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Gold/Mining/Energy : Golden Eagle Int. (MYNG) -- Ignore unavailable to you. Want to Upgrade?

To: Mike Gold who wrote (7194)	7/2/1998 12:59:00 PM
From: the Chief	Respond to of 34075

Hi Mike. Always glad to hear from you.................... You said: The new report claims 6 million ounces as PROVEN resources. I think to be considered proven, you must be able to mine it economically. Definition;(extraction from GE website) "A concentration of naturally occurring material in such form and amount that economic extraction of a commodity from the concentration is currently or potentially feasible. Location, grade, quality, and quantity are known or estimated from specific geologic evidence. To reflect varying degrees of geologic certainty, resources can be subdivided into Measured, Indicated and Inferred." <<So with this definition, the proclamation of 6.4mm ozs proven does not mean that you will get 6.4mm ozs out of the ground. It just means that the measured or proven resource is 6.4mm ozs. The actual percentage recovery at a specific cut-off grade may result in only 5 million ounces being recovered, or even much less. You said:...... it is true that in the previous Guido report, it made no mention of recovery % other than calling previous recovery of 50% or less diasterous etc. Can you remember what g/t they were recovering ? How does this now relate to the "micron" size leaf gold that they now insist could become recoverable? QUOTE - Guido Paravicini, M.A., Eng., an independent mining engineer and geophysicist hired by the Company to perform geological evaluations of the Cangalli property, has projected that, with a conservative calculation of 2 grams per ton (g/t) of recoverable gold, daily gross production from Cuev a Playa could reach 500 to 650 troy ounces of gold (approximately US$150,000 to US$200,000 per day at US$300 per ounce). ISP and Eagle Mining of Bolivia, Ltd. have conservatively estimated that combined operating costs would not exceed 40% of gross sales, resulting in daily net revenues of approximately US$90,000 to US$120,000, or monthly net revenues of US$2.25 million to US$3 million. (The Company cannot guarantee that Mr. Paravicini's projections are accurate, nor that they will necessarily re sult from the ISP contract.)ENQUOTE QUOTE-Following two site visits to the Company's Cangalli operation, Mr. Zambrana reported that in excess of 50% of the fine gold being processed was being lost due to present recovery methods. Mr. Zambrana is currently developing a new flow sheet designed to increase recovery levels; Golden Eagle expects the modifications to be completed by the end of January 1998. ENQUOTE <<So in short they expect to take a tonne of dirt that the recovery has been about 1 g/t and then increase that recovery by 50% with new methods to 2 g/t. I have no problem with these claims, assuming the data pesented is valid. To then use the data of these "micron" size particles that have been missed to; upgrade the g/t of a given tonne and then not include what percentage of those "microns" you can legitemately recover is all very confusing to me! To show you that "resource" is in the eye of the beholder. Arizona says a company has sand. The company says they have an ingenious way of extracting "micronic" sized gold. The micronic sized gold becomes " in the eye of the company" a resource!!!!! So in the end, if a company is stubborn enough it can claim "economical" resource from sand. Can they extract it? they say they can! Who's right? Nobody is, until somebody is proven wrong! the Chief