Because of past financings that involved flow through shares the company is obligated to spend a certain amount of money on drilling and exploration. That's why it is smart for companies to put this money aside and label/earmark it as such. This is a must going forward.

Lastly if there is a bzillion tons of nickel in the ground then each share will be worth so much purely based on the intrinsic value of the nickel divided by number of shares out. Similar to a book value per share.

Lastly I think the plan is to sell the company and it's Nickel assets to a major needing feed or reserves. I can't see wanting to mill it on their own or build a mill.

Joint ventures are a possibility as well.

Here's a link to some information on flow through.

http://silverstockreport.com/email/f...

"Flow through shares are issued by Canadian exploration companies to Canadian investors in private placements, when the companies issue stock to raise money. The money raised must be spent on drilling exploration (not underground drilling).

There are several tax incentives for Canadian investors who buy flow through shares, because the Canadian government is trying to stimulate the mining sector. But like most things governments do, there is a drawback. The tax incentives are quite large, and they add up quickly. If a flow through share costs $1, it really may only cost the Canadian investor about $.41!

Source:
http://www.goldencapital.com/flowt/t...

The reason is that there is a 29% Federal Canadian income tax reduction, plus a 15% tax incentive, plus about a 15% Provincial/Territorial personal income tax reduction.

The flow through share program was designed as a temporary measure in the year 2000 because the mining exploration industry was nearly destroyed through low metals prices.

As a consequence, the Canadian government decided to motivate Canadians to explore for minerals when it made the least sense to do so; when metals prices were low. Fortunately for us, we can now buy Canadian exploration stocks at a discount, because of this foolish Government program.

The flow through share program is set to expire in March, 2007."

Source:
http://www.pdac.ca/pdac/advocacy/fin...