AXG - Antipodes Gold [formerly GEL - Glass Earth]

[elZorro]

GLASS EARTH GOLD LIMITED

QUARTERLY OVERVIEW

EXPLORATION (please refer to the individual sections following for fuller description of the exploration activities).

• WKP gold project in Hauraki, New Zealand (Glass Earth 35%)
  
  Newmont and Glass Earth commenced a further 5,500m drill programme at the WKP gold-silver prospect in April 2012. Three drill holes were completed in Q2 2012; WKP32, 33 and 34. A fourth hole is in progress.
  
  Full assay results are expected by early September.

• MUIRS gold project in Mamaku, New Zealand (Glass Earth 100%)
  
  A 17 hole drill programme of approximately 2,350m at the Massey Reef commenced in late November 2011 targeting the Muirs/Massey gold-silver bearing epithermal quartz veins to bring confidence in the resource to Industry standard (JORC/NI 43 101).
  
  • Drillholes MSDH12, MSDH13, MSDH14were completed within the quarter, MSDH15 continued into July 2012.
  • MSDH12intersected at a greater depth than expected, expanding the cross sectional width of known mineralisation in the central part of Massey Reef. (Press Release 31 May 2012).
  • Compilation of results and subsequent interpretation is anticipated early in September.

• GARIBALDI gold project in Otago, New Zealand (Glass Earth 100%)
  
  Glass Earth announced in April 2012, that it had madea new gold discoveryat its Garibaldi project in Central Otago.
  
  • Exploration continued in the quarter with channel/panel sampling and detailed ground magnetic (geophysical) surveying to clearly delineate the host mafic schist and attendant structures likely to be the focus of gold mineralisation. 168 line kms of surveying was completed in a 12 day period; data has now been post processed and interpreted.
  • Planning is underway to drill this project in the third quarter 2012.

PLACER MINING - Acquisition and Growth in Otago, New Zealand

• Mining operations took a major step forward with the establishment of two additional mining units at Drybread in Otago, successively in late May and late June. Site set-up costs and commissioning costs have been written off as incurred. This, combined with lower productivity (expected in the winter) and amortization of exploration costs, has provided a loss for the quarter.

• Lower productivity in July (mid-winter) has improved in August.

• The full benefits of the increased throughput and 100% ownership should become apparent in the spring/summer in New Zealand, with a significant improvement in gold production and cash generated.

The notes from the field clearly show that a raft of news is about to break for the share. GEL management tend to not put out news that often, unless it is very material. We've just come through a winter with reduced exploration options, and some assays appear to have been delayed, but will be revealed soon.

There were indeed some big setup costs for Drybread by the look of it, but the potential of those likely-looking grades, when run through two or three GRUs with a bit of recycled water, has my attention. Go for it, that's what I say

[elZorro]

Write downs impact on Glass Earth

Simon Hartley — 31 August 2012
Accumulated exploration cost write-offs have pushed boutique gold producer Glass Earth Gold Ltd (TSX-V & NZAX: GEL) into an $8.49 million loss for the half year to June, but remains confident cash-flows from gold recovery are achievable.
Glass Earth, one of the country's largest gold explorers, commissioned three gold recovery units around the Maniototo area in Central Otago during the past two months to unearth alluvial gold in a bid to boost cash-flows, but was hampered by snow at its sites.
Glass Earth holds $1.57 M cash in hand, compared to $2.48 M at June last year.
Chief executive Simon Henderson said there was a “strategic review of cash allocation” done during the second quarter, to focus cash on “best potential” gold targets.
Subsequently, exploration work carried out between 2005-08 at older prospects, and a “pruning” of the prospect portfolio and its overall permit holding costs, prompted $6.3 M in write downs.
Henderson noted there had been several “one-off costs” including a surge in administrative and readying for gold production costs and asset write-down.
“While these one-off charges have resulted in a loss for the quarter, they will support the company's ongoing production programme which should generate a steady flow of cash to support its administrative and exploration costs,” Henderson said.
In June Simon Henderson had forecast gold revenue for the remainder of the year of up to $2 M and, if production targets were met, estimated gold revenue in 2013 would be up to $6 M.
In June, Glass Earth clinched $C2.35 M ($NZ2.95 M) from private equity placements out of Canada, to refinance a $4 M buy-out of its former joint venture partner.
The partner buy-out was $2 M in shares and $2 M cash, the latter to comprise 25 monthly payments of $80,000 from proceeds of the alluvial gold diggings around the Maniototo.
*Simon Hartley is senior business reporter for the Otago Daily Times.

