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 : International Precious Metals (IPMCF) -- Ignore unavailable to you. Want to Upgrade?

To: BobS who wrote (24353)	11/4/1997 5:21:00 PM
From: Claude Cormier	Read Replies (2) \| Respond to of 35569

<< Does geographical reserves mean the gold has been proven without a doubt to be in >> << geographical reserves >> ?? DO you mean geological resource ? BTW, in my last post, I met to say "geological resource" not "geological reserve". A geological resource is an unproven resource that has potential for development of reserves. Some company will talk about geological resources as the total of possible, probable and proven reserves. Others will use the term to define ore that has been explored enough to conclude that metals are present but not enough to conclude that a reserve exist. The later definition is the one I use. IPM has a geological resource. I believe that if/when the bulk samples confirm a consistent recovery, we will start to think of it as a reserve in the inferred/possible category. More bulk samples and drilling will eventually bring it to the proven and probable category. << Does proven reserves mean gold is in the ground (geographical reserve) AND it is proven to be mineable for a profit? >> A reserve can be classified as proven but still not be mineable if the ore is refractory, complex. Cambior has a 14 millions ounces deposit in Mexico. The ore is refractory. They have been trying for 3 years to recover at a profit...so far to no avail. The market cap of CBJ does not reflect the potential of this deposit..zero value..nada.. << Is a reasonable Market Cap formula the following: Cap = $D x Proven Oz of Gold ; where D is 20 in a depressed gold market and no speculation is built into the market cap. >> I would use a higher figure than $20 for proven reserves. But again all depends. D varies quite a bit depending on several factors, including the size of the company (Barrick had its reserves valued at US$220 last year), the cost per ounces, the fact the deposit is in production or not. If not in production, how easy will it be to bring it to production..etc.. As an example, Misty Mountain gold has a proven and mineable deposit cyrrently valued at C$9 per ounce. The market seems to think that it will never be brought to production. The average $ value of proven ounce in the ground is now probably near US$75-$85 for junior producers, $125-$175 for seniors. Much lower for non-producers (Metallica is at US$16).. In good times, I used $US65 for non-producers, US$100 for juniors. An irrational exuberant market would have a value of $400-$500 and more...like it happened to some stocks in 1980.