I don't have a clue how a buyer would value the company. However I used a scenario that I understand. If a bank was to give you a mortgage, they would want to base the amount of money they would give you on the monthly payment you could make.

Based on a conservative production level of 1200 tons per day at half an oz. per ton. You could yield 600 oz. per day x 22 week days = 13,200 oz. per month. Conservatively SGR has said their cost is about $400 per ton leaveing at least $600 per ton profit. $600 x 13,200 oz. per month = $7,920,000 per month. Of course you would then need to calculate life of mine based on audited tonnage. 1,600,000 oz at 13200 per month equals 10years 1 mo. If you run those numbers in a mortgage calculator you get a number of $660,000,000 or about $2.75 per share. No bank would ever give you 100 % of your equity or value, so we are probably at a fair price at this time. If the hinge has at least 500,000 oz. that would add 3years and 2 months to the LOM. extending the ammortization period which would allow a mortgage of $780,000,000 or $3.25 per share. I figure every 500,000 oz. would add $0.50 to share price.

If you change the tonnage per day to 1800 you would yield about $11,900,000 per month LOM would be 6 years 9 months. YADAYADAYADA about $750,000,000 or $3.12 per share. Each aditional 500,000 oz. would add $.54 per share. I think we are pretty sure the new 43-101 is going to show at least 2,500,000 oz. So we are worth at least $3.75 as soon as they put out some numbers. With the 1800 per day scenario that woulld be $4.18 per share

An increase in tonnage, or higher grade ore, and with higher grade ore a lower cost per ton, the share price could rise accordingly. Also there is the chance of discovering more ounces with continued drilling.

I'm sure what I posted here is not the correct way to value a junior gold company. Yet I think it illustates why proveing reserves is just as, if not more important than getting the mill going. Good production numbers now will help stop further dilution.