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Gold/Mining/Energy : Golden Goose Resources-GGR (TSE) -- Ignore unavailable to you. Want to Upgrade?

To: Bill Murphy who wrote (5)	1/18/1999 7:48:00 PM
From: gtr	Read Replies (1) \| Respond to of 14

Here is a previous NR from the company explaining some of the costs of this property: Tuesday Jul 7 1998 Mr. Irwin Miller reports Golden Goose advises that an encouraging economic evaluation has been completed which contemplates using the heap leach method of processing from the proposed open pit at the Magino gold mine project near Wawa, Ontario. Results of work carried out by Witteck Development in the late 1980s and additional tests by Lakefield Research in late 1997 indicates that gold recoveries of 70 to 75 per cent are attainable. In view of this, Golden Goose will now proceed with a comprehensive testing program of the heap leach process by a renowned research facility based in Reno, Nevada, with results expected by the end of October 1998. A preliminary economic impact study by BLM Bharti Engineering, of Toronto, highlights that heap leaching would enhance the economic aspects of the Magino open pit project. Based on the same parameters used in the detailed prefeasibility study prepared by BLM and outlined in the press release in Stockwatch October 31, 1997, processing proven and probable reserves of 20.5 million tons grading 0.05 ounces per ton of gold (approximately one million ounces) over eight years, compares as follows: CAPITAL COSTS (millions of dollars) Preproduction Future Total capital capital capital Conventional milling $110.6 $36.6 $147.2 Heap leaching $69.9 $18.1 $88.0 ECONOMIC DATA Operating costs I.R.R. N.P.V. (U.S. $/oz) at 5% discount (millions of dollars) Conventional milling 95% recovery $191 11.30% $31.7 Payback period 5.3 years Heap leaching 75% recovery $191 16.06% $32.1 Payback period 3.9 years Heap leaching 70% recovery $206 10.65% $15.7 Payback period 4.7 years Analysis of the above data leads to the following conclusions: a) The lower capital costs coupled with the lower threshold of size and grade of deposit required for profitability greatly reduces the economic risk; b) The lower capital costs bring the project within the realm of a greater number of gold mining companies; c) The heap leach scenarios contemplate production of approximately 100,000 ounces of gold per year, which is quite substantial, particularly for intermediate production. d) The combination of relatively low operating costs of approximately $200 (U.S.) per ounce with the heap leach process and the accelerated payback period constitute additional positive economic factors. The the excellent potential of substantially increasing the ore reserves by further exploration based on actual drill results, as indicated in the press release in Stockwatch October 31, 1997, all of the above data can be dramatically enhanced. Thus, confirmation of previous heap leach results would greatly facilitate the development of Magino into a large tonnage open pit gold mine. Golden Goose also recently elected F. William Nielsen, a senior geologist with over 25 years of experience in all facets of mining exploration and development, to its board of directors. Mr. Nielsen, who in 1995 was the first person to propose the concept of a large tonnage low grade open pit mine at Magino, is intimately involved with all of the matters mentioned above. GTR