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Gold/Mining/Energy : Royal Oak-RYO -- Ignore unavailable to you. Want to Upgrade?

To: Thomas P. Talbot who wrote (1490)	11/23/1998 5:23:00 PM
From: Elizabeth Andrews	Respond to of 1706

High-grading is what every start up mine does. They mine the highest value ore possible to the mill for as long as possible to pay off the debt as fast as possible. What has been published with respect to the reserves is an average of life of mine. They haven't published the mine plan but they have a very good idea of what the head grades will be for the next ten years or so. The upside, if it exists, is that the mined head grades may be better than the drill indicated grade and the recoveries in the mill may be higher than forecast from the preliminary metallurgical results.

To: Thomas P. Talbot who wrote (1490)	11/23/1998 6:36:00 PM
From: Al Cern	Read Replies (1) \| Respond to of 1706

Tom, I can't come up with anything that makes sense from a financial perspective. A long time ago, or so it seems, I said that $400 gold wasn't enough for this co., and when I do some very simple arithmetic, with what are presented as the company's actual production statistics, I don't come up with a different answer now. They simply can't produce enough gold (because of the lousy grades) to pay off the debt that was required to build this monster. $300 gold will put them away mercifully, $400 gold will prolong the pain for no real gain. I'll take a 1500tpd operation, milling .33oz./ton at a cash cost of $200/oz. anyday over this baby. Sincerely, Al Cern