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Gold/Mining/Energy : Mongolia Gold Resources
MGR 21.34-0.3%Feb 9 3:59 PM EST
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To: Phil Jones who wrote (3199)2/23/1999 9:45:00 PM
From: Bearcatbob  Read Replies (1) of 4066
 
Even more on established operating costs:

To: Bearcatbob (2197 )
From: Dave R. Webb Thursday, Jun 11 1998 6:42PM ET
Reply # of 3203

Bearcatbob

I don't mind negative comments, but you are making statements that are suggestive and misleading.

When you say in effect that the costs at Bumbat are well established, therefor the mine is marginally economic, you are mixing fact with interpretation.

The costs at Bumbat are established (as well as a commissioning run in will establish). They are in the $35 range to mine mill and recover. The average grade of the deposit is in the 10 gpt range. You do the math. If this is marginally economic, then say so.

Gold orebodies are characteristically inhomogeneous. This means that the first tonne of ore, and all subsequent tonnes of ore are unlikely to be the same grade. The initial work at Bumbat stripped a low-grade portion of the 118 vein. Ore in this area averaged 6 gpt. Poor mining practices diluted the ore more than had been planned, resulting in a grade closer to 4 gpt. The mining practices are now corrected. Higher grade ore has been prepared for mining.

I hope this clarifies your statements.

Dave

So, the limited run in 1997 has established operating costs? I doubt it. It may have established potential operating costs. However, I submit that all 1997 did was prove how difficult it is to operate a small facility in Mongolia where delays are encounter for things like belts and bearing covers.

I submit that there is no reasonable way to estimate the total costs of operating that mine/mill for a year. This is especially true after it has sat idle for a year.

Go back and look at the posts.
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