Also in the ODT today.

One thing to note about this article is that the placer results might be a moving target. The 2013 $6M placer returns target is from June, which is now a few months ago. The absence of glowing reports from Gunclub about great recovery rates there, implies that it was relatively close to a cutoff grade. If that gear has been moved to Drybread, where we have been told there is another spot waiting - another part of the permit -then the implication is that the grades might be better there.

GEL's RC drilling machine, the small truck-mounted unit, can drill down 20-30 metres, which is fine for placer areas (it's also going to be heavily used at Garibaldi I think, saving costs). As the RC rig has already demarcated the Drybread areas, all GEL need to do is get the GRUs tuned up to recover what they already know is there.

As we all know, cash is king. GEL is focussing the Dunstan Mining gear in one geographical area for the moment, we'll have to trust that this is because of good backup data.

I spotted last night that the permit table on the website has been updated. It's quite a bit shorter. Gone for sure are applications 53346, 53186,53188, 53295, 53296.. A lot of the Goldmines NZ permits that were purchased in the buyout recently, are not listed now, but still show at NZPAM as valid applications or permits. Permit 53298, 3,500Ha of prospecting permit just north of Gore in Otago, has been granted on 27th August.

GEL still has a massive permit area, the pruning has saved $50,000 of permit costs each year, and will allow them to concentrate exploration labour and outwork on the best permits.

[elZorro]

The BTV video seems to be missing from the front page of the Glass Earth website. Here's one spot on the web where it can be picked up.

http://www.b-tv.com/features/watch-n...hGoldMay12.wmv

I had another look over this video, to remind myself what is going on for the next few months. The video shows GRU#2 working at Gun Club, and it doesn't have a jig system, looks like riffles off to one side. It'll have to be carefully tuned to gather the fine gold at Drybread.

Both Simon Henderson and Brent Cook had something to say about the placer gold levels in the near future. Simon said that the recovery is to be tripled, from C$2mill worth to C$6mill gross, and Brent said that if the figures work out, Glass Earth will be fully funded for G&A costs and exploration. That's about C$4mill of net profits after costs, in a quiet year.

Sparrowhawk and Garibaldi (close to each other) are also to be drilled sometime soon.

[elZorro]

A bit of detail on Newmont's Correnso prospect, and Lorrance Torckler had a meeting with Simon Henderson over WKP, while at the conference.

AUSIMM NZ 2012: Focus placed on Waihi’s new Correnso discovery

Ross Louthean — 3 September 2012
A paper by Newmont Waihi Gold on its new Correnso discovery at Waihi proved to be a magnet for geoscientists at the AusIMM NZ Minerals Conference in Rotorua last week.
The paper was prepared by Newmont Waihi Gold executive geologist Lorrance Torckler, associate Jackie Hobbins and geoscientists including Jeff Mauk who until last year was a senior lecturer at the University of Auckland for which he is still linked but now is based with the US Geological Survey in Denver, Colorado.
Correnso is a high-grade epithermal deposit discovered between the town of Waihi, and the discovery hole in late 2009 had an intercept of 22.7 metres grading 17.3 grams/tonne gold.
“It is speculated that early sulphide-rich vein phases at Correnso may have a greater magmatic fluid component than later quartz-dominated vein fill,” the paper said.
Correnso is within the Waihi epithermal vein field which hosts a swarm of gold-silver mineralised quartz veins including Martha, Favona, Union, Trio and Amaranth.
Martha and subsidiary veins were mined by underground methods from 1882 to 1952 and by open pit from 1988 – producing 7.5 million oz of gold to December last year.
Current mining operations at Waihi take in the maturing Favona underground mine and the developing Trio underground mine.
Correnso extends over 800 metres of known strike between the Union Hill-Trio deposits to the south and the eastern end of the Martha vein system to the north.
“The overall strike of Correnso is north-north-west, which is unusual for the Waihi vein field. Two sub-parallel veins, referred to as Correnso East and Correnso West, host separate high grade ore shoots that coalesce in a central zone where the two veins join,” the paper said.

