hi Auchterarder Your calcs I think are about correct. In all my...

hi Auchterarder

Your calcs I think are about correct. In all my communications it has been pretty much $400 to $500 free cash per oz. And that money is then used to 'fund' the company going forward.

The calcs should be pretty easy to follow. As the digging and trucking is all 'contract' and 'firm numbers'. We are dependent upon

1) KGM being very conservative with the money SPEND (do exporation and development in a business reponsible manner)

2) the POG

3) the actual grades received at the mill

I am trustful that John Mc and team will do well on 1. They have history of being conservative developers

I am hopeful on 2.

3 I may worry a bit about. You recall we are a couple weeks LATE on the report of the grade received at the mill - which will justify the first payment.

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My last guess at yearly cash was posted end Jan as:

I think I want to revise my previous numbers. I was digging around broker presentations and email communications re the costs.

My numbers I do not think include the 1/3 profit to the mill. So my number crunching was around $20 mill free cash. But I think KGM will only keep $14 mill.

So at a conservative view one could say $55 mill market cap, and $14 mill free cash, less $10 mill costs, so you end up with a very basic 7 to 8% 'profit'. Mind you, as a worst case that is not bad.

But it means the share price can only go up if they announce more oz or if they are able to produce MORE or the price of gold rises.