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0.3¢ orinoco gold limited

I would assume that they don't have the ore to process more than...

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Davisite

19,095 Posts.

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21/11/18

11:37

Post #: 36585111
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Originally posted by BondJamesBond ↑

It's still got me stumped why ogx aren't purchasing many HM 2's??????

I find it extremely strange that no-one is discussing this here considering everything is counting on these mills.

I don't understand this. Can someone explain if I'm missing something here?

They announced they are purchasing 2 more HM 2's.
Ok good. I see the logic as this is where they have had there best success.

But why only 2?

To be honest, if they had announced purchasing at least 15 more HM 2's, I would have actually considered re entering, but 2 more???
This company is moving slower than a snail in a time when they need to be moving like a greyhound.

If you were running a mining company that is in desperate need to become cash-flow positive and to avoid either going broke or giving a large piece of the pie away to competitors, wouldn't you do everything in your power to give the best chance of success?
Everything to reduce risk of failure?

In the 8 days they produced 1,209.33 g (42.6 oz) Working at even 7 days per week they would produce no more than 170 oz per month at the current rate (And this is at 7 days per week mind you). That's 5.3 oz per day.

Say they can break even at 650 oz per month (And I think that's not enough, but let's say 650),they would need 3.8 x the current HM capacity.

Now a more realistic calculation still using 650 oz per month break even figure-

So let's say working at a reasonable 5 days per week- That's 5.3 oz x 22 working days in a month= 116 oz per month.

They need to achieve a minimum of 650 oz per month. So 650 divide by 116 current oz= 5.6 .

So they need to multiply their current HM capacity by 5.6 times.

HM1 (125kg p/hr) = 31.2% or 0.31 output of 400 kg p/hr HM's production rate.
So 400 kg p/hr mill = 0.69 output when working out how much the 400 kg mill achieves compared to the 125 kg p/hr mill.

So the 400kg mill is achieving 3.65 oz p/day and the 125kg mill is achieving 1.64 oz p/day okay.

Again, they are currently producing (in the 8 day trial) 5.3 oz p/day.

They need to produce 29.5 oz per day if they work 5 days per week (for 650 oz p/m break even status)
Which equates to an additional 24.2 oz p/ day or 5.5 times multiplying the current production.

5.5 x 0.69 (0.69 is the 400kg mill production compared to 125 kg mill)= 3.8

So they need to purchase at least 4 more 400kg mills to break even on a monthly basis assuming the 650 oz p/ month, which in my opinion is under estimating it.

But they only purchasing 2 more? I don't get it. The numbers just don't add up!

You'd think they would over compensate right? They need to purchase an absolute minimum of 4 more 400kg mills.

Why not say let's double that or even add an extra 50% to our throughput?
So instead of purchasing 3.8 400 kg p/hr mils, why not make it 6-8 more mills?
After all, This is a time of make or break isn't it?

The idea that they are only purchasing 2 more mills as they are planning on installing a ball crusher and/ or having a 3rd party process the ore and/ or installing a CIL plant in the future is not sound reason to only purchase 2 more mills.

This way of thinking is extremely risky in a time where they need to play things as safe as possible to ensure they achieve their goal of becoming cash-flow positive.

Same thing again! No back up plans or plan B's & C's in place.
The decision to purchase an additional 2 mills strikes me as a company at the trial experimental stage & they have even stated it's a trial!

I would have thought that the time for trials are over. They have been trialling for almost a year now.

Any thoughts to their decision of only purchasing 2 more mills?

Expand

I would assume that they don't have the ore to process more than this. More interesting is why they have not tried to toll treat the tailings.

OGX Price at posting: 1.3¢ Sentiment: None Disclosure: Not Held
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