Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Pacific Rim Mining V.PFG -- Ignore unavailable to you. Want to Upgrade?

To: charred who wrote (12980)	4/17/2000 10:57:00 PM
From: Elizabeth Andrews	Respond to of 14627

This market is under the control of a real expert. A real liquidity crash just happened and not even a meaningful downtick. They can't own it all can they? I wouldn't give more than $20/oz in situ as a realistic valuation. Don't forget there is a big NSR on this baby and the capital costs in this remote area are going to be up there. How far does the power have to come? They have to pump water and lots of it a long way. Add it all up. It's going to have to be 5 million oz of leachable grade, like 0.20 oz/ton.

To: charred who wrote (12980)	4/18/2000 10:59:00 AM
From: Quickdraw	Read Replies (2) \| Respond to of 14627

<...nobody in Miami> Tell you what, I've arranged to phone CMS tomorrow so I'll ask her if she attended. I sure see her name there as a speaker ... don't think they had a booth. Message 13382985 ... but then you would know best. <... financing ... that what I said they should do> I think you'll find you were not the first or only one to make this point ... but sure, why not take credit for it. <Please gives us examples of this> Example: "Homestake to acquire Argentina Gold Corp. for approximately U.S. $200 million (C$300 million) in Homestake common stock. Argentina Golds' principal asset is its 60 percent interest in the Veladero property" " ... Veladero's three mineralized zones contain at least 4.5 million ounces of gold and 100 million ounces of silver." " ... the transaction values each Argentina Gold share at U.S.$5.14 or C$7.81" Argentina Gold: shares o/s 38.5 million www2.cdn-news.com Ok, so lets work it out: 60% of 5 million oz = 3 million ozs (ARP's share) US $200 million divided by 3 million ozs = US $67 per oz Am I missing something here? Qd

To: charred who wrote (12980)	4/19/2000 1:11:00 AM
From: skynight	Read Replies (2) \| Respond to of 14627

I don't know where you get your information but it is wrong as usual. Catherine was in Miami and I spoke with her both before she left and after she returned. Why do you insist on attacking Pac Rim? Did you apply for a job with them and get turned down or are you paid by another company to try and divert money away from them? I really don't understand what you have against Pac Rim. They are some of the finest people in the business. When you have earned the same reputation as the people at Pac Rim then you can criticize them. Until then I would suggest you not challenge successful people. It makes you look very small. sky

To: charred who wrote (12980)	4/21/2000 11:54:00 PM
From: Bill Jackson	Read Replies (3) \| Respond to of 14627

Charred, What people pay depends on the total ounces and the ease of mining and the ease of leaching(recovery rate) and the amount of overburden. It looks like they can mine from surface here.....a strong plus as there is no overburden. It also looks like they are getting high recovery rates, but that needs to be confirmed by the degree of oxidative weathering at depth....the deeper stuff might be more tightly bound with sulfides etc and only the top is well weathered.....although I am encouraged by the broken structures and the permeable nature in the deeper old holes they have found(intense fracturing)....it may all leach well. this is a second potential strong positive. Then there is the size of the area. 1850 meters long, 250 wide and on the order of 100 meters deep(this needs to be confirmed). On the face of it that makes a reserve of about 140 million tons(and it may be deeper, longer and wider???) If they have a grade of 1.5 G/tons that equals on the order of 6-7 million ounces......a fairly large deposit. If the average grade is larger and the extent is larger it could be better. Time will tell. If it is all easily fractured and leachable from surface a fairly low cost operation will ensue. with 4.5 grams per cubic meter and 90% recovery we have a value of about $35 per cubic meter. They describe it as intensely fractured? that means it can be ripped and graded and hauled by draglines(low cost dragged buckets) and conveyors, given a minimal crush and size with low energy that should cost less than $12-13 per cubic meter, leaving $22-23 as the yield in profit. Let us say they use up half and recover half, that will still give them a cost of $130 per ounce and I am betting it will be in the 80-90 range, less if grade is higher. A lot depends on the final size, a larger mine uses larger equipment at a lower cost per ton and/or lasts longer as an exploitable resource. Now what would someone pay for such a resource? Probably $30-60, depending on the final size, final grade and final extractive efficiency. Lets face it if the maximum they will pay to buy the resource and to operate it is in the $150 area a resource that extracts for $50 is worth $100 per ounce and one that extracts for $120 is worth $30 per ounce. It also depends on who else is looking on PFG as a nice mouthful to bite off. Rumor has it that two majors are interested in Luicho....to the point of accumulating a share holding of some size, but just investment grade right now....it may become a question of two dogs and one bone....in that case $60 is quite reachable if the size grade and leachability co-operate. $60 will back into a share price of around $20 per share, depending on the dilutive effect of the to be announced next week financing. I see all this recent news as highly positive to SH values and I feel it is a good time to buy. When will all this happen? When those values of grade and extent and ease of leaching are more fully described so a major can quantify the reserve to an acceptable degree. There is one other option. Self operation. Heap leach is low tech, low cost and LOW CAPITAL INTENSIVE. With a good reserve PFG could easily raise the capital to run such an operation. The design and operation skills are widely available at a high level and this one deposit could catapoult PFG into the junior major ranks immediately. Sale of Diablillos to a silver major could well finance such a venture. the control block seems to be tightly enough held that a hostile takeover would have to be very high before managment agreed and that means over $40 a share as with PFG operating this mine it could go way over $40 per share. Lets say it ends up at 7 million ounces and is operated for 14 years at 500,000 per year at an average cost of $125. That would be quite doable and the final would be lowerIMO. $160 net margin times 500,000 divided by 22 million shares is $3.75 per share for 14 years. Barrick made 80 cents a share and was worth $25 a share , so PFG might well be worth $100 or more per share when in operation of this mine. Now these figures are all if and maybe, but there is a seed of truth in all of this. Every major was at one time a tiny crumb eating junior that made their way with one big operation that they were able to find and operate and also withstand takeover pressures with a strong control group in command. Will PFG do this? beats me, but they just might do it. Bill