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Gold/Mining/Energy : GOLDEN PHOENIX MINERALS, GPXM
GPXM 0.00010000.0%Nov 7 9:30 AM EST

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To: terry101 who wrote (405)11/13/2005 6:29:15 PM
From: pogbull   of 811
 
Ashdown Update

November 13, 2005

The new drift, or by-pass, was begun on September 9, 2005. It is being developed by two three-man crews under the direction of Mine Manager, Earl Harrison. The bypass was started 70 feet inside the pre-existing adit, which had been dug 23 years earlier by a previous operator.

As reported in prior company news releases, the adit has been fully rehabilitated and fire proofed, and an explosives magazine has been constructed inside the 12 Level that extends northeast from the original decline.

In driving the bypass, our miners have been using hand-held jacklegs to drill the face in order to load explosives for blasting. Blasted material is removed by an Elmac mucker with a 2-ton bucket and an Elmac 10-ton truck. The drift dimensions are approximately 10 feet wide by 10 feet in height. It is timbered using 8” x 8” Douglas fir timbers and 3” x 12” lagging.

Initially, the drift encountered loose volcanic tuffs for approximately 200 feet. These are compacted sedimentary layers that have little structural integrity. The miners then encountered mixed ground including a composite of clay and boulders, then some competent quartzite, followed by more composites. This has required extensive timbering. The result is that progress has varied between 2 and 15 feet per day. To date, over 360 feet of drift has been completed. We have driven deep enough and far enough in order to have by-passed the initial collapsed portions of the original Sylvia decline, and are now in position to cut an access passage, or crosscut, toward the original decline at a beneficial angle that crosses, rather than follows, the composite ground layers. This is expected to aid in the rate-of-advance. In addition, a jumbo, which is a mechanized drilling rig used in place of hand-held jacklegs, has been purchased and is being commissioned to start service this week. The jumbo is expected to accelerate the drilling time by 30%, and also adds an additional level of safety to the mining process.

The current plan is to run a crosscut from the 220-foot marker of the bypass so as to intersect the original decline at a location that past data indicates has a high-percentage chance of being free from cave-ins and is closer to what the former operator has recorded as hard (and therefore ‘good’) ground. This is a modification of the initial plan, which was to drive directly to the section of the original decline that is proximal to the face of the target moly deposit. It is estimated that by intersecting the original decline sooner, access to the face of the moly deposit can be accelerated. The way to confirm this is to proceed. The Company continues to strive to reach the target moly deposit within this calendar year, and the composition of the ground encountered between the working face of the crosscut and the original decline, plus the condition of the original decline when intersected, will determine our rate of progress. To date, the crosscut has advanced about 65 feet and the miners report being in better ground, consisting of cemented tuffs and basil conglomerates. This ground has sufficient structural integrity to allow our crews to suspend timbering in favor of rock bolts and wires. This further aids in the acceleration of daily progress, as anticipated.

The mill construction remains on schedule, with the heavy equipment having been set on the foundation and the light equipment being added at this time. The mill walls and roof have been staged on site, and are scheduled for installation as soon as the 14-foot-wide thickener tank has been set. A water-well, located 50 feet from the mill, has been drilled to a depth of 150 feet, and will provide mill water at an estimated rate of 30 gpm. The tailings impoundment excavation is complete except for perimeter work, which is scheduled to be completed by the 18th of November. At current rate of progress, it will be ready to accept the liner membrane that will be professionally welded in place before month-end. With that, plus completion of the walls and roof of the mill, there will remain wiring, plumbing and minor equipment additions before the mill will be ready for commissioning.

Numerous shareholders call or write to ask when the Ashdown mine can begin production. The answer to that question is as soon as

The mill is completed,
The declines (both old and new) are completed, cleared and timbered or bolted so that access to the face of the moly deposit can be reached safely and efficiently by heavy equipment, and
The 1000-ton bulk sample can begin to be extracted.
It is technically feasible to have this work done before year-end, but the determining factor remains the nature of the 200 feet of ground that must still be crossed and the condition of the back portion of the old decline when entered. These factors are unknowable at this time, and will be dealt with as we encounter them. We have sufficient manpower and equipment to get the job done in the above time-frame, given reasonable conditions and provided no unexpected conditions are encountered.
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