to the board and especially opaline, page-18

Thanks for the replies. I noticed the latest share Placement has caused a stir. What I would say about that is, if your unhappy about a Director pledging money for cheap shares, vote at the next General Meeting where it still needs shareholder approval.

I'd have to agree with NK in saying that HEG looks fully priced at current stages in development. With a Market Cap of $88 million, $3m in cash and losing about $2m a quarter. Until the cash balance starts increasing each quarter through gold sales and not capital raisings, HEG is fully priced. Of course, this is not to say the share price can't and will not appreciate.

In comparing it to a nearby gold mine in BDG, it looks quite expensive. I'll use BDG as an example because I have no interest in BDG. I could use my favorite gold producer, but that would just be cross-promoting and ramping my own stocks.

BDG has a Market Cap of $119 million but has cash of $57m. Take away cash from both companies and you get;
HEG - M/C $85 million
BDG - M/C $62 million
Now remember, HEG is losing about $2m a quarter and BDG is increasing it's cash balance by about $5m a quarter($7m last). On a yearly basis, one is losing $8m while the other is making $20m. This is not including it's new acquisition in the Henty mine. I could 'speculate' about future announcements and future cash flow but I'll remain to what's present before us.

Now I know BDG is a stock nobody wants to admit they own. Having been a Billion dollar company before a single ounce was produced, brings back some bad memory's for some. However, it's hard to go past it's superior infrastructure, mining equipment, plant and the pedigree of the Bendigo Gold Field.

You need to remember that BDG has issued an amazing $420 million in capital to build the business where it is today. Whereas HEG has issued about $45 million in capital, so naturally BDG has an advantage.

As Gold Bars has pointed out, it's much better to invest in companies that are real 'cash flow positive' and that are cheap relative to it's peers.

I do think HEG has a future and I hope the options do get over the line. It's in the interest of all parties for that to happen. I do feel the share price will need to be well over 30 cents for that to happen. It's share price will also come under selling pressure because investors will need to sell the heads, to convert the options.

Good Luck