KAI (ASX) Ann: Significant Gold Nugget Discoveries at Croydon Project

Originally posted by wagold ↑

MZN Ann shows how complex this stuff is

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There's that discontinuity I was theorising about. I quantified it as discontinuity factor above. Looks like it could be a significant factor if it's already been observed...

Originally posted by ghosta ↑

I like johnathonc's advice to turn off your computer and come back in 12 months time....it is great advice, but we will all ignore it. Thats illustrative of the whole problem with conglomerate gold..our emotions have total control over us where logic has no part.

Bob Moriaty and Rhino have been telling us since the conglomerate story broke, that the only way to get grades is to mine it. Thats fact. But no, our emotions cannot accept that and we want Novo to release grades.

Hennigh hasnt done so. Why? Simply because he knows releasing grade information will mislead the market. Remember the only way to get accurate grades is to mine it.

You may think..no Hennigh has beat the odds and found a new way of determining overall grade. Well no he hasnt, and he has never claimed that. He has told us that the purpose of his work is to produce a mineralisation report to get permits for mining. And of course to gain a better understanding of conglomerate gold.

We want grades. So we can work out how much gold is there and therefore how much our shares will be worth when this stuff is mined. We totally ignore the fact that the only way to determine grade is by mining.

So why are any grade figures that Hennigh could release so meaningless?
This simplest way to look at this is to go back to when the story broke twelve months ago. A sample of the very top layer of conglomerate was put through a steinhert machine and produced amazing grades. Then the Denver conferance and nuggets being pulled out of the top layer of conglomerate, nuggets everywhere.

Twelve months down the track and Novo are not even looking in the top layer of conglomerate. They found gold at the bottom layer just near where they found it at the top at Purdys, and at again at comet well in one location And another higher up which has a tuff marker at the same location, which looks like it corresponds to the bottom layer at Purdys.

The conglomerate top layer which was amazingly gold bearing at Purdys hasnt been found to contain much or any gold (as far as we know) elsewhere. Even in other locations close to where it was found.

You might dismiss this as "they made a mistake, the top layer was incorrectly recognised". One thing is certain, it wasnt the bottom layer. There was conglomerate underneath whatever layer they were looking at, so it is 100% certain its not the bottom layer which was found nearby to be the richest part.

This variability is extreme. You cannot make or imagine a strata which is more variable. So that is why the only way to determine grade is by mining.

The problem with mining is what do you process? We already know there are pockets of nuggets in places that are not continious but extremely high grade. There may be continious nuggets in certain layers. So if you mine the whole conglomerate layer you will get all the gold, but will mine so much barren rock the grades will be awfull. And if you target below the tuff layer, you might get a lot of gold in one place and none fifty meters away.

Hennigh may have figured it out by now. Not from the samples sent to Perth, but by trenching and looking and metal detecting. He may have a vague idea of grade, enough to be ablevto say its worth mining, but no sampling will ever give a reliable figure you can use to calculate an overall grade. It is just impossible to take enough samples at the necessary close spacing over such a vast area to do so.

Despite this we still want Novo to release results which are meaningless, so we can make meaningless calculations.

So what does this all mean from KAI? They need to open up trenches and look and metal detect and get an understanding of what gold bearing layers they have and how continious they are. Sending off samples to be graded will help them make field estimations, help recognise what is say 0-5g/tonne as distinct from 5-10 g/ tonne material. Decisions to mine/ large bulk sample can only ever be made on field estimation, not numbers from a lab.

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"The problem with mining is what do you process?" More to the point, how many tonnes can you process, or what kind of (feeble) mining rate can be achieved if you don't know what's ore?

The redeeming factor is that a gravity circuit can process the ore cheaply (then heap leach the fines maybe). My feeling is that this ground will suit the small players but larger mining companies might struggle to scale up.

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(20min delay)
Last 1.7¢		Change 0.003(21.4%)		Mkt cap ! $34.20M

Open	High	Low	Value	Volume
1.5¢	1.7¢	1.4¢	$142.6K	9.557M

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