cmparing mt kare to 28milloz porgera gold mine, page-6

Hey Forrestfield

Since we aren't in production, yet :) it is difficult to work on a share price estimate based on EPS. But what we can do, is look at other gold explorers with low cash cost (less than $300 Oz) and see where they sit in terms of market cap and JORC Resource.

Most gold explorers sit at a market cap of $100 per Inferred Ounce of JORC Gold Resource, $150 per Indicated Ounce of JORC Gold Resource and $200 per Measured Ounce of JORC Gold Resource.

There is higher value in the market cap for Indicated and Measured since these become a RESERVE Gold JORC, and this is what banks and large companies lend against.

We currently have a JORC Inferred Resource of 1.4million ounces and 700,000 ounces of Indicated JORC.

If you look at the Pathway to production below, you can see than once the PFS is released, then the next step is an increase/improvement in the Indicated and Measured JORC Reserve Item 2.

Another factor that adds to a company's market capitalisation is how close they are to production and how large can the total JORC Resource/Reserve get considering historical factors and the size of nearby mines. We have covered this extensively on HC! :) Porgera is a 28 million ounce gold mine sitting on the same geological fault.

IndoChine finished building a 150 man camp, medical facility, river monitoring equipment last month. Ask yourselves, do you really need all this for 6 geologists and 9 assistants that are manning the drill rigs???

Also, the sound of mid term production is also interesting! We need to keep an eye out for this!

We also have the advantage of a low capex of $150million since the grade of gold and silver is so high, check out the drilling results in the past and Mr Promnitz' hint "does history repeat???" that you dont need a large scale expensive machinery to process millions of tonns of rock to produce 150,000 ounces of gold since the grades are so pure and so shallow!

And yet another benefit is the high grade of silver may pay for the processing of the gold, we know we will get silver credits, but if they metallurgy can confirm that a zero cash cost gold mine will be in operation for the first 7 years then again that will add to the market cap.

The other advantage is that 85%+ of our shares are held by the Top 20 Shareholders who are made up of multi billion dollar Resource Funds and one Fund BlackRock which is has $6Trillion under management. They wont be releasing their shares on the market for a small percentage gain!

When these milestone events are completed Funds and investors will have to buy on market IDC shares and will have to pay a premium for all the factors listed above!

The other factor will be the price of gold, which is expected to lift well beyond $1800/oz in the next 12 months.

I hope that helps to explain the factors that will lift IndoCHines share price. How high it goes depends on these and the market forces at hand.