KKLL...
So my maths is ‘not cricket ‘, I love your maths more, and I am glad you were not just watching the test match.
....Based on YOUR arithmetic I upgraded my numbers from $81,000 a day to $457,000 a day ( if Gascoyne is to get $1800 an ounce) ....Then re-estimated based on the actual hedging price of $1710 an ounce
..arriving at genuine likely earnings in December of $12,474,450 ?
Over the December quarter -at $1710 an ounce for the lower estimate of 17,000 ounces - that is $29 million dollars?
Obviously not enough ?
....Then I took the brave step of actually reading the quarterly:
I should have done it before
Some takeaways:
Seems one of the three pits - Golden Wings had proved a complete dud (it’s supposed to be providing 10% of the life of mine resource) Gilbey’s - the previously mined main pit* has not been achieving the indicated resource results either.
So distressing operations at both pits were further delayed while experts, Cube, were called in to identify the problems and come up with solutions.
As a result, in the quarterly there was news of
- increased production :
“The mining contractor, NRW Holdings, is planning to increase its excavator capacity on site from 8 excavator shifts per 24 hour period, to 9 excavator shifts (5 excavators on day shift and 4 on night shift).
- increased intelligence :
“Cube Consulting have been working closely with the Dalgaranga mine staff in a review of grade control practices, resources and reconciliation”..
(The results of the review are the new blueprint for whether it is a ‘make or break ‘ operation I expect .)
-better mill performance
It was pegging before (ie ‘mill is overloading, retaining fines or ‘the grates are pegged’ )
The now installed new mill grates were foreshadowed in the quarterly and potentially going to provide a 37% increase in speed for a spend of $150,000.
So did we have a choice about now supporting Gascoyne ?
Yes.
People always have choices.
I think NRW has been very concerned about the numbers and direction for some time and has proceeded with the loan because it honestly xoects things to improve .
..and this is already ‘our mine’ to some degree.
NRW was working on it since well before @jacko1had sniff of a rumour back in September 2017.
October 2017 “NRW’s CEO and Managing Director Jules Pemberton said of the award: “NRW has been involved with the Gascoyne team for some time through the early project studies, and we look forward to working with Gascoyne on this exciting new major gold mine development. This project will expand NRW’s current commodity base into WA’s robust gold sector.”https://nrw.com.au/dalgaranga-gold-project/
The main ‘fail’ was perhaps that ndicated resource figures for Gilbeys and Gold Wings were esssential data for all the estimates from the start.
They were not met .
Disappointment there coupled with a host of other issues from weather to possible management ugliness around ‘naming and blaming ‘ has polluted the project from the start.
And, just the fact that Cube consulting was called in, indicates no one really had any idea of which way to steer the horse.
Additional ‘grade control drilling ‘ was announced in the September 17 update https://hotcopper.com.au/documentdownload?id=uOMxKKzFkiWRTLKhOROKAxjvTDYC6ge6yxKZp/Rgke92GA==
In the September quarterly Cube had been analysing data for ‘six weeks’ (Since around August 20?)
Then ‘we’ got new management on the Gascoyne side - a board “renewal” announced October 9. https://hotcopper.com.au/documentdownload?id=uOMxKKzFkiWRTLKhOROKAxjvTDYD4w28wBKZp/Rgke92GA==
“....the retirements of foundation directors Gordon Dunbar and John Den Dryver, continue the Board’s realignment of its composition and skills to reflect the Company’s recent transition into gold production. Gascoyne’s long serving directors Graham Riley and Stan Macdonald have brought forward their intended retirements from the Board to facilitate these two new appointments as part of the Board renewal process.”
Followed by Mike Dunbar going announced October 29.
It’s been HUGE.
Every thing has been cleaned up except us ( we were already clean!)
The next quarterly will be the interesting one ...
Cheers
*https://www.mindat.org/loc-289835.html
The Gilbey's Gold Mine is an open pit approximately 70 kilometres north-west of Mount Magnet. Discovered in the early 1990's, and developed across 1996 to 2000, producing 229 000 ounces of gold.
Remaining resources, mainly beneath the Gilbey pit is JORC Measured, Indicated and Inferred 23.7 Mt at 1.4 g/t Au for just over one million ounces.
Several prospects are within the immediate area including Gilbey South, Gilbey North, Beefeater, Gordon, Bombay and Vickers. A small pit on oxidised ore is about two kilometres to the north called Golden Wing.
The deposit is on alluvium, residual duricrust, sporadic saprolite clays, with outcropping gabbro, pyroxenite, black shales, and north-west to south-east trending quartz zones. It is part of the Dalgaranga Greenstone Belt. Gilbey is located on the western limb of a south plunging anticline, within a dextral ductile shear zone, trending north-east, dipping north-west at 40 to 70 degrees.
The pit is 130 metres deep, mainly on oxidised material to 100 metres, as part of a shear zone 100 to 200 metres wide, trending north-east for two kilometres. Gold mineralisation is associated with quartz-pyrite-carbonate veins within sheared porphyry-shale.
(20min delay)
