International Precious Metals (IPMCF) Message Board

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Gold/Mining/Energy : International Precious Metals (IPMCF)

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To: Zeev Hed who wrote (2369)	2/15/1997 10:50:00 AM
From: Bill Jackson	of 35569

ZEEV; You are quite right. at 220,000 ounces per day that is around 3300 tons per year. We will get a dramatic drop in gold prices if anything like that scenario comes to pass. In fact when an operation like this comes into production the management will have to take that into consideration and size accordingly, as a depressed gold market is equal to a low level of recovery when it hits the bottom line. Any such large operation must be stretched in longevity to avoid undue market impacts. Management must know this, so where did it come from? Usually from people with calculators(replacing brains) because if you take a cube 5KM x 5KM x 500 meters you have 37.5 billion tons at 0.25 ounces per ton that is 9.3 billion ounces, at a 100 year rate that is 93 million per year or 250,000 ounces per day. This is extrapolative thinking as we do not know how far deep it is. But on a 1 KM square at 200 meters we have 600,M tons or 150M ounces or 1.5 M per year for 100 years 4100 ounces per day(63 tons/year) sor twice as much for 50 years and so forth. But no fool would run it so quickly as to depress the price of gold by 80%(which 220,000 ounces per day would do). Bill Jackson

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