AXG - Antipodes Gold [formerly GEL - Glass Earth]

[elZorro]

There's a bit more detail about the proposed new director, Mr Fleming, in this NZResources article.

Glass Earth gains a new director and seeks another
15 February 2012
Active gold explorer and boutique miner Glass Earth Gold Ltd (NZAX & TSX-V: GEL) has appointed a new director and has a nomination for another director.Justin Cochrane has been appointed to the board and the company said well known geoscientist and corporate developer Adrian Fleming has been nominated to become a director at the annual general meeting on April 25.Both Cochrane and Fleming are Canadian residents in Vancouver and Fleming retains a New Zealand residence and spends a lot of time on the South Island.

Cochrane is executive vice president of corporate development at Sandstorm Metals & Energy, as well as being actively involved with Sandstorm Gold and earlier worked as an executive of Canada’s National Bank Financial.Cochrane said Glass Earth Gold was going through a “transformational period” and said the company differed from other junior exploration companies, being well funded and generating cash from its placer gold operations. Excess cash from this can be reinvested into drilling hard-rock projects in New Zealand.

Adrian Fleming is a geologist with 35 years diversified experience in the mining sector and has been in teams that made gold discoveries at Porgera (Papua New Guinea), Big Bell, (Western Australia), Gross Rosebel (Suriname), Hope Bay (Nunavut, Canada) and most recently White Gold (Yukon, Canada) with Underworld Resources -- which was acquired by Kinross Gold in 2010.He is the founder and CEO of Smash Minerals, a director of Goldminex Resources, and several TSX-V listed companies."This is a great time to be invited to join Glass Earth Gold. The company is NZ's leading junior gold explorer, and in contrast to its peers has developed small scale gold mining operations which provide a cash flow to cover its fixed costs,” Fleming said.

Glass Earth Gold has licences covering more than 10,000 square kilometres on both the North and South islands and, at the end of last year had a net cash position of $C3.6 M.

I would like to see GEL hold onto 35% of the WKP area if they can, and this just needs a bit more capital (http://en.wikipedia.org/wiki/Mining_feasibility_study)to be put in for a (likely) large return. I put this to Simon Henderson:

Q. There are very few details about the WKP area JV document with Newmont. If the 4 years of exploration by Newmont under the JV is technically complete in mid 2011, and the permit is finishing its 10 year term next year, what is the timeline for a mine feasibility study? Is Newmont entitled to take control of this regardless, in which case the earn-in for GEL will reduce to 25% or 20% from 35%, or can GEL opt to pay for the study? Is the intention to add a four year discovery permit to this area? Does Newmont have a more recent estimate of the resources at WKP than that supplied for 2010, and if so, what is the figure?


A. WKP (10km north of Waihi) you'll of course be familiar with, it looks like a company-changer and is our top priority for this year - we're looking forward to some real drilling progress and taking care to release both news and plans as soon as that's possible.

Regarding the WKP JV: the window for Newmont funding a feasibility study in exchange for another 10% of interest has passed. Newmont shares our excitement about the project but we're not quite at the stage we can put a solid timeline on how it will progress. Close, but not yet, and in the meantime we see no issues arising around the permit administration. We've made real progress at WKP so far and there's plenty of drilling to be done yet. I don't believe they have officially revised their estimate but are likely to soon, and for now the priority is getting on to some drilling in anger.

Sounds like Newmont are in the driving seat, and are committed to further drilling at WKP - they still have their eye on the prize.

[Vtrader]

Z,
down 4% on NZAX
up 8% on TSX

All this FA is a bit unusual for me.
Confident to hold currently, the direct communication from GEL is reputation enhancing.
Ahem! PC brigade leaving their mark. Once upon a time things were good or bad, better or worse. Now every action ie either reputation enhancing or reputation eroding. My mind boggles how masked and convoluted the truth has become. Who benefits from this PC stuff anyway?
Gold is good, always has been.
V.

[bermuda]

Vtrader,
Good to have you on the thread. I suppose it is you who is right up there on the ASX comp. This looks good. El Zorro has kept it alive but so often these gems fly under the radar. I am normally a O&G guy but this gold play has to be the best tip I have heard of. Picked up a few and still in the negative. Hate it when that happens.

Patience required.

To be honest this is a tip from one of the best stock picking experts I have ever come across. I would not have a clue about gold. Suffice to say I think it is a pretty safe haven.

[Vtrader]

Vtrader,
Good to have you on the thread. I suppose it is you who is right up there on the ASX comp. This looks good. El Zorro has kept it alive but so often these gems fly under the radar. I am normally a O&G guy but this gold play has to be the best tip I have heard of. Picked up a few and still in the negative. Hate it when that happens.

Patience required.

To be honest this is a tip from one of the best stock picking experts I have ever come across. I would not have a clue about gold. Suffice to say I think it is a pretty safe haven.

Bermuda,
all sorts come together here on this forum, we all know and celebrate that.
It is no secret that elZorro and myself share a beer or two occasionally and call it a ST meeting. must be almost time for another...
re Gold and the ASX comp, all my picks are from ASX.XGD, from some analysis I completed late last year.
O&G, must be about time NZ had a good showing again. Is Maui the only significant deposit around?

On topic.
GEL is speculative for me, well assisted by elZ and his ability to extract the most obscure connections from published material and otherwise.
My methods are technical, and this is a speculation of chart trends usually more suitable to indices and liquid stocks.
will post some EWT charts and commentary, see how GEL lines up going forward, was a good match on the way up to 80cps and back to 50cps currently
V.

[elZorro]

Hi Bermuda and VTrader, if it cheers you up, I'm a bit in the red with GEL too. But not much, and of course this share has a massive upside potential, and could do anything on that score. Another quarterly report has to come out this month (wrong again, see lower post), and there is drilling and trenching going on over three permits at least, with alluvial/placer equipment in use flat out. Including the GRU#1, 'Big Bertha', I'd hope. So we should have some news soon.

A last comment from Simon's email:


You'll understand it's difficult, as a lean junior explorer, to put as much time into communication with investors and the market as we could. But it's also of vital importance and we are always thinking of ways and means to get our message, and our results, communicated effectively. 2012 is looking like an exciting year for us and part of that will entail pressing forward with more effective communication - our shareholders deserve to see value arising from our hard work.


Amen to that.

[elZorro]

I have had a bit of a look at the last two quarterly reports from Glass Earth, as although they might be a bit cryptic, they are generally useful. In relation to GRU #1, which will be pivotal to solid placer earnings in 2012 (as far as I can tell) we have:


2nd quarter August 29 2011
Placer production -- Mining commencement at Drybread in September with rebuilt Gold Recovery Unit #3. GRU#1 off lease and being reconfigured for mining at Drybread in Q4. GRU#2 continuing mining at Gunclub. Resource definition on several other prospects is continuing.

3rd quarter report 25 Nov 2011
Placer cash generation was down as Gold Recovery Unit #1 came off lease and has not yet
been redeployed to another mine site. GRU#2 remains operating at Gunclub and GRU #3 is
currently being commissioned at Drybread (all in central Otago in the South Island of New
Zealand – see attached map). Expansion of alluvial/placer gold mining in the Central Otago
region is a strong focus as mining operations bed down.

Near Term Outlook

WKP South - additional step-out drilling planned.
Muirs - Further drilling being undertaken.
Ophir - Plant and mine designs to be finalized.
Placer production - Mining commencement at Drybread in November with rebuilt Gold Recovery Unit #3. GRU#1 off lease and being reconfigured for mining at Drybread in early 2012. GRU#2 continuing mining at Gunclub. Resource definition on several other prospects is continuing.


OK, so it looks like the reconfiguring took a bit longer than planned, but as at late November 2011, it was still headed for Drybread. I was just wondering if it will be used at Ophir later, but of course there is no mining permit in place yet.

The GRU#1 was purchased by Dunstan Mining around 2009 from someone who had left it in the Cardrona Valley. I'm no expert on this, but I'd guess it was in the Cardrona river or nearby. There was a mining permit no. 41670 which had been taken over by NZ Gold Ltd in 2004, and surrendered before time in early 2010. The director is Michael Coleman, the company has no other current permits. Once the GRU was tidied up by the Dunstan team (now 50% owned by GEL), it was leased to L&M Mining for testing in their Earnscleugh project above Alexandra. And here's the curious thing -a Mike Coleman is a contractor to L&M Mining for that permit.


http://www.odt.co.nz/the-regions/south-otago/64038/the-people-earnscleugh-mining-operations

[elZorro]

GEL management is promising more news and communication in 2012, and it looks like they have started down that path already. For the previous three weeks, we've had a news release on the first day or two of the week. http://www.nzx.com/markets/NZAX/securities/GEL. GEL is not a big company -yet- so we can't expect earth-shattering news every time. But with so many permits being worked on, there will obviously be plenty of data for a few new releases.

One other company I looked at even gave a press release to report simply that nothing has changed, but they've drilled another few metres in a few days. GEL could not be that boring, and the last three news releases have been very positive. Let's see what happens this week.

An example of stuff we don't hear about: positive outcomes from the aerial surveys. This data has to be made public eventually, and GEL provided immediate info on water sources in central Otago.

http://www.odt.co.nz/regions/central-otago/195751/aerial-study-finds-water-ida-valley

[elZorro]

In March 2010, GEL announced a possible JV effort with Placer Gold International Corp, if they fronted up with some exploration costs and $500,000 of machinery. At the time they were very difficult to spot on the web. Now they are listed on the Frankfurt exchange as BPK, a reverse takeover. They have a small MCap of about 2.5million Euro.
http://www.bloomberg.com/quote/BPK:GR
(http://www.bloomberg.com/quote/BPK:GR)
Their technical director is Dr. John H Youngson, who is noted as an alluvial specialist advising GEL back in the 2007-2008 Exploration Report, page 10.


Dr. John H. Youngson, Technical Director
Dr. Youngson graduated from the University of Otago, New Zealand, with a Masters degree in orogenic (hard-rock) gold deposits and a PhD in placer gold deposits. He is one of only a handful of experts in placer geology worldwide. He has over 20 years’ experience in placer and hard rock gold deposits in Africa, the western Pacific, Australasia, North America and South America, where he has worked as a consultant to several Major and Junior mining and exploration companies. John is currently CEO and co-founder of Placer Solutions Ltd and Youngson & Associates Ltd and a founding director of Placer Resources Ltd. He is also Managing Director of Tanzania-focused resource company, NZTZ Developments Limited and COO of PGIC’s New Zealand based daughter company, Placer Gold International Limited.
http://placercorp.com/index.php?id=11&L=1 (http://placercorp.com/index.php?id=11&L=1)



Maybe we'll hear more about this in the next few months, but in the meantime their website has some really interesting data about GEL's permits in Otago. Have a good look at the site, some GEL photos we've never seen.


