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Gold/Mining/Energy : Global Platinum & Gold (GPGI) -- Ignore unavailable to you. Want to Upgrade?

To: Ed Fishbaine who wrote (7065)	8/26/1998 12:39:00 PM
From: Mike McKay	Read Replies (10) \| Respond to of 14226

To All: This is my third contribution. My first was 6539 on July 7, 1998. I have just returned from a visit at our production facility at Hassayampa. I met with Mr. R. Jensen, Mr. S. Lamont, Mr. R. Twiford, Mr. W. Palmer, Mr. P. Skinner and some of the staff. Date of visit - August 24, 1998. The first thing I observed upon arrival was Wayne Palmer inspecting this week's resin shipment. The operator assisting was very proud. The resin was very dark. NOTE: As the resin takes on PGMs it gets darker in color. The darker the better. This would be the best shipment ever. The day consisted of six hours spent in two meetings and a walk and talk through the plant. I will not go into detail as to how much of what chemicals, in what form are added and when, that I leave to GPGI. The protocol in my previous life (6539) was not to disclose information that might be proprietary to any third party - I expect that still remains and will honor it. The outline of their (our) process is on the web page and on this thread. Observations The plant now has two specific units. The main production facility and one dedicated to R&D. The attitude of the production personnel has changed dramatically since my visit last fall. They are focused on production. One shipment of resin each week - no excuses. Everyone is aware that R&D is not to interfere with day-to-day production. Dedicating equipment to R&D was a step in the right direction. R&D is presently involved in testing some additional resins which may provide for faster loading, load a larger amount of PGMs and/or be metal specific. The potential advantages are significant. A faster resin would mean that we could increase the flow rate thereby producing more impregnated resin sooner. A metal specific resin has the potential of reducing Sabin's refining time and cost. The potential benefits are significant and warrant a full R&D investigation, but not at the expense of production. All the players understand this fact. R&D is also finalizing a system that will cause the copper removed from the liquid (after passing through the resin column) to form a copper compound that is readily saleable. Getting paid for a by-product makes eminent sense. Since my last visit Mr. Lamont established a method to improve the furnace efficiency, effectively reducing the tap-to-tap time by 50-60%. The leaching phase is now more selective (leaves more of the garbage in solution). Thus, the precipitate has a higher concentration of PGMs. The following is a summary of the items raised/discussed at our meeting: Equipment During the meetings there were at times differing opinions as to what and how much additional equipment was required. My thinking is that even if the equipment may not be required to meet production criteria in the next few weeks so what. It will be required within the next 6-8 weeks. I'm just trying to justify my opinion. Present Situation There is a very large supply of ore that is ready for leaching. The ballmill bearing has not been repaired as of yet. It should be repaired within the next 3-4 weeks. The very large pile of leachable ore plus the stock pile of dore metal and the returns from Noble will keep us busy for the next few months. NOTE: The cost of production has already been paid for so converting the dore metal to PGMs as a priority is the right decision. Resin Columns - Present Situation We presently have one set of four resin columns in use. The second set is at the plant and is being prepared. At this point in time the two sets will have to share a resin filter. This will be an inconvenience but possible. Given the continued improvement in the efficiency of the resin columns and the potential for R&D to find resins that are significantly faster loading than what we presently have, we did not have unanimous agreement as to the number of additional sets of columns that would be required right away. Action Taken An additional three sets of resin columns along with pumps, etc. were ordered. Four additional resin filters were ordered as well. They will be 50% larger than our current filter. The current filter was fine initially but we are now making larger shipments. During the next meeting to discuss production the old resin filter will be considered for replacement. Tanks - Present Situation In that we are working off a large inventory of already precipitated material, or dore metal, etc. we have sufficient precipitation tanks for now. Once the additional sets of resin columns are up and running the liquid in the large tank that feeds the columns will need to be refilled five times more frequently: it seems appropriate to have a very large preparation tank to be used to refill the tank that feeds the resin columns. Action Taken An additional large tank plus three additional large precipitation tanks were ordered along with the necessary pumps, plumbing, filters, etc. Furnaces - Present Situation The three furnaces presently in place using the lower operating temperature and working five full days per week can melt the equivalent of over 60-80 tons of head ore per day. Furnaces need repairs from time-to-time. This, of course, reduces production. Some of the repairs can be done on weekends but not all. SOLUTION: Purchase an additional furnace. When a furnace is shut down for repairs lift it out of the way and replace it with the spare one. Action Taken With the current furnaces and the modified melting practice, an additional furnace is not required at this time. This will be reviewed at the next meeting. COMMENT: In the near future we will need to add additional furnaces and adopt the higher temperature/faster tap-to-tap time practice. In view of the above, engineering work has commenced to put in place additional "Environmental Equipment" scrubbers, etc. to handle our future needs. Our current equipment meets our immediate short-term needs but won't handle full blown production. Personnel Presently personnel are hired only as absolutely required and paid a wage which is thought to be appropriate. Our wage cost per 1,000 oz of precious metals produced is a small fraction of what Stillwaters is. Current manning levels are insufficient to support this expansion and leave sufficient time for training. The quality of the work our employees do is important to the success of the process. Decision The base rate for employees would be increased by 25-30% and four additional employees would be hired as soon as possible. They will receive 2-3 weeks of training on the day shift and then put into their selected jobs. The majority of equipment mentioned above was ordered during breaks in the major meeting. The additional equipment should be delivered to the mill over the next few weeks and placed into production shortly after. The attitude in the plant has moved to a "let's get it done today." This is an improvement. With the higher wages being offered we can be more selective. We must realize that our future shift supervisors will probably be drawn from our current (and additional four) employees. On my way out of Phoenix I stopped into the company that supplies our pumps, tanks, etc. I talked with the sales representative who handles our account. I left after about 15 minutes, he has a high opinion of us. The orders we had discussed were being processed and payment was in place. He offered his business card, I will be keeping in touch with him as a follow up. Summary The additional equipment should allow each phase of the process to handle the equivalent of 50-60 tons of head ore per day. I personally think the purchase of six vice three additional sets of resin columns would have been better. But, given the improvement in the resin production phase of the operation and the reasonably short delivery time (2-3 weeks) I yielded on this point. I will be returning to the plant in another 4-6 weeks to again review their shopping list and how the equipment will meet our production requirements. My purpose for this visit was to ensure that funds previously provided by "my fellow investors" would render an appropriate return in a reasonable period of time. The next visit will start with a confirmation of what has been accomplished and production planning for the next three and six month periods. Once we have cheques from Sabin for the first three months of resin production in hand, it will be possible for management to establish a long-term production and development plan. All of the above is just my personal opinion. I would like to thank Mr. Jensen for allowing my visit and the production staff and management for their patience and assistance. I ask their continued patience as I will be in touch with them frequently so that next time I should be up-to-date when I arrive and the time I spend can be focused on the future. From a personal perspective, GPGI is fundamentally different from all the other desert dirts - we are in production. It will break my heart if the short sellers who made all that money shorting IPM, NAXOF, MAXIM have to pay back some of it because they shorted one stock, they shouldn't have----GPGI. GPGI is also the first US firm to produce PGMs and have them refined in the USA. Stillwater still has to ship their's offshore for final processing. We can take pride in our accomplishment. Thanks to all. I will write again in 4-6 weeks. Mike McKay