Hi Guys!

Be carefull! The pre-market bids mean nothing. There will be a lot of fun and games behind the scenes, as some will try to create the impression that KXL is going to open at $5 or higher. That will encourage retail investors to raise their bids, so they dont get left behind. Two minutes before the market opens tomorrow, all the big bids will disappear and the retail guys will be left with the bids well above market. Guess who is going to sell into those bids?

It is very unlikely to me that we will see a huge gap up tomorrow. The news is great, and we love to see so many high grade numbers to get the level of excitement up. But do not confuse that info to suddenly think we now have millions of ounces of gold in the ground. Sure we have one more baby step towards proving up millions of ounces. But what has realistically been confirmed from the latest data is not a big deal.

Here is a back of the envelope assumption:

Hole HR07-51 from the Golden Mile zone yielded an impressive 10.4 oz/t across 3.6m. So in terms of resource assumptions, you could infer that grade extends to 30m on either side of the drill core, and to 30m depth below. The intercept occurred about 30m to depth, and I suspect they have assays from channel sampling above. That data would be blended with the actual assays from the nearest drill cores to either side and with the samples from surface. So if we already have an intercept at surface of say half an ounce gold per tonne, then they would combine the 10 oz and the half ounce, and come up with a weighted average for the resource block. They would do the same for any drill cores to either side and around the same depth. But lets just consider that hole with the data we have:

3.6m width, 60m lateral extension, and 60m total depth... generates a rock volume of of about 13000 cubic meters. Go with a specific gravity of 3 and you end up with 39000 tonnes of rock, and then plug in 10.4 ounces, you get 400,000 ounces of gold. That is a huge, huge interval! We know it will come in much lower than that when they blend in the other data, but its still an amazing chunk of high grade vein. But its a long way from the 5 million ounces, or 40 million ounces that some are projecting.

If you have too much time on your hands, you could dig around a map of the drill and sample data, and come up with a blended estimate for all the numbers that are on the public record so far.

Anyway, I think its a fantastic start, an exciting discovery, and this stock is going to bounce around like a bucking bronco tomorrow. Its not my job to offer anyone advice, I am just sharing my opinion. A bit of patience on the trading tomorrow will probably save people some money.

cheers!

mike