Mining Minerals & Metals Share Discussion Threads

[serpicouk] 21/4/2008 23:46

As a reality check - 'visible gold' in core samples may yield 'as little' as 40g/t or even less.

And that may be over only a few meters of the whole core. Still nice, but don't expect 1.3Moz in 100m x 150m area =) Would be happy to be wrong on that one.

[serpicouk] 21/4/2008 23:29

I see that junior explorer Frontier Pacific Mining had an offer (rejected) of ~£75M. They have 1.4M oz in Greece. It does look like it will be very low cost in production and in a relatively stable area...but even so, that's a hefty £50/oz pre-production.

What value GEX later in the year/next year?

[1waving] 21/4/2008 22:11

tonudiki, and if that zone extends for 3000m to the north ..............

Seriously, am very encouraged by the 'very extensive, visual indications of good grade mineralisation' bit.

[tonudiki] 21/4/2008 21:27

Fantasy & fun time only.........

The most intriguing bit to me of the last Komana East RNS, were the lines:-

"Assay results are awaited from two further stepout fencelines to the
south and from two stepout fencelines to the north. The northern
fencelines, in particular, each displayed very extensive, visual
indications of good grade mineralization. If these boreholes in the
northern stepout fencelines report ore grade assays as expected....."

So, these northern fencelines still to be assayed are 100 metres apart and cover strips of ground ~150 metres wide. Drills are typically going to 100+ metres depth but lets say 75 metres true depth.

Suppose that the "very extensive, VISUAL indications of good grade mineralisation" does ( as I believe) mean bonanza grades, and further suppose that it is 150 grams/tonne over (say) one tenth of the volume contained within these fencelines.

We would then have a very compact area of 100 metres length X 150 metres wide X 75 metres depth X 2.5 tonnes per cu.metre X 150 grammes per tonne X 0.1 = 42.19 million grams.

42.19 million grammes/1000 X 32.15072 = 1.356 million ozs.


I know, I know.......the math might be o.k., but the assumptions are for dreamers only.

Still, it's fun to play with the numbers though!!

[1waving] 21/4/2008 20:46

Serp, details taken from Jan 30th update and drillplan map.

Hole KWRC117 intercepted 4m at 4.8gm ton, this hole extended the strike southwards by 100-150m. A further fenceline was drilled 100m to the South of that KWRC 123, 124 and 125. The results for KWRC 125 came back as no significant mineralisation, results for KWRC 123 and 124 are still awaited ( from pre-xmas !! ) KWRC 123 looks as if it would be the hole in a Southern alignment with KWRC 117.

There is also another hole marked on the drillplan map in that most Southern fenceline marked KWRC 353 that I can find no reference to in the release. This one also looks in alignment.

The holes to the South are not as productive as further North but the potential is still there for southerly extension. Have to wait for the results of 123 and 124.

With Soloba being along strike to the South it wouldn't surprise me if there was more significant mineralisation between K West and Soloba.

[serpicouk] 21/4/2008 20:05

1waving - is Komana West still open to the south? I know some hole results are still awaited but I thought the southern most assays didn't really seem to hold much. I might need to take another look.

I agree, I'm eagerly awaiting results from the soloba target. I think this would be very significant if realised.

[haydock] 21/4/2008 08:43

In a webcast a few weeks ago on t1ps.com Hugh McCullough made it pretty clear that Komana east was more exciting that K West. These results show he was correct.

Much more to come from Komana !!

It's a game of patience & attrition at the moment, a year ago this would have caused the share price to rocket , now we have it in the price for nothing.
It is bound to count when the market changes.

[1waving] 20/4/2008 22:57

From the latest drill results at Komana East:-

The assay results reported below confirm the belief that the Komana East deposit is one with considerable size potential. The consistently good widths and the high average grades encountered mean that resource gold ounces can be quickly developed. Glencar controls a total of 23 kilometres of strike length along the shear structure to the north and south of Komana East within the Komana licence and the mineralisation there is open along strike in both directions and at depth. An additional nine kilometres of strike length to the north is controlled by Glencar within the Sanioumale licence, one of the licences under joint venture with a subsidiary of Gold Fields Limited.
End Quote.

The known strike lengths from both Komana East and Komana West now stands at 3.5 km+ with both still open in both directions along strike and at depth. There is also the RAB drilled zone of significant mineralisation at Soloba 3.5 kms to the south along strike from KW and initial 5 hole RC drilled strike at Kama 9 kms South of KW to add in. The N-S series of strikes down the West side of Komana shows great potential for further strikes.

With the main shear zone running NNE-SSW through Komana and the statement Glencar controls a total of 23 kilometres of strike length along the shear structure to the north and south of Komana East within the Komana licence, the ultimate total confirmed strike lengths at Komana alone could be a multiple of 3.5 kms.

In a webcast a few weeks ago on t1ps.com Hugh McCullough made it pretty clear that Komana east was more exciting that K West. These results show he was correct.

Much more to come from Komana !!

[1waving] 19/4/2008 14:13

Technical perspective longer term on weekly chart.
18/52/200 MAs, Bollinger 20 2.0 & 20 MA, volume.

The bollingers are tightening with volume increasing and the share price moving up. The share price is sat above the 18/20/200 MAs. A possible longer term Elliot wave 1 & 2 now formed with wave 2 taking a simple a-b-c form. We now may be starting a wave 3 up, this is the longest and strongest wave and will be in excess of wave 1 which was 14p. The weekly RSI (not shown) is at 47.15 and heading up.
The conclusions are that a bottom has been formed after a 2 year downtrend and the trend is turning up, definitely in the short and medium term and very probably in the longer term, a break up through 8.5p would be strongly bullish in the longer term. Looking good overall.

