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Gold/Mining/Energy : International Precious Metals (IPMCF)
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To: virginijus poshkus who wrote (12144)6/14/1997 8:31:00 AM
From: Zeev Hed   of 35569
 
Vargas: I am not smart enough to know what will be embraced, the bottom line is there are two ways to get validation of the treasures, you sample and show by a method accepted by the bankers or by well respected third parties what is the value of your resource (the route IPMCF is taking) or you bootstrap yourself to get into production and get positive cahs flow, what GPGI is attempting. Both still have a number of hurdles to pass.

It is clear that not all the valuable stuff is extractable by "normal methods". It is also clear that marginal extraction (I mean by that additional extraction beyond what "standard extraction yields) has marginal additional costs associated with it ( for instance, grinding, high temperature leaches, more reagants per ton etc.) and there is a point where marginal cost exceed marginal profits. Meaning, let's say that the actual absolute average content of Au in IPMCF ore is .3 oz/ton. Let also say that the first .2 oz/ton is extractable at a cost of (just wild guess, not a fact!!!!) $50/ton, and to get the next .05 (to .25 oz/ton) the total cost per ton increases to $75/ton and to get the last .05 (to extract the whole theoretical .3 oz/ton) increases the average cost per ton to $125/ton. It might very well not be worthwhile to get those additional .10 oz/ton and be satisfied with the .2. Just because an analysis indicates presence of a resource, it does not mean it is profitably extractable.

Zeev
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