German Hills

PGIC has the option to enter into a JV on the German Hills Project with Glass Earth Gold New Zealand Ltd and Dunstan Mining Ltd, on essentially the same terms as those for PGIC’s Vinegar Hill JV (NZ$ 150,000 to $ 250,000 expenditure on exploration for 30% of the project, with an extra 20% for expenditure of up to NZ$ 500,000 on mining equipment for the JV). The project has not entered the exploration phase yet. The German Hills project area includes a portion of the same ancient channel system that is being explored at PGIC’s Vinegar Hills JV in Central Otago and wholly-owned Waikaka Project in Southland. An exposed portion of the quartz pebble conglomerates (QPCs) at German Hills were mined by hand methods and hydraulic sluicing in the late 1800s and the early 1900s.

Mining ceased where the QPCs disappear beneath younger cover sediments, because no fall was available for the tailings. A limited amount of contemporary exploration showed that the ancient channel QPCs continued beneath the cover strata. A model resource of 45 million m3 with gold grades of at least 0,1 g/m³ was estimated from widely spaced drill holes. Significant results included 3 g/m³ over a 6 m thickness of gravel as well as some encouraging intercepts in the QPCs. In the 1990s, alluvial fan and stream sediments containing gold reworked from the QPCs were successfully mined by Dunstan Mining Ltd, and a continuation of one of these fan deposits was recently mined by a Glass Earth – Dunstan Mining JV. Further mapping and exploration work is necessary before drilling for resource estimation can commence. In a next step the Joint Venture partner will close up the drill hole spacing to define any high grade channels and a mineable resource, and apply for a mining permit on the area.

Vinegar Hill

The Vinegar Hill project covers 940.3 hectares in Central Otago, South Island in New Zealand. It consists of two broad alluvial flats (referred to as Nicholson Lake and Shepherds Flat) flanking a small, central dome-shaped hill of recently uplifted Otago Schist bedrock (Vinegar Hill). It is a joint venture (JV) with Glass Earth Gold Ltd. and Dunstan Mining Ltd. PGIC has the right to earn 30% of Nicholson Lake and 30% of Shepherds Flat by spending from NZ$150,000 to NZ$250,000 each on exploration, and a further 20% of each alluvial flat by spending up to NZ$500,000 each on mining equipment for the joint venture. Two gold bearing units are present; the modern gravels of the alluvial flats in the valleys and an older quartz pebble conglomerate (QPC) unit (Dunstan Formation), which is richly auriferous locally.

Dunstan Formation QPCs are the basal fluvial gravel in a deformed Miocene sequence that underlies the valleys and has been upturned and exposed locally around the margins of Vinegar Hill, by uplift of the hill through the sequence. These gravels were deposited in the upper reaches of the ancient (Miocene) river system, which drained most of the Otago Goldfield and transported gold into Southland, where PGIC’s (PGIL) Waikaka Project is situated. The same QPC unit has been mined extensively elsewhere in Central Otago, notably at St. Bathans about 4km distant, where an estimated 200,000oz of gold at grades up to 1-2oz/m3 were produced between the 1860s and the 1930s.

Gold was discovered at Vinegar Hill in the 1870s and was initially exploited by hand-methods mining of selected stream gravels. Gold was soon traced to sources in the Dunstan Formation QPCs and several companies commenced hydraulic sluicing and elevating operations on them, which continued into the 20th Century. Production records are poorly documented but anecdotal reports of excellent returns were reported from time to time.

Contemporary exploration has utilised geophysics and drilling (c.40 holes) to follow the QPC beneath the alluvial flats. Grades obtained from the alluvial flats and the QPC are variable, but encouraging, and are locally high (up to 20 g/m3 for a 1m interval in one hole and 0.9 g/m3 over 60 m in another). A poorly constrained model resource of 10,000 ounces at depths less than 8 m in the alluvial flats has been estimated from existing resource data. Landowner access agreement is in place and the JV will commence an aggressive exploration programme in Q3 of 2011. This will include test pitting of the alluvial flats to infill and extend existing resource data, and drilling and bulk sampling of the QPCs to define high grade leads within them.http://placercorp.com/index.php?id=22&L=1 (http://placercorp.com/index.php?id=22&L=1) (Spot the yellow GEL bulk tester in the photo)

GEL has several permits in the area, and one covering St Bathans and Blue Lake. EP53182, MP53653, EP53008, and EP53349 in process. The area is now covered in permits. Remember the grades are probably in grains per cubic metre, with 3g/m3 being the cutoff.

Glass Earth hasn't been in the habit of producing a 4th quarter report or MD&A in advance of the annual set of books. So late April is the date for the annual report publication, and a month after that the Q1 report. Maybe they'll take pity on the shareholders and start knocking out a Q4 report late in February each year. Just an idea...

[elZorro]

It's like watching paint dry, isn't it, VTrader? The permit 53378 on the West Coast was granted on 8th February. EP53378 "Old MacDonald" of 4963Ha. Goldmines NZ (Bob Kilgour) is 100% owner and GEL is the operator. The intention is to look for alluvial gold in the headwaters of MacDonald's Creek. The permit is beside Lakes Wahapo and Mapourika. And GEL is over here why?

Back to Otago, here is the last remaining operational stamper battery running in a video. DOC crank it up and look after it. Great job...

http://www.youtube.com/watch?v=wAUbdqs8Xy4
(http://www.youtube.com/watch?v=wAUbdqs8Xy4)
From November 12 2009:

OPHIR: Glass Earth has recently constructed a purpose-built pilot plant (5-7 tonnes/hour throughput) designed to recover coarse/fine free gold by means of conventional crushing/grinding followed by a gravity separation process. An initial bulk sample of approximately 150 m3 is currently being processed in order to confirm the crushing parameters and recoveries. Following this test, the pilot plant will be relocated on site at the Wai-iti vein system for additional bulk testing.Following a successful Evaluation Phase (November 2009), an affirmative decision to mine would allow for the construction of a larger plant (circa 40 tonnes/hour throughput), completion of regulatory consents and mining. The potential to replicate the mining on other pods of near-surface ore will be progressively evaluated thereafter.

If Ophir needs a grinding/crushing process first, that would be a bit of a holdup.

There's a photo of the plant in this article. http://www.stuff.co.nz/southland-times/business/3072752/Ophir-may-be-next-gold-strike

[elZorro]

There has been a steady increase in interest in GEL on the TSX over the last week. Look at the buy side orders, not high value, but there's about 10x more volume than normal.

[elZorro]

Not at all Sparky, great to have your comments on the thread. Have a look at a few goldie shares, remarkable gains on some, especially since late 2008. GEL is still waiting to make its big run, which any junior explorer will do if mining proposals eventuate. Here's a few more photos from CHFIR, from their June 2011 trip to NZ. Looks to me like two Hitachi loaders are in use, one dump truck for removing topsoil or overburden, and GRU#2. All this gear is probably owned by Dunstan Mining. The site might be McAdies or Gun Club, Otago.


http://chfir.com/gallery/geltour2011

This new article is full of detail about why some of us hold gold explorers.

http://www.moneymorning.com.au/20120223/2012-the-year-gold-exploration-stocks-explode.html

[elZorro]

MOD Resources is doing a JV with Oceana Gold at Sam's Creek, Nelson. Here's an article from NZReseources about the drilling equipment. Alton Drilling are also contractors to Glass Earth, and their helicoptered drilling platforms might come in handy at some stage. Noteworthy too, the reporter visited the site for the report.


Mod Resources gears up for busy year at Sams CreekRoss Louthean — 24 February 2012
The Australian company that has taken charge of advancing exploration on the Sams Creek gold project near Takaka in the North West Nelson region is about to begin the last of its first phase nine-hole diamond drilling programme.
MOD Resources Ltd (ASX: MOD) is earning up to 80% equity on Sams Creek – the largest undeveloped gold deposit in New Zealand – from owner OceanaGold Corporation (ASX, NZX & TSX: OGC) by taking the project through to final feasibility study.
The Alton Drilling rig was completing the second last hole when NZResources.com visited the high-country site yesterday. Once the last hole of this campaign is completed, MOD Resources will begin planning a wider drilling programme aimed at lifting the established resource of more than 700,000 ounces gold, and significant silver.
The intent is to keep the Alton rig, built by its own factory near Auckland, on site and, by mid-year, evaluate whether to bring a second drill rig now being built by Alton at its workshops.
Some of Australia’s highly skilled drilling companies could learn some logistical lessons from the Kiwi operator, which has designed a rig that can be helicoptered into mountainous country where drill pads have to be cut, assemble and then rapidly disassemble and re-locate the rig to another location on another elevated drill pad.
Linked to this is an Alton-built camp that has been designed to perch in high country for around-the-clock drilling operators which can be moved within hours to be housed near a new drilling location, where man-made paths have to be cut.
By that time MOD Resources will be aiming to expand the resource picture at Sams Creek where the company already has plans to drill away from the Main Zone that holds the established resource, and to target lightly-explored areas by predecessors Rio Tinto and OceanaGold, for a project that has been virtually idle for more than seven years.
The known resource is within a 600m zone and managing director Derek Byrne said the programme through the balance of this year will be to sample or drill up to 600m on either side of Main Zone.
One of those targets will be Carapace, which sits above the Main Zone and takes in limited early drilling by Rio Tinto subsidiary CRA Exploration almost two decades ago where the first hole in the area produced a shallow hit of 9 metres grading 9 grams/tonne gold.
Because of its apex position, initial work at Carapace may take in sampling, using a hand-held drill for shallow probes and to use a modern saw technique to take rock samples.
MOD Resources, which also has a rapidly advancing copper discovery in the emerging Botswana copper belt, is building up its exploration team and is now providing jobs for New Zealand geologists and field operators, and has its administrative headquarters with Dunedin-based project manager Paul Angus, who spent many years in senior and administrative roles with OceanaGold.

[elZorro]

Just found or rediscovered the 2011 half-year report from GEL: (http://www.glassearthgold.com/i/financials/2011/mda_30jun11.pdf)here's some of what they said about placer mining:


Placer exploration & mining is conducted under a 50/50 joint venture with an experienced placer miner in the Otago region (Goldmines New Zealand Ltd and the related mining company, Dunstan Mining Ltd). In Q1 2010, the first generation of cash from these placer initiatives was recorded. Costs associated with the exploration and establishment of these operations is being amortized rapidly against revenue as a conservative approach.The first placer mining at McAdies commenced in December 2009 and finished in October 2010 with the replacement operation at Gunclub commencing in December 2010.

