It’s timely for Rox to defend their production model or change...

It’s timely for Rox to defend their production model or change it?

When Rox announced their Scoping Study last year the market gave it a thumbs down.

Rox had too many missing ozs of gold ore feed at 5g/t.

Renowned Mining engineer Jeremy Peters knows the Younami project well and was once tasked to check it out as a take-over target.

He said that Rox would struggle to find the missing ozs of feed and imo the market is now agreeing with him, although not all the results are in. A possible scenario is a lengthy period of exploration with CRs along the way to identify the required feed for the 71kozs PA model, and even longer for the 90kozs model the company prefers.

Rox’s Scoping Study can only use 20% of the total resource. Why not, Jeremy asked, install a bigger mill that could process almost all the grades at Youanmi?

Rox could start with the 1m ozs (half indicated) near surface free milling oxide gold? With Currans etc that no will grow. The ore is 1.74g/t which is fine for a 2 MTPA plant and being open pit the cost of production should be low.

Production would be at east 100kozs PA.

Rox also has more than 2.2m oz Au @ 6.89 g/t underground that a 2 MTPA mill would easily process and continue production at 100Kozs PA for many years.

The downside here is that pre -production costs would be higher but the increased free cash flow would make the project attractive to investors.

The other way to go, as I have been crunching the numbers on, is to keep the small mill but aim for 60Kozs PA which means there is a lot less 5g/t ore to find.

At the upcoming AGM I will be following up the mining industry critique of Rox’s model of production.