I just thought I'd share a few thoughts on the Arizona property purchases. I do hope we spent a small amount of money on exploration but I'm worried that the upside might be limited. I've found two companies that I think provide us with a realistic "upside" potential for our Arizona property.

Redhawk Resources

It's located just north of our Sombrero Butte project and is 35 square miles versus our 5 square miles.

Property Purchased for $7M in 2007

Exploration expenses of $24M

PEA stage

2.1B lbs of copper

Total drilling of 206,000m

Despite investing over $31M into the project, the market only values them at roughly $48M.

Curis Resources

Property Purchased for $20M in 2010

Exploration expenses of $19M

PFS stage / permitting

2.4B lbs of copper

Total drilling of 176,000m

They have completed a PFS and some permitting. The market values their $39M investment at roughly $65M.

One thing to keep in mind is that I have not included regular corporate expenditures such as salaries, listing fees, etc in the amount of money invested. So this makes the return on their money look even worse.

So it looks like we can expect to spend $20M+ to get one of the Arizona properties to the PEA stage and the market should reward us with an increase in market cap of roughly $20M ($20M less cash, $40M earned value) or a share price increase of 5 cents. Not very impressive. That being said, the property itself should appreciated in value and the reward for exploration work will be more greatly rewarded if metal prices improve.

I do hope we do some exploration work because there are some very impressive properties in Arizona. For example, Resolution Copper has 40B lbs at 1.5% Cu. I like how the properties are near existing/proposed mines as well so that might provide some upside with minimal exploration required. (Note: The San Manuel mine west of Sombrero Butte has been shut down since 1999. This was not mentioned in our press releases.) Overall, I'm not very impressed with the properties but still think it's worth drilling a few holes into highly prospective targets.