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Gold/Mining/Energy : Corner Bay Silver (BAY.T) -- Ignore unavailable to you. Want to Upgrade?

To: Elizabeth Andrews who wrote (559)	12/23/1999 12:45:00 AM
From: Claude Cormier	Read Replies (1) \| Respond to of 4409

<<Peter the down dip resource is irrelevant and not worth pursuing due to the fact that deposit plunges into the hillside and the stripping ratio is going to go off the scale when contemplating mining to a pit floor of 300 meters. >> It is possible that it will be as you say... but not guaranteed. The ore starts from surface along the hillside on many sections and a good resource could be develop not far from surface. We don't really know how close to surface is this deposit donw in the valley to the east. <<Why are they drilling when the say they a minable resource now? The present value of future reserves is almost zero and is a smokescreen.>> They are current reserves ...not future. More than 95% of this is already proven and probable as calculated by Mintec. The NPV is at 6% discount and 60% recovery rates is approximately US$40. << The drill program means the property may have a problem and the drilling to prove up a larger resource is a way to deflect the problem that may kill this project. >> Why drill more something that is already proven/probable? Why not extend the resource/reserves to improved the value of the deposit. If your statement was true, all miners would stop drilling after the first few holes and do in-fill instead of step-out. <<And, there's a lot of talk about metallurgy which I believe will be this projects biggest problem. >> It may be... But, again, compare this project with The Rochester mine. Rochester is profitable with 58% recoveries. They have materials that is not as leachable as the Chlorargyrite found at Alamo DOrado. Test so far have indicated that recovery rates are at a minimum of 58% and a maximum of 97%, depending on the grade, the degree of crushing and the type of material. High grade oxydes gave recoveries of 74% on chips samples from various depth. So the odds are excellent. FWIW, even at average recoveries of 53%, the project still has a NAV of $2.75 per share and a IRR of 33% <<Very risky boys.>> There are some risks... as usual.... but they are much smaller than if you short BAY.

To: Elizabeth Andrews who wrote (559)	12/23/1999 4:03:00 AM
From: marcos	Read Replies (1) \| Respond to of 4409

One of the reasons to drill thoroughly enough to get an overall picture of the deposit is to establish the best siting of your camp, to figure out where you're going to put the leach pads, mill, tailing ponds, equipment sheds, outhouse, etc. You don't want to just plunk them in there and then find out they're on top of your sweetest spot of all. Winspear has been intentionally drilling off an area this year where they don't expect to find kimberlite, just making sure before they site the camp and airport. X-Cal at Sleeper inherited a mill that's right on top of what now appears to be an economically leachable deposit. Costs money to move that stuff, better to get it right in the first place. Also, a site has to be optimised accurately to be most efficient in moving material. A hundred metres counts big when you're about to move a few million tonnes. Another reason - They're a junior. That's what they do - drill. I dunno, i like it. john and Mark - Thanks for the AGM reports, great stuff ... cheers