AXG - Antipodes Gold [formerly GEL - Glass Earth]

[Minerbarejet]

What do you mean Major?

sorry -been studying too many charts lately- meant to say the golden VALLEY road which cuts off from the Waihi-Whangamata road and heads down towards Athenree.

[elZorro]

Attachment 4540

sorry -been studying too many charts lately- meant to say the golden VALLEY road which cuts off from the Waihi-Whangamata road and heads down towards Athenree.

Ok, I see the Golden Valley Road heads East from Waihi township, and would pass over the top of the Correnso mining area roughly. I spotted this submission from Laurie Richards, a geotechnical engineer, for the hearings on Correnso. He's under contract to Newmont, but has provided compelling arguments for the safety of the mining that will be done. The ore is within andesite, and if you've ever picked some up, it's incredibly dense. The cavities are only about 9m x 8m, way smaller than the cavity Manapouri power station sits in, and the rock down there is poorer quality.

At the end of the report are some maps (not always the clearest) which show that to the west of this area, i.e. where Glass Earth has a permit, there are historic stopes, some of which had not been backfilled (hence the previous subsidence locals are worried about). But south and west of this area again, also I'd guess within GEL's space, not much historic exploration has been carried out. Using the same techniques and reasoning as applied at Correnso, with rigorous backfilling, there is no obvious impediment to mining at a safe distance from the old workings, if a resource is found. IMHO.

http://www.hauraki-dc.govt.nz/news/M...ieRichards.pdf

[elZorro]

Here is a link to a pdf of the Correnso gold area superimposed on the surface at different heights.

http://www.hauraki-dc.govt.nz/news/M...o-brochure.pdf

The area of that find is very small compared to the available exploration space in the Waihi West JV area. Correnso is relatively tiny, but it contains US$1billion of gold, maybe a net profit of $200mill or better. That's because the underground ore grade is about 20g/tonne on average.

The part labelled yellow in horizontal crossections is up to 500mtrs north-south, but only 50mtrs east-west, at best. Easy to miss if it was drilled without good pinpointing by other techniques.

[elZorro]

The 20 May press release by Newmont Waihi to explain the gravity measurements in Waihi West. All fairly low key.

http://www.waihigold.co.nz/assets/me...est-200513.pdf

We have not heard any more about Placer Gold International. Their website is still running, and here is a page giving good background on the placer technique. GRU#1 from Glass Earth is shown at Earnscleugh a couple of years ago. It's now up on the hard at Drybread, working at Morans. GRU#1 was replaced by a much bigger machine with about 4-6x the capacity, by L&M Mining, after an evaluation period. I figured out that the grade at Earnscleugh is about 0.2 g/tonne (0.3 to 0.4 g/m3), and there's a lot of gravel to get through.

http://placercorp.com/index.php?id=58&L=1

[Flugenbear]

My first post on this forum.
Firstly thanks to elZorro for all his posts and research into Glass Earth....very interesting reading. Thought it about time I contributed something!
First quarter financial statements released in Canada Friday afternoon. Unfortunately it didn't make the most pleasing reading, particularly for the placer mining showing a loss of $246,000, and anticipated loss in Q2 as well before they hope to go profitable in the 2nd half. Grades (0.33g/tonne) and price less than forecast. Currently have a shade over 1 million cash on hand.
Lets hope they can sort out the placer mining by doing 24/7 mining on one site (not sure which, maybe EZ will know)
Unfortunately I see more dilution coming before years end, and with the current share price which is unlikely to climb, this won't be nice.
Here is the link to the announcement in Canada

http://finance.yahoo.com/news/glass-...203000940.html

[elZorro]

My first post on this forum.
Firstly thanks to elZorro for all his posts and research into Glass Earth....very interesting reading. Thought it about time I contributed something!
First quarter financial statements released in Canada Friday afternoon. Unfortunately it didn't make the most pleasing reading, particularly for the placer mining showing a loss of $246,000, and anticipated loss in Q2 as well before they hope to go profitable in the 2nd half. Grades (0.33g/tonne) and price less than forecast. Currently have a shade over 1 million cash on hand.
Lets hope they can sort out the placer mining by doing 24/7 mining on one site (not sure which, maybe EZ will know)
Unfortunately I see more dilution coming before years end, and with the current share price which is unlikely to climb, this won't be nice.
Here is the link to the announcement in Canada

http://finance.yahoo.com/news/glass-...203000940.html

Welcome to Sharetrader, Flugenbear. It's a good debut, no-one else seems to have spotted that the Q1 report was out. GEL don't often release it at the end of Friday on the TSX. It isn't very good news, I felt a bit betrayed at first.

