<<The Study was completed by Bema staff and audited by Mineral Resource
Development Inc.
(''MRDI''). The resource model contained in the Study was completed by MRDI. The
Study was
undertaken to evaluate the viability of the Lo Increible Property based only on open
pittable
reserves.>>
So underground mining is the icing on the cake...
<<The conclusion of the Study is that the project is technically and economically
viable>>
And we have a 10 cent stock??!
<<The Lo Increible project contains a mineable open pittable reserve of
11.4 million tonnes with a 3.14 g/t gold for a total of 1.1 million
ounces of recoverable gold. The average waste to ore ratio is 6.74 to 1.
Forty-five percent of the ore is measured and indicated, the remainder
will be drilled at closer spacing during Final Feasibility to bring it
into the measured and indicated categories.>>
Million plus and going up. Sounding like a mine.
<<The Study recommends mining from 6 open pits and processing ore at 3,000
tonnes/day, yielding an average of 138,000 ounces per year for the first
6 years>>
Compare this to Refugio's current annual ounces to Bema...!!
<<Initial capital costs are estimated at U.S.$69 million with payback in
2.5 years.>>
That is an EXTREMELY favorable (short) payback period. Will be
a big factor in financing the mine.
<<Direct operating costs are U.S.$167 per ounce and total costs
including capital is U.S.$235 per ounce. This project carries a pre-tax
Internal Rate of Return of 26.1% at U.S.$325 per ounce gold and 19.9% at
U.S.$300 per ounce of gold.>>
Lets assume $300 gold, likely more pessimistic than financing assumptions. An IRR of about 20% is pretty hard to walk away from,
and that IRR is likely to be viewed as a floor in my opinion.
Bema would be crazy not to pursue this.
<<In
addition, all six deposits including La Victoria and La Cruz remain open to depth and
along
strike.>>
Explo potential still there, tells us the numbers are likely to improve over time.
<<A final feasibility study, projected to cost approximately U.S.$6 million dollars will
commence
as soon as financing has been completed. Bema and El Callao have commenced
discussions
regarding financing alternatives.>>
ECM on its own has no "financing alternatives"; they don't have a dime. On the other hand, Bema has
$17 million and access to loans. How is this going to work?? I say
Bema will merge ECM into Bema for stock. Sheer speculation, who knows.
But ECM is unquestionably more valuable now, after prefeasibility, and will be even more so after the feas. study. Can't wait.
<<The key project parameters of the pre-feasibility study are summarized in the following
tables:
Summary of Base Case Parameters
------------------------------------------------------
Inflation Constant U.S$
------------------------------------------------------
Gold Price U.S.$325/oz. (10% over spot; too low or too high?)
------------------------------------------------------
Nominal Process Rate 3,000 t/day
------------------------------------------------------
Project Life 11.0 years
------------------------------------------------------
Initial Capital Cost U.S.$69 million (low cost mine for the output!)
------------------------------------------------------
Deferred and Replacement U.S.$3.3 million
Capital
------------------------------------------------------
Mine Life Direct Operating U.S.$167/ozt Au
Costs
------------------------------------------------------
Total Cash Costs U.S.$235/oz. (yee hah! )
------------------------------------------------------
Operation costs per tonne U.S.$15.50
------------------------------------------------------
Waste: Ore Ratio 6.74 (is this on the high side?)
------------------------------------------------------
Mineable Reserves 11.4 million tonnes
------------------------------------------------------
Average Gold Grade 3.14 g/t
------------------------------------------------------
Average Gold Recovery (to 92.0%
Dore)
------------------------------------------------------
Average Annual Recoverable 97 thousand ounces
Gold
------------------------------------------------------
Total Recoverable Gold 1.1 million ounces
------------------------------------------------------
Gross Gold Receipts U.S.$346.0 million >>(pretty good for a 10 cent stock)
Looks exciting, especially after a long slumber....
Thanks for posting this.
John |
