Fourth and last installment about the mine tour:
Again, please let me say this is only for those who wish to read it. It has been suggested to me that I offer this to some magazines, and I just might do that. Thank you for the suggestion. This is not intended to promote the company nor to suggest that you purchase, hold or sell the stock. It is simply a posting of what I saw and interpreted for myself. Please feel free to corroborate any information herein with the company itself.
After we had talked a bit with the new mining crew and Jeremy and Stan had returned, Stan reached for the intercom to inform "up above" that we were starting to walk out and to send the trolley cars to meet us.
When we reached our meeting point intersection, Stan called and said we were now at the intersection. Again, this was comforting in just understanding how a mine works and how many safety features were set up and properly used.
Stan is a joy all in himself. To me he is a small bundle of weathered energy whose handsome face jumps into contageous smiles every time he begins to talk about the mine. With a serious face and deadly serious blue eyes peering out from under his lit-up hardhat, he told me, "Well, it's MY reputation too you know! I come from some big mines with some important strikes. I dont want my reputation to be known as wasting my time in some place that has nothing!" Stan made sure we all had pieces of quartz striped with iron filings, pieces of malachite, pieces of lode bearing granite (guessing - you can's see it). There were lots of jokes about the "visible gold". We saw none the day of our tour. When any is encountered it is pretty quickly taken out. Most gold in the ore needs to be "produced". Stan's eyes and my eyes are about the same it seems - neither one of us can see anything small if it gets to within 3 feet of us. In fact his eyes are so bad that the joke in the mine is "Hey, yeah we saw visible gold! Even STAN saw visible gold. And if STAN can see gold without his glasses, now we are talking GOLD!"
In fact I have a piece of this "visible gold" in my pocket (on our desk). I told Jim that my sweetieheart would forgive me this trip if I could come back with an exciting memento. The quartz rock of white crystal quartz and green malachite was sliced and in the middle of the slice (a piece about 2" x 4" x 1/8") are speckles (flakes, really) of gold which I would describe as red gold. The flakes are almost like tiny bits of leaf gold, rolled out and broken up by rolling through the quartz slablet. There is enough gold in the piece that about 1/4 of the entire space is occupied by the flakes. One side is different than the other side in the placement of the flakes of gold.
In this discussion about being given a piece of BCMD gold, I mentioned to Stan and Jim that it occurred to me that if there were visible gold here and there on various days, that I could imagine such excitement that 10 miners x 2 pockets each x 6 days per week, etc. etc. could amount to a fair amount lost to the mine and walking out in bluejeans pockets onto people's private desks. This petty thought has of course been covered by mines for eons. In a "big strike" miners are required to deposit their street clothes, shower, don miner's clothes and reverse that coming back. Even the shower water is collected for gold dust from off of the miner's bodies. In normal working mine conditions, the miners are watched by the superintendent and if anyone is suspected, they are "wanded" like in an airport.
Once back outside there was "business" to be done, Stan being busy with operations, dumping our suits, more pictures and maps to be seen, Jim and Stan talking, Jim on the phone several times to the Ruby Mine telling him not to wait to go ahead and pour, etc. Jim had smartly suggested that we buy our lunch to go (he bought it for us) in the last hamlet just before climbing the mountain. We were (now 5pm) famished and very grateful to have lunch waiting for us in the 4WD.
We then started our way back down the very long road (all 4WD terrain) back to the beginning of the property line where we turned off to the left and climbed the mountain all over again all on another extension of BCMD property. This is why, Jim emphasized, "we are the only game in town." BCMD has the largest land package ever assembled..." Now, I know Kennecot Copper is geographically huge but I dont know how many miles is their strike zone. BCMD has 10-11 (my memory at fault, not the fact) miles of strike zone. We drove and drove past the Upper Brush Creek Mine, the Carson Mine, the road to the Kate Hardy mine. Jim asked if we could stay another day. If so he would take us to all of these mines. The infrastructure in all of the mines, he said, was what puts them so far ahead of any new start up mine. He talked about the Sixteen to One mine being about mined out. Though there is still enough there to make it a good viable mine. There is some chance that BCMD could be approached by other local mines, who do not have the financial backing like BCMD now has, to take them over by purchase or lease.
I continued to be impressed by "little things", such as Jim's management of the 4WD road that we were on. He knew the road backwards and forwards (meaning he had been over it many many times) and he demonstrated to me yet another area of competence in his ability to negotiate 4WD material. We were up higher this time, encountering some snow alongside the roadway and even some snow in the road itself.
When we got to the Ruby Mine the workers had gone home. There are currently 3 that work full time including Vern, the production plant superintendent. Vern is just as personable as Stan and also exuded confidence and competence. He immediately showed Jim a 14 oz gold bar (Jeremy asked if it was "dor" - meaning, I gather, that it also has other minerals in it) and (if I observed the gestures correctly) Jim was required to sign a receipt for the bar. The bar was surprisingly heavy. It felt more like a 5 lb. bag of sugar that I was holding in my hand!
In walking around the production plant we noticed about 4 outbuildings housing various machinery and tractors. There was a large "holding pen" all shored up with timbers where trucks dump the ore to be worked on. Piles of ore are identified with numbers of the stope (area) that they come from. Piles of ore were covered with large blue plastic tarps to keep as much of the coming storm moisture out as possible. We saw a large pile of freshly milled lumber used for shoring up. The timbers were approximately 12" x 12" by 24 feet (guessing at the length, the dimension was told to me).
