To my fellow HC investors and even speculators and traders, I think it prudent to discuss what people are expecting from the up coming resource statement from Salt Creek and perhaps set an expectation.
Lots of people are talking about the 2008 target of 2.0 to 2.2m oz's being achieved with the Salt Creek upgrade. I think you will be disappointed if that is your expectation.
Previous maiden resource for Salt Creek was 250,000 oz’s over 500 metres of strike length ( took 9 months to prove up that figure). Since then as per slide 18 of the Pay Dirt presentation, we have an additional 250 metres of strike length in the resource upgrade even though strike length has now been extended to 1,000 metres. The resources between 750 metres and 1,000 metres will no doubt come at a later date.
Since the resource upgrade in Jan 2008, IGR have been extensively drilling out Salt Creek doing both in-fill drilling ( expected to increase the confidence in the previously announced drill intercepts and may even increase the oz’s slightly if the grades have been improving ) and performing extensional drilling ( adding oz’s to the overall resource ). The extensional drilling being included in this resource upgrade is only for the 250 metres between the 500 mtr mark and the 750 metre mark.
Seeing as the increase in the length of Salt Creek for the upgrade is 50%, I would extrapolate that the resource upgrade should be in the order of 50% or 125,000 oz’s or more if the grades have been better than reported in the first 500 metres.
I can’t see how we can expect 500,000 oz’s in this upgrade if the whole 1,000 metre strike length is not included in this resource upgrade.
It is important to note however that the oz’s found so far at Salt Creek and those that are expected in the resource upgrade in the coming week or so are high quality oz’s because they are shallow and there is likely to be a high percentage conversion to reserves.
As for the 2008 target, I believe that IGR would have to find another Salt Creek to achieve this 2-2.2m oz target. We have to remember that exploration is high risk and we can’t be guaranteed this success but as the team at IGR have shown, there are quality prospects around Salt Creek in Mohegan, Reddale, Salt Creek North and Lucky Bay that could give us this exploration success before year end. There is plenty of cash in the bank and plenty of rigs on the ground.
I am confident that the team at IGR can come up with the targets set at the beginning of the year.
ReifeDiver, if you expect IGR to keep on discovering oz's at the same rate as that which has been reported to date, you may get disappointed. Chris and his team are good, but they are not miracle workers. I do however like your enthusiasm.
I do also think IGR has the most prospective ground around Kalgoorlie. Just look at how hard RBR is trying to hit the ground around Salt Creek and Reddale, calling their prospects Salt Creek North and Reddale North.
Regards
Kojasper
IGR Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
