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Gold/Mining/Energy : SOUTHERNERA (t.SUF) -- Ignore unavailable to you. Want to Upgrade?

To: Peter Bourgeois who wrote (2160)	11/5/1998 7:16:00 PM
From: VAUGHN	Read Replies (3) \| Respond to of 7235

Hello Peter Over lunch today, I had a very interesting conversation with KF, in which he patiently answered a number of questions. Firstly, as was referenced on an earlier post, I had suggested to HB some time ago and again through an e-mail a month or so back, that SUF might be interested in looking into the potential of Ground Penetrating Radar, to find hidden kimberlites. (Sonic drilling by the way was an idea that SUF got from ABZ not me). I gather from NS that HB does not think much of the idea. While KF clearly stated that he is a Mining Engineer and not an Exploration Geologist, I did get the impression that he found the technology as I described it, intriguing. I pointed out that I had seen a very distinct cross-sectional image of the Arkansas lamprolite on the internet, and we discussed at some length how this technology might aid in covering a lot of ground economically and assisting in locating a concealed pipe(s). We also discussed the possibility of using oil exploration technology, specifically seismic to delineate kimberlite diatremes against the granite and metasediment background. Kim was familiar with this technology and felt that it might offer some potential as well, but of course exploration at Back Lake is not his responsibility so I can only hope that he might persuade HB and/or CJ to look into it. He did indicate that DBs were using a form of seismic on the Marsfontein (sp?) farm apparently to delineate pipe perameters from a central drill hole, but I believe he said it was also being used in exploration. I gather as noted in the previous article, there is some sharing of technology and cross-fertilization going on down there. So who knows, perhaps SUF will look into it and consider it this coming spring in the NWT. Regarding Marsfontein and other farms, Kim was pretty matter of fact about his belief that there were quite a number of known dykes and pipe targets on this farm and others, that remained to be drilled, in addition to what he repeatedly referred to as prospective and considerable “gravels”. Our previous discussion about this possibility would appear to have been confirmed, as he seemed to think that there was a considerable potential resource there. This discussion was all prefaced by one involving the market's discounting of SUF at present presumably based on its appraisal that once the M-1 is exhausted in 2.5 years, current earnings may not be maintainable. Kim pointed out that he would have to mine the Leopard fissure at roughly four times the M-1 rate to achieve the same earnings levels. However, I gained the sense that he was very very confident that the brain trust was going to find additional open pitable sources (pipes) to take its place. I asked if it would not be feasible to mine the M-1 below the target open pit depth of 250 meters? I indicated that I appreciated that the pipe diameter and strip ratio of waste rock were probably the defining economic factors and in that regard I asked him two questions. Firstly, to avoid the need to mine costly waste rock, was it not possible to mine such a small pipe vertically without going underground? To use an analogy that most of us can visualize, like one of those overhead claw cranes we all used as a kid at the carnival to pick up some trinket from a pile. Kim indicated that they were considering doing precisely just that. Apparently SUF and DBs are considering such a crane/shovel that will move up and down the sides of the pipe. I gather the host granite is extremely stable and there are few concerns about rock integrity and bursts. While achievable production from such a system would presumably be the determining factor, it sounds as if M-1 (the richest pipe in the world) earnings may be maintainable at least in part for some time to come. My other question regarding economic exploitation of all of the small pipes SUF was running into, (Sugarbird Pass, Koidu, etc.) had to do again with the economic implications of strip ratios on deposits as small as these. I indicated that it was my presumption that even if they did attempt to open pit these pipes, wouldn't they run into prohibitive ratios very quickly? Kim indicated that they would. I asked if it might be possible in those instances where these small pipes are close to the Leopard and Sugarbird fissures, if they might be more economically mined from below? Simply put, drive an adit from the underground dyke workings, to the base of the pipe say at the 600 meter level, and blast the ore down and muck it from below? Kim indicated that SUF was also considering doing precisely that on both the aforementioned pipes especially the Koidu, the ore grade (and economics) of which initially appears to me to be quite low by Klipspringer standards. By doing this, SUF could effectively eliminate the majority of the cost of waste removal in mining these small pipes and significant lower the line by which they judge economic ore value ratios. So there you have it: 1. It is possible that seismic and possibly radar technology might help and be considered in Munn, Margaret and Yamba exploration this spring. 2. Seismic exploration is used by DBs at Marsfontein. 3. There are definitely very prospective and extensive fluvial/paleo gravels at Klipspringer that have yet to be evaluated. 4. There are definitely very prospective and a considerable number of known pipe targets on a number of Klipspringer farms that suggest the M-1 might be the sibling of an extended family. 5. The M-1's life may very well be extended considerably beyond 2001. 6. Alternative and underground mining techniques may very well make many of Klipspringer's small pipes as economic as much larger and higher grade kimberlites. To close, I would like to add that I have up until today, I have never had the pleasure of speaking with Kim Freeman, but I was very very impressed. He was knowledgeable, patient, forthright, receptive, open minded and a genuine pleasure to talk with. Should any of you ever have the opportunity at some show or conference I would strongly recommend it. I do not know how Chris manages to attract so many genuine and unaffected people around him, but KF is a considerable asset to SUF. You could not ask for a better ambassador for the company. SUF is just a class act. On that data that BokurtD posted. That is the text of SUF's 3rd Quarter Report and it is on the web site but under reports I believe. You have to get at it in a round about way as I recall. If you can't find it, I will try to get it for you tomorrow. Have a good evening. Regards from the Great White (wet) North