The ore is taken from the arrival pile and placed into a sorting mechanism (please, if there are any miners here in this thread, and if I get some of this wrong, forgive me). The sorting process sorts the size of rock. This sizing makes the grinding process more even. The ore is then put into a huge revolving machine that looks like a cement mixing machine on the back of a cement truck, only much much more substantial in the thickness of its metal and the size of its bolts. This revolving machine is also fed with steel balls the size of cannon balls. As it revolves, the cannon balls and the ore roll around for a good long while and finally it comes out as fine as face powder through a small chute. This powdered ore is then put on the shaking table, a very long table which vibrates. There is a water spray which sprays the powdered ore, helping separation. The gold is the heaviest of the elements. The table is slightly slanted from side to side, the right side being higher than the left side. This table is about 30-50 feet long (I clearly am not too good at guessing lengths!). As the table vibrates the gold (which is still not "pure" gold) climbs upward while the lighter weight rock powder falls downward, is washed off and caught in a trough to be discarded. The gold is collected and taken to the smelter building where the "oven" melts it down into a bar.
The shaker table was described to me as being "warped" and had been warped for a long time, being on their mainenance list to fix shortly. But my eye could not detect the warp, it was so finite.
BCMD's video tape will be finished its editing process soon (perhaps in two weeks)and will be available to us for the cost of copying and the tape itself (just so we dont put them under with hundreds of requests for ourselves and all our friends!), lol. The tape will show the production plant at the Ruby Mine, will show Vern explaining all, doing a pour, and some of the things that we missed by virtue of a derailed trolley cart. Stan is also on the tape.
Again, I was impressed by what I felt was a positive interaction between a CEO and its company staff. It seemed to me that Vern had full delegation to run the production plant, that he was respected by his CEO, that he in turn was very glad to see Jim and had an element of respect and trust in his way of communicating with Jim. The mood at the production plant was, as I read it, that they were gearing up for big production....that they were on their way to big production; that possibly by next spring they would be processing ore at the rate of double the current, or 120 tons per day and would go from there to 600 tons a day (on their way to 200,000 tons annually divided by 300 days, or 6 days per week - you know, 200k oz of gold annual estimate presuming an average of 1 oz/ton). This is conjecture on my part, putting bits of conversation together and trying to understand the whole larger picture.
We talked about snow days and how much that might impede production. The heavier snow falls are traditionally at higher elevations and I was told that the amount of snowfall that the mines normally experience will not be a deterrent. Some days might be impossible and some days might get slowed down, but that significant slowing was not expected. As I stated earlier in the first installment, the whole area is not expected to receive more than normal precipitation this year as most of the el nino activity will be going to the north and to the south of the Sacramento area.
On the way back to the office, Jim talked about the process of looking for a diamond JV and felt they had some good prospects on the line. The diamond fields are nearby but not adjacent to the gold properties. The diamond fields are an exciting addition to the whole package and there seem to be enough indicators (such as persons in the past finding actual diamonds in the area) and the diamond rocks being "shaggy" not worn down by long coursing through a river bed, that makes Jim think (and Rhotert think) that they are right on top of the source - meaning all they have to do is go down, instead of out and then down.
We talked about the POG and how, if it bottomed further, it would impact BCMD. Jim talks in terms of the cost of production being "zero", at the moment because the capitalization is in place by virtue of the JV's infusion and all of that money is allocated to production costs and plant expansion, plus the profit to the company belongs to the company and not to the JV until all monies have been provided (the $9 mill) so there does not seem to be much concern over the POG by BCMD. In fact it is the reverse. If other mines go under, they will be in an even better position. Even local mines, under such pressure and without capitalization, could come to BCMD which means that BCMD might be willing and able to take some more mines under their wing and under their ownership (or under lease). But, who knows? That is all conjecture. It just sounded feasible to me.
Some of my notes from the early morning office part of the day: The mine is 600 feet below track level. The Pillars contain 8-9k tons of...? "not proven but they had this before". Dewatering holding ponds (environmental issues) already in place. 40 people on the payroll. The mesothermal veins of ore reach down 10k feet. Ogden Strandberg, mining engineer figured out the mining production costs of $150/recoverable oz. He is known to be very experienced and accurate.
Art Smith is the company geologist (he explained to us how galena and gold are "sweated out" at the same time (geologically). Water forms veins, temperature changes, water + sulphur important in the finding of gold, led sulphite. (These are "notes", as I said.) There are 45 days of millwork left to be donen on the "liners" (I forgot what those are, sorry.) They are in the process of winterization of the mill at the Ruby Mine (covering the open parts of the buildings). They think Pillar 8 is a "biggie" (jewelry grade stuff). They believe they have 30-50 years of mining at this high level.
Additional info: As I was driving up through California I heard more than once, ads promoting "hard assets"..."buy gold now, gold has never been a lower price...call Merritt Financial..." The 150th gold rush anniversary starts Jan. 28 (?) and is going to be a big thing in Grass Valley and Nevada City. Grass Valley is clerly an old historic mining town and has been preserved as a fun tourist place to visit. There will be (I am thinking) endless celebrations, events, news coverage, magazine articles, and I would think, coverage of BCMD.
PLEASE TAKE NOTE: After this posting I would like to say that I feel no need to continue to post on the SI thread or in chat rooms. I do not feel the need to worry about my stock or watch it on a daily basis. I feel comfortable investing for the long haul. I believe that when Jim and Lionel go on the road to promote the company, that there will be a strong base of investors coming into the commpany, that the people holding Private Placement shares may very well not wish to unload all of those shares but will keep some (and perhaps sell some) that the production capability and expandability of this company is solid and the price will stabilize and climb. With that thinking I do not feel the need to continually post or watch the posts and frightened meanderings of other minds. Those experiences are normal to people, being worried and frightened, but I have done what I feel I needed to do to be comfortable and I encourage others to do the same. I wish us all luck and continued pride in holding stock in what I feel is an excellent company. I couldn't be more excited. |