In March 2010, Glass Earth (and Goldmines New Zealand Ltd) entered into a joint venture with Placer Gold International to carry out drilling and bulk sampling at Vinegar Hill in the Manuherikia valley (the 2 target areas are referred to as Shepherd’s Flat and Nicholson’s Lake). Historically, the site was mined by sluicing and hydraulic elevators. Placer Gold will provide up to NZ$250,000 (circa C$190,000 for each of Shepherd’s Flat and Nicholson’s Lake to prove up the resources in return for earning a 30% equity. Should Placer Gold wish, it can provide further funding of NZ$500,000 (circa C$380,000) per target for capex to earn a total of 50%. The NZ$500,000 funding is preferentially repaid out of mining profits.In October 2010, the Company purchased 50% of Dunstan Mining Ltd, thereby securing access to mining equipment and related resources. All mining equipment is held by Dunstan Mining including the 40 tonne Gold Recovery Unit leased to another mining project.

Net cash generation from the Company’s 50% share of placer operations totaled $357,000 for the year, with the Q4 contribution reduced due to rehabilitation work at McAdies and the initial set up at Gunclub. Planning is underway to commence a further 2 mining operations and a franchised arrangement – all to run concurrently with Gunclub. The leased gold recovery unit has been returned to Dunstan Mining in June 2011 and a third gold recovery unit is being built.



Q1 2011 Exploration & Mining Activity


Good revenues were gained from leasing out the Gold Recovery Unit at Earnscleugh and placer mining at Gunclub (Ida Valley, central Otago). While the net revenue of $129,000 was a welcome contribution, management is committed to a significant increase in placer gold production from this source this year. Exploration, land access, permit and resource consenting continued on several targets in the Ida, Manuheriakia and Maniototo Valleys (central Otago) in order to allow multiple operations to be run concurrently.


Q2 2011 Exploration & Mining Activity

South Island placer work comprised ongoing mining at Gunclub, a drilling campaign at Drybread (a target in the Manuherikia Valley, also in central Otago), processing of drill samples and field mapping/sampling in Southland. South Island placer mining at Gunclub continued with twenty five pits completed and assayed to define and test the western lode ahead of mining. Resource definition drilling commenced at Shepherds Flat in July. Six drill lines are planned with eight holes and 165m of drilling per line. Drybread RC drilling has continued with 144 holes completed and two additional lines planned. Processing of these drill samples is ongoing. Council resource consents have been granted in respect of Drybread and the grant of a Mining Permit is imminent. This will allow 2 further Gold Recovery Units to be deployed –complementing production at Gunclub.

Tucked inside this report is a few lines about Serpentine: two drillholes done, best result was 1 metre of 1g/tonne. It didn't reflect the surface measurements, and they're not sure why.

[elZorro]

I've added up most of the new additions from the third quarter MD&A. From the management side, it's easy to add to the existing file and send it off, but from the reader's point of view, this could be done a lot better, and it would be more interesting.


Mining at Gunclub encountered a lower grade section of the resource, as indicated by drilling and trenching results, with consequent lower production. The rebuild of GRU #3 is nearing completion and will be mining at Drybread in Q4. The leasing out of Gold Recovery Unit #1, ceased in mid-June as planned. This unit is to be reconfigured and is planned to also commence mining at Drybread in early 2012.

Q3 2011 Muirs Exploration Activity
A 17 hole drill program of approximately 2,345m at the Massey Reef has been approved and will commence in late November. When completed, it is expected that this programme would enable a resource calculation to be undertaken at Massey Reef.

Q3 2011 WKP Exploration Activity
Assay results from the 720m diamond drill hole, WKP 30 were received after some delays at the laboratory. These results will be the subject of a separate press release. The intersection of andesites (the preferred host for epithermal mineralization) with rhyolites, in this large and fertile system, is encouraging. A substantial infill/expansion drill program is warranted.

Q3 2011 Placer Exploration & Mining Activity
South Island placer mining at Gunclub continued although, inhibited somewhat by winter snows and the building of a large water storage dam. Production was down although the
high New Zealand gold price almost offset this. Exploration continued at Drybread with further shallow drilling and sample processing. A Mining Permit was granted for Drybread on 26 August 2011. The drilling results are very encouraging and a Gold Recovery Unit and associated plant has been moved on site with gold production expected to commence in late November. Stage 1 drilling was completed at Shepherds Flat (57 holes for 709m) and results were encouraging. Stage 2 has been planned and is expected to start in December.
Shallow drilling has also been carried out on 3 other prospects in the adjoining Maniototo Valley with good results.

Q3 2011 Other Otago Exploration Activity
A shallow drill program was undertaken at the Ophir project (50% GENZL) consisting of 17 holes across 8 individual shears identified by geochemistry and rock chip sampling, along
with complementary mapping and geophysical surveying. Initial samples have been dispatched in order to assess the best assay method, whereupon the remaining 90% of
assays will be dispatched. A draft mining plan suitable for a pilot mining program has been prepared for the Wai-iti shear zone and a plant design prepared to allow resource consenting to commence for this project.

Results from the Hindon work were encouraging with rock chip samples returning highest values of 7.4ppm Au and 6.6ppm Au which support a plan to drill late in the 4th quarter.
Overall, results from the Nokomai rock chip samples were discouraging.
All results from channel sampling at Sparrowhawk, Manorburn and Sonora Creek Quarry have been received and they do not indicate the presence of a new pre-enriched protolith as postulated.


Note to management: shareholders would like to know how all of these areas are going now, well before the late April timeframe..

[elZorro]

All quiet still with GEL, but in response to a polite email to Simon Henderson today, about the likelihood of some press or quarterly news releases soon, and updates to the CHFIR site, I received:


Re our lack of exposure to Canadian brokers: this is precisely why Justin Cochrane and Adrian Fleming have joined the team, they're both dynamic individuals with a wealth of experience and together cover all bases in the Canadian gold/finance world. They've made the same comments already - that we lack exposure, and are enthusiastic about changing that. We're also taking this chance to review and overhaul our wider IR strategy to come up with a more cohesive and proactive approach - more news, more reporting, more communication. We have exciting exploration and plans this year, and have no intention of letting ourselves and shareholders down by not communicating effectively.
Thanks, Simon.

Great, this sounds good.

[Vtrader]

And an increasing POG will leverage all that effective communication.
V.

[elZorro]

And an increasing POG will leverage all that effective communication.
V.

Hi Vtrader, looks like your EWT predictions for gold are working out.

[elZorro]

Yep, great press release overnight. GEL traded as high as 45c on the TSX, about 54c NZ at one stage.
This share is still an absolute bargain in my opinion.

Have a look at the press release: http://www.glassearthgold.com/s/NewsReleases.asp?ReportID=510008

The image of the WKP area shows the magnetic alteration pattern that drew them there for more drilling. Every time they've drilled, they've found more gold, and keep repeating the mantra that this is a BIG area. How BIG? I've drawn a line around the altered space, most of which has not been drilled yet. It's roughly 3km long x 1km wide x 200metres of gold-bearing ore at various grades, so far as we know.

If each cubic metre weighs say 2 tonne, and the average grade is no worse than 1 gram per tonne (add in silver as a plus), then a back-of-the-serviette calculation comes up with 38Moz possible. This is being very optimistic, but if GEL has 35% of that, say 13Moz with a valuation of $200 per ounce in the ground, GEL has a possible MCap of $2600 million, or $39 per share.

We're many drills away from knowing for sure, but that's why I'll continue to hold this share.

[bermuda]

EZ and Vtrader,
I think we are going to enjoy our investment in GEL. Starting to look really good. A very savvy guy put me onto this one. He has given me 3 picks over the last few years. RPM ( ASX ) a 6 bagger, DIL,( NZX ), nearly a 6 bagger and now GEL. Unfortunately GEL has been slow out of the blocks but I am looking forward to big things.

[elZorro]

Tempted to buy in, but liquidity isn't much chop. If I want a decent sized holding, it's a punt that there will be a buyer down the line. Average volume for the last 3 months is less than 4000 shares a day.

Liquidity is much better on the TSX, but it's another layer. In the next newsy period ahead, liquidity won't be an issue. Annual report coming up, placer income, lots more drills to hear about.

[Vtrader]

And what a difference some effective communication makes.
I am going to enjoy mopping up the sells as this low liquidity stock spreads the Bid:Sell gap.
B:S ratio now 4:1, just last week it was 1:4
May even be tempted to play both sides of this one, add to the liquidity.
V.

[elZorro]

Cheers, Vtrader.

GEL is up strongly on the TSX at the moment (Friday), by over 10% so far. The last news release about Simon Henderson representing the company at the PDAC 2012 mining and exploration conference over the next few days in Toronto is good news for more exposure to the enthusiastic Canadian goldie market.

http://tmx.quotemedia.com/article.php?newsid=48939771&qm_symbol=GEL

It will also be an opportunity for CHFIR to get the latest news updated to their client page for GEL.

PDAC 2012 boasts an attendance of over 22,000 over the four days, and I'd guess many of them will be big investors. GEL's current small Mcap with its massive permit holdings and potential should hold their attention. Here are some media images of the 2011 conference.

http://www.pdac.ca/pdac/conv/2012/gen-info-media-gallery.aspx (http://www.pdac.ca/pdac/conv/2012/gen-info-media-gallery.aspx)

Here's an article by Grant Bradley, well researched, about Newmont in Waihi. It concentrates on the pressures on Newmont near the main Waihi pit. But if doing up the old Pye factory is an indication, they're keen to see their new mines through. Total spending to get to these three new deposits is over $330 million, which of course is ten times the current Mcap of GEL. No mention of WKP in the article (65% owned by Newmont for the expenditure of a few million in exploration), this might be an oversight.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10789416

Someone did note that by now, the Waihi Hill, which turned into a deep pit, was meant to be a steadily filling recreational lake for residents. Some have bought property in the town on that basis. But Newmont have been good employers and stewards of the area, there are points to be made on both sides.

[Vtrader]

Cheers, Vtrader.


http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10789416

Someone did note that by now, the Waihi Hill, which turned into a deep pit, was meant to be a steadily filling recreational lake for residents. Some have bought property in the town on that basis. But Newmont have been good employers and stewards of the area, there are points to be made on both sides.

