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

To: ogi who wrote (59034)	4/23/2008 12:57:48 PM
From: E. Charters	Read Replies (1) \| Respond to of 78421

Mostly they have dealt with the lack of industrial output of tires by raising the price. I went to buy some of those white plastic pails for shipping samples in, the 20 litre containers with lids. They wanted $17.50 per pail and 5 dollars for the lid. the whole pail used to be 5 bucks a few years back - and not that many. Mark my words, $7.00 a gallon for gas, $350 a tire and 200 dollar a barrel oil is not far off. Anything above that and most of us will start to see the sense in becoming Mohammedans. Russia is already at Peak and declining in Oil production. Hydrazine and oil shales here we come. Gold producers have a higher average share price than non producers. You want to be in stocks that are serious about production and have no impediments, political or otherwise towards that end. A low leverage for such a grass roots stock is about 10 to one. A high leverage is about 50 to 100 to one. Why people cannot figure that out I do not know. It is because of the alcoholic-sex crazed manic depressive gene that fuels stock-gambling in this snowy Las Vegas. A simple rule for finding such stocks is to look for the what they lack. If the company was formed by brokers or lawyers, be careful. The best laid plans to produce are NOT based on solid mining engineering principles. Ask the people if the mine is free gold and what the release size is. Even maybe the bond word index of the ore and what the cyanide residency time is. What percent of the metals comes out by gravity? If you really want to get technical ask them what the average assay in the ore zone is. How may lenses the ore is divided into. What the metamorphic grade of the host rock is. Dip, strike and plunge. If open pit, what the pit depth is, what the strike length is, the average pay width, whether selective pit bottom mining, how they plant to establish selected lenses, and inclination of pit walls/stripping ratio. If underground how wide the stoping width. What stoping method they plan to use. When their eyes glaze over at these topics, you know a few things. A: they are not the technical person, B. they might be geologists C. Their plans for serious production are not realistic and they will run into snags, D. They ain't gonna make it in any realistic time frame. If they say they plant to sell it to a major, excuse yourself to go to the washroom, but don't return. Often you hear, "we don't know yet, it is subject to study", or "so and so knows, I am just the business person". These concepts are vital and not that hard to know. They should be known to anyone selling the company as they directly impact profitability. They should be studied by all concerned. If the concepts are not known then it must be very grass roots, but in fact the analogs should be known. Metallurgical studies may be and should be carried out at a very early stage. A reply such as "we believe the character of the ore is similar in all characteristics such as friability and porosity to Mine A in the belt and would be amenable to heap leaching", is a good answer. "We are currently undertaking column leach tests", is a good response. There maybe other answers but a serious mining company should be researching these at a very early stage. You don't spend 2 million on drilling a body off only to discover that the ore is completely refractory and there is no way it would pay at the grades you have encountered. Quite a few geologists do that. I know a group in Quebec who plan to mine a body that might make it. They have not done metallurgical yet, but its characteristics much like other mines in the area. Responds to full milling and 24 hour cyanide. They are coming out at one dollar. Probable leverage is perhaps 5 to 10 times. I am not crazy about their approach, or all of the people involved and I will admit they could not answer many of the questions I put above, but they are real. That is the sort of investment you should look for. Real is not promotional. But often real does not raise much money in the initial stages. EC<:-}