G.
I've got to admit that some of your messages have a curiously aggressive tone and I can suggest that if you'd like to spend a bit of time getting a closer look at what it takes to run an exploration company or to raise money, I'll be happy to support the education. Still, you do express sentiments which I know are reflected elsewhere, so I never take it personally.
RE: "If the financing isn't fully subscribed soon your team is not doing thier job properly. For a project this incredible to raise only 10mm US should not be this hard and long. How much longer till we see this deal close."
I'm not sure what your market experience is but this one is very, very, very ugly. There are many funds hanging out with the losses they have had from investments in everything from juniors to majors. These are billion-dollar assets-types. They have been burned in the recent past and, in many, many cases, their own boards and investors are saying 'NO' to any discussions about exploration investments. It's a state of mind in time. We have one of a very, very few high profile exploration plays... which is good. We have continued to produce good results. We are getting some positive responses but most are hesitant. No one is saying the winter downtime is a problem. No one is saying we don't have good to fabulous results. No one is questioning our credibility. Everyone is quoting metal prices. Everyone is knocking the entire sector. There was a gold-related issue -- regarding bullion receipts -- which was to be listed yesterday which had a NEGATIVE value. As one senior banker said to me today, "There has not been a single good news day since the issue was started. All you need is one day when metal prices are convincingly improving."
Several people in this business have said to me this is the worst market they have seen in 25 to 30 years.
Did you buy or, better still, sell a house in 1981 when interest rates were 15 to 22%?
If this were the 1996 market, I'd agree with your critique. It shouldn't be this hard or take this long. I could say the same about our cancelled Convertible Debenture deal last fall. We delivered what we said we would, and all holders of those CD units would have been forced to convert to equity and we would have had our funding and, by now, blown away the debt. But the falling LME prices frightened investors and the deal was not done.
We are doing our very best to get this deal done. With a small bit of luck, it has a good chance of having reasonable success. I hope this happens within the next two weeks.
Now, with that dirge behind me, there is another side of the coin. All markets change. This one will come back... Likely of greater import, we have two excellent deposits started, and promise of more to come.
Re: "The numbers Walters is throwing around are they in line with the project western copper has going in Mexico?"
Based on only the preliminary results I've seen, there are both dsimilarities and differences between our Lejano find and Western Copper's Penasquito silver project in the Conception del Oro district in northeastern Zacatecas State, Mexico. Because I've not seen a drill plan of their work, I'm only visualizing what I think they have. Generally, their intercepts are deeper -- apparently theirs will be an underground mine -- while ours are close to surface, likely open-pitable (relative to location -- this is not a forecast about economics or metallurgy or anything else). As to intercepts, they have some longer intercepts (than ours, so far) of lower grade (than ours, so far). Below is their release about earlier drilling. Look at one of their good holes:
"...Hole WC-3, collared 165 metres east of hole PN-26, was
drilled due west at -70 degrees and intersected 99.2 metres, beginning at 153.1 metres, which average 189 g/t silver, 2.48 per cent zinc and 2.15 per cent lead. This intercept contains a high-grade zone of 17.1 metres, beginning at 178.5 metres, which averages 406 g/t silver, .58 g/t gold, 5.20 per cent zinc and 4.76 per cent lead."
We haven't yet drilled that deep but some comparisons can be made with our:
Hole 11: 12 meters of 642 g/t Ag with 1.78 g/t Au and 6.1% Pb, including 4 meters of 1,155 g/t Ag, 3.77 g/t Au and 8.1% Pb; and,
Hole 8: 22 meters of 290 g/t Ag with 1.00 g/t Au and 4.4% Pb, including 6 meters of 476 g/t Ag, 2.70 g/t Au and 9.8% Pb.
BELOW IS THEIR RELEASE
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Penasquito drilling results
Western Copper Holdings Limited WTC
Shares issued 13,970,000 May 14 close $7.75
Fri 15 May 98 News Release
Mr. Mike Halvorson reports Western Copper has received initial results from a drilling program at the Penasquito silver project in the Concepcion del Oro district in northeastern Zacatecas State, Mexico. Western Copper acquired 100 per cent of Penasquito from Kennecott Exploration in March 1998.
A 3,000 metre diamond drilling program began in April 1998 to test
partially defined mineralized zonesand geophysical anomalies previously identified by Kennecott. Work started in the Chile Colorado zone where two holes (WC-1, WC-3) have intersected significant zones of silver mineralization. A third hole, WC-2, tested another outlying geochemical anomaly, but did not contain significant mineralization.
