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Excerpt from The Wall Street Transcript's 12/26/05 interview with Tanzanian Royalty Exploration Corp., formerly Tan Range Exploration Corporation, (TRE) CEO James Sinclair:

TWST: Would you start with a quick overview of Tan Range?

Mr. Sinclair: Tan Range is a minerals exploration company whose business plan is to develop royalty income from mineral assets in Tanzania. We don't intend to achieve this objective in the usual way by issuing capital stock for financing, by borrowing from lenders to purchase royalties, by making direct purchases or by lending to companies that have bankable feasibility studies on quality projects. Instead, we plan to develop royalty income from exploration successes on our holdings that just happen to be in one of the world's most prospective gold producing belts.

TWST: Why take that approach?

Mr. Sinclair: The reason we have chosen this approach encompasses an understanding of simple mathematics and the minerals industry itself - especially how money is raised for project financing. The simple mathematics part is that the relationship between a junior exploration entity and a development company (usually a major mining firm) under normal conditions is a percentage transaction whereby the junior would, for instance, own 30% of a new project and the major 70%. Keep in mind that these are 'working' interests where each of the partners puts up its share of expenses whether they involve exploration or development costs. Whatever percentages they agree upon is generally a product of the attractiveness of the project in its early stages. The junior then has to carry its part of the debt created to finance the project. Generally, the junior has to pay back to the major that share of the debt before seeing any significant degree of income. The payback schedule under normal conditions would be 80/20 of cash flow, with the higher amount accruing to the major and the remainder to the junior. However, in some cases it is 100% to the major. In rare cases, there might be more for the junior but that would be very unusual. So your average junior gets to count ounces by taking 30% of the proven reserves (and the remaining resources) and attempts to develop value for the common shareholder along with the ability to continue financing and operate based on counting those ounces. This, of course, assumes that the industry is being evaluated by analysts as an asset-based entity. However, that assumption hasn't held true over the past five to seven years. Nonetheless, I believe it will become true with the increasing price of gold, but we need to face the facts of where we are today. In reality, gold producers today are being analyzed as manufacturing companies on the basis of cash flows and price/earnings ratios, etc.

Source: Tanzanian Royalty Exploration Corp. CEO Describes his Company (TRE)