The key comment for me was...
The sight of Newmont Waihi Gold's humble headquarters getting a new roof is cause for celebration or dread - depending on where you live.
The leaky old former electronics factory is getting its first spruce up for years and there's a fleet of new SUVs in the carpark. Newmont is digging in.

They all know there is gold in them there hills
V.

[elZorro]

PDAC 2012 starts up today in Toronto, well I guess our overnight. Simon should be fairly happy with the current position of GEL's tenements. An interesting article about PDAC, cautious optimism with metal prices and outlook. Sounds like PDAC is all about the junior explorers, with many hoping to be bought out by a large player, and others hoping to make it big on their own bat.

http://business.financialpost.com/2012/03/02/pdac-2012-economist-outlook-brings-optimism-to-mining-sector/


With few exceptions, the juniors hope one day to either be swallowed up by a larger player or evolve into a powerhouse, following in the path of such industry giants as Barrick Gold or Teck Resources.
“PDAC is really about the explorers,” said Charles Oliver, a portfolio manager with Sprott Asset Management. “PDAC is where dreams are made or crushed.”


There are some new investors buying GEL over on the TSX by the look of it. Here's a Stockhouse post from one, who indicates Newmont will have a strong interest in Glass Earth's shareprice.


http://www.stockhouse.com/Bullboards/MessageDetail.aspx?p=0&m=30761511&l=0&r=0&s=GEL&t=LIST

[elZorro]

Articles have started to appear from the PDAC 2012 convention. The consensus is that gold has plenty of years left in its bull run.

http://business.financialpost.com/2012/03/05/pdac-2012-commodity-boom-has-more-room-to-run/

http://business.financialpost.com/2012/03/05/pdac-2012-rising-costs-expect-to-support-metal-prices/

[elZorro]

A great story with this copper explorer, has parallels with Glass Earth.

http://business.financialpost.com/2012/03/06/pdac-2012-copper-miner-has-golden-touch/

TSX:LCC was 50c a share in 2009, now its about $15, a 30-bagger in 3 years, 3-bagger since October 2011.

I just noticed that Glass Earth's original cornerstone shareholder, St Andrews Gold in Canada, purchased their Holloway Gold mine in 2006 from...Newmont Mining. Newmont appears in the background of GEL's deals more often than not.

[elZorro]

The day after the PDAC 2012 conference, and the Glass Earth stand must have impressed many. Nearly a million shares have sold so far this morning, 250,000 in bids, very few on offer, the share up over 10% to CAN 41.4c, equiv NZ 51c. There are still 3-4 hours of trading to go.

http://tmx.quotemedia.com/quote.php?qm_symbol=GEL

This subscription website has posted positive comments about Glass Earth recently, could help explain the investor sentiment. With a smaller Mcap like GEL's, it doesn't take much.

http://www.explorationinsights.com/

This guy must be good, does anyone on this thread subscribe?

http://www.explorationinsights.com/pebble.asp?t=70

Found some reference from a site collecting TV interview stock picks. It was Brent Cook's Top Pick.


New Zealand. They have a large deposit and are finding some high-grade veins. Just started drilling on another project and if they drill deeper he feels they will find good values at depth.

[elZorro]

Glass Earth was one of three top picks. Here's the actual text, part of it that's public, anyway.This helps to explain why nearly 1 mill of 66 mill shares turned over last night.

http://www.theglobeandmail.com/globe-investor/investment-ideas/3-top-junior-miner-picks-from-exploration-insights-brent-cook/article2363487/
(http://www.theglobeandmail.com/globe-investor/investment-ideas/3-top-junior-miner-picks-from-exploration-insights-brent-cook/article2363487/)
Here is the interview with Brent Cook on BNN, thanks to a contact in Canada.

http://watch.bnn.ca/wednesday#clip633627

Even though the interviewer would have been prepped, there was a bit of confusion about Newmont. Brent Cook looks to be a straight-up geologist, good presenter, might have been intrigued that he'd have been speaking to the founder and CEO of GEL running the stand at PDAC.

The outcome has been quite a few new shareholders turning up on the TSX, from the look of it. The rising trendline is now well confirmed. I would expect that Simon will be organising a news release or two, on his return to NZ. Some news about placer income would be great, thanks :)

[elZorro]

As hinted by Brent Cook at PDAC, GEL has posted some news on Muirs overnight, great news.

http://www.glassearthgold.com/s/NewsReleases.asp?ReportID=512304

Looks like the latest drill has intersected a bonanza grade section, over one ounce of gold a tonne. Each cubic metre of ore in that 2 metre quartz vein would have about $5000 of gold in it.

The drills are happening very close to No. 4 road, you can see it clearly on the terrain map.

[elZorro]

Another news release, this time it has much more direct bearing on the shareprice, although the TSX is not showing that.

http://tmx.quotemedia.com/article.php?newsid=49394460&qm_symbol=GEL

Glass Earth has reached an agreement with Bob Kilgour to buy out the other 50% of Dunstan Mining, which includes mining equipment and trained staff no doubt. This means GEL will get 100% of the placer output on their permits, as the JV partner NZ Goldmines (also owned by Bob Kilgour and family) is also in the deal. Mr Kilgour still has other companies that have mining interests, including around Ophir (Ophir Gold Ltd). I'd say this is a major win-win for all concerned. Mr Kilgour will have capital available (some of it drip-fed) and GEL can cover it from the placer cashflow. A small dilution in the GEL shares should be made up by positive sentiment.

GEL is now in a more powerful position, signalling perhaps an end to constant JVs and deals to stitch something together.

Looks like GRU#1, which is the big unit, is not up and running in Drybread yet, but that must surely be occurring in Q2. It would probably quadruple gold output, so quite impressive income for GEL should be just around the corner.

I have also noted that the two sides of this buyout agreement have agreed on a price for about 3.2% of Glass Earth shares as at 15th March 2012.

It is CAD$0.548c, NZ$0.685c, well above the current shareprice :). Glass Earth last held that price on the NZAX in Sept 2011, but the TSX market reached nearly CAD80c around then. (Note, see later, this wasn't correct).

More numbers: Here is the projected total placer ounces for GEL in 2012: 7,500 ounces. At NZ$2,000 or so, that's NZ$15mill of gold sales. The minimum payable grade is about 0.2 g/tonne (3 grains per m3 wash), so to get those ounces in the worst case it would take 1.2 million tonnes of dry gold-bearing gravel in a year. With no holidays and running 24 hours, it's 137 tonnes per hour.

Now GRU#1 can handle up to 100 tonne/hr, in L&M's operation they achieved 45 tonne/hr. The figures start to look sensible if the grade is in fact better than 0.2 g/tonne, which is quite likely. Why else are they showing this much interest? If it's 0.5g/t on average, they'll only need to handle 55 tonne of dry ore/hr. They will have three GRUs. With $15mill in income, they should be able to employ about 40-50 people, pay for fuel and repairs, and still have a few million in profits.

[elZorro]

I've just noticed the change in the TSX news release. There was a line missing from the cash allocation for the deal as first posted. In all, NZ$4mill in cash is being transferred, and I would assume about another NZ$1mill in current share value to make $5mill total, this is over 2mill shares at about NZ45c.

From a shareholder point of view, the press mistake is quite a big one - I purchased some shares based on the first NR. I would also like to know when GRU#1 will be operational at Drybread, as it's been a few months since it was retreived from Earnscleugh, and at that stage it had presumably been in going order.


CORRECTION FROM SOURCE: Glass Earth Gold to Purchase Joint Venture Partner to Consolidate Placer Gold Production
WELLINGTON, NEW ZEALAND--(Marketwire - March 15, 2012) - This document corrects and replaces the document released at 8:00 AM EST on March 15th, 2012. In the table titled "Consideration," a row labelled "Deferred cash (payable June 11, 2012)" has been added. The complete and corrected news release follows.
Glass Earth Gold Limited (TSX VENTURE:GEL)(NZAX:GEL) ("Glass Earth Gold" or "the Company") announces the purchase of its placer gold production joint venture partner, Goldmines New Zealand Limited, as well as the remaining 50% share of the joint venture's mining operator, Dunstan Mining Limited, in regards to the placer mining/exploration project located in Otago, New Zealand.
On 15 March 2012, the Company entered into agreements to acquire full ownership of its placer joint venture and associated mining equipment. The transaction involves purchasing the 50% of shares in Dunstan Mining Limited (mining operator) that the Company did not already own, and 100% of the shares in Goldmines New Zealand Limited (the other 50% joint venture party).
Taking full control of placer mining activities will enable the Company to significantly accelerate and increase production capacity.
In 2011, the placer joint venture (then 50% Glass Earth Gold), contributed CAD$752,000 in gross revenue and CAD$274,000 in net revenue based on only one Gold Recovery Unit ("GRU") operating. The Company plans to commission a further GRU in Q2 and another in Q3.
This together with 100% ownership and increase in throughput should enable the Company to achieve its previously articulated production goals.
Consideration





NZ$m


CAD$m





Issue of 2,188,184 shares of the Company









Cash


0.5


0.4





Deferred cash (payable June 11, 2012)


1.5


1.2





Deferred cash (payable NZ$80k/month (CAD$65/month) for 25 months commencing July 1, 2012)


2.0


1.6





Total cash:


$4.0


$3.2













The transaction is subject to TSX Venture Exchange approval.
About Glass Earth Gold
Glass Earth Gold is one of New Zealand's largest gold exploration companies, with its experienced geological team exploring promising gold prospects across a land position of approximately 10,000 square kilometres, in both the North and South Islands. The Company held a net cash position of CAD$3.6 M at the end of Q4 2011 to fund exploration progress.




From NZ Resources today, delayed response..


New high grade hit for Glass Earth Gold at Muirs ReefRoss Louthean — 16 March 2012
Active New Zealand gold explorer and boutique miner Glass Earth Gold Ltd (TSX-V and NZAX: GEL) has had strong results from the second of 17 diamond holes being drilled at Muirs Reef in the Hauraki goldfield.

Assaying of hole MSDDH9 gave a series of intersections, the most significant being 2 metres from 48m depth grading 38.4 grams/tonne gold and 49.2 g/t silver. Higher up the hole there was a 2m interval grading 2.5 g/t Au and 1.2 g/t Ag and from 85m depth there was an 18m section @ 0.78 g/t Au and 0.9 g/t Ag. The drilling programme at Muirs Reef will continue through this year and take in about 2,500m of drilling to identify gold mineralisation in the Massey Reef area.

