Tanzanian Royalty Exploration Letter to the Editor Re Bloomberg Article by 24hgold

Mots clés associés : Nickel |

Re: Chairman's Corner - Friday, July 06, 2007
Title: Letter to the Editor Re Bloomberg Article

Dear Friends,

I would like to bring your attention to the following Letter to the Editor which was submitted in response to an article that appeared on Bloomberg.com by news columnist,Jonathan Weil.

To the Editor,

Re Jonathan Weil's column, "SEC Snaps Its Fingers and Assets Appear" (June 27):

I would like to clarify several items in his piece that I feel misrepresent the minerals industry segment, my public company and me personally.

Tanzanian Royalty was singled out for coverage from sixty one listings under the Metals Mining category on the AMEX. Approximately 90 percent of these companies are jointly listed on the AMEX and Toronto Stock Exchange (TSX) and they all fall within the same reporting standards.

Weil takes particular exception to the way assets are reported under Canadian and American generally accepted accounting principles, noting that our assets under the former are approximately double. He then goes on to conclude in all too common US-centric fashion that "The US approach seems more sensible."

I found the thrust of his article was largely invalidated given the fact our financial statements are filed with AMEX under both standards, allowing investors to choose whichever valuation they prefer.

Also, I would question his inferred slight of the reporting standards of the TSX which is the largest natural-resource exchange in the world. TSX listings have been responsible for the vast majority of major mineral discoveries and mining-related merger and acquisitions activity during my entire career in the commodities business of more than 50 years. The TSX knows its business and has the global credibility and authority to back up that statement.

Exploration Company

Because we are an exploration company, reporting assets under Canadian and/or American GAAP really doesn't tell the whole story or adequately reflect our business. By expending monies on our exploration holdings, we attempt to value-add these assets with a view to confirming previously established exploration potential. This allows us to attract joint-venture partners to carry the property forward.

These partners assume the financial risk of determining the economic viability of the properties and we are left with advanced (pre-production) payments during the exploration and development phases and sliding-scale royalties at production. Our industry partners take on the task of compiling and reporting exploration results in accordance with Canadian National Instrument 43-101, including the calculation of mineral resources where applicable.

At the present time, the value the marketplace attributes to our company is based on a number of factors that have little to do with Canadian or U.S. GAAP.

Measures of Value

Foremost are our land holdings in the prolific Lake Victoria region of Tanzania, where drill- indicated potential has been established for gold, diamonds and base metals including nickel.

One of our partners has achieved considerable exploration success near its operating mine (a joint venture) while our wholly-owned Kigosi property has reported some of the most encouraging exploration results this year of any company in Tanzania.

Just recently, we signed a Letter of Intent with a large, publicly traded Chinese company that has expressed a keen interest in our entire non-committed portfolio of mineral projects in Tanzania.

Tanzanian Royalty also has an experienced management team, seasoned industry partners and an aggregate exploration budget (including joint venture expenditures) that is among the largest on the African continent. Clearly, the marketplace is aware that the company and its exploration partners are actively engaged in exploration for commodities that are increasingly in short supply throughout the world.

Business Background

For the record, as chairman of Sutton Resources, I was responsible for acquiring the Bulyanhulu gold project in Tanzania that was subsequently acquired by Barrick Gold Corp in a takeover valued at approximately $500 million. It now ranks among the largest and richest underground gold mines in the world.

In 2002, I took a major position in Tanzanian Royalty through a vend-in of Tanzanian properties that were held in my privately-owned company. So it's very much a new company -- hardly the 17-year-old original suggested by Weil. Since that time, I have funded Tanzanian Royalty out-of- pocket through $17 million in share purchases at market prices, taking no warrants, options or discounts -- a practice that I plan to continue.

Perhaps the profiles, market-related commentary and other news that has appeared about me in the New York Times, Barron's and Bloomberg have heightened my candidacy as a target for business writers who would do themselves a favor by attempting to better understand our industry and its modus operandi.

James E. Sinclair
Chairman
Tanzanian Royalty Exploration

Copyright © 2007 TANZANIAN ROYALTY EXPLORATION CORPORATION (TNX) All rights reserved. For more information visit our website at http://www.tanzanianroyaltyexploration.com/ or send email to info@tanzanianroyaltyexploration.com ..
Message sent on Fri Jul 6, 2007 at 2:42:27 PM Pacific Time

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