Yesterday on Fast Money, Dennis Gartman and the panel said that POG is probably going down due to recent FOMC comments, no QE3 expected, no inflation and a stronger US$. It doesn't seem all that long ago I heard them say POG could reach a new high in the 2nd half of this year. Talk about flip-flopping. Should I believe them this time?

I haven't in the past cared that much about POG, but I've started to care more now that we are looking like we'll become producers at Magino as long as POG stays high enough to make mining economic. As per the PDAC Corporate Presentation dated April 2nd the highest NPV sensitivity are Forex and the gold price.

I'd like a SP of at least $5.00. With a back of envelope calculation I determined we'd need a resource of just over 4 million ounces @ $850 per ounce to achieve this price. I believe we'll have at least this much come the Full Feasability Study.

$850 - $461= $389 x 4,037,275 ozs = $1,570,499,975 / 314,100,000 shares = $5.00

I've been looking at other co's that have been given about the same EV per resourse ounce as us. I picked Detour Gold because I like their conservative approach and I hope we can become a company like them. IPO in 2007, C$ 678 million in 4 bought deals and another $500 million US raised through convertible notes since then. Only 103.45 million shares outstanding, trading at $23.40 with production slated for 2013 with 14.7 M ozs in reserves and hoping or 20 M ozs.

I can only hope we're half as susseccful as that. The size of our resource will determine that. They also had to build a road and bring power to the mine. Things I don't think we have to do. So all in all, I think we'll do well even if POG falls.

Cheers,

HF