I realize people are throwing around ‘what if’ type of thoughts given that we are in a prolonged period of wait and see until we find out about the details of our agreement with Ecuador on mining FDN and the details of the new mining law. Here is my thoughts.

We are more than adequately financed to take us through the early stages of underground exploration and to the bankable feasibility stage. Does anyone believe that we are OVERvalued at $8/sh or think that the share price is going to tank due to fraud …. that gold prices are set to plummet, that we will be stripped of our deposit, etc? If not there is ZERO reason to go to the market for now.

Right now we are trading at about $77/oz insitu (145 million shares fully diluted at $8/sh with 15 million ounces insitu) or about $60/oz if we have 20 million ounces. 145 million shares fully diluted assumes that everyone exercises all their warrants and options and injects another $XX million into the company. I for one believe we will get much more than $0.08 ($77/$923) for every dollars worth of gold we have in the largest high grade, low cost prospective mine that is available on the market. Note that that $0.08 includes exactly $0.00 as a premium for the potential of FDN, $0.00 premium as a 'company maker' acquisition, $0.00 as a premium for a super attractive land position and $0.00 as a premium for the goodwill that has been established in Ecuador that will allow this mine to go forward when others won't.

Even WITHOUT an offer our share price will appreciate on an announcement of the terms of the mining deal. From that point assuming similar gold prices the share price will continue to appreciate as we update our resource estimates upward, release RESERVE estimates, go underground, and move towards making a mining decision. They will take another jump as a bankable feasibility study is released and a mining decision made.

I'm not an analyst but I think we are trading with every possible risk already built in other than nationalization and maybe even that. If you refer back to the Genuity report they used a 6.7% discount on gold valuation ($140/oz vs $150/oz) to account for country risk. Right now we are trading at about $77/oz insitu (145 million shares fully diluted at $8 with 15 million ounces) or about $60/oz if we have 20 million ounces.

IF we haven’t been taken over by the time a bankable feasibility study is released we will have to go to the market to fund development. At that point the political risk of Ecuador will dictate whether that funding is through issuing equity or debt, and debt is my preference.

As to spinning off ARU2 with the rest of the concessions the money issue can be determined at that time. Maybe it’s happens with a portion of cash on hand from ARU or through a share issue in ARU2.

Right now we don’t need more money and issuing more shares would result in unnecessary share dilution and will result in us getting much less than we would if we did it later, if at all.

During a takeover we will get $1 for every $1 in the bank but we expect to get 3-7X the current stock price for the equity we have. So if we go to the market and dilute our shares in return for cash don’t need and we will be GIVING the 3-7 times multiple we expect in a take over in the near future for every $1 cash we get. My response is thank you but no thank you!!!!!