goldfield whispers

One problem with grist from the rumour mill is finding facts among the imaginative ramblings, exaggerations and downright lies. On Friday, I spent an hour on the phone with John Williams MD of AAM and managed to sort out a few facts. Much of the following has been announced already but misinterpreted by many of us.

* Current cost of production $700/oz. Recent waste stripping is excluded as development cost towards future production. There had been uncertainty as to whether this was projected cost or current cost.

* High grade sampling of the expanded Gamma site has defined an unusually wide gold anomaly that includes high grade outcropping reef. (1oz/t in part). Gamma has depth potential which will need testing but already AAM is planning grade control drilling to define the near surface resource. 1000t @3g/t has already been trucked and put through the plant. The connecting road will be upgraded depending on drilling results. The Gamma deposit shows exciting potential.

* Feed grades are improving as more ore sources become available, as the main Beta pit is drained and as better pit operating protocols are implemented.

* Carbon stripping costs are less than I feared. Alternative destinations are available for this service.

* Excellent gold pour for the first 5 days production in July. (Not sure if this has been announced so Im not disclosing the interim numbers)

* Heap leaching operation planned for low grade ore. Once plant production has been optimised, the cut off between heap leach and direct treatment ore will be defined. My estimation is that this will be between 1.4 and 1.8g/t.

* A significant silver orebody is being uncovered in one of the minor Beta pits. Limited amounts of this ore is being blended and put through the plant. This presents a similar problems to deciding what colour to paint the yacht. Silver bearing ore through the plant must be limited for the present but a significant silver orebody will diversify the resource base.

There is quite a bit more... Im writing it all into the newsletter...

Cheers.