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Gold/Mining/Energy : A New Age In Gold Refining -- Ignore unavailable to you. Want to Upgrade?

To: go4it who wrote (335)	12/20/1997 9:00:00 PM
From: Michael J. Wendell	Read Replies (1) \| Respond to of 672

Charles, You are so right. Reserves are important, but not as important as they used to be with the new accounting procedures discounting reserves to being worthless after ten years worth. Additionally, mines have gone through their entire lives with geological reserves. An example is one in Honduras that I am familiar with. It has been producing from one formation for fifty years averaging .19 opt recovered gold from .21 opt heads. The assays for heads are not proven, the recoveries are. The geological reserves are there and no one expects the mine to run out of ore in the next 50 years. The mine is a very profitable mine. They determine ore by a method that works for them. The DDs could be well advised to use geological reserves as well. Use the recovery process to determine reserves if necessary. Hundreds of mines used to do that. The very old engineering books say that the best reserves are those based on measuring ore quality by the process to be used. What is wrong with that. It is more costly to doreserves measurements by process and naturally these take more time to gather great statistical importance. But in fact, by this method, a commercial process is in place and the proof of the reserve quality. Amax Gold at Ft. Knox in Alaska would have been far better off with a different method of measuring reserves also. The modern method got them in a lot of trouble. I personally will stand and fight for reserves calculated by process measurement over any other. That of course assumes the mathmatical models remain constant for both methods. The years ahead are going to be better for the DDs. They are the real wealth deopsits. Happy Holidays. mike