gold price down. think kcn

when punters in gold stocks turn on their screens this morning, they will notice that the gold price is down sharply. the tsx gold index is down 6% and hui is down 5.4%. this does not bode well for gold stocks in australia today, particularly the high cost producers. of course, one does not know what will happen to kcn, but punters in kcn can sleep easy, knowing that the company will be an incredibly low cost producer, when mining starts at chatree north. in another post, watso estimated costs at chatree north to be about $350 per oz (including depreciation, but excluding exploration, taxation and admininstration), so even at a gold price of $900, there is a massive margin of $550 - which would compare to a margin of $600 per oz, if the gold price was $950 per oz. what does this mean - well, not too much as for every 100,000 oz of production the difference is $5m (the difference between $60m and $55m).