[elZorro]

I'm still puzzled about the relevance of the Gunclub mining equipment being moved to Drybread. But all the evidence I can find points to Gunclub producing only 15 to 20oz of gold a week. If it was running 65 hours/week, 50m3/hr, then the grade was 0.19 grams/m3. Turnover of $615 per hour running, which doesn't leave a lot spare after wages, fuel and maintenance costs. It's at or near the cutoff grade being used for Drybread.

With all three machines at Drybread, there should be some maintenance savings, and diggers and trucks could be spread around the three sites as required. But what are the grades there? That is the multi-million dollar question. Better than Gunclub, anyway.

More about the Gore prospecting permit: the Waikaka River had a lot of dredges near it too, like Waikaia further to the north.

http://data.nzpam.govt.nz/PermitWebM...x?permit=53298

GEL's permit application had been in with NZPAM since the start of 2011. About a year ago, Placer Gold International was granted a much bigger (and later filed) 50,700Ha adjacent prospecting permit, no. 53402. An individual has a mining permit for the Waikaka River itself through the middle of GEL's permit 53298, and through the centre of Gore (52250).

GEL's required work is minimal, includes 10 RC drills minimum. Looks like the area is in paddocks, so suitable for GRUs, and hence the interest by PGI too.

[Vtrader]

I have been absent for a while...
See you and all your ST friends slugging it out here Z.
Where do you get all this information? Do you have a day job? Perhaps you have no need for sleep? Or possibly kids that do not consume all of your time and resources...
I still hold the GEL faith.
With the recent POG 'breakout' (ASX gold thread) I may set off to confessional again soon...
V.

[elZorro]

I have been absent for a while...
See you and all your ST friends slugging it out here Z.
Where do you get all this information? Do you have a day job? Perhaps you have no need for sleep? Or possibly kids that do not consume all of your time and resources...
I still hold the GEL faith.
With the recent POG 'breakout' (ASX gold thread) I may set off to confessional again soon...
V.

Now I'm in a quandary Vtrader: do I reply to this post and be polite, or leave the only alternative post in a week or so, up for a few days?
I used to be undecided, now I'm not so sure.

In answer to your questions, the kids find my homework answers too long-winded to ask anymore (who would have guessed), I enjoy the posting so don't mind spending some time on it. And nearly everything I'm finding is there on the web.

Not a bad time to buy some GEL, IMHO, although no-one knows when the next news is coming out. Gold does look to be the flavour of the month. The price over here is a little cheaper than on the TSX, and no extra bank currency fees.

Waikaka: PGIC has built a small rig to get some test results from the middle of their EP 51820, within the big PP.

http://www.placercorp.com/index.php?id=25&L=1

Not all of the area has been bucket dredged before. PGIC has the EP until early next year, and it looks like their favourite NZ spot at the moment. I'm not sure who owns the massive dredge in the photo, but I don't think it's PGIC, as the parent company has an Mcap of about 1mill euro.

[elZorro]

Vtrader et al, the prospects for many Goldie shares look set to improve. Gold in US$ is bolting upwards.

I've been doing a bit more research on gold in NZ. As we know, Glass Earth is pinning its short-term finances on alluvial or placer gold. It turns out that over 54% of all the gold ever mined in NZ has come from placer work. Worldwide, the percentage is higher. Before gold dropped back in price in the late 1980s, there were 150 placer rigs working in NZ. This paper is a bit old, but still good.

http://www.nzpam.govt.nz/cms/pdf-lib...ort14_gold.pdf

Neaseville is mentioned, a permit GEL has applied for, up above WKP.

September could be a great month for GEL. We will get some drill data from WKP, we might hear about how good (or bad) things are at Drybread, and on 13th Sept overnight, QE3 could be announced, which would take gold above US$1800 again, IMHO.

There is some potential for GEL to earn more than just a few million from placer. Considering the country is awash with excavators and unemployed people, Glass Earth could quickly gear up further, once it secures suitable cashflow. A fleet of nimble GRUs could move around their permits, and reinstating the land as they go, this is a very tidy way to profits that I estimate in the tens of millions per year, given suitable and achievable grades.

Recently Newmont Waihi stated that it's costing them more to recover the leftover hardrock gold around their older Waihi mines, than they get back. This is part of their reasoning in the push for higher-grade Correnso. After this is sorted out permit-wise (hearings by December 2012), I'd expect more action from them on WKP.

GEL's shareprice - in Canadian terms it's below what ACC paid, it's below what Woolwich paid recently, and yet there is the distinct possibility that Glass Earth won't require any market funding for their normal level of operation or exploration.

