Man what a spew Hanlong is going to take over SDL. She was going to be a long term beauty!
Anyhow we need to keep finding new companies like IDC and other we discuss on HC to invest in. As they say in the classics, never fall in love with a stock eh?
That is actually a very good question and I was wondering why IndoChine released their previous announcements about the cut off as dollar cost rather than grams/tonne of gold like everyone else too.
It all comes down to the conservativeness (is that a word?) anyhow, of the Canadian company, Madison Minerals, who used to own it. I think Scanno asked who was the previous Canadian Company that owned the tenement and poured $75m into it over a period of almost 10 years. Only for IDC to pick it up very cheap!
The pic above is from IDC's presentation on the 2nd of June 2011. And it display's the cut off grade in dollars and in grams per tonne. Something most gold miners do not do, due to the added cost and time it takes to work the cut off rate in dollars per tonne. Which is a combination of the current ($300 per ounce gold price in 2003-2007 by the average grade of gold defined in grams per tonne). But Madison Minerals did just that. Here is a link to their site, which still shows Mt Kare. http://www.madisonminerals.com/project_pnguinea_info.php
This Canadian company was a very conservative well run company, you can see it with the manner that they continually drilled yet, used very high cut off grades for gold and silver to measure and release information to the public. Over 90% of their resource is in the indicated category, which is astounding. Unfortunately they were caught up in the GFC debt trap in 2007 and fortunately for us, IDC picked up the tenement very cheaply.
I found on the World Gold COuncil website a bit more info for you guys. I have highlighted the section with *************** that highlights that when an explorer/miners calculates the gold cut off in dollars per ounce, it is a much more significant piece of information.
So if Madison Minerals calculated a cut off of 1 grams per tonne back in 2007 with a conservative price of gold at $300 per ounce. At this cut off grade, Madison Minerals defined a resource of NI43-101 of 1.9million ounces of gold and silver. (1.7million ounces of gold and 200k ounces of silver eq.)
Now fast forward to 2011 and the price of gold is $1650 per ounce.
This gold price is more than 5 times higher than the 1.9m ounces defined at $300 per ounce..........
I'm calculating worse case scenario of a 5-7million ounce gold resource being announced. Or an increase of 2.5-3.5 times what was defined in 2007, but the potential upside is potentially a lot more. If the NI43-101 resource is a 1 to 1 relationship to our JORC Compliant Resource Definition, eg 1.9mill ounces in 43-101 = 1.9mill ounces in JORC. Then IMHO we may see a 9-10million ounce deposit. It really depends on how the two ways to measure gold differ.
Even with a 5-7 million ounce Tier 1 Gold Deposit being defined, this is a very large gold mining project right next door to the massive Porgera gold mine owned by the monster Barrick, and found by the legend geologist Mr Peter Macnab who is a major shareholder of Gold Anomaly.
We'll know in the next 3-6 weeks when IDC is expected to announce this new JORC Compliant Resource.
I hope that helps a bit with your questions.
Cheers Nectar
http://www.gold.org/investment/research/
What is the average cost of mining per ounce? The world average mining cost per troy ounce was around USD 235.00 in 2002 (based on figures published by Gold Field Mineral Services). These costs include depreciation and amortization but to get a true estimate one should add between 30 and 40 USD/ounce to cover exploration, head office costs and so on. However, costs vary widely between companies and the mines themselves.
How much gold is still underground? According to the consultancy company Beacon Advisers in a study published in 2002, known resources associated with current mines were around 1,227 m oz or just over 38,000 tonnes. If all of this could be extracted economically this would amount to around 15 years production at current production rates. In practice the amount of known resources remains fairly constant over time since the results of new exploration finds replace those resources that are exploited.
What is the average gold mining grade? The grade of ore refers to the proportion of gold contained in the ore of a particular mine and is quoted in grams per tonne (g/t). The type of mine depends on the depth and grade of the ore. At a rough estimate, the larger, better quality South African underground operations are around 8-10g/t (Anglogold), while the marginal South African underground mines run at around 4-6g/t. Many of the operations elsewhere in the world are open pit mines, which run at lower grades, from as little as 1g/t up to around 3-4g/t. ********************************************************* A more significant piece of information than average gold mining grade is cost per ounce, which is a combination of grade (grams/tonne) and operating costs (USD/tonne). ********************************************************* Where is gold mined? Gold is mined on every continent, barring Antarctica. For more details, please see Mine Production.
How much gold has been mined? The best estimates available suggest that the total volume of gold ever mined up to the end of 2002 was approximately 147,000 tonnes, of which almost 60% has been mined since 1950.
What is the WGC? The World Gold Council (WGC) is an association of the world’s leading gold producers dedicated to the promotion of gold. "
IDC Price at posting:
12.4¢ Sentiment: LT Buy Disclosure: Held
