TO ALL:
The following letter, from Dick Jensen, is being mailed to shareholders.
DD
October 20,1998
Dear Shareholders,
I wanted to write this letter to all to discuss the status of our production, the water situation, and also to make some general comments concerning our immediate plans
1) SHIPMENTS MADE TO SABIN METALS, INC.
Since making the decision in June of 1998 to change our mode of processing ore from the production of copper dore bars and the subsequent electro-winning thereof, to the utilization of the relatively new technology of running our precipitate in solution through a series of resin columns, we have made a series of eight shipments to our refiner. Laboratory results using the resin technology appeared favorable from the beginning. Shipments 1 and 2 showed substantial promise and results were actually better than anticipated in all four precious metals, gold, platinum, palladium and rhodium with rhodium results, 3.77 oz., approximately equal the combined weight of all three other precious metals. However, shipments 3 and 4 and shipments 5 and 6 showed only negligible recovery of precious metals.
The Company, though obviously disappointed with these results, has undertaken to determine the problem areas in our processing procedures and are presently in the process of correcting the problems encountered with our leach and precipitate. Our problems in identifying what went awry were compounded by the fact the results on any two shipments were delayed in getting to the Company for approximately 30 days. Representatives of Sabin Metals, Inc. have been very cooperative and helpful in resolving our problems and continue to encourage us in our efforts.
2) PREPARATION FOR FIFTY TON TEST
In view of the circumstances set forth above, the Company has determined to immediately undertake a series of two smaller 60 pound tests taking the raw screened ore through processing until we have metal in hand. These tests will be performed under laboratory conditions with each stage of the process monitored and tested, including an analysis of the ore taken from different areas of the ore pile. The company believes that these tests will address any remaining areas of concern not already remedied by our employees at the mill site; and, if so, the Company will proceed with a production test of 50 tons on the same basis. Provided all goes well with these tests, any future shipments to Sabin Metals, Inc. will be consistent both in quality and quantity of precious metals tendered for refining.
3) WATER SITUATION
As many of you know, the Company in September was served with "Notice of Violation" from the Arizona Department of Environmental Quality, which alleged that the Company was a discharging facility as that term is defined under the statute. After a series of meeting with the Department, the Company is pleased to announce that the Department has granted the company the right to continue to operate under existing conditions for a period of 180 days; provided, however, the Company operates as a zero discharge facility. During this interim period, the Company is obligated to proceed with its application for an Aquifer Protection Permit. The company has determined to retain the services of a professional consulting firm expert in these matters to assist the Company with the permitting process.
Shareholders should also be advised that the company either has the equipment on site or ordered sufficient to allow the Company to process the precipitate derived from 50 tons of ore per day through the resin columns. As our technical problems are resolved, Management expects this level of production to result in a positive cash flow.
Management of the Company remains confident and steadfast in its commitment, regardless of the occasional setbacks, to make the Company a force to be reckoned with in the precious metals market. We appreciate, need, and ask for your continued support as shareholders.
Very truly yours,
BOARD OF DIRECTORS
GLOBAL PLATINUM + GOLD, INC.
/S/ Richard E. Jensen
Richard E. Jensen
Chairman and President
|
