NORTHGATE EXPL (NGX.TO) Message Board

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Gold/Mining/Energy : NORTHGATE EXPL (NGX.TO)

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To: Elizabeth Andrews who wrote (110)	1/5/2003 9:42:03 AM
From: tyc:>	of 158

>>On site mining cost+trucking to mill+milling has to be less than US$12.50 ton I don't know what costs were included in the scoping study. However, that seems to be DSR's responsibility. From NGX point of view, I have read that Northgate is not responsible for any of the capital expenditures to develop or operate Sustut. It will buy the ore when it is delivered to them, and charge a milling fee. I feel sure I have read that the milling fee to be charged is $1.00 per tonne. Presumably, the purchase price of the ore will include all DSR's costs (capital and operating); thus everyone recovers costs, then NGX and DSR share the profits 50-50. So not only will NGX get half the profits, it will also defray its milling costs. I suppose the feasibility study will work out the details. The point that raises my eyebrows is that the ore will be transported to the valley floor by "ore-pass and drift". I imagine a hole in the centre of the pit down which the ore is dropped !! Have you any thoughts on this ? The orebody is pretty high up the mountain. Rather appropriately, the contract miner is called Procon Tunneling.

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