what bernanke has done, page-30

Paddyboy

In the short term smaller investors can push up a share price, but it is the big guys who determine whether they share price will stay up or go down. They have analysts who do detailed reviews and not simplistic comparisons based on historic PEs.

I have been wondering whether the current grade of the ore that is being mined is high enough for SLR to achieve 300k ounces pa without increasing their milling capacity at the combined Mt Monger operations. This might be an issue at SLR's side of the operations rather than at IGR's end. Obviously they will have the funds to expand, but Lord Les will need time to sort things out.

There will be a heap of opportunities once the SLR team understand what has been acquired. Perhaps they can expand IGR's milling operations sooner which was promised by its management.

I know I am going to be shot down, but if SLR reduces costs by $30m pa across the operations at Mt Monger that means a savings of $100/ounce would reduce the all in cash costs of the underground operations to $900/ounce, which is good at the current POG but obviously is high relative to an RRL or MML.

In case people are wondering how I get my current all up cash costs of $1000/ounce at Mt Monger. it is based on current reported estimate of around $620/ounce. The royalty payments add around $50/ounces. In addition there is ongoing sustaining and prepaid costs of around $330-300/ounce (see the table at page 9 of the June 2011 quarterly report, and yes I did verify this with SLR as being ongoing per ounce). Digging an incline for the other 2 or 3 mines at Mt Monger will be extra ($5,000/metre), which is depreciated over time as is the equipment/plant.

Murchison needs that copper deposit to grow which it probably will. That would provide for a reasonable cash cost over time. As you know the current estimate is $1070/ounce, plus royalties. A $300/ounce reduction via copper credits would be excellent.

What worried my about SLR, which I sold shortly before the merger announcement, was the possibility of POG heading back down to $1400 or even lower. Draghi and Bernanke have ensured this will not happen any time soon, I think. At the current POG SLR should do well, and of course be very profitable if gold heads above AUD$2000.

I am hoping that if the mining boom settles down our OZ goldies will be a beneficiary of a lower AUD and lower input costs. But I could be wrong here.

IGR's tenements sure look interesting. They could not be in better hands than SLR.

(Chuck - I hope I have answered your previous question of me about my costing of Mt Monger - sorry for taking so long.)

Perhaps some of the SLR followers who do deep research into goldies may want to comment about my estimates on Mt Monger production costs. I am open to alternative views where that can be supported by data.

These are exciting times for the better goldies.

loki