Assay values for the two Western Copper holes and the previous Kennecott holes at Chile Colorado are listed below. Hole WC-1, drilled 100 metres west of hole PN-28, intersected 219.7 metres of mineralization, beginning at 198.8 metres, which average 53 g/t silver, .79 per cent zinc and .28 per cent lead. Narrow intervals of high-grade mineralization occur within this thick interval. Hole WC-3, collared 165 metres east of hole PN-26, was drilled due west at -70 degrees and intersected 99.2 metres, beginning at 153.1 metres, which average 189 g/t silver, 2.48 per cent zinc and 2.15 per cent lead. This intercept contains a high-grade zone of 17.1 metres,
beginning at 178.5 metres, which averages 406 g/t silver, .58 g/t gold, 5.20 per cent zinc and 4.76 per cent lead. Hole WC-3, the first hole at Chile Colorado drilled in an east-west direction, confirms that north to northeasterly trending structures are an important ore control in addition to east-west structures previously identified. The area of maximum fracture density appears to be related to a Providencia style Pb-Zn-Ag chimney emplaced in a sandstone (Caracol Formation) rather than a limestone host rock. Sandy and calcareous zones within the sandstone, as well as poorly defined breccia zones, exert a strong control on location of high grade mineralization. More drilling will be required to define the lateral and vertical extent of mineralization at Chile Colorado. However, the mineralized zone is at least 400 metres long, 100 metres wide, 150-200 metres thick and has been closed off only on the east side. Western Copper entered into an agreement with Kennecott in March 1998
covering ten properties in Mexico, including Penasquito. Kennecott has a one time option to back-in for 51 per cent of Penasquito when an inferred resource has been identified on the property. In the event Kennecott exercises the option, it must first pay Western 150 per cent of 51 per cent of expenditures associated with Penasquito and then, to earn this interest, has five years in which to either make all subsequent expenditures required to take the property to a decision to mine or make expenditures totalling US$25,000,000 in respect of the property.
From To Int. Au Ag Pb Zn
(m) (m) (m) g/t g/t % %
---- --- --- --- --- -- --
Hole WC-01
198.8 418.5 219.7 0.37 53 0.28 0.79
286.0 349.0 63.0 0.57 87 0.29 0.99
312.4 325.0 12.6 0.38 187 0.22 1.21
389.0 403.5 14.5 0.48 85 0.79 1.76
Hole WC-03
153.1 252.3 99.2 0.38 189 2.15 2.48
168.9 220.1 51.2 0.56 312 3.57 4.11
178.5 195.6 17.1 0.58 406 4.76 5.20
Hole PN-19
170.0 310.0 140.0 0.43 130 1.80 2.50
208.0 218.0 10.0 0.68 586 10.1 7.90
Hole PN-26
162.0 277.0 115.0 0.34 119 1.52 2.08
Hole PN-27
171.0 194.0 23.0 0.58 256 2.89 3.02
204.0 211.0 7.0 0.22 357 5.24 4.89
267.0 269.0 2.0 13.20 170 0.13 0.22
Hole PN-28
226.0 376.0 150.0 1.05 72 0.18 1.45
318.0 354.0 36.0 2.16 90 0.17 2.30
335.0 354.0 19.0 3.25 104 0.15 2.95
Hole PN-41
254.0 268.0 14.0 0.47 128 1.90 1.80
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Western Copper has shown a larger mineralized area BY DRILLING than we have, so far shown BY DRILLING. In other words, they are further ahead in their development than we are, although not by a long way.
Of course, this is only a reference to Lejano (pronounced: LE-HON'-OH), not taking Bacon or Ciclon West or any of the other properties in the area into account.
This in mind, you might also consider looking at the Wolverine deposit (I understand it is being sold) held by Atna Resources and Westmin. This deposit in Yukon was seen as very exciting until they discovered a major metallurgical problem -- selenium -- which alters the whole scenerio there. However, it is a major deposit which got the market excited. Their massive sulfide deposit shows intersections generally of between 0.5 meters and 7.5 meters. To quote from their latest release:
"The 6.2 million tonne Wolverine deposit grading 12.7 per cent zinc, 1.3 per cent copper, 1.5 per cent lead, 371 g/t silver and 1.76 g/t gold, is one of the richest massive sulphide deposits in the world. Recent studies by Westmin indicated that the presence of amounts of selenium in the concentrates would be a major concern with respect to the marketability of the concentrates to smelters. Atna has started scoping (pre-feasibility)studies, metallurgical (including hydrometallurgy)and marketing studies to advance the development of the Wolverine deposit."
Again, we have not proved tonnage yet but the numbers are interesting: Their zinc and copper numbers are higher than what we have so far, but our silver is much higher, and both our gold and lead are also higher.
I hope this helps.
Greg W. Taylor
VP Corporate Development
Yamana Resources Inc. |