GEL's books in six months or so could easily feature a positive cash balance of several million dollars, and rising, from ongoing gold sales.

They will still hold all their superb permits, including the giant WKP and Garibaldi. Any sort of a positive mention from Newmont about WKP regarding mining in future, would have a huge effect on a share with a current tiny Mcap of about $18mill.

Don't expect a dividend, or a steady shareprice from GEL. You can expect surprises, hopefully pleasant ones

[elZorro]

Just had a chance today to have a look at NZPAM permits for Glass Earth. Permit 53182 is reduced in size, let go were 53191,53190, 53229. This is Fruidburn, Serpentine, Lee Stream. Also 40769, 40770, 40768 (the outer area around Muirs) and 40766.

Of other interest is applications for a reduction in the size of several other permits, but these might be partly due to NZPAM rules. St Bathans, Sparrowhawk, Ida, Maniototo, etc are to be very much scaled down. If all of these are accepted, the area under permits will be about 298,222 Ha, with annual fees of just over $218,000. This is a substantial drop in costs, and of note, very little area around Drybread was let go. WKP and JV areas intact. Some applications are still in place, mostly prospecting permits, which will add another 100,000 Ha.

It's now the 10th of September, to me that is starting to stretch "early September" for the next news. Should be sometime this week.

[elZorro]

GLASS EARTH GOLD LIMITED

QUARTERLY OVERVIEW

EXPLORATION (please refer to the individual sections following for fuller description of the exploration activities).

• WKP gold project in Hauraki, New Zealand (Glass Earth 35%)
  
  Newmont and Glass Earth commenced a further 5,500m drill programme at the WKP gold-silver prospect in April 2012. Three drill holes were completed in Q2 2012; WKP32, 33 and 34. A fourth hole is in progress.
  
  Full assay results are expected by early September

• MUIRS gold project in Mamaku, New Zealand (Glass Earth 100%)
  
  A 17 hole drill programme of approximately 2,350m at the Massey Reef commenced in late November 2011 targeting the Muirs/Massey gold-silver bearing epithermal quartz veins to bring confidence in the resource to Industry standard (JORC/NI 43 101).
  
  • Drillholes MSDH12, MSDH13, MSDH14were completed within the quarter, MSDH15 continued into July 2012.
  • MSDH12intersected at a greater depth than expected, expanding the cross sectional width of known mineralisation in the central part of Massey Reef. (Press Release 31 May 2012).
  • Compilation of results and subsequent interpretation is anticipated early in September.

• GARIBALDI gold project in Otago, New Zealand (Glass Earth 100%)
  
  Glass Earth announced in April 2012, that it had madea new gold discoveryat its Garibaldi project in Central Otago.
  
  • Exploration continued in the quarter with channel/panel sampling and detailed ground magnetic (geophysical) surveying to clearly delineate the host mafic schist and attendant structures likely to be the focus of gold mineralisation. 168 line kms of surveying was completed in a 12 day period; data has now been post processed and interpreted.
  • Planning is underway to drill this project in the third quarter 2012.

PLACER MINING - Acquisition and Growth in Otago, New Zealand

• Mining operations took a major step forward with the establishment of two additional mining units at Drybread in Otago, successively in late May and late June. Site set-up costs and commissioning costs have been written off as incurred. This, combined with lower productivity (expected in the winter) and amortization of exploration costs, has provided a loss for the quarter.

• Lower productivity in July (mid-winter) has improved in August.

• The full benefits of the increased throughput and 100% ownership should become apparent in the spring/summer in New Zealand, with a significant improvement in gold production and cash generated.

These enlarged areas of the MD&A report are the parts I think the market should be informed on soon. WKP31, the diamond drill that had tantalising projections made on its second half assays, has never been fully released. Now we know that there are more drills WKP32,33,34 and perhaps 35, that have been completed. WKP 31 was completed many months ago, there's no excuse for the delay. The market is not fully informed.

Placer results: these are critical to the immediate value of the shares. poor results at Drybread will lead to more dilution, while good or outstanding results will revalue the shares upwards. Again, all the market has is the vague tantalising expression:

Lower productivity in July (mid-winter) has improved in August.

How much did it improve? What did it start at, what did it get to? Why can't we have this data? Is the equipment and workforce there making a good dollar, or is it like throwing money down a deep dark hole?