Playing around with numbers again...

Everyday the potential of KXL grows. The amazing thing is that all of us have forgotten that they also have nickel/copper and uranium exploration successes going on!

However, my attention is clearly on Gold and Hercules

What we know

Strike length on surface is now 20km with VG along strike.

Vein widths vary from 1.5m to 11m

Grade varies from 4g/t to crazy nugget values of >7000g/t. Historical average for the beardmore area 20g/t

Depth - historically for these structures > 1000m in this area and across Canada for that matter.

So doing the math using 2.5 t/m3 using Au @ $750/oz

Agressive calculations

Length = 20,000m

Width = 2m

Depth = 1000m

Grade = 20g/t

In ground $ = $250/oz

0/S = 100 million

NPV = (20,000*2*1000)*2.5*20 = 1,500 million grams Au !!

or  43.5 million oz of Au!

or 10 billion and a SP of $100!

Ok... now conservative (really conservative)

Length = 20,000m

Width = 1.5m (reduced by 25%)

Depth = 500m (reduced by 50%)

Grade = 10g/t (reduced by 50%)

In ground $ = $200/oz (equivalent to Elenore buyout price with no 43-101 and remote location)

0/S = 100 million

NPV = (20,000*1.5*500)*2.5*10 = 375 million grams Au !!

or  almost 11 million oz of Au!

or 2.7 billion and a SP of $27!

Now consider...

1) The Mag survey shows over 40 km of vein structures similar to the GM that they haven't stripped yet. Possible 3x above numbers.

2) Gold is likely to go > $1000. Take 50% of increase and add it to the ground value... so Possible 50% increase to above numbers

3) They have 100% ownership of 1000sq km in this area.

4) SGX has already found good nickel/copper next door. Likely on KXL property too.

5) PP are all non-brokered so "effective" public float does not get diluted.

6) They will have 3 drills and 60km of drilling in 2008 - that will be at least 300 holes to report on... regular NRs to keep momentum going.

7) Casey predicts the 3rd phase of the commodity cycle to kick in any day - that would be the mania stage. Remember the tech mania stage in 2000.

The numbers are staggering, the potential SP spectacular folks.... IMHO of course

Hope you are in, buy on dips... hold for the long term.

mz