Simon Henderson, Glass Earth Gold’s chief executive said these results were encouraging news for the project and the company was now moving to double-shifting of the rigs for the next holes. “Our exploration team is working hard to develop and evaluate the Massey Reef gold system – the results so far show continuity and expand the system, and striking this high grade interval is a very promising sign,” he said.

The Massey Reef drilling programme follows completion of trenching last year that included significant surface results, including 24m @ 5.7 g/t Au and 1.9 g/t Ag, and 10m @ 3.1 g/t Au and 1.7 g/t Ag. Muirs Reef is 65 kilometres south-east of Newmont Waihi Gold’s Martha open cut mine which has an historic production of 10 M ounces gold and substantially more silver. Muirs Reef is at the southern end of the Hauraki Goldfield. Two quartz reefs were mined within this epithermal system until the 1930s, with over 43,000 oz of gold extracted from shallow surface and underground workings.

Massey Reef is part of the Muirs Reef mining area. Recent surface trenching results in outcropping and sub-cropping quartz veins demonstrated a 650m strike length of the surface mineralisation, ample dimension to potentially host a significant gold resource.

[elZorro]

Remember the email I received from Simon Henderson on 10th February 2012 (already posted) contained this:


We're actually going through a significant (and exciting) overhaul of alluvials, I can't tell you more than that today but we are looking forward to some real progress, and profit, this year. Our placer mining is shaping up as a very useful and unique side to how we operate - it began as a survival tool but is starting to look like a true opportunity for self-funding meaningful hardrock exploration. So when laid alongside our current projects and land package it's very compelling.

I think the good drilling news at Muirs, and feedback from contacts at PDAC, may have pushed a long-mooted deal with Bob Kilgour forward. There is no doubt that there's a lot more interest in Glass Earth's prospects in 2012. A weighted average of the prices for GEL shares on the TSX leading up the 15th March would have been C37c or so, the exchange rate conversion to NZ is about NZ45.7c, or 2,188.184 shares to give a value of $1mill NZ in GEL shares.

This could explain why the big GRU#1 has not been deployed yet - Glass Earth perhaps wasn't too keen on having to halve the profits in perpetuity, and gaining access to Dunstan Mining accounts might have been sporadic. I have yet to find out exactly where Dunstan Mining's buildings are, or find out anything about their assets list. Surely these assets will be incorporated into the main set of books for Glass Earth from 2012 onwards.

With up to $5mill in cash and shares available to Ophir Gold, there should be nothing stopping a rapid rollout towards mining at Ophir. GEL still has a JV there, a lot of area around the Ophir gold permit(s). It'll be interesting to see what happens over there in the next few months. Maybe Ophir Gold will use the funds to purchase or build new mining equipment for processing. I think a crusher/mill is required at least.

As far as GEL shares go in the meantime, some good drill results at WKP, Muirs or Hindon will create buyer interest. But if on top of that, the GRUs start to produce plenty of ounces within a quarter, the finances of Glass Earth will be changing dramatically. If 50% of the gross return on placer gold was net profit, $5mill profit would require about 5,000 oz of gold to be produced (the target is 7,500oz), which is about 20oz a working day.

Goldmines NZ Ltd (soon to be GEL) has permit PP39336 in Southland, and has applied for EP53378 and EP53379, West Coast. GEL was the operator for one. Map of PP39336 below, it's a decent sized one at 15,100 Ha, but has an expiry date of May 2012. Normally only the most prospective part will be saved as an EP or as multiple EPs. Glass Earth has helpfully already listed all the JV permits and applied permits with Goldmines NZ, clicking on the LHS will link through to the NZPAM maps. This was done two months ago.

http://www.glassearthgold.com/s/CurrentWork.asp

Application Permit 53380, have a look at that - we could be running West Coast beach sand (http://www.teara.govt.nz/en/gold-and-gold-mining/4)through the GRUs. This area starts just south of Three Mile Lagoon, and covers some of the coast (some nowhere near roads) down to where the Haast River enters the Tasman Sea.

[elZorro]

The EP application for the West Coast has been in for nearly a year, might be time for it to be approved.

A bit of background:

http://www.otago.ac.nz/geology/research/gold/gold_cycle/sea.html

Looks like the permit application is only for gold/silver. The gold normally sits in the ironsand strips on the beaches, which can also be a good resource in bulk.

http://www.contrafedpublishing.co.nz/QM/February-March+2009/Ironsand+prospecting+on+the+West+Coast.html

There's a familiar name, Mr Youngson of Placer Gold International..
I guess if we wait long enough, we'll hear the whole story.

Anyone know more about this area? Cheers.

[elZorro]

NZResources has this article from Simon Hartley, and this time it's a result of a direct interview with Simon Henderson. The figures line up with the basic maths above, about 20 ounces of gold a weekday is the target.


Glass Earth buys out its placer mining partners in Otago

Simon Hartley — 19 March 2012
Placer gold miner and active New Zealand gold explorer Glass Earth Gold Ltd (TSX-V, NZAS: GEL) has bought out its Otago joint venture partner for $4 million in cash and script.
It is now targeting quadrupling of gold production out of Central Otago this year.

It appears 2012 could be the year Glass Earth finally hits its straps after five years of, at times, surviving hand to mouth, and repeatedly having to seek fresh capital.
Glass Earth Gold has spent about $35 million in gold exploration around the country in almost five years, much of it in Otago, and is this year expanding gold production from one to three sites in Central Otago.

With $C3.6 M ($NZ4.51 M) cash in hand at the end of last year, the existing placer gold production unit in the Ida Valley will be joined by two more, at adjacent sites in the Manuherikia Valley.

Late last week Glass Earth Gold purchased placer gold production joint venture partner, Goldmines New Zealand Ltd and also the other 50% share of the joint venture's mining operator, Dunstan Mining Ltd, which had overseen placer mining and exploration projects around Otago. Glass Earth chief executive Simon Henderson said all operations, equipment and staff from Dunstan and Goldmines have moved directly under Glass Earth's umbrella.

“Taking full control of placer mining activities will enable the company to significantly accelerate and increase production capacity.

“We want to be generating a healthy cash surplus from placer [gold production], which will set us apart from other greenfield operations,” he said.
Glass Earth at present targets 20-25 ounces of gold per week from the Ida Valley, but has budgeted this year for a total 100-110 ounces per week from the three sites.
In 2010, gold from the Ida Valley generated $357,000 revenue for Glass Earth. In 2011, the joint venture gold production contributed $C752,000 ($NZ943,775) in gross revenue, using just one gold recovery unit.

Henderson said the two units being commissioned would be in the second and third quarters this year.
On the question of funding streams for operations, he said the buy-out payments totalling $2 M cash were spread over 25 months, at $80,000 per month, which left Glass Earth's cash position largely intact. Henderson hoped that with improved cash flow there would be no need to seek any recapitalisation from shareholders this year, instead focussing on “delivering some value to shareholders.”

Craigs Investment Partners broker Peter McIntyre said while as a “niche operator,” Glass Earth's production costs would be low compared to the overheads of major producers, but it will “at some stage” have to consider going back to the market. “Glass Earth needs a year of getting a few runs on the board for when they do have to go back to the market,” he said.

In the North Island, exploration is focused on large epithermal gold systems in the central North Island Hauraki region, including a joint venture with Newmont near its Waihi mines and its own exploration project -- at Muirs Reef. “That [recent assays from Muirs] has been a real shot in the arm for us,” Henderson said.
Glass Earth early last week reported its second set of strong results from its diamond drilling at Muirs Reef.

The most recent assays returned results of a 2 metre intersection of gold at 38.4 grams/tonne and silver at 49.2 g/t, while in late-January results included 2m of gold at 2.46 g/t and 17m at 1.58 g/t.

*Simon Hartley is senior business reporter for the Otago Daily Times.


Big trading day for NZ with GEL, someone ended up with some bargain shares..(not me :().

[elZorro]

I think the Birchfield dredge is the biggest example of a GRU we have. A West Coast council offshoot helped with a $2mill loan to get it restarted. Interesting background from further up the West Coast.

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10624664

More data http://www.contrafedpublishing.co.nz/QM/October-November+2009/Gold+by+the+bucket.html

Just spotted that Bob Kilgour has also successfully helped sell most of 100 lots on Molyneux Estate in Alexandra (has approx 1/3 share), and the contact details were the same as for Dunstan Mining for some of that time. Things were a bit tight in 2009 re council fees for a related commercial site on Boundary Road. Not too many houses show up on a satellite map though. Must be an old scan.

http://www.molyneuxestate.co.nz/prices.html

From PDAC, CHFIR made a presentation and GEL is on page 13. No new data. http://chfir.com/sites/all/files/chf_client_in_briefs/CHF-2012PDACBook_FINALscreen.pdf

[elZorro]

Renison Consolidated Mines has wasted no time in filing an EP (54216) for GEL's relinquished area around the Talisman Mine.
GEL let this area go early I think, and RSN is a penny dreadful that would in theory have difficulty in raising their own capital to explore these areas.

http://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?application=54216

They also have a huge application in for a nearby area, 54215.

http://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?application=54215

[elZorro]

The most recent December writeup of GEL by Vicarage Capital (http://www.vicaragecapital.com/reports/2011/dec/gel.pdf) has a few typos, but some data I might not have noticed before:


Game Hen (South Island):
90% interest in a mesothermal shear zone. E-W orientation, with strike length of 760m,6km shear zone, with a separate 4.7km vein swarm at Hindon. Rock chip samples have returned several results ~41g/t Au, with up to 71g/t Au at Hindon.

Placer Deposits (South Island):

GEL has a number of deposits, which produce 2,500oz/yeah Au. GEL purchased a 40t/d float unit, which was refurbished in Q3 2009, and production begun in Q1 2010. With recent investment of C$1.5M from placer specific investment group, GEL intends toincrease production from these placer deposits to 7,500oz/year Au in 2012. Recovery is through gravity only.

Others:

There are numerous other small high grade vein projects located within the Otago South
Island area at various stages of development/exploration.


They also mention that 2010 exploration by Newmont revealed extensions of good-quality drill results trending in a NE-SW direction from the Correnso deposit and further into the GEL JV which lies under most of Waihi. I think we'll need GEL's confirmation on that one.

The Vicarage report also states that a placer specific funding group has funded C$1.5mill towards JVs in the S.I. If this is correct, that'll be some of the sites in the Manuherikia region, JVs with Placer Group International and John Youngson.

I have an overseas contact who mentions the rumour? of Newmont agreeing to a new drilling program for WKP, for about 5,000ft of drills, to be completed within 6 months, starting about now. This would be about 8-10 drillholes, if each are about 200 metres or less.

