Wally,

It has always been my opinion that the Tesoro would be bought before it ever got to the production stage. So, if we sell it before then, the buyer would worry about the taxes. As with any buyout, the suitor would factor the countries tax/royalty rates into any such offer they make. In light of this, the deep drills would most likely be important to us, to show mine life and maybe help cut down on any royalty rate that may be factored into a capex.

There has been concern about nationalization on a global scale, and we may be getting closer to that day. But for now, I believe that Peru may be in a slightly different train of thought. Peru is only about 15% explored for metals yet and there is tremendous upside potential in new discoveries and start up mines. For Peru, lets say just starting out industrializing their metal resources, there is too much growth that Peru could jeopardize by slapping on higher royalties like some of the other countries are doing. Peru has every metal known to man locked up in the Andes, in vast quanities. To hinder this potential at this time, would be a mistake for Peru, and I believe they know it. This is why you see Humala trying to find a comprimise between the people and the miners, so that this important and main source of revenue continues. If Peru were to slap on ridiculous taxes to miners, they would have no choice but to slow down mining and the growth would be hampered on new start ups, because of the decrease in funding sources, as stated in youn article.

If Peru plays its cards right and keeps modest development in mines/energy progressing , it is possible for it to become one of the richest nations on earth in time. Their people are poor now, but with the policies in place, and new ones being worked on with miners are going to assure sustainability to their people in time. If this is gone about the right way and this succeeds, the growth could be enormous. Peru needs these miners, they cannot let them walk away or slow down, so IMO, they will be compelled to compete with the rest of the world to keep the miners they have, AND attract new ones. The more miners they have active in time, could allow them to drop their tax rates because of the volume effect.This in turn would attract more miners most likely causing a boom and lead to the growth I speak of. As the smaller countries resources get used up, no doubt they will raise their taxes accordingly,pushing companies to the new frontiers, of which Peru is one.

So, in summary, I don,t see Peru jeopardizing what may be the mainstay of their economy.

IMO