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Gold Reserve Inc. Message Board

  • buyuranium buyuranium Oct 7, 2013 10:49 PM Flag

    New topic -when do WE HIT PAY DIRT?

    All you loyal holders of GRZ ,when do you think we get a settlement or a decision is finally rendered?

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    • Perhaps the question should be "IF", not "when". I don't like how not even one person thinks we can lose.

      • 1 Reply to proton777
      • Even with a "win", we could still "lose".

        The ICSID procedural detail recap clearly suggests that the panel is trying to determine the value of the GRZ claim.

        The panel tried to get both sides to submit a joint expert report which presumably would come up with a valuation that both side could agree upon. My guess is the report was something along the line that "we agree to disagree" with both sides sticking to their respective positions: VZ claiming costs only (probably in the range of $250 to $300mm and the return of the data) and GRZ claiming a full value of $2.1 billion.

        The VZ position would probably go something like this:

        GRZ is entitled to recover their costs, but VZ is entitled to the data. All the geophysical surveys, drilling results, assays, site design plans, etc. were costs and expenses that were recorded on the accounting records of GRZ and became part of the $ claim amount they are seeking. If the panel finds that GRZ is entitled to recover their costs, then the data belongs to VZ since VZ has paid for it via the award amount. I think this is a reasonable claim on VZ's part and makes common sense and would probably get a sympathetic ear from the panel since this is easy to verify and quantify.

        The real burden is on GRZ and their $2.1 billion claim for value at the time of expropriation. GRZ claims that they got multiple estimates from various experts to confirm their claim amount. I don't know anything about the estimates, but I guess that some were "comps" of similar size ore deposits and milling operations from other mines around the world.

        VZ will claim that the most accurate value would be for "comps" in VZ and not other countries. We all know that similar mines in Canada and Australia are worth more than those in Peru and Argentina. The only VZ comps that I recall offhand are Rusoro and Hecla. Hecla had a small mine operation in VZ and sold it for essentially book value. (continued in next post)

    • Not a minute too soon...

      Sentiment: Hold

    • January 26, 2014

    • This is hardly a "New topic"

    • There is no incentive for VZ to settle, unless there has been a profound attitude change in Caracas.

      At first I thought a decision would be in April/May 2014 time range. I now believe it will be in the June/August 2014 time range. The legal team representing VZ also has a stake in the proceedings and it is also in their best interest to delay or drag out the timeline to keep the their client from an adverse judgment for the longest time possible.

      The decision will come in the June/August 2014 timeframe. After that, it will take another 3 to 4 months to get VZ to the table in which they will offer 10 cents on the dollar spread out over 7 to 10 years. As mentioned by DB, GRZ will use all legal avenues and aggressively pursue full payment.

      As a side note, I believe any decision by the panel will include the requirement that GRZ has to turn over the data to VZ. Since the award is supposed to represent the value of the project at the time of expropriation, it seems to me that the $ award amount includes GRZ's full project costs (which include the data).

      As far as the stock price goes, the panel tried to get the two sides to come up with a joint expert report to address the quantum issues. This indicates that the panel really wanted to the two sides to agree on a price. This tactic failed and I think VZ's experts value the project in the $300 to $400 million range while GRZ values the project at $2.1 billion including interest.

      The panel is going to have to pick a number for the award. Estimates are a very dicey proposition, so might the panel give each side half a loaf? Half is better than none and both sides have a little to grumble about.

      My guess would be $800 million to about $1.4 billion for the award.

      This process is like watching paint dry. It takes a lot of patience.

      • 3 Replies to grzwatcher
      • What if the price of gold starts to go to where it belongs and starts to break out in the next 30-60 days? And we see gold at $1450-1500.

        I like GRZ for the arb story, as well as it's "call" on the gold price. If it should take off soon would be the perfect storm in our favor especially if we get an affirmative decision. VZ. would be put in a very bad bad position to continue to do the wrong thing!

        I am hoping that the Paris hearing will be the final legal proceeding and certain things in the arbitration matter become painfully clear so that the judges force a settlement or render a quicker decision. If Gold starts to rally strongly that could help grease the wheels of justice.....

      • I am with you regarding the award date, the data being part of the award and that Vzla. will delay the process for as long as they can. Also, I have always believed a settlement would be in the $800 to 1 billion range. Where I disagree is with the settlement date. This because of the fact that the Chinese now have skin in the game, the money to pay (which vzla. does not have) and, MORE IMPORTANTLY, once the award is out there is no negotiating it down to the $800 million level from the $1.4-1.6 billion.
        Venezuela's negotiating positions has always been that they will pay book / investment value for the expropriations (hence the 300-400 million), but when they have settled other cases they have agreed to pay usually around 1/3 of the claimant's award demand.
        In short, I expect a settlement by Dec. 2013 for around $ 800 million

        Sentiment: Hold

      • As a side note, I believe any decision by the panel will include the requirement that GRZ has to turn over the data to VZ. Since the award is supposed to represent the value of the project at the time of expropriation, it seems to me that the $ award amount includes GRZ's full project costs (which include the data).

        i dont think so ! the data had a certain cost but its worth much more now !
        your way of thinking would be the same like they have to hand over some equipment they already bought ...

    • If other cases on the ICSID website are used as a prognosticator, then post the Oct 15-16 valuation hearing, both parties would submit final observations by year end. Then the panel would request a statement of costs from both parties as they deliberate to write. So award may be early spring if not settled. Momma needs a new pair o' shoes!

    • My guess is ICSID decision will happen in December.
      Settlement likely before December.

      Sentiment: Buy

3.45-0.10(-2.82%)Oct 2 12:48 PMEDT