Taken together, it would appear that shareholders are being left in the dark for considerable periods of time with this company. If any data would be expected to affect the shareprice, there are rules about this sort of behaviour. On previous performances, there will be no quarterly report for the three months leading up to Dec 31 2011. This will be incorporated into the annual report, which will come out on one of the last days in April 2012.

Here's a little list of items that could be included in press releases up until that date.

Progress at Game Hen and Hindon, drilling has been ongoing?
More detail on the Placer JVs, how many sites, what gear, photos, what is going on with GRU#1?
Drilling program for WKP - details?
Muirs drill results?
What are GEL's intentions for the Goldmines NZ permits? (Some only under application).
And how about a quarterly report before the end of April, there should be one at the end of February.

There is a lot of buying interest on the low side over on the TSX, perhaps it's steady accumulation of GEL shares.

[elZorro]

In the months ahead we should be hearing more about PGIC, who have apparently fronted up with some capital to earn an interest in some placer JVs with Glass Earth. Just when I thought we were clearing all this away..


Placer Gold International Corporation owns Placer Gold International Ltd, NZ (Previously Gold Standard Ltd).
Office: Dorf 76, Walzenhausen, 9428 , Switzerland.


This looks like yet another tax haven company. (If you're going to play with the big boys, make sure you don't pay any taxes either). If you or I tried this, the IRD would be looking sideways at our annual returns.

[elZorro]

Placer Gold has a presentation on their website, looks like this is a listed company with shareholders, at .25-.30 Euro approx (http://www.bloomberg.com/quote/BPK:GR).

Placer Gold International was brought in as a shareholder to replace Gold Standard Ltd-registered in the Cayman Islands, in early 2011. No relation to Gold Standard Ltd, a deregistered NZ company. http://www.business.govt.nz/companies/app/ui/pages/companies/2264627/14637822/entityFilingRequirement?backurl=%2Fcompanies%2Fapp %2Fui%2Fpages%2Fcompanies%2F2264627%2Fdetail%3Fbac kurl%3D%2Fcompanies%2Fapp%2Fui%2Fpages%2Fcompanies %2F2264627%3Fbackurl%3D%2Fcompanies%2Fapp%2Fui%2Fp ages%2Fcompanies%2Fsearch%3Fmode%3Dstandard%26type %3Dentities%26q%3Dplacer gold international

A month after Cayman Island resident and gold investor Bob Moriarty (Gold Standard) bowed out, Placer Gold International appeared. Mr Moriarty seems to be a clever investor, see numerous web interviews. http://www.theaureport.com/pub/na/6718

Also revealed on PGI's site, some of the gold grades we're talking about at Vinegar Hill, German Hills, (GEL permits) and these are good. The units are g/m3 (data provided by Glass Earth), but according to the writeup, in this case it could mean grams of gold per cubic metre, the only other mention of units in the PGI document. I hope this is correct, if it's grains per cubic metre it's not nearly so good.

http://placercorp.com/fileadmin/images/Praesentation/2012-02-15_en.pdf

PGIC intends to also run its own Waikaka permit in Southland (EP 51820), and to be reaping 15,000 to 25,000 ounces per year from there, by 2014. Vinegar Hill is not being expected to be mined until 2014 either.

[elZorro]

OK, GEL has produced the annual set of books and the MD&A for the last quarter, one month earlier than usual. Either they are precis masters (as our English teacher used to say) or the press release is the short version. Net loss as usual, with some ground being written off.

http://www.glassearthgold.com/i/newsreleases/2012/GEGLPR_28Mar2012_PlacerJVFinancials.pdf

Here's where they need to be careful: 10,000 km2 of land being prospected they say.. in fact the permit list is for only about 1,100 km2 of land, and another 7,600 km2 or so in the wings under application with NZPAM. Some of this is being re-applied for, after the major permit holdings reached their terms.

There is not enough detail to say much about whether they are heading in the right direction. A lot of digging about down in Otago for just $230,000 of annual placer gross profit, of course maybe a lot of the turnover went to Dunstan Mining. No data about most of the permit work at all.

There have been about 2mill odd shares added to the issued list. These could be the shares for part payment for Dunstan Mining and Goldmines NZ.

From NZResources:


Cash flow erodes losses for Glass Earth Gold

Simon Hartley — 30 March 2012
Small scale gold miner and active explorer Glass Earth Gold Ltd (TSX-V & NZAX: GEL) posted a $C1.71 million ($NZ2.09 M) loss for calendar 2011 trading, but retains $C3.6 million ($NZ4.44 M) cash in hand for ramping up its Central Otago gold extraction programme.
In dual fund-raisings, Toronto-listed Glass Earth raised $C2.9 M and $C250,000 – the latter warrants and options -- and sold placer from its tenements near Alexandra last year for $C316,000 ($NZ387,000).
The $C1.71 M loss for Glass Earth, which has spent more than $35 M in mainly southern exploration in during the past five years, follows a loss the previous year of $C1.46 M.
A month ago Glass Earth bought out its joint venture partner for $4 M, in cash and script, saying at the time it was targeting a potential quadrupling of Central Otago gold production this year -- up to 100-110 ounces per week from three sites; one in the Ida Valley and two in the Manuherikia Valley.
Yesterday, Glass Earth chief executive Simon Henderson said the sole “gold recovery unit” in the Ida Valley would be joined by a second unit, at another site within three weeks, and a third unit is being refurbished to be operational at another site by June.
“Placer mining expansion in 2012 should see a significant increase in both gross and net revenue,” Henderson said in a market statement.
The company’s operations in the North Island remain focussed on large epithermal gold systems around the Hauraki region, including a joint venture with industry heavyweight Newmont Waihi Gold, relatively close to its open pit and underground operations in Waihi.
*Simon Hartley is senior business reporter for the Otago Daily Times.



Maybe I have the maths wrong about the Dunstan/Goldmines deal, but it looked to me like NZ$5mill was the price Simon - $4mill in cash, some deferred, and another NZ$1mill in value of GEL shares.

Why is it so hard for shareholders to find out where the placer sites are going to be, what the gear looks like, and which GRUs are on track? So far I think I've only seen photos of GRU#1. If this is the GRU that is on target for deployment in late June, then for half of the calendar year the gold output won't be huge. Big GRU#1 would by then have been lying idle for about a year, waiting for refurbishment.

Note: this looks like what will be happening, late June setup in Drybread for GRU#1. A year out of action, that has cost GEL plenty.

[elZorro]

GEL filed full documents with SEDAR in Canada on 28th March 2012. Anybody can access them, and here is the MD&A document, much more detail as I suspected.

http://www.sedar.com/CheckCode.do;jsessionid=0000oI6Qqpv50_8pj1obfTM3k-9:-1

Biggest news item as far as confidence in GEL: Newmont is going to drill another 6,000 metres at WKP in 2012, for more data.

That's 30 drills at 200metres average.



Business Combination


As announced on March 15, 2012 the Group acquired full ownership of its placer joint venture and associated mining equipment. The transaction involved purchasing the remaining 50% of the shares in Dunstan Mining Limited (mining operator) that it did not already own and 100% of the shares in Goldmines New Zealand Limited (the other 50% joint venture party). The acquisition cost consisted of cash and deferred cash of $3.2m and the issuing of 2.188m Glass Earth Gold Ltd fully paid shares (total consideration of approximately $4mill).



Taking full control of placer mining activities will enable the Group to accelerate and increase production capacity. In 2011 the placer joint venture (then 50% Glass Earth), contributed $752,000 in gross revenue and $274,000 in net revenue based on only one Gold Recovery Unit (“GRU”)operating. The group plans to commission two further GRUs. This, together with 100% ownership and increase in throughput should enable the Group to achieve its previously articulated production goals.


This is the reason for the pricing on the deal, in NZ$ it was about $5mill, in CAD$4mill.

GEL now has over $800,000 of mining equipment assets, plus another $900,000 from Dunstan Mining. The rest of the purchase price was deemed to be the value of the permits and access agreements.

See the annual books on the GEL website too: http://www.glassearthgold.com/s/AnnualReport.asp

[elZorro]

Here are some excerpts from the GEL annual report.

GLASS EARTH GOLD LIMITED
For the year ended December 31, 2011

MANAGEMENT’S DISCUSSION AND ANALYSIS
(All amounts stated in Canadian dollars, unless otherwise indicated)
Attention is called to a caution in respect of
Forward-Looking Statements - included at page 33

ANNUAL 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%)
Five, long (up to 720m), diamond drill holes provided a successful follow-up of the
encouraging results from the 2010 diamond drilling campaign on WKP West.
Ø WKP 27 intersected 152.4m @ 1.16 g/t Au including 1.4m @ 30.7 g/t
Au and 77.7 g/t Ag; ;
Ø WKP 28 intersected 49m @ 1.08 g/t Au and 3.32 g/t Ag; and a new zone
was discovered at WKP South (WKP 29);
Ø WKP 29 intersected 3.2 m @ 37.0 g/t Au and 17.0 g/t Ag:
Ø WKP 30 consolidated this discovery, intersecting 9.0 m @ 3.2 g/t Au and 2.6
g/t Ag;
Ø The strong resistor targeted extends both north and south of those drill holes.
Aeromagnetic and CSAMT resistivity geophysical surveys indicate that this
new zone has a strike potential of at least one kilometer;
Ø WKP 31 was completed in December to a depth of 598m. Initial assay
results include 9.7m of 17.2g/t Gold and 24.2 g/t Silver.

Glass Earth and its partner Newmont have committed to an extensive drilling campaign for 2012 of approximately 6,000m to advance this project.
·
MUIRS gold project in Mamaku, New Zealand (Glass Earth 100%)
An independent review of the Muirs-Massey Reefs area was completed in April 2011, leading to more defined exploration work.
Ø A 5 hole diamond/RC drilling program completed in Q1
Ø Further trenching over the recently detected high surface gold values (up
to 17 gm/t Au in situ rock chips) commenced in April 2011;
Ø Ten trenches were dug with a combined length of 235m and all, but
one, intersected significant quartz veining and were channel
sampled. Assay results received were very positive including 24m @ 5.72 g/t Au;
Ø A 17 hole drill program of approximately 2,345m at the Massey
Reef commenced in late November with the intention that it enable
a resource calculation to be undertaken for the Massey Reef;
Ø The first two drill holes have been completed at the Massey Reef with the
first drillhole (MSDDH08) penetrating a highly altered andesitic volcanic
unit with variable quartz veining throughout. Results included an intercept
of 17m @ 1.71 gm/t Au. The second drill hole (MSDDH09) reached 191m
with assays pending.
· OPHIR gold project in Otago, New Zealand (Glass Earth 50%)
Ø Metallurgical work on Ophir ore samples is encouraging, with between 82-
85% of gold recovered in gravity separation processes;
Ø Progress was made on the design and costing of a pilot processing plant for
the Wai-iti shear zone.;
Ø Additional drilling was undertaken (17 holes for 446m) across 8 shear
zones. Initial lab results are encouraging, including 4.2 gm/t Au over 8m
in OPH013, and 5.8 g/t Au over 6m in OPH014;
Ø Remaining samples from the drill program were submitted for assay by
cyanide leach;
Ø Additional work is being undertaken as a pre-requisite to a formal
proposal for capex and mining for the consideration of the Joint
Venture.

