The difference here Kim is that Southern Pacific has reserves, a technical term meaning their company has hired a 3rd party independent engineering company that came in, analysed all their work and certifies that they have XXX amount of oil and gaz in a 43-101 resource estimate. They also had earnings in 2010 of over 8M dollars, so they have revenue and cashflow which enables them to pay loans.

We are at a much earlier point were not only do we not have any revenues to pay a loan with, we do not even have enough drill holes, bulk samples to get our 43-101 done. In a year, with alot of hard work from the company, we will know alot more about what is under the ground and possibly be in a position to do a 43-101. However, even with a 43-101, we will still be a few years away from mining this deposit which means no revenue for probably 3 years from now. So a loan is very, very, very unlikely for us and we need to understand that we will get dilution in the next few months, that is a fact when investing in juniors that we all must understand.

Now, GNH has had offers of financing I am sure and although they do not get to dictate at what price it will be (market decides that) they do control how much money they take at each level. If we were at $1 or more, they could raise 20M dollars and it would not hurt us too much in dilution. At our current price, they would probably only do a financing of 2-3M dollars to minimize dilution at this level.

Glorieux