Charles, OK, here is a shot at your Q&A request.
The first and foremost issue is certainly estimating reserves. Even if you could prove 100 ounces per ton, if you only have 1 ton of material, it is not worth buying. Estimating reserves is typically done with a drill program. 300 to 500 feet is implied reserves, 200 to 300 is probable and less than 150 is proven reserves. The question would be how much do you need to prove to get this on the lips of every gold producer in the world and let the bidding war begin.
If Naxos can keep up the work along the lines of the 1.7 certification, (there inlies the consistancy issue) it won't take a recovery operation to get the interest of some very large investors, institutions, etc.. Bear in mind the gold mining industry is scrambling right now to drop production and recovery costs any way they can. If a company can prove up a reserve with a concentration of 1.7 opt, then the cost per ounce for recovery (if the estimates of $150 per ton are correct) is $88.23 per ounce. The lowest cost per ounce I have ever read about is in Peru at $98 per ounce and that isn't a particularly large reserve.
Once estimated reserves are calculated, and this estimate is in line with all previous estimates and cut THAT in half, with only 1 billion tons of material, a reserve of 1.7 BILLION ounces of gold could be there. If you assume only $200 per ounce value, a $340 BILLION asset is in the ground from which the State and Federal govt would get a cut in the form of taxes, etc.. Can you name a govt branch that couldn't use a few BILLION dollars off the top? Who in their right mind would fight what could be one of the cleanest mining operations ever producing that kind of ongoing revenue stream for all kinds of programs?
So, we don't necessarily have to wait for actual recovery before things get very interesting, but proving reserves and also proving some consistancy of assay will do plenty for us and put Naxos in the spotlight for anyone who wants to be in the gold business into the next millenium.
I hope that this helps you out. I couldn't bear the idea of you reading through the last 8,000 posts. You would need the help of a good analyst if you tried that in one sitting.
Regards,
Tom F. |
