"They look for a company with 0.5 million oz in a position to expand to 2 mil oz as a good investment target, which fits Kodiak's profile."

explorationguy, I think you hit it right on the nose as to where KXL is. I have discussed this with a number of people who are in a position to know, and that's exactly the story.

As to KXL's current resource, I think you're a little light at 300k oz, and from my discussions with management, our previous figures (some months ago) are sounder. Perhaps you used a short length or depth for the Golden Mile. These is no need to estimate the width as the 1m equivalent is already provided in the posted results. In any case, we've already done these calculations many times and have a good handle on it (see old posts). A reasonable figure from a 43-101 if done for our current position would be 600-900k oz gold.

Your guideline from Barings is also correct. The bottom line is that gold in the ground, and not producing, is currently valued at about $85/oz, which is roughly 1/10th the value of gold bullion in the hand.

So we are solidly a developer and National Bank's assessment of KXL as desirable for takeover makes sense. But the comment made about the great number of closely held shares is also a strong factor, so any takeover would be a negotiated one.

Our cash in the bank also makes us attractive. If there was a takeover, the remainder properties would be spun off into a new company a la Virginia Gold and we would have to hope it would have enough cash to continue exploring properly.