Gold and Silver Juniors, Mid-tiers and Producers Message Board

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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers

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To: marcos who wrote (62300)	11/22/2008 11:56:23 AM
From: tyc:>	Read Replies (1) of 78407

>>Agreed with most of this, except maybe base metals .. You observe that a base metal content seems to detract from the market's evaluation of a gold stock. Is the converse true ? Does gold enhance the market's evaluation of a base metal stock? I sharpened my pencil to calculate the profitability of Mt Milligan as a copper mine producing LOM 88,000,000 lbs of copper a year, treating LOM gold production (217,000 oz per year) as a by-product credit. At current prices of gold and the Canadian dollar, my arithmetic (using feasibility study figures) said that copper could be produced at a negative cost of C$0.096c per lb. For every C$10 change in the price of gold, cash flow from the mine would change by C$2,200,000 (88M*C$.025). Production of both metals in the first six years would be higher than the LOM figures I used, so initial cash costs might be even lower. (It sure wd be great if someone were interested in checking my figuring)

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