Total estimated Ni at Inspiration’s Langmuir
properties: 351,998,814 lbs
Because the Company’s properties are:
1. located in a Ni mining friendly area,
2. previously permitted as mining properties,
3. within short-distances of Ni processing facilities (concentrating near Timmins and smelting near Sudbury,
4. already developed as mines (i.e. ramps, Langmuir 1 dewatering imminent)
5. considered as reasonable open-pit mine operations(Langmuir 2), then an in-situ Ni price of $3/lb. is used to estimate current fair value (80% discount to current cash Ni at USD$14/lb). The total value of $ 1.055 billion is divided into the basic shares outstanding (approx. 64 million). This results in an estimated current value for ISM of around $16.50 per share. Fully-diluted shares should not be used in this calculation, as these would be exercised in the future when, in the writer’s opinion, materially higher Ni bearing material estimates are likely to have been determined, based on the accelerated, extensive drilling to be completed and results expected to be reported between now and the dates of exercise of outstanding warrants and options.
ISM Valuation:
The Company reports this zone of Nickel bearing material appears to be open to the north and at depth; therefore further drilling should increase the contained Ni estimate.
This valuation does not attempt to compare the Company with other exploration projects nearby including Golden Chalice, Liberty Mines, First Nickel, and Starfire Minerals. The area appears to have large structures that extend across claims. The entire area may become a target for development by a multi-national mining company, which suggests that a higher in-situ Ni valuation is warranted. If the Company doubles this reports estimate of Ni at Langmuir through detailed drilling, then it is likely to become a target.
The methodology applied to estimating Ni at Langmuir 1 did not attempt to “fill-in” gaps in core sample data, where the summarized report excluded a length between reported samples. It is the opinion of the writer that the effect would be that Ni estimated at Langmuir 1 is low.
From the Jensen report (p.48): “Detailed mapping and interpretation indicates that both the Langmuir No.1 and No.2 deposits occur at the same stratigraphic position on opposite limbs of an anticline / syncline pair and implies that the favourable stratigraphy may be repeated at several locations on the property.” In the author’s opinion, this should be interpreted as meaning that the above Ni poundage estimates are a starting point, and that significantly more Ni is highly likely to be found at the Company’s Langmuir area properties after they drill into the 40-60 anomalies they are targeting over the next year.
The basis for the following was obtained from information released by the Company during 2006 and 2007, prior to Sept. 20th. The calculations below ARE NOT NI 43-101 compliant and should not be used as or confused with terminology reserved for inferred or actual resources and reserves. The approximation of current value below is not intended to be representative of actual value that would otherwise be calculated using NI 43-101 compliant information and methodology.
