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Gold/Mining/Energy : Fairmile Gold -- Ignore unavailable to you. Want to Upgrade?

To: mark warburton who wrote (3630)	7/29/1998 2:56:00 PM
From: Steve Stakiw	Read Replies (3) \| Respond to of 4057

Mark, Your comparing Fairmile's Buffalo Valley project with the Ontex/Metalore Brookbank project is not representative comparison. Buffalo Valley presently has a resource of 20.66 million tons grading 0.029 oz/ton Au for a total of 600,100 oz. There is also good potential to increase this resource with further drilling on the targets near the A/B/O Complex (the site of the existing open pit). Recent computer modeling of drill holes has indicated a new target along strike but deeper than the present 600,000 oz resource. You comment that ".with grades around .029, so what! Barely feasible with POG at higher prices." In actuality, this compares very favourably with operations in production in very close proximity to Buffalo Valley. As mentioned in my previous posting (#3624), the Redline deposit on the Converse property of Romarco/Uranerz (Cameco Gold)/Newmont presently has a resource of 49.9 million tons grading 0.021 oz/ton Au for a total of 1,038,000 oz and I understand that Newmont is scheduled to takeover operatorship of the project soon. These deposits can turn into very prolific producers. Some comparative projects in the Battle Mountain - Eureka Trend of Nevada include: Rayrock Resources/Homestake - Marigold Mine - approx. 15,000,000 tons at 0.033 oz/t Au Battle Mountain Gold - Fortitude Complex - approx. 50,000,000 tons at 0.035 oz/ton Au Newmont (Santa Fe) - Trenton Canyon - approx. 20,000,000 tons of 0.029 oz/ton Au Newmont (Santa Fe) - Lone Tree - approx. 50,000,000 tons of 0.075 oz/ton Au Echo Bay Mines - Cove/McCoy Mine - approx. 29,000,000 tons of 0.032 oz/ton Au Placer Dome/Kennecott - Pipeline Complex - approx. 100,000,000 tons of 0.075 oz/ton Au The Brookbank project in the Geraldton/Beardmore greenstone belt of northwestern Ontario has a resource of approx. 1.4 million tons grading 0.233 oz/ton Au. This type of gold deposit is very different than those mentioned above situated in the Battle Mountain Trend of Nevada. The Brookbank project is an Archean greenstone type gold deposit with the mineralization associated with pyrite mineralization at the fault related contact of metasedimentary and metavolcanic units. The deposit is relatively narrow but has good extension potential along strike and to depth. If the project undergoes development an underground operation would be necessary. All the Nevada projects mentioned above are near surface open pittable projects. There are a number of parameters which must be taken into consideration when comparing the economic potential of deposits. Open pit/heap leach (Nevada) versus underground mining, milling and processing are two important considerations in the logistics of an operation. Also: type of ore (oxide vs. sulphide), economies of scale, production life, existing infrastructure, permitting capabilities all weigh in the valuation of a deposit. Regards, Steve Stakiw