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Gold/Mining/Energy : Royal Oak-RYO -- Ignore unavailable to you. Want to Upgrade?

To: Al Cern who wrote (954)	4/26/1998 9:09:00 AM
From: Thomas P. Talbot	Read Replies (1) \| Respond to of 1706

If Kemess is anywhere near as predicted which, given all the studies and tests by engineers we have to believe is true, then there will be positive cash flow. Further, even if current operating revenues barely cover all cash and non-cash costs then, why not just forward sell to bring some future revenues into the current period to cover any short fall. I believe Peggy mentioned this in the conference call and the revenues could, according to her, be quite substantial. I believe RYO has no forward positions on the books (except some options) so they have plenty of room to maneuver in this venue.

To: Al Cern who wrote (954)	5/7/1998 3:13:00 AM
From: Michael Bidder	Read Replies (2) \| Respond to of 1706

Could you comment on the following? I assume that Kemess must have a state of the art grinding operation for this type of operation. However I understand that semi-autogenous grinding mills can consume metal in the form of crushing balls or the like. These parts are an expensive part of a milling operation if the rock is hard. Expensive to buy and to transport if the operation is remote. Werner Nennecker, President of Bankrupt Pegasus Gold, said during a conference call that the Mount Tod grinding operation was not able to meet design specifications and therefor was run at a higher speed to increase throughput. This had the adverse effect of increasing maintenance costs. I assume the consumption of metal balls and associated milling parts. Also electrical consumption was increased. Is it true that in a large marginal bulkable type operation if one phase of the operation doesn't meet design specifications then the end result, can be disastrous to the bottom line? Thanks, -Michael Bidder