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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: russwinter who wrote (48171)	2/6/2000 12:17:00 AM
From: Gord Bolton	Read Replies (2) \| Respond to of 116764

Top ten reasons for the POG rising 1. Gold producers could not agree to limit production, forward sales or prices unless/or until they could eat Ashati alive, and the bullion banks too, at the same feast. 2. Goldman Sachs still does not know what to do with Ashanti and their hedge. They are starting to sweat big time. They are in a no win situation. 3. Billy went looooong with the social security money and will be looking for support from the goldbugs for a third term. 4. Hi I'm Barrick and I'm a hedgeaholic. But I saw the numbers on the Ashanti shareholders suite against the directors and I will never short gold again. 5. The Duma told Boris that he had to return all of the stolen gold to the Russian treasury or they would make him work it off. 6. Supply and demand in the Gold Market are searching for equilibrium. 7. The markets are at all time highs and there is nothing to hold them up. Savy investors all decided to seld their shares and go long gold the same day. 8. Somebody audited the books and there was actually no gold there. 9. Some Cubans actually had a claim on all the gold sold by the BOE. That is why they were selling it. 10. Gold had to go up as all of the producers had already shorted more than they had. There was nothing left to sell.

To: russwinter who wrote (48171)	2/6/2000 8:55:00 AM
From: Enigma	Read Replies (2) \| Respond to of 116764

Much has changed with the large open pit mines using the leaching process. With underground mines - eg. Campbell Red Lake - there were rich stopes which could be used for grade control. With a large open pit operation - you mine what you have and the grade is usually uniform. Remember that Barrick has already mothballed several higher cost operations. The large miners are looking of mines where the cash cost can be under $100/oz.

To: russwinter who wrote (48171)	2/6/2000 2:15:00 PM
From: goldsheet	Read Replies (1) \| Respond to of 116764

> Further, even they are mining out the juiciest part of their reserves right now Check out their annual reports and you will see the average ore grades of the mines have remained relatively constant over the last four years. It is rather hard for a heap leach mine (ABX/NEM/PDG) to high grade like an underground mine can do (like Homestake, Hemlo area mines, etc..) > My point is that sure there are some low cost deposits being produced, but it's a small percentage of overall mine production Some of these "tiny" mines are almost big enough to be in the Top 15 as stand-alone companies. Pierina produces 837,407 ounces at $42, Cortez 797,115 @ $48 Meikle 977,356 @ $75. Entire companies would love to get into the million ounce club, and these individual mines are almost there ! > that can't be replaced cheaply because of the exploration dearth The big firms are having no problem replacing all of the reserves they mine, and even adding to them. ABX is moving Pascua resources into the reserve category, and Placer still has a lot of ounces at Getchell. No one believed me when I said world primary mine production would set a record in 1999 despite lower prices but it did, and it looks like it is going to happen again in 2000. There is a lot of profitable mineable gold available in the world. Unfortunately, only about a dozen companies have the resources to do it properly. I feel sorry for the high cost, low volume producers, but natural selection tells me they either better get bigger to function in the new reality of the gold mining business or go out of business. Bob Buchan (Kinross) had it right when he said you need to be a 1+ million ounce producer to be viable, and I think he recently changed it to 2 million ounces. Gold mining is a tough business even in the best of times.