I haven’t yet seen any discussion on what tenement E47/3945 may actually be worth and would like to toss these rough calculations into the ring to hopefully get better minds giving a clearer picture. All amounts are in Aussie dollars. There is also no assumption on what gold bearing capacity is within the other 3 PIO tenements in this area.
My figures are based on what Novo and the Hedgeless Horseman have put forward. It appears .2-.3 grams per cubic metre is the worst return wherever they test the swales and edges and the average is .83 grams. Costs per cubic metre may be $6, but I’ll also show figures for double that.
The big question is how much of the tenement actually holds gold bearing swales worthy of mining?
PIO probably has at least 5,000m x 5,000m of potential ground. So how much of this will end up being mined? I’ll assume 5%. I’ll also assume the average depth is 1 metre only.
Here goes!
Area: 5,000m x 5,000m x 5% = 1,250,000m
g/m 0.2
grams 250,000
ounces 8,818
Price $2,500/ounce
value $22,045,000
cost $6/m $7,500,000
cost $12/m $15,000,000
profit $6/m $14,545,000 (PIO $4,363,500)
profit $12/m $7,045,000 (PIO $2,113,500)
g/m 0.83
grams 1,037,500
ounces 36,596
value $91,490,000
profit $6/m $83,990,000 (PIO $25,197,000)
profit $12/m 76,490,000 (PIO $22,947,000)
If it turns out that only 1% of the area contains gold worth extracting then PIO profit at 0.83 g/m and $6/m cost becomes $5,039,400.
Having done these calculations, maybe this is why the market is not that excited!
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