As I understand it Dana has signed up for the exclusive right to...

As I understand it Dana has signed up for the exclusive right to take as much kaolin as it wants, up to 10M tons (with the option of another 20M if they pay another $2M). So Dana doesn't actually have to take any, in which case no royalty would be payable. Don't get me wrong, I think this is great progress, and I'm happy to see action that reduces dilution on the path to building the plant, but I don't think we can count the royalty dollars just yet. (For example, and I have no reason to believe this is the case, Dana might just think it's worth paying $1M to keep 50M tons - $5B-worth at $100 a ton - of high quality kaolin resource out of the hands of its competitors, and have no intention of taking a gram of it. Hopefully the deal excludes that as a possibility, but I just don't know.)

I'm not down ramping - on the contrary I'm delighted by progress - four significant positive announcements in the three months is tremendous, and a huge reinforcement in confidence in the management. And I'd love to see $2.50 a ton royalty on 30M tons, which by my reckoning would mean the plant could be built with no dilution at all (with the required funds borrowed). I'm also optimistic that we will see royalties flow in. I just don't think we should start assuming that we have the royalty dollars - and especially not the upper limit.

So I think it's fairer to say that the deal is POTENTIALLY worth more than the market cap of the company, but not to go further than that just yet. (I've been thinking for a while that it's bizarre that a company with $6B of resource in the ground has an MC of $10 - 14, but that's for a different discussion.)

GLTAH!