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TGR: Can you share some more of these advanced stage gold juniors?

JT: Let me say a little more about Sangold. Its mine in Manitoba is now producing, and should be producing cash flow positive results by the end of this year and growing its production very substantially over the next two or three years. In addition, it has recently discovered a very high-grade deposit there that actually could rival the Red Lake deposit that was Goldcorp's company maker. So Sangold is another company with cash flow now that it can use to fund its growth now when equity is so expensive or even impossible to obtain. It can now grow its business from internally generated cash. That's the ideal given current market conditions.

TGR: How about those that are promising but not yet producing?

JT: As for projects going forward, when they start doing the feasibility studies, they will be looking at energy costs, the cost of labor, the cost of all the inputs. Because it is such a difficult market now, share prices have been obliterated. I'm looking at Luna Gold Corp. (TSX.V:LGC) as a company on my list, for example. The company's market cap is only $7 million now. It's got a bankable feasibility study to produce about 60,000 ounces at $422 in Brazil. When you're looking at prices, if you figure $800 gold, it would throw off an annual $28 million in operating cash flow over a minimum of eight years. So its current market cap is a mere 25% of a single year's cash flow. That's what I call ridiculously undervalued!

I think Luna and a lot of others are going to be targets for takeovers. Especially bigger companies, bigger projects will be attractive to majors unless we see a revival of the share prices of these junior and they can then start to raise their own capital, to put their projects into production. Luna is selling at 10 cents a share. To raise $47 million, which is what it needs to raise to build its mine? At 10 cents a share, it's just not going to happen.

I think a lot of these juniors that have advanced stage gold projects look like they'll be very profitable on the basis of bankable feasibility studies. Again, though, if they can't raise their own capital, I think they're going to be takeover targets of some of the cash-rich gold mining producers.

TGR: Where do you stand on AuEx Ventures (TSX:XAU)?

JT: AuEx is a very interesting company. They are earlier stage company, but I believe that AuEx is on to a major discovery, at least one and possibly two. They don't necessarily expect to be a producer. They are mine finders. They have a very good business model, a very conservative business model that has other people spending money to earn in to very good projects. AuEx is headed by Ron Parratt (as CEO) and some other very strong operators who picked up some very good exploration prospects and they're developing those properties. At least one of them looks like it will be a world-class project. Another one is joint-ventured with Agnico-Eagle and that one is also starting to look very exciting. My sense of AuEx is that they're on to at least one and possible two major deposits. Then I would expect that they'll get carried into production or work an arrangement, a joint venture or a share deal or something down the road. AuEx has a very low market cap. It's under $30 million so I think its share price potential is huge in percentage terms from here.

TGR: Any others?

JT: In terms of companies that can soon go into production, I love Romarco Minerals (TSX.V:R). Like so many others, it's selling for peanuts at this point, but Romarco has 1.5 million ounces at the Haile mine in South Carolina, of all places. This mine was actually in production in the 1980s by Piedmont Mining. And Robert Friedland headed a company nearby that was a larger scale producer. The region is economically depressed and from what I understand, the permitting process is going along even better and with more speed than in mining-friendly Nevada. . .looks like it could produce gold at $350. Capital costs should be relatively modest. $800 gold, costing $350 to produce 100,000 ounces per year should result in a very robust gold mining operation. Romarco's market cap is something like $28 million.