AXG - Antipodes Gold [formerly GEL - Glass Earth]

[elZorro]

Andrew (IT at GEL's Head Office) has emailed a bit of background: he's busy with permit reporting obligations, but acknowledges the website should get an update or two in future. Thanks for that.

On another note, GEL's partner (Dunstan Mining) is keeping the recovery levels at McAdies in-house at the moment, even the crew there don't know the levels. Andrew thought the figures will be released eventually..with a bit of diplomacy.

I've been working with figures of 5g/tonne, as the big pit at Waihi has 2-3 g/tonne. I figured GEL has drilled quite a few holes all over the place, and had selected McAdies as a good starting point. They certainly had heaps of sites to choose from. Gold naturally occurs in the crust of our Earth at 5ppb by weight, and anything up to 15ppb or so is "background". Of course 5g/tonne is 5ppm, a thousand times more gold than background.

I don't think GEL would have chosen a mining site with anything less than 1g/tonne over parts of it, considering they can pick which gravel goes into the GRU. If the results were average or poor, I don't think they'd be talking about building or bringing in another GRU so soon.

[elZorro]

Capital will pay for gold exploration
By ALAN WOOD - The Press
Last updated 05:00 02/02/2010

Glass Earth Gold is planning a capital raising through overseas and New Zealand investors in March after it completes a share consolidation plan.

Glass Earth chief executive Simon Henderson said the money raised will be spent on test drilling at five of the company's seven South Island sites and in two North Island sites.

He did not want to name a figure, but it would be significant for a company of Glass Earth's size – a capitalisation of around $11.9 million.

"(We've) got to get onto our major drilling projects at the end of the recessionary phase. We've got ourselves through that process without falling over and now we've got to ... start more active drilling in the field," Henderson said.

Glass Earth has called a special general meeting on February 24 in Vancouver, Canada to consolidate its 157.7 million shares into 31.5 million shares – on the basis that every five common shares be consolidated into one.

This was to help with efforts to raise more capital, Henderson said.

Investors, particularly in North America, were not as interested in "penny shares" or those with a face value of less than 20 cents a share.

Glass Earth shares last traded at 7.7c within a 12-month range of 5c to 17c.

"We are looking at a significant capital raising in late February, early March. The (share) rollback is geared around that fundraising process, so we'd need to formalise that so people buying shares are buying in at the rollback stage."

Glass Earth also wanted to commission a second alluvial gold-recovery unit at one of its Ida Valley prospects in the first quarter of 2010. There was already one unit – comprising diggers, a processing plant and water supply-washing system – operating in the Ida Valley region of Central Otago.

Henderson was unspecific about the amounts of gold being recovered daily from the McAdies prospect in the Ida Valley but said its sale would go towards making the company cashflow positive.

Glass Earth is working with joint venture partner Dunstan Mining in the Ida Valley and is permitted for mining at the McAdies prospect.

"We are producing in a very minor way. It's a good start for us," he said.

"We anticipate increasing the number of operations that we have in the Ida Valley ... we have one operation going in partnership (with Dunstan Mining).

"We should have another running inside three months, and we have potential to grow further if those two consolidate enough business."

Henderson said he was confident of getting a second permit through soon for the second Ida Valley site.

Glass Earth dual-listed on the Toronto and New Zealand stock exchanges in October 2006.

It has also entered into a joint venture with private South Island company Ophir Gold and has recovered a small amounts of test gold from a prospect near Ophir township in Central Otago.

Henderson said sampling tests were continuing at the Ophir prospect with drilling into the rock, and some results from those tests still to be returned from Canada. "We did construct and process some material, and the results of that aren't finalised yet."

http://www.stuff.co.nz/business/indu...ld-exploration

Right, that's starting to get clearer: the placer work won't pay for all the drilling they'd like to do soon, and of course there are time limitations on the Crown Minerals exploration permits. And to outsiders, despite the fact the GEL shares only started off at 20c/25c (IPO), they can look a bit scary at the current price.

[elZorro]

A business called Kenex has been an historical feature of GEL's JVs (Aurora) and acquisitions (HPD) by the look of it:

http://www.kenex.co.nz/Predictive/success.asp

Who knows what the near future holds, if GEL start drilling their best spots in earnest.

Re post above, I forgot Ophir rates its prospects at 3-4g/tonne gold, so McAdies should be there or thereabout.

[elZorro]

OK, lets start with a proposition that one GRU at McAdies recovers 13oz gold every hour, running at about 50% duty, 80 tonnes gravel/hr, 5g/tonne gold.

The GRU and water pump could use $60 of diesel every hour, and one person (I'm being careful here) stands next to the GRU looking after it at $60 per hour chargeout. As part of the contract, two medium diggers and their operators could cost another $400 per hour. The GRU would also be billed out, let's say $200 per hour. Total running costs if everything goes right could be just $720 per hour, and the worst that can happen is that the rig breaks down, stopping the income flow. The contractor would carry any repair costs I guess.

