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Gold/Mining/Energy : North American Palladium(AMEX:PAL)- PGM Producer -- Ignore unavailable to you. Want to Upgrade?

To: koan who wrote (609)	6/14/2000 9:38:00 AM
From: Elizabeth Andrews	Read Replies (1) \| Respond to of 976

You can expect the mill rate to fluctuate between 2200 and 2600 tpd. The grade mined could be more of a variable and a bigger factor in the short run as there are high grade zones in the deposit. I believe the mine plan gets into higher grade ore in the next two quarters. If prices hold the EBITDA will be impressive. This is an unusual situation as a mine is producing while being expanded significantly. The new mill will be exactly that, a new mill and the current mill will be decommissioned when the new mill is ready to go. There should be no interruption in the income stream at a time when prices are high. Compare this to the mess Placer Dome is in at Getchell! Remember that the SA PGE properties are primarily (80%) platinum. To increase palladium production by one ounce they have to produce 4 ounces more of platinum. Since the platinum market is basically a cartel this increase in output may negatively impact platinum prices. The net gain may be negative to the income stream even if palladium goes to $1000 per ounce. So supply of both metals is probably inelastic at this time of exploding demand. But the fundamentals appear to favor palladium. PDL is 85% palladium and growing as the price rises.