Here is another part I liked:

The size of the Explorer-Producer Gap gives a general indication as to whether explorers are being valued at a premium or a discount relative to producers. As discussed in Junior Gold Explorer Valuation Observations, at the end of 2009, gold explorers appeared to be overly discounted relative to gold producers. The size of the Explorer-Producer Gap did however shrink over the course of Q4 2009.

Gold Explorer-Producer Gap exists because of the $$, time and risk deltas between the two groups Junior gold explorers may be thinly trades, followed by few (if any) analysts, and as a result may be occasionally be mispriced in the market. Gold producers such as Kinross Gold and Agnico-Eagle are on the other hand widely traded and extensively followed thereby reducing the chances of a market pricing error. Therefore, the Gold Producer Valuation Line provides a solid valuation basis. The Explorer-Producer Gap is the natural consequence of the following differing factors between gold producers and gold explorers:

• Capital Expenditures requirements to move an ore deposit from a simple exploration project to fully developed operating mine,

• Discounts as a result of the multi-year time lines required to turn a promising deposit into an operating mine, and

• Risks inherent in mine development projects.

I believe GNH is mispriced because of the overhype of 2010 and bearish 2011. However, our resource estimate will enable us to attract a different group of investors that never look at companies that do not have 43-101 compliant resource estimate. With these new eyes on us, having positive results from Champagne or Beland will enable us get back some of the respect we deserve.

G.