Tis a simple excercise people.Take the number of shares on issue...

Tis a simple excercise people.

Take the number of shares on issue at Discovery

(eg) 350 million shares (including options & agree definately need to raise more capital)

For a $1 share price you are looking for:
a) Takeover offer of $350million
or
b) Ongoing Profits of $35million per year (10 times earnings)

So the question therefore is:- Is Para 1 + Para 2 capable of returning GDN $35million a year profit

Nahman also asks an important question with regard to valuation. Is GDN planning to expand by drilling more prospects. If so this decreases the Earnings per share and in turn the share price until such time as they find more oil or gas.

Upon current share price $0.155 and factoring in future dilution of say another 100million shares. Their current projects would need to return the company profits of at least $6million per year on an ongoing basis to justify the current share price. (350million shares times $0.155 divided by 10 for times earnings)

So I will now go and do my homework on exactly how much profit this thing could produce if it got anywhere near its aims.