the company does not need a reserve at this stage. If you really had any idea you would know the mineral resource is first.
Then a mine plan: 1. What tonnes are to be mined per day. 2. What the strip ratio will be. 3. What the angle of batters if open cut 4. parameters for underground if UG is the option 5. Scoping study based on grades of resource & metallurgy if FS and or DFS. 6. Plan of operations. 7. Dewatering is not an issue, as I recall a major cocky dam within 100m of the western boundary from aerial shots. 8. Then a reserve!
I believe most of the above is probably all in train at the moment. Remember there are two projects side by side. Mt Freda and Golden Mile. Golden Mile drilling is very shallow at 5m vertical based on results & announcements thus far. So i imagine without to much trouble that will be quickly converted to a reserve.As for Mt Freda all we know is that it was a historical high grade producer until 1992 and has a shallow 60m open cut.
Drilling announced by Ausmex has shown plenty ore left below open and along strike in both directions. Moving from resource to reserve is just a question of what you want to mine over what period. The resource can be updated on an annual or biannual timeline.
I think punters need to know what the difference is. Resource means how many tonnes and what grade the mineral is based on a g/t Au cut off on the bottom and a top grade cut off at the top. E.g.: bottom cut off if 0.5g/t Au means. No good grades drilled under 0.5g/t Au included in the resource estimates and top cut-off grade say 5g/t Au means no grade of gold drilled over 5g/t Au is included in the resource. So, in the case of Golden Mile all the high-grade intersections like 10, 15, 20, 30 g/t don’t get counted. That’s the way the JORC works. The “reserve” is a number of tonnes and grade based on what the company decides to mine over a period. E.g. if the resource is 200,000t and the plant can do 60,000t a year, they will call the reserve over the next two years of mining 120,000t. Reserve does not mean the tonnes in total the company has. It’s actually a stupid word to use as most people think that’s what reserves mean that’s all you have. In the case of mining it does not mean that. If an orebody went to 2,000m and had a resource of 5m tonnes most likely the profitability would only be to say to 1,000m depth and that would be reserve.
In the case of Ausmex, the two main mines, the ore is close to the surface to the resource can easily be the reserve in cases like these. With Gold at nearly $A3,000 an ounce the resource and reserve will probably be the same because at $3,000 an ounce will be crazily profitable.
Anyway, a bit of trivia so everyone knows what the term means. Some of the posts on here are hilarious. Cheers BB
AMG Price at posting:
4.6¢ Sentiment: Buy Disclosure: Held
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