I'm no expert, but....

I have seen deposits valued at X dollars per ounce; this has been done in the context of speculating about a possible buyout price for a company, or for a particular property that a company may sell. Most recently I saw a company (I think Ventana?) valued at $170/oz for one single deposit, for the explicit purpose of determining a target share price based on an imminent buyout.

It was also a "back of the envelope" calculation that the analyst was simply using to justify buying their shares at the company's present price. But the justification was that the big boys like Goldcorp presently pay good money for significant deposits that can keep them in business.

In the case of GNH, it has to be remembered that this deposit has no Pre-Feas, nor does it have a 43-101. They need a piece of paper proving a mine's economic model before someone like Goldcorp will offer a serious price. For GNH to get to that point, it will have to spend money, probably a lot for a deposit this size, and the money will come from dilutive financing.

I would expect you'd have to determine how much more money (beyond present cash) will be needed to get this deposit proved up, factor that against the (ex-cash) market cap to determine how many more shares must be issued, and use that to determine a factor to multiply against the $/oz figure to find out what the deposit is worth right now, before dilution. This is because the shares issued in future dilution will effectively be stealing a portion of your shares' portion of the company's value.

Also, when does the deposit get sold? I'd think it won't be before 2013, given where they are right now. For any price that exists in the future, you have to apply a discount factor that takes into account cost inflation, political risk, commodity price risk, and opportunity cost of money. This is not trivial, it's professional. For Quebec and gold and this relatively long timeline, an optimistic discount factor might be 8% per year (compounded). Over three years, then, put a compounded discount of 30% against the diluted value.

But if you're not so bullish on gold, or you're more worried about cost inflation (eg for hydro, diesel and mining equipment), then maybe you need up to a 15%/y discount factor, which means you discount by 50-55% for the 3 years.

So I'd say $100/oz is unjustifiably optimistic - not the sort of number a professional house will use, anyway. $30-$40/oz is probably within reason, if you assume the final sale value is $100-$150/oz and gold is absolutely not going to go measurably down from here before sale time.

I'd appreciate any input on this from anyone who's got a better handle on valuation analysis or accountancy. In fact, I think I'm going to ctrl-c this and email it to an analyst I chat with to see if he agrees.