even be called a valuation measure). It just should not be used full stop and I'm surprised you bother too given you are familiar with all those others.

If I take an NPV (the only valuation tool I bother with) of the Andy Well project at say a 300k oz resource (with a bunch of my own assumptions), I get a value of slightly below its market cap. So yes NOT cheap for an explorer, and it doesn't even have the 300k oz yet.

I am sure I can find an explorer that on current resources has an NPV of well under their market cap. In fact I have a few on my watchlist.

And you know what, the fact that its highly valued is pretty much evidenced by the performance of DRM this CY. Ignoring 2010, DRM SP has been well below average despite management continuing to deliver on several fronts. It started the year at $1.40 and is currently sitting at $1.50...hardly anything to crow about.

But my view is quite clear...I am invested long term in this not only for what they have, but for certainty and future potential.

Certainty in that the project WILL be feasible, regardless of what happens to the gold price (I have no idea what pangea is going on about, there are a heap of narrow gold mining companies that have been or currently are extremely profitable, unless they are Victorian reefers). The only uncertainty I had (and it was only a CAPEX uncertainty really) that surrounded it - being the proximity of the current road which could have required moving it!- was removed recently by discussions with government.

As for potential, what that means in terms of SP is only something that will be find out as hurdles are crossed. Let's look at some of them:

- We know there is a initial resource upgrade coming, but what we don't know is what that upgrade will be. But there is potential.

- We know that the structure is still open to the south, and that they have identified a potential northern extension, but we don't know what they will find until they throw the holes down. But there is potential.

- We know there has been excellent drilling results at Abbots, but we don't know whether this will eventuate in a resource and if so, how big and what global grade. But there is potential.

- We know the company has 130k metres of primarily exploration drilling planned for 11/12 on highly prospective ground, but we don't know what that drilling will turn up. But there is potential.

In my view, the 'potential' of DRM easily outweighs that of any other explorer that I have looked at. In my view to use the $EV/oz measure is just not feasible, other than to say that you know what, perhaps it reflects this potential!

Regarding your last para, again your initial post did not mention producers at all...but you will be happy to know that my SECOND biggest investment (though quickly catching DRM) is Northern Star Resources. DRM was picked up at the IPO, NST primarily at 5c. So yeah, the producer has definitely won out in terms of performance (so far).

I like you am a retired investor (and coincidentally also solely gold focusses these days) - though at 36 yo, I'm guessing significantly younger. I guess we just see things differently. Perhaps being younger, I am a little more willing to take risked potential.

By the way, have you ever BEEN to a DRM "same old same old" presentation? I have...to several when I am lucky enough that the MD comes to Melbourne. Imo the VERBAL presentations are rarely the 'same old same old'. A powerpoint slideshow can be deceiving as can a presentation given at a plain vanilla conference where the time allotted is bugger all (10-15mins).

Cdchi1