[1waving] 18/4/2008 22:11

Morila is also in the same Birimian Greenstone belt not too far away to the East, maybe similar geology. Morila is said to be winding down now with production probably ending in 2012. Wonder if Randgold would come back for a second bite at the cherry/Komana ? It may make sense to them with their major operations already in Mali.

[serpicouk] 18/4/2008 21:46

I wonder if one can take a look at Morila as a reasonable geological model - and hence processing model?

Carbon-in-leach process, ~92% recovery, cash costs at Q407 $279/oz (with total cash cost at $337).

A quick search shows that a carbon in leach plant capable of processing 6,000 tonne of ore per day (yielding 135,000oz/pa - based in Africa) cost about $14M back in 2004. No idea if that sounds a reasonable estimate - excluding the significant inflation seen in the mimning sector.
[Edit: correction to plant cost - the original $27M included a 6MW generator and other infrastructure]

More on the Morila set up here:



and here:

[1waving] 18/4/2008 15:05

Thanks for the info on the carbon-in-pulp. Extraction and capital costs ??

[chrissey] 18/4/2008 14:53

thanks for the feedback.
1waving, the carbon in pulp will require milling of the ore,this is more capex but the recoveries are higher,this makes good sense with high gold price.

looking good IMHO

[stuart14] 18/4/2008 11:43

The unfortunate timing was the buy at 10p!!

I'll keep an eye in here though. The assets look good.

[1waving] 18/4/2008 11:35

May be unfortunate timing but good luck and hope you get back in soon.

[stuart14] 18/4/2008 11:32

Closed out the last of my position this morning. Made the share price go up!!!! I'll be back, just need the cash right now.

[pecker1] 18/4/2008 08:42

chrissey,

I have this on my list of potential ten-baggers within 3 years. They need to drill flat-out before the rainy season comes in June to establish as large a JORC resource as possible.

[stenick] 18/4/2008 08:40

MM,s p#####g about,man the cannon's lads.

[chrissey] 17/4/2008 23:12

Thinking of the value in situ of gold, $100/oz for readily accessible gold (heap-leach, etc) crude is probably a significant understatemnt and with a million oz deposit, 60% extractable (depending on mine design)this indicates a value on Glencar (ignoring the JV) 30x what it is. Stripping back and applying geopolitical risk,technical cost/complexity of processing if not heap leachable I still see 10 x current cap as reasonable. Newmont are struggling to find gold, most of the large producers aim to at least replace mined out reserves and are struggling to do so. Are we really that far from fair value?

Just on what we have now and alone, gex should trade at 30p so the current price is difficult to appreciate. Thats my view, maybe I am missing something.

[1waving] 17/4/2008 19:59

Serp agree that takeovers will be aimed at in production, or near production juniors with the exception that exploration phase juniors with major size deposits will prove attractive.
Was reading today of one particular Asian emerging market related mining company on the lookout for deposits towards 5m oz, can't remember the name of that company at the moment. The majors with declining reserves will also be looking out for the bigger deposits.

Want to see Glencar fully explore Komana and Solona before any JV or takeover. That will take at least until maybe March next year.

[serpicouk] 17/4/2008 19:43

I hold MCR - interesting that, in my view, what's drawn a bid is the fact they've recently started production. Whilst the operation should take advantage of the current high gold price the reserves are very small.

Whilst further exploration should produce an extension to the current short mine life I don't see the same exploration upside as we have here with GEX.

Guess what I'm trying to say is that M&A looks to be picking up - but I feel people still aren't certain that gold prices will stay high/go higher. Therefore, for now, M&A will be centered on those in/starting production.

If gold holds or continues its bull run then this activity may spread into pure exploration plays in due course.

Feel we're still cheap based on in ground potential rather than requiring M&A hype.

Still undecided about what I feel would add the most value to GEX - continue to go it alone or get the big boys in the speed the process up...

Also, will be interesting to see what the bid is for MCR...the more M&A the easier it will be for others to asign fair value to GEX.

[1waving] 17/4/2008 19:29

When the bids are accepted and completed for cash, that cash will look for a home in the next bid candidate and boost the juniors in general.
Any hedge funds that are long of the majors, short of the juniors will start getting their fingers burned from now and if they close their shorts that will also boost the sector.
Not looking for a takeover of GEX yet as I think the initial takeovers will be on the cheap. There is a hell of a lot more to come from Glencar in new finds and resource ounces.
Looking to increase my own estimate of 3m oz at Komana from the drilling done with a few more results. 3m oz is starting to look conservative. Will soon be looking for resouce ounces at Solona.

[haydock] 17/4/2008 18:29

The ma&a factor is not in the price, but it has become the flavour of the small mining month, with many commenting that it will be the future:
And now:

Stmnt re Share Price Movement




RNS Number:5976S
Mercator Gold PLC
17 April 2008

Mercator Gold plc

Statement re Share Price Movement


The board of Mercator Gold plc (the 'Company') notes the recent rise in the
Company's share price and confirms it has received a preliminary approach which
may or may not lead to an offer being made for the Company.

There can be no certainty that an offer will be made for the Company or as to
the terms on which such an offer may be made.


Further announcements will be made as appropriate.