Jack,
A few comments on your post #4527:
In my opinion, it will take cash receipts greater than those
announced today to move the stock significantly. Progress is
progress, however. Procedures will be revised and processes
fine tuned and greater returns will be had. I have no doubt
of this.
You have hit the nail on the head. In fact, some of these procedures
and processes have been fine tuned since we sent that 50 ounce batch
to Engelhard.
There was severe dissapointment when there was no refined metal
shown at the meeting in Nevada, and the announcement of smaller
than expected returns from Engelhart West was also disappointing.
Both can be viewed as good progress, they just did not meet
expectations.
Other than what Jeff Williams reported about the meeting in Nevada,
we don't know what happened (i.e. different agendas, etc.) or what
was supposed to happen. So, I won't even attempt to address our
expectation levels vs. those of the attendees for that meeting.
However, I will question your "smaller than expected returns"
comment. What exactly were you expecting? Here are my calculations:
Assumptions:
1) The ratio of precious metals in the semi-refined metal we sent
to Engelhard is the same as we had for the sludge we sent to
Sabin (see Sept. 15 update).
2) Since I don't know what prices Engelhard used, I'll use the
closing bid prices from yesterday (see
kitco.com.
Dec.19
Ratio Price $/oz
-----------------------
Silver 0.301 6.07 1.83
Gold 0.218 289.45 63.10
Platinum 0.187 355.75 66.53
Palladium 0.192 184.75 35.47
Rhodium 0.103 320.00 32.96
-----------------------
1.001 199.89
So, the THEORETICAL maximum we should have expected to receive for
our semi-refined metal was: 50 oz * 199.89/oz = $9,994.50. There
are two very good reasons why we didn't get paid that amount. First,
it assumes that our metal contained 100% precious metals. That's
simply not the case. It would have contained some amount of
impurities. Your guess is as good as mine what that number would
be, but I wouldn't be shocked if it were 20-30%. Also, there's no
way that we would get full value of the metals for such a small
quantity. The spot values are based on large quantities. Mike
Wendell posted a message on his "New Age" thread which stated that
"Precious metals are marketed in 1000 ounce minimums for favorable
treatment." (Dec. 15). It's very much like currency exchange (see
what rate you get when converting $100 vs. $100,000) or the buying
and selling of less than a board lot of shares (often, you'll pay
more when buying and receive less when selling).
I'm not sure what your expectations were for this batch of metal
but I can say that a $5,000 gross value is not a disappointment
for me. Anybody who was expecting 10's or 100's of thousands of
dollars was simply being unrealistic.
We should NOT focus on the amount of money we received. The bottom
line here is that we put the metal on the table and a major refinery
was able to deal with it. The process works. Now, we just have to
choose the best method and ramp up production accordingly. Do we
send semi-refined metal to Engelhard? Do we send anode bars to
Friendship? Do we send sludge to Sabin? Dennis DeNoble made a
reference to two other refiners. Perhaps one of those will figure
into the equation. Maybe we'll end up using more than one refinery.
In my opinion, the positives outweigh the negatives. We're on the
right track, although we're moving slower than we'd like. Then
again, didn't the tortoise win the race? :) |