FINANCIAL
· Successful Fundraising – the Company raised a gross $2.9m by private placement
in late Sep/early October together with an additional $0.25m upon the exercise of warrants and options;
· The Company’s cash position as at December 31 2011 was $3,614,000;
· Financial results - The net loss for the year ended December 31, 2011 was
$1,714,000 including a non-cash write-off of accumulated exploration expenditures of $695,000.

PLACER MINING
· Placer mining continued with only one Gold Recovery Unit effectively operating at a time. Cash contribution from the Company’s 50% owned placer mining operation(s) totaled $316,000 for the year ended December 31, 2011;
· The placer joint venture owns 3 Gold Recovery Units and has mining permits and resource consents to allow all three to be operating.
· In March 2012, the Company acquired the other 50% of the placer JV for $4m incash, deferred cash and Glass Earth Gold Ltd shares (see Subsequent Event note on page 27).
· The Company intends to have a second GRU running in Q2 and a third in Q3.
This, together with increased throughput and 100% ownership should
ensure a significant improvement in gold production and cash generated.

Q4 2011 Exploration Activity
Progress was made on the Ophir project (50% GENZL) with the design and costing of a pilot
processing plant completed for the Wai-iti shear zone. Remaining samples from the Q3 drill
programme were submitted for assay by cyanide leach. Initial lab results are encouraging.
A programme of shallow drilling was completed across the Hindon and Game Hen targets
(East Otago). Six drill holes were completed at Hindon targeting gold-bearing shear zones
identified through geological mapping and rock chip sampling (up to 7.5 gm/t Au). Samples
have been submitted for assay. An additional eight drill holes were completed to target the
Game Hen shear. Rock chip sampling of this structure has indicated grade of 1.3 - 41.4 gm/t
Au, with anomalous (Macraes like) arsenic levels (up to 5000 gm/t).
At Sparrowhawk geological mapping and sampling was completed to investigate areas with
anomalous gold (identified in Q2 2011 soil sampling). Encouraging rock chip samples
returned values up to 8.73 gm/t Au. Trenching is to be completed in Q1 2012.
A programme of soil sampling was undertaken at the Moeraki project to test geophysical
anomalies parallel to the Hyde Macraes Shear Zone (identified in the 2007 airborne
RESOLVETM survey). Results were encouraging and follow-up sampling will be completed in
Q1 2012.

Q3 2011 Exploration & Mining Activity
South Island placer mining at Gunclub continued although, inhibited somewhat by winter snows and the building of a large water storage dam. Production was down although the high New Zealand gold price almost offset this.

Exploration continued at Drybread with further shallow drilling and sample processing. A Mining Permit was granted for Drybread on 26 August 2011. The drilling results are very encouraging and a Gold Recovery Unit and associated plant has been moved on site with gold production expected to commence in late November.

Stage 1 drilling was completed at Shepherds Flat (57 holes for 709m) and results were encouraging. Stage 2 has been planned and is expected to start in December. Shallow drilling has also been carried out on 3 other prospects in the adjoining Maniototo Valley with good results.

Q4 2011 Exploration & Mining Activity
South Island placer work comprised of ongoing mining at Gunclub.
Exploration continued at Drybread to provide grade control in preparation for mining. Pilot
mining commenced in November with a protracted settling in period.

A full analysis of Shepherds Flat drilling was completed and presented to Joint Venture
partner Placer Gold International who has agreed to proceed to stage two of the Shepherds
Flat Joint Venture.

A reconnaissance drill programme was completed at greenfields target Beatties (Maniototo
Valley). An area of encouraging grade was encountered, and a follow-up drill programme is
to be completed.
A second phase of drilling was completed at Kirk Creek to build on earlier positive results.
Results from this second phase of drilling downgraded this prospect.

Hauraki Region - WKP

Q2 2011 Exploration Activity
Helicopter supported diamond drilling continued with WKP 28 (April), WKP29 (May/June) and
WKP 30 (Jul/Aug). Results for WKP 28 & 29 were released on August 26 (see below) with
assay results awaited on WKP 30.

WKP WEST
WKP 28, confirmed significant low grade gold mineralisation, highlighted by narrow
intervals of high grade, and is consistent with strong ground-based resistivity (geophysical) surveying. This demonstrates the zone has potential for over 800 m strike and a vertical extent of over 250 m. To date, the five long, angled, diamond holes drilled have all intersected significant gold-silver mineralisation over broad widths confirming a potentially very large epithermal gold system.

NEW TARGET ZONE - “WKP SOUTH”
WKP 29, drilled westward (previous holes were drilled eastward into the WKP West resistor) targeted a potentially new mineralized zone to the south-west, represented by a strong resistor, intersecting an exciting zone of high grade gold-silver mineralisation.
The strong resistor extends both north and south of the current drill hole, with another drill hole WKP 30, (results pending) drilled beneath WKP 29, angling at depth and traversing the resistor for a length of 720m. Aeromagnetic and CSAMT resistivity geophysical surveys indicate this new zone has a strike potential of at least a kilometre.

Q3 2011 Exploration Activity
Assay results from the 720m diamond drill hole, WKP 30 were received after some delays at the laboratory. These results will be the subject of a separate press release. The intersection of andesites (the preferred host for epithermal mineralization) with rhyolites, in this large and fertile system, is encouraging. A substantial infill/expansion drill program is warranted.

Q4 2011 Exploration Activity
Drillhole WKP 31, drilled at a 68 degree dip southwards from the center of the prospect was
completed in December to a depth of 598m. Initial assay results include 9.7m of 17.2g/t
Gold and 24.2 g/t Silver. Remaining assays, geological logging and metallurgical testing are
underway.Significant recent drilling results at Central Zone, WKP Project
Drillhole ID From To Interval m Au g/t Ag g/t
WKP 31 146.1 155.8 9.7 17.2 24.2

Q4 2011 Exploration Activity at Muirs
The first two drillholes (of seventeen) have been completed at the Massey Reef this
quarter. Drilling commenced late November and the first drillhole MSDDH08 reached 86.5m
on the 13th of December. The drillhole penetrated a highly altered andesitic volcanic unit
with variable quartz veining throughout. Results included an intercept of 17m @ 1.71 gm/t
Au.

The second drillhole MSDDH09 reached 191m underneath and on section with MSHDH08.
MSDDH09 intersected quartz veining from 64.6m to 67m and silicic hydrothermal breccia
from 103m to 117m, assays are pending.

Mining at Gunclub (Gold Recovery Unit #2) encountered a lower grade section of the resource, as indicated by drilling and trenching results, with consequent lower production. The rebuild of GRU #3 was completed and commenced mining at Drybread in Q4. Gold Recovery Unit #1 is to be reconfigured and is planned to commence mining at Drybread in mid-2012.

C$392,000 for Investor Relations explained: The Company is developing an improved Investor Relations programme, which covers the Canadian and European investor base (including London). The objective is to ensure that the market is fully informed of Glass Earth’s progress as it enters an exciting time in its development path. Increased expenditure on personal presentations by the CEO and internet based dissemination of information, as assisted by IR professionals in Canada and London are budgeted to continue.

In 2009/2010, in tandem with the approach of limiting overheads, the Company placed significant effort into developing some its numerous placer gold targets and a near surface hard rock gold ‘pod’ deposit (Ophir) - both with a view to establishing smaller scale mining that could provide a source of ongoing revenue that would contribute significantly to the Company’s cash requirements.

Progress has been steady, with one placer mine in production and a 40 tonne gold recovery unit (“GRU”) leased out from December 2009 to June 2011. A replacement placer mine commenced in early December 2010. In addition, the Company has signed a Letter of Intent with a Venture Partner to provide funding of up to NZ$1.5m (circa C$1.1m) to develop 2 placer mines. These initiatives are expected to generate significant contributions towards the Company’s cash requirements.

In March 2011, several additional exploration staff were hired and a large office/workshop leased in central Otago, to use as a base for operations.

The Directors have approved a rolling 12 month budget that allows the Company to continue as a Going Concern based on this year's fundraising, the cash budgeted to be generated from mining activities and contributions from joint venture partners.

The Mamaku-Muirs and Central Volcanic Regions exploration expenditures, including
staffing, permit rental, resistivity surveys and field work are currently budgeted for modest activity through 2012 apart from trenching and drilling campaigns at the Muirs prospect.

The Otago Region is a major focus of Company funded exploration endeavour and mining activities.

Outstanding Share and Option Data

Subsequent to the 1:5 share consolidation on 18 March, 2010, as at March 26, 2012, the following items were issued and outstanding:
· 66,162,409 common shares;
· 2,828,000 common share purchase options with an average exercise price of $0.4361 per share and expiry dates of between March 27, 2012 and August 17, 2015;
· 9,106,500 unlisted common share purchase warrants with an exercise price of $0.35 per share and an expiry date of May 5, 2012;
· 5,102,840 unlisted common share purchase warrants with an exercise price of $0.35 per share and an expiry date of June 7, 2012;
· 5,517,790 unlisted common share purchase warrants with an exercise price of $0.50 per share and an expiry date of December 23, 2012;
· 340,000 unlisted common share purchase warrants with an exercise price of $0.50 per share and an expiry date of December 29, 2012;
· 2,027,426 unlisted common share purchase warrants with an exercise price of $0.50 pershare and an expiry date of January 6, 2013.
· 1,150,400 unlisted common share purchase warrants with an exercise price of $0.50 per share and an expiry date of January 8, 2013
· 2,665,949 unlisted common share purchase warrants with an exercise price of $0.80 per share and an expiry date of September 23, 2013 and
· 340,900 unlisted common share purchase warrants with an exercise price of $0.80 per share and an expiry date of October 5, 2013
There are no shares subject to TSX Venture escrow provisions.


