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

To: loantech who wrote (65800)	6/20/2009 9:31:48 AM
From: Earlie	2 Recommendations Read Replies (1) \| Respond to of 78412

Earlie from Earlie Here is part two of the Ventana/GSL commentary (part one was post #65780) Commercial Feasibility Greystar has published several 43-101 reports. It has also published Phase One of its feasibility study and expects to conclude this study later this year. The numbers are encouraging, particularly the stripping and oxide/sulfide ratios and the expected low cost of production. There is no doubt that the capital costs are going to be serious but with an expected 15 year mine life (not including any new discoveries), solid projected margins, and The World Bank at its elbow, GSL’s gold will not be left in the ground. To date, Ventana has not published a 43-101 “Resource Calculation”. Some analysts have taken huge liberties with acceptable reporting standards and published “conceptual” calculations that have little or no basis in reality (“conceptual ounces” …..indeed). This month, Ventana published comments from a Mineralogy/Metallurgy Study it recently commissioned. It did not sound terribly encouraging. The term “Challenging” was noted, and the involvement of copper was expected to increase the complexity of the gold extraction processes required. Oxides have not figured prominently in any published data to this point in time. Many investors have missed a key point. Greystar was an early participant in this area of Colombia, hence it was able to acquire relatively large blocks of mineral concessions. It has also been able to acquire several thousand hectares of surface ownership. This surface ownership provides plenty of room for required plant and facilities sites while the large mineral concessions provides elbow room for future exploration in what is becoming an “hot” gold exploration arena. Such is not necessarily the case for all follow-on gold explorers. This is mountainous country. Terrain and watersheds have obvious impact on where economically feasible mining can take place. As is the case in residential real estate, “location, location and location” are important considerations that investors should take into account. Investment Value For those who “trade” Ventana, a word of caution might be in order. It appears that Ventana has now published just about all of the results from its 116 hole drill program. Yes, a new drill program will no doubt commence in the near term, but there will be a significant “lull” in published results, due to the time required to actually locate the drill platforms, complete the drilling and obtain assay results (past news releases provide a reasonable approximation of these time frames). That “lull” will likely be significant and could dampen stock price momentum. Currently, Ventana’s market cap significantly exceeds that of Greystar. Unfortunately, the published data do not appear to provide longer term validation to these market valuations. The basic fact is that Ventana has just commenced early stage exploration (in very demanding topography to boot), while Greystar is approaching commercial production. Of course momentum is a powerful thing in any market and the Ventana team has done a superb job of ensuring that investors know and understand their story. Investors must also recognize that both companies will need to raise serious dough over the next year or so. Yes, both are reasonably “cashed up” at present, but both face significant (albeit for different reasons) money-raising tasks. Can this dichotomy last? Time will tell. In the mean time this observer sees merit in riding each/both, so long as one is agile and recognizes that timing entries and exits will be important. Perhaps the strategy is…..some Ventana for its near term momentum, Greystar for its 900 pound gorilla land holdings and approaching production cycle and a keen eye out for additional exciting “plays” in this territory as new gold explorers arrive and the area blossoms into a true “gold camp”. Best, Earlie