With no better figures, I guess the wholesale gold value might be over NZ$1,000 per ounce in the raw state, some silver to be extracted etc. The govt fee is fairly small, so let's say income is $13,000 per hour, costs are $720, wow! over $12,000 per hour profit. Is this too good to be true?

One would hope that there's not some sort of 50/50 profit sharing going on with Dunstan Mining, the contractor, as mooted for Ophir. Fair enough when it's over or around their mining permit.

Now if $12,000 profit per hour was doubled with another GRU, and assuming there was no shortage of 5g/tonne gravel, and again running at 50% duty, how long would it take to make the NZ$12mill GEL is looking for?

1,000 hours of operations, 500 hours for each GRU, so just a few weeks.

Just a reminder about the levels at Ophir:

http://www.contrafedpublishing.co.nz...ons+again.html

[elZorro]

Have GEL missed something in the Waikato?

Just entered on the Crown Minerals site, application for a 452600Ha EP by China's largest gold mining company, Zijin Mining Group. No. 52446, at 4526 km2, this area is not in Taranaki but the Waikato. It stretches around Hamiltown (that's close to home) and up past Huntly's coalfields towards Meremere, and way back down into the King Country.

http://data.crownminerals.govt.nz/Pe...lication=52446

Zijin have a market cap of NZ$22.6Bill and that changes a lot (listed company), was heaps higher 2 months ago. This area is almost as much permit space as they had in all of China, according to a 2008 article I glanced at.

Anyone know anything about this?

[elZorro]

http://www.otago.ac.nz/Geology/resea.../alluvial.html

Just double checking, a few grams of gold per tonne is not unusual in Otago alluvial mining sites. Recovery rate could be somewhere between 50% to 80%.

[elZorro]

Hi Yankiwi, thanks for posting..plenty are just looking..

I think this SP lacks direction at the moment, here and on the TSX. Shareholders do deserve some numbers from GEL management. Recent (and some old) drill results, bulk testing figures, assays, etc from some of those permits we stopped hearing about.

Not to mention the recovery grades and tonnage mined from McAdies, and how that site is set up with the contractors, if it affects the returns to GEL.

Is the company playing around over there, or is it literally a goldmine for temporary cashflow? You'll know from previous posts that I think it's more likely going quite well .

[elZorro]

You've got that right eZ.

I'm sure the information they seem to be sitting on would surely effect the share price one way or the other. Therefore - it should be released in a timely manner.

IMO GEL has a big future in front of them, as well as us shareholders. The only question is how long will it be until that future arrives.

One reason that persuades an exploration company like GEL to have an IPO is to increase its profile, while of course having access to shareholder funds without paying any 'interest' in the short term. The quid pro quo is that the operation of this business must be a lot more open than a privately held company. I've no doubt this can take a lot of effort, but at times like this when more shares are likely to be issued, shareholders (existing and prospective) would like to see a state-of-play document that really does let us see how things are going.

On another note, MPA 52021 has still not been approved according to the CM website. I note that MPs have been issued for other numbers around this series, 52022 through to 52146. Many of these are on the West Coast, seems to be where the action is. It's also possible the permits are easier to get over there (no shortage of water Aotea?).

This Gun Club permit application is across Webster Lane and Nevill Lane, near Moa Creek/Bonspiel. I would expect that the Gun Club and Nevill prospects are within this space, but cannot find anything pinpointing the spots on a Glass Earth plan. But these appear to be the other two sites GEL is wanting to set up gold recovery on, in Ida Valley.

[Aotea]

Gidday EZ,
I wouldnt put too much weight on that delay....provided GEL could prove there is a resource there, and the means to extract it, they have little worries. As for water, Crown Minerals couldnt care and doesnt have the ability to consider such things, so thats a no-brainer. I would stick with Otago tenements rather than the Coast...far higher values.

On another matter, Im a little surpised that the ORC has allowed the water takes being ground water, then then returning them to surface flows and then calling them non-consumptive. They dont know their ar*e from their breakfast and clearly the wool has been pulled over thier eyes....

[elZorro]

Hi Aotea,

Welcome back, are you heading over to your prospect soon? Are the cidadas flying around yet (trout fishing)?

You will have a better idea than most, what did you think of my speculation on the amount of gold in the gravels at McAdies? What would be the range expected in partly covered areas of Otago, if the average grade is higher than on the West Coast?

I'm not sure about the water rights, just happy they got some, and it's not too bad a use for water considering irrigation water (in much bigger volume) is only used relatively inefficiently in Canterbury, say about 30% is used by the crop, the rest filters through the ground. Huge power use too, of course.