1. Generate as many high quality prospects as possible
Teuton has been generating quality prospects in the Stewart region since the company was formed in 1981. Discovering a mine is not easy. We figure the best way to go about it is to stake and prospect as many properties as we can: the more hands you are dealt the more likely that one day Lady Luck will smile on you with four aces! And what better place to do it than the Stewart region? The Eskay Creek mine is world famous for its high gold and silver grades and before that it was the Premier. Now it is the giant gold-copper porphyries that are in the news. NovaGold and Teck’s Galore Creek, $2 billion project will be largest start-up in British Columbia history. In a few more years, we predict that Seabridge Gold’s development of its giant Mitchell et al copper-gold deposits will even eclipse Galore Creek.
Teuton is now the dominant land holder in this very rich, highly mineralized region and almost all of our 1,100 square miles of ground has been acquired over the years for nominal costs of staking.
2. Enhance the value of the properties by carrying out diligent grass roots exploration with emphasis on zones of glacial meltback (ablation).
In the last 25 years that company prospectors have been exploring the Stewart region, scores of mineral prospects have been discovered on Teuton ground. Meltback of icefields has been accelerating so that more and more virgin ground come open each summer. Such exposures are the most highly prospective ground of all, because no one else has ever set a prospector’s pick on it.
The famous Granduc copper mine was discovered in the late 1940’s when melting ice revealed the massive orebodies at the head of the Leduc River. Seabridge’s Red Mountain gold property was found the same way in 1989. Just this year, on Teuton’s Treaty Creek claims, two promising copper-gold-silver zones were discovered after the Treaty Glacier dropped over 60 vertical feet, revealing a long swath of fresh, never before seen rock.
Recently, companies optioning claims from Teuton have continued this tradition of grass roots discovery, most notably in 2006. The 2006 British Columbia Mines and Mineral Exploration Overview published by the BC Ministry of Energy, Mines and Petroleum Resources features a map showing 30 new mineral discoveries in the province. A remarkable 10% of these discoveries were made on Teuton claims, confirming the high potential of the Company’s area holdings. These new discoveries include the JK copper zone (discovered by Teuton optionee Bell Resources) and the SP Vein and Midas gold-silver zones (made by Teuton optionee Sabina Silver).
We anticipate even more will be added to the map when the 2007 review is published.
3. Keep dilution of shareholders’ equity to an absolute minimum by seeking out partners to option a 50-60% interest in our mineral properties.
Teuton has 26.3 million shares outstanding. From first listing in 1985 to the present day, that represents only a little over 1 million shares per year in share equity dilution, a record of which we are quite proud. Nowadays, many TSX-V companies issue so many shares so often that they do in two to three years what Teuton managed to stave off for 22. We are strongly committed to retaining shareholder value and one can’t do that with reckless dilution.
How does one keep dilution so low? Simple…option out as many properties as you can, and have others finance the riskiest first $1-5 million of exploration. Our typical option agreement requires the optionee to spend $1-5 million over 3-5 years to earn anywhere from 50 to 60% interest in the property. We also request annual cash payments which helps to offset administrative costs, again working to keep share dilution to a minimum.
In 2006 Teuton signed its strongest option agreement ever, a multi-million $ deal with American Creek Resources (“AMK”). Under the terms of the agreement AMK can earn a 51% interest in Teuton’s flagship Treaty Creek property by spending $5 million over 3 years, with $1 million minimum to be spent in the first year. A further 9% can be earned by AMK if it chooses to take the property to a feasibility study.
