Richard, I have tried to explain that before. I think that only an ounce or two are leachable by normal leaching processes, may be 2 to 3 if they grind very fine. The rest is locked in essence in solution in the matrix. Assume that the mother quartz veins (in the original rock) cooled so rapidly that there was no time at temperature for sigmoidal precipitation of the precious one out of the matrix, or at least, the precipitates are so small (possibly and most probably sub microns, just the size of the embryonic nuclei or slightly larger). Yet, you do not need that much to extract the stuff if its concentration is really that high. Make an estimate from a similar industry, what does it cost to process glass per ton of glass? It is less than $100 bucks, but in essence that is what they have to do. For $2500 worth of gold and gold equivalents, it is quite worth while. Even if secondary processes take another $100/tons it is still worthwhile.
The truth is that they need not do that high temperature reduction step (in which I bet they loose a lot of gold and possibly some palladium), and if I had my way, they could get rid of the electrowinning process as well.
Even if they stay with these processes, I doubt that it should cost them, even on small scale more than $500. I do not know the exact numbers, but rational people can estimate upper bounds and see what is the value with those upper bounds, if GPGI later surprises us with lower costs, then consider it chantilly on the cake.
What differentiate GPGI from the other desert dirts is the huge concentration of the stuff, I think it is the first time they came public with it, and very carefully so. Jensen said that we should not presume that the whole stockpile has the same concentration, nor should we assume that the Hassayampa other 15 MM tons have the same richness (and we know to take only half since the other half was shipped as aggregates).
To start and make a model for a slightly longer term, I would say that the 15 MM tons of additional ores at Hassayampa will yield only 5 MM of concentrates and have only a value of $1000 per ton.
I get numbers that are kind of numbing (and we run into world supply problems here as well). I do not even want to post these here. Do the calculus yourself.
My estimate of near term value of the shares of about $10/share are still valid, IMHO. What keeps me from increasing the IEI is the fact that usually, before such momentous news, the market would have indicated something is afoot. Yes, GPGI has strengthened technically quite appreciably in the last two weeks, but somehow, I would have expected more oompph. Well we'll see.
Zeev |
