RE: RE: Reverse Engineer? Dansul/Schiff - this is very difficult to reverse engineer based on info provided: Here is the wording from the original press release from July 28th, 2009;
Galway has acquired 80% of several concessions in the district covering 335.6 hectares. These concessions acquired to date have combined annual payments of US$230,000 and a payout of US$4-9/ounce gold for 80% of the NI 43-101 delineated reserve after 3 years. This is payable 60% in cash with the remaining 40% in Galway shares. The Company continues to negotiate with other concession holders in order to enhance the current property package.
I think the $4-9 was based on the POG at the time. The wording on the Galway website under Cali shows .5% to 2% per oz - but is this as of today or as of time of signing. Assuming that the full $6.6 million in cash represents 60% then only $4.4 million of the stock should represent the 40% in stock required for the 80% agreement - is it possible that the other $3.4 million in stock was used to purchase the remaining 20% of the properties? If so then the total payout for the 80% is $11 million. Based on that here's my crack at it:
Scenario 1: $4 to $9 per oz of resource
Taking a wild guess that $4 is based on first million oz and $8 on 1 to 2 million
First 1 million = $4 X 1,000,000 oz = $4 million
above 1 million oz ($7 million remaining) = $8 X 875,000 oz = $7 milllion
Therefore 1.875 m.oz = 80%. 100% = 2.34 m.oz
Scenario 2: .5% to 2% per oz of resource
Same assumptions as above, .5% (=$8) on first million, 1% (=$16) up to 2 million, assuming $1600 gold
First 1 million = $8 X 1000000 = $8 million
above 1 million oz ($3 million remaining) = $16 X 187,500 oz = $3 million
Therefore 1.1875 m.oz = 80%. 100% = 1.484 m.oz
Again its very difficult to tell. Note that the Galway website says under Cali says "Measured and Indicated" while the original press release says "reserve". Today's press release says resources. Also of interest is that the resource payout schedule has been extended to 2013??? Perhaps if the above calcs are truly reserve or even M&I for that matter then there is much more resource to be converted. Anyone else out there care to weigh in on this?