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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers -- Ignore unavailable to you. Want to Upgrade?

To: hubris33 who wrote (8431)	3/27/2006 6:00:14 AM
From: Ed Ajootian	Respond to of 78417

hubris, thanks, that's helpful. Is a mine only economic if it is of interest to the majors? For a given amount of gold-equivalent ounces of resource, wouldn't the threshold for an economic mine be smaller for silver vs. gold, since the silver would be less expensive to mine (on a gold-equivalent ounce basis)? The reason I say this is that for silver, there would be more ounces of the good stuff per ton of earth than would be the case for gold, which would imply to me that the costs of extracting that (on a per-ounce-of-gold-equivalent basis) would have to be cheaper than extracting gold.

To: hubris33 who wrote (8431)	3/27/2006 4:47:09 PM
From: E. Charters	Respond to of 78417

That industry standard is everything but. CIM standards in fact forbid gold equivalent reporting. They may have got that one by the 43-101 relaxation committee of 2005, but in fact you cannot since 1955 that I know of report assays in dollars, or convert them into dollars or equivalate them to other metals. There are no equivalent metals. Gold has different structures, costs, recovery, and marketability. How do you make gold equivalent when it may take 24 hours to leach gold from a silicate ore when it may take 60 hours and much more cyanide and losses to leach silver from a high sulfide ore. Do you have to smelt the sulfides to get the silver? Does it report to the pb or the zn? Big economic difference. How far is the nearest smelter? How much do they charge? What are there charge backs or penalties? What are they recoveries of pb, zn, and ag? You may be looking at max 80% in any of those and sometimes less than 60% in the Ag. Best to use 80%. Mining and mill costs could go to 100 dollars. Smelter costs to 250 dollars. If you cyanide it could cost you lots. Mexican ag cyanidation was always expensive. And what are the size of the stopes? Development cost? Dilution? Total ore to defray capital? On the other hand 50 ounce silver overcomes a lot of evils. EC<:-}