60-Second update, page-2

Thinking about New Orient a bit more, Luke Cox gave a short interview off to the side of the mining conference he presented at last week. From the 3:30 minute mark he talks how he wants to get a quick and cheap MRE from the surface of a shallow pit at New Orient so he has "optionality". He talks up the idea of tolling treating any New Orient dirt at either Westgold's' mill to the north or the Checkers mill owned by Ramelius to the south but I'm not convinced either mill has any capacity for more or any toll treating (I recall @Aljn indicating that Westgold's mill is fully booked for the next 30 months or so and Ramelius is dithering about whether to expand Checkers to process more of their own material).

https://www.you tube.com/watch?v=dgrDBViWg6s ................. (remove the space between "you" and "tube" to bring the link back to life)

Interesting question though: at this time of record gold prices is it better to go for cash flow and toll treat quite small deposits or is it better to keep drilling to build something with substance.

I had exposure to a very young Ramelius back around 2007 (from memory) where they managed to pick up the small Burbanks mill on the cheap and they thought they had a small shallow deposit at Wattle Dam which they would process. The rest is, as they say, history in that small shallow deposit sat on top of one of the highest grade deposits in Australia and Ramelius went on to make so much money they actually handed bundles of it back to shareholders (not dividends but capital) and went on to buy the Mt Magnet operation for $40m.

Black Cat (which has the old Silver Lake crew involved) is another that went with the quick monetisation, in their case of mining two pits totaling 50koz at their East Kal project. They've gone even simpler in that MMS is doing the mining, for a 30:70 split with Black Cat, and with the ore being toll treated at the Paddington mill. After upfront costs are covered Black Cat gets the first $30m of net cash flow after which it will be split. The ore is not particularly high grade, the bulk of it being around 2.4g/t, but no doubt $30m cash would come in handy to any junior goldie.

I know when Torque Metals listed a few years ago now they said they had about 35koz of fairly high grade ore sitting in the Paris pit but they decided to try and build up the MRE for that project, which is currently sitting at about 250koz at around 3.1g/t. Be interesting to see how the post-merger team decide to handle and develop Paris (which I think is the main attraction for the incoming Aston Minerals insiders). My guess is that they will want to turn it into cash as quickly as they can.

This quandary is facing another junior explorer, Warriedar Resources, right now. They have MRE'ed up just over a million ounces under 2 g/t and I think they have about 500koz of shallow material at around 1.6 g/t (which I'm guessing is mostly oxide), and they also have an old oxide mill on the property and a number of operating mills in the region. Warriedar management are proclaiming the west Perth mantra that all they want to do is "drill, baby, drill" whereas I would prefer they make every effort to take maximum advantage of record gold prices and try to monetise what they already have.

For me, I am all in favour of Luke Cox's idea of quickly cashing in on any low hanging fruit they have at New Orient. Hopefully the incoming assay results from the Island project will merit Caprice throwing a bunch of cash from New Orient at extensive drilling at Island. Onwards and upwards!