I need to spend a bit more time looking at the full details, but there are options for a rosier outcome than it would appear at face value.
I run a simple spreadsheet on placer returns, and it's startling what happens when a GRU is put on 24/7 operation. Practically, this is going to be tough, running a machine in the frost and snow, with lights on all night, but it will be profitable. I had an idea that this was going to be required as soon as the gold price dropped. The Feb 2013 NI 43-101 report details all the costs in the example placer operation, close enough to get an impression. Lease and R&M costs were very high, so they need to run with the more reliable machine, on the best grade area.

They didn't spell out which machine would be used - Hecklers was the first area set up, it uses GRU#3, which is smaller than GRU#1, but GRU#1 has had a lot of effort and cash spent on it, while GRU#3 hasn't received much mention. The Hecklers area also had some strong looking grades closer to the middle of the selected mining area. Maybe they'll put the machines beside each other for backup, or rob parts from GRU#2, which is not being used at the moment. These are tricky decisions, as you say.

The spreadsheet also says that even at $1400 an ounce, if they get grades well over 0.4g/m3, they'll do even better. At the last indicated grade (0.39g), there could be about $2mill spare annually after all related costs and staged equipment payments, not bad from just one machine. Maybe they'll cherrypick good grades from all over the permit to feed into the GRU.

Holders of the share will be willing the gold price up, and hoping there is a bright looking pocket of alluvial gold somewhere on the Drybread permit.

[Flugenbear]

I have to admit after reading the report my confidence has taken a big hit. One concern I have is the gold price was actually pretty good in Q1. It did fall a bit in Feb/Mar, but still averaged above $1600USD. The big fall came in April and since then averaged a bit over $1400. The USD has strengthened a bit the last few weeks, if that continues will help, but there are certainly a lot of things that need to line up in order for profit to flow.
Encouraged to hear you think the 24/7 will make a big difference. As you say that will be tough through winter.
I guess we have to hope for a recovery in the gold price and some USD strength.
Suddenly feeling I am holding too many shares!

[elZorro]

I have to admit after reading the report my confidence has taken a big hit. One concern I have is the gold price was actually pretty good in Q1. It did fall a bit in Feb/Mar, but still averaged above $1600USD. The big fall came in April and since then averaged a bit over $1400. The USD has strengthened a bit the last few weeks, if that continues will help, but there are certainly a lot of things that need to line up in order for profit to flow.
Encouraged to hear you think the 24/7 will make a big difference. As you say that will be tough through winter.
I guess we have to hope for a recovery in the gold price and some USD strength.
Suddenly feeling I am holding too many shares!

I had a look at the insider data yesterday, Geoff Loudon hasn't sold any of his GEL shares, and he has over 12 million of them. Mind you, it would be hard to move that many.

I agree with you, I wasn't expecting great profits in Q2, but I was hoping for a good positive cashflow in Q1, with the gold price being up at $1600. It's taken them quite a while to figure out that Drybread holds the key to investor confidence at this point. We're happy to wait for the hardrock mines to work their way through, but as significant funds and effort have been used on the Placer gear, it's very important that we can see a return, and not a loss. It's not as if they can hand the gear back and recover all the wages, lease, R&M costs to date. They have to find a way to make it work out. I'm sure that's possible.

[Flugenbear]

If they can at least get it to break even point that's a start. It's horrid to see funds going down the tube on something we thought would turn them a profit. I'm glad the share price didn't fall too far, though there are not really any buyers out there anymore....
I do agree with the new initiatives they should be able to turn this around, though I think the Q2 loss will be even greater than Q1, lets hope the 2nd half of year can help erase that....

[elZorro]

The Q1 report said that losses in Q2 will/should be smaller than Q1, Flugenbear.

From Stuff.co.nz, no extra news here.

The prices they are quoting are from the TSX. It's at C5c, about the equivalent of the NZ price.