Lori or the first bidder?

To be blunt, if Lori just plans on proving up the one anomaly with this 10,000m drill plan, that is not a good thing, in our case and IMO.

Lets say if she does take this route. She punches a lot of holes in this one anomaly with great numbers coming out. We have done some math here and know it may be possible to have 100 mil ozs of gold in the one anomaly. This possible 100 million ounces, I beleive needs the whole depth of 1300m of the anomaly to get this amount at 1 g/t. BOW, can correct me on these numbers, but I am not too concerned with what they actually work out to, I am trying to get a point across.

So, if our deepest holes are only 400m, we will be partially only proving up 1/3 of the ounces or approx 30 million ounces. If a possible suitor sees Lori just focusing on the giant anomaly, and knows she can only prove down to 400m in this current drill plan, he most likely will make a bid, based on whats looking like 30 million plus ounces. If our deepest holes end in mineralization, this will show open to depth and hopefully great grades. This will change the way the bidder will come at us, and gives Lori another card to play. If we happen to miss with the bottom of the holes, the bidder will use this against us and say there is no proof of gold deeper, and make the lowball offer.

Now, if Lori is smart, (which I beleive she is), she will put the drills where Quantec showed her. SCATTERED over MOST of the anomalies. By doing this, she should be able to initially show that the mineralization is over a wide area, and just not in the giant anomaly. BOW did some numbers on some of these other scattered anomalies and made it easy to see how possible ounces can be added quickly to an estimate. So, in this case, a suitor could not deny the fact that we have multiple near surface gold anomalies that have addable ounces. For what we may be not proving up deeper than 400m on the anomaly, we may be able to get a lot of this back from the scattered other anomalies. If we are lucky, the quick math on the other scattered anomalies may show a possibility of 20 million ounces there. Add this to the possible 30 million in the anomaly, then you now have 50 million that a suitor would have to take into consideration when making his initial offer. Now add what the trenching may come up with, and we may have something bigger, by doing it this way, it may force a bidder to put in a higher initial offer.

As I said before, 1 hole in each of the smaller anomalies will prove what the Quantec is telling us, and will prove up the property at its fastest pace. I beleive everyone of us and management want to sell this property as quick as we can, and at a FAIR price. The trenching was a necessity to hopefully add value to the top soil and see exactly how much overburden is there in different areas before we hit the bedrock. The 10,000m drill plan, on top of this, may suffice in getting the first offer.

A lot of junior/exploration companies will take 7-15 years approx to prove up a property to the point that its felt the company knows what resource it contains. I beleive we are around the 6 year mark on the Tesorro, BUT IMO,the Quantec has taken years off of the exploring in our case. Many companies will spend years drilling blind, hence taking much longer to prove the potential of a property. By Lori being smart, I beleived she knew what the full geophysics could do in repect to our timeline, and although costly at the time, may have been a great move to hold this extra card in a buyout situation.

I have been giving most of the credit to Lori for excecuting this plan, but there are the geo,s behind the scenes making recommendations and suggestions. Our geo,s seem to be top knotch and I beleive very worthy of mention.

I have seen investors of different companies expecting buyouts to happen soon after they invest, but the companies seem to go on for years without an initial offer. I beleive we differ very much from these companies because of what I said above, about being able to only SHOW there is lots of gold on the Tesorro AND showing that it is economical. These kind of situations don,t lie around long before some major may come and have a peek, they dont need 100 million ounces PROVEN to make an offer, they only need to know how economical it will be and if it is a multi million ounce deposit.

IMO