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Gold/Mining/Energy : BALACLAVA MINING (BIL.V)
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To: Pete Mimmack who wrote (80)8/19/1998 7:34:00 PM
From: Tom Harper  Read Replies (1) of 139
 
You raise one valid point and one irrelevant point :

You are quite right that the market will respond more positively to a deposit recoverable at $100/oz than to one at a higher level.But can you or Shaeffer honestly say the cash costs will be $100? Do you have any idea how costs can rise astronomically in a lush ,tropical jungle environment with heavy annual rainfall? Just compare Greenstone's actual costs to their "projected" costs and it might send a chill or two up your spine.And mind you , Greenstone's "projections" were made after the deposit was defined and after feasability.

Your point about a gold price forecast is , on the other hand , not immediately pertinent to deciding whether BIL is a good investment : we are dealing with an exploration play here.If you want to bet on the future price of gold , your portfolio would be better served by a gold producer with high cash costs.Or if you are not that risk tolerant,try a producer with low cash costs,say Placer or Barrick.

Think about it.
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