from Grandich website

Through the horrific market conditions of the last few years, Sunridge Gold has consistently been knocking off important milestones. Today Sunridge has completed what can be considered the most important milestone to date at its Asmara project in Eritrea, with the Eritrea National Mining Corp (ENAMCO) formally agreeing to acquire a maximum 30% stake in the property following months of negotiations. ENAMCO has now agreed to pay Sunridge US$18.33 million, payable in stages prior to production for the purchase of the 30% participating interest. Also, on signing of the shareholder agreement ENAMCO will pay Sunridge one-third of all project development costs back-dated to July 4, 2012, the date they exercised the right to purchase, which amount is currently estimated to be approximately US$4 million. In addition, ENAMCO will contribute one-third of the funding of ongoing expenditure on the project, including exploration and development. It is important to understand the $18.33 million valuation was based on the value of the project in 2012 before the Feasibility Study was completed. And the Company has significantly increased the value and de-risked the project since. A Feasibility Study on the four advanced deposits (Emba Derho, Adi Nefas, Gupo Gold, and Debarwa), which make up the Asmara Project demonstrated very strong economics, with a net present value of $692 million using a 10% discount rate, and an IRR of 34%. The mining plan has a three phase start-up plan outlined beginning with high grade copper and gold, will produce an average annual rate of 65 million pounds of copper, 184 million pounds of zinc, 42,000 ounces of gold and 1 million ounces of silver over the first eight years. The permitting process for the mining license -- which is expected to take 9 to 12 months – is well under way, with the submission in December 2013 to the Ministry of Energy and Mines of the project's Social and Environmental Impact Assessment report. With the government a 40% partner, I don’t envision any major difficulties with the permitting process. Sunridge and ENAMCO are now working toward completing a shareholders agreement, which is expected to take less than three months. The agreement will govern the management and funding of the project, which will be held 60% by Sunridge, with ENAMCO holding the remaining 40%. The joint venture company will be led by a five member board of directors, made up of three members from Sunridge and two from ENAMCO. *What this Means* Now that Sunridge has completed this major step, it has 2 different paths that it could take from here, both of which are now wide open. * This clears the path for Sunridge along with ENAMCO to take the Asmara Project to production just as Nevsun did 3 years ago. Sunridge is now working on project financing and it just became a lot easier now that the government is their partner and responsible for 1/3 of all costs. The mining plan outlined in the Feasibility Study includes a staged start up with the first stage being extremely high grade direct ship ore. This can be brought to production relatively easily as it would not yet include a mill and bring in significant revenue. * Sunridge has previously stated that there is interest from several companies in terms of a takeover or acquisition. With this agreement now complete, I’d have to say that a) this should only speed up the process and b) the cost to take over Sunridge has just gone up. I think it’s important to note that theCanadian investment banker SGC noted it engaged a few months back gets a payday only on a successful M & A deal – that’s incentive in my book! While I don’t usually pay much mind to technical charts of penny stocks it is worthy to note that: * The 50-Day M.A. just crossed above the 200-Day M.A , a move usually viewed as quite bullish * A $.28 share price would mean a new 52-week high for the share price. Given how much stock has traded here and below it should be good foundation to move to higher levels. I own now 6.2 million shares and have been a compensated consultant to the company for a very long time so please consider me quite bias. And in my bias position using a back of the envelope takeover valuation, I believe there’s opportunity to see a 100%-200% higher valuation in the coming months – fingers and toes crossed. However, if the company decides to go into production, I can live with that knowing how well Nevsun did from this point on in their growth path.