I came across info from Scotia Capital, an excerpt of which is attached, which supports Peter G's analysis this a.m. Seems like the stars are starting to align for SQI after quite a quiet period in the weeds.....hip hip horay for those who bought it! Much better than croak croak!

“From Scotia Capital Report…..SQI

RVC/NGD Follow On…Don’t Forget the SQI Stub: Recall that Silver Quest (SQI-CN, not covered) owns a participating 25% interest in the Davidson property (75% RVC) which comprises the northern half of the Blackwater property (see map below). This morning, New Gold announced the friendly all stock acquisition of RVC. On March 29th, SQI and RVC executed a formal joint venture agreement regarding advancement of the Davidson property (http://www.silverquest.ca/s/NewsReleases.asp?ReportID=449276&_Type=News-Releases&_Title=Silver-Quest-Executes-Formal-Joint-Venture-Agreement-on-Davidson-Property-B...) which in hindsight was clearly a hurdle that had to be overcome before New Gold would launch their bid for RVC. We see upside to the current SQI share price (~$0.72/sh), and think it should currently be valued >$1/sh, and ~$1.50/sh with drill success on either their Davidson JV property (3 drills currently turning) or their Yukon projects (see valuation breakdown below).

Looking at the valuation implication for SQI, considering the transaction value on RVC is $513mm (netting out cash) the NGD bid implies $134/oz for RVC using both indicated and inferred ounces. As SQI’s 25% interest in the Davidson property nets them 342.5koz (as per the table above), simple math is as follows:

342.5k oz * $134/oz = $45.9mm, or $0.50/sh.

Company had ~$7.3mm in cash at February 15, or ~$0.08/sh

Company also has 100k freely-tradeable shares of RVC, say $10/sh * 100k = $1mm, $0.01/sh

Company also has a large land package in the Yukon near ATAC (ATC-CN, not covered, $670mm market cap), Kaminak (KAM-CN, not covered, $225mm market cap). Earlier stage peer companies such as Northern Tiger (NTC-CN, not covered, $44mm market cap) have market caps in the $40 - $50mm range, so assuming the midpoint $45mm, or $0.49/sh. A $4-5mm drill program is planned for this summer.

So, $45.9 + $7.3mm + $1mm + $45mm = $99.2mm / 92.7mm outstanding = $1.07/share

And remember, last week RVC / SQI announced the approval of an $8.6mm exploration program for the Davidson property ($1.8mm SQI’s share), including 20,000 metres of drilling. This should materially increase the number of ounces on the Davidson property beyond the 1.37mm oz currently (100%-basis)…from Trevor: “This is likely due to the upside potential represented by lack of in-fill drilling on the 75% owned northern half of the property and open area targets.”….remember that the David / Jarrit claims to the south (100% RVC) host 2.8mm oz at ~1.05 g/t gold and most of the work to date has been focused on this part of the property (see drill hole distribution map below). Assuming Davidson eventually also hosts 2.8mm oz, at $134/oz SQI’s 25% share would be worth $93.8mm, or $1.01/sh (so an additional $0.48/sh for $1.55/SQI sh total). “