Also in the annual report:


As at December 31 2011, Glass Earth held by itself or together withjoint venture partners, one of the largest portfolio of gold and silver focusedprospecting and exploration permits in New Zealand (2,700 km²), withapplications lodged in 2011 for an additional 7,300 km²..

I added up the areas for the permits they held at the end of 2011, I only came up with about 1,050 km2. It's about 1,184km2 now, with another 7,767 km2 applied for. 5,262 km2 of that is one big prospecting permit application above Macraes, 53297.

So I'm missing some permit areas that are fairly big, not sure what they are.

[elZorro]

The latest MD&A shows that there are a lot of positives already, more on the way.

Filtering through all this to see what the shareprice might do in the next few months, there is some dilution heading our way if the share price stays slightly above C35c, with over 14 million share purchase warrants coming through between now and early June. There is a possibility that some are selling off GEL just above this figure, to buy some of their warrants with the cash.

I just had a look, and in late November 2011 GEL was saying that GRU#1 would be heading for Drybread in early 2012. Now it's predicted to be just after all those 35c warrants have been either picked up or dropped, in late June. Of course Glass Earth raises no capital out of traders on the NZAX or TSX, they'll be keen on seeing the warrants picked up. The next raft of warrants are at higher prices, but by then, the cashflow figures from placer mining will be much better. So the next 2-3 months might be a time when the share doesn't move much, but will be a great time to accumulate GEL. There's also always the chance that something bigger gets discovered, with drills ongoing.

I've received the proxy voting forms for the AGM, to be held later this month in Canada. Nothing too contentious there, with the stock options clause for directors, employees and consultants to the firm being up to 10% of all the current stock, but that's the same as in previous years.

My only comment here is that Glass Earth can look a bit like a cosy club for gold exploration groups in NZ. If consultants are charging GEL their normal fees per hour, this shouldn't mean they are the only pick for JV partners, and also get to purchase large chunks of GEL off-market if it drops lower than it should, based on fundamentals. These parties are all insiders, effectively. On the other side of the coin, stock incentives are a much better idea than higher remuneration of directors and key personnel, for a greenfields explorer.

[Had a look at the financial report, looks like stock options might be offered to non-employees in lieu of payment for goods and services].

[elZorro]

ODT reports that another GRU is to be installed near Gunclub within 3 weeks. No photo? Unsure about the capacity of this unit.

http://www.odt.co.nz/news/business/203606/glass-earth-posts-loss-cash-retained

Still another refurbed unit to be installed in June, should be GRU#1 at Drybread.

Note to ODT: GEL technically has a few dozen permits waiting for approval from NZPAM. Current actual permit holdings are a lot less than 10,000 km2. This is written up correctly in the latest annual report, just out.

[elZorro]

Today, NZPAM posted the granting of mining permit MP53814 for Glass Earth.

It's called Pig Burn, and previous passing mention was made of this site in the 2008-2009 Exploration Vision. The NZPAM link to the area is being worked on, so I can't tell for sure where it is. It's inside permit EP53183, in the Maniototo area. Other placenames nearby might be Cambridge Creek, Cap Burn, Orangapai.

The permit is for 5 years, area is 45.57Ha, requires the processing of no less than 50,000 cubic metres per year, although this is standard. It could be this is the site that is destined to take the second GRU within three weeks, see latest MD&A report.

An archaeological report has been completed on the site.


Arch Hill Heritage Ltd. consultancy reports completed since January 2011Middleton, A. October 2011. Regent Theatre Dunedin: Final report on archaeological authority 2011/262 for Oakley Gray Architects / Dunedin City Council. Arch Hill Heritage Report No. 99.
____. October 2011. 189-195 King Edward Street South Dunedin: Archaeological Assessment for the Brocklebank Family. Arch Hill Heritage Report No. 98.
____. August 2011. Beach Road Oamaru: Archaeological Assessment for Lakes Consulting Group / Waitaki District Council. Arch Hill Heritage Report No. 97.
____. August 2011. 234-242 George Street, Dunedin: Archaeological Assessment for MRF Properties. Arch Hill Heritage Report No. 96
____. July 2011. The Beeches / Pig Burn Proposed Mine Area Archaeological Assessment for Glass Earth Gold Ltd. Arch hill Heritage Report No. 95.
Middleton, A. & H. Williams. July 2011. Oamaru Harbourside Walkway / Cycleway Final report on authority no. 2009/214. Arch Hill Heritage Report No. 94.
Middleton, A. June 2011. Takiroa Rock Art Site: Final report on authority no. 2010/03. Arch Hill Heritage Report No. 93.
____. May 2011. Drybread Proposed Mine Areas: Archaeological Assessment for Glass Earth Gold Ltd. Arch Hill Heritage Report No. 92.
____. May 2011. Ophir Post Office Final report on Archaeological Authority 2011/343. Arch Hill Heritage Report No. 91 Report to NZHPT.
____. May 2011. Ambrose Building, Gore Final report on archaeological authority 2010/330 for Mollison & Associates / Mataura Licensing Trust. Arch Hill Heritage Report No. 90.
____. April 2011. Vulcan Hotel St. Bathans: the archaeology of the waste water scheme earthworks. Arch Hill Heritage Report No. 89.
____. April 2011. Outram Blacksmithy, Hoylake Street: Archaeological Assessment for Gerald Rillstone and Lisa Chatfield. Arch Hill Heritage Report No. 88.
____. April 2011. 38 Derwent Street Archaeological Assessment for Daniel & Rayleen McCloy. Arch Hill Heritage Report No. 87.
____. March 2011. Vinegar Hill Gold Workings Archaeological Assessment for Glass earth Ltd. Arch Hill Heritage Report No. 85.
____. February 2011. Conroy’s Road, Alexandra: Five Schist Culverts. Final report on authority no. 2011/251. Arch Hill Heritage Report No. 83.
____. January 2011. Bannockburn Gravel Pits Archaeological Assessment for Central Otago District Council. Arch Hill Heritage Report No. 82.

[elZorro]

The permit map is now available on NZPAM, and the area is at one end of an unsually shaped permit EP53183, in a region below Ranfurly, near Orangapai. Note the strange crop circles, these might be centre pivot irrigator areas.The area to be mined looks like a braided river bed, not intensively farmed.

This area was/is part of an Aurora Minerals JV?

http://www.auroraminerals.com/LinkClick.aspx?fileticket=6xdN7u7IsYU%3D&tabid=1967&mid=3750

I checked Aurora's background again, probably have it back in the thread, but Aurora Minerals has dropped all NZ permits, or they've expired. They're concentrating on Western Australia now. (ASX: ARM). The permit was 39267, a big one.

The permit MP53814 is 10% owned by Mark Gunton, Auckland (NZ Minerals). This is in keeping with all the other Otago permits held by Glass Earth.

[elZorro]

It might be time for another information request from the Glass Earth office.

It's a bit confusing, but it sounds like GRU#2 is working at Gunclub, GRU#3 is either at Drybread doing a pilot trial or is being refurbished to be placed at another site altogether, or there is another GRU#4 being refurbished, perhaps for Pig Burn, the new placer mining site.

GRU#1 is the only unit we seem to have photos of, and while it's probably the biggest equipment GEL owns, it has been out of action for nearly 12 months, but will eventually be deployed at DryBread (the largest placer permit) in June 2012.

While GEL says they had 2,700 km2 of live permits as at 31 Dec 2011, I could only tally about half that from the permit table, allowing for ones that had been dropped and picked up since. The permit list on the GEL website could include areas, along with relevant dates.

[elZorro]

Googled up this short interview with Simon Henderson, and just the few words are filling in some gaps.

http://www.menafn.com/menafn/qn_news_story.aspx?storyid={7f88b9ea-451b-4dc4-a604-03f511ad0db1}

Targeting 1Moz+ at Muirs, and of course it's 100% owned by GEL. Some of the gold is very shallow, and it's worth a lot more than when it was last mined, then purely taking out the bonanza grades before flooding set in. Muirs should be worth about as much as WKP to GEL, even if WKP goes over 3Moz. Still the issue of getting someone to front up with capital to mine it though.

On a day like today, when Heritage Gold is making scary moves, I'm pleased to be an investor with Glass Earth.

[elZorro]

From NZResources:


Glass Earth Gold sees WKP as having scope for 3 M ounces

Ross Louthean — 13 April 2012
Being an explorer with cash flow and substantial gold permits throughout New Zealand were two positive pointers detailed by Glass Earth Gold (TSX-V & NZAX: GEL) to the investor resource media group Stockhouse.

In a question and answers session Glass Earth’s chief executive Simon Henderson said the company also had the advantage of being a gold producer – from placer operations in Otago – to help fund its search process.
Henderson said New Zealand was chosen because of its “huge gold potential,” its strong gold mining history and the evidence shown by two large gold mines – Martha on the North Island and Macraes on the South.
Glass Earth Gold’s two leading projects were the 35% owned WKP gold discovery with Newmont Waihi Gold near Waihi and the 100% owned Muirs Reef project, further south in the Hauraki goldfield.
Henderson said WKP was advancing and could have potential to be a +3 million ounce project. The first hole there showed the size of the system with 156.1m grading 1.6 grams/tonne gold, and recent holes included high grade hits such as 3.2m @ 37 g/t Au.
He said work in the past year at Muirs Reef demonstrated a 650m long strike length of surface mineralization. The company was now undertaking a 2,500m diamond drilling programme to identify the depth and strike extent of this system.
Henderson said the company has about $C2 million ($NZ2.43 M) on hand with a burn rate of around $C120,000 ($NZ146,250) per month and much of this is being funded from placer mining profits.
Source: stockhouse.com


Here's the link to the item on Stockhouse. (http://www.stockhouse.com/Community-News/2012/Apr/11/Explorer-has-cash-flow-from-New-Zealand-gold-disco)

In fact the wording from Simon Henderson was that WKP certainly has the potential for +3Moz.

The importance of this, is that 2-3 Moz is the stated trigger level for Newmont to be interested in opening up a new mine significantly removed from its current infrastructure. I had wondered why there was more buy interest over on the TSX for the last 2 days. GEL moving a bit higher today, still near the price of those C35c options.

I have emailed Simon with some questions yesterday, and true to form, I have very promptly received good answers from him directly. Here's one.


Q. With all the share options coming through at C35c, is Glass Earth keen to see these picked up, or in view of dilution to your own holdings, happy to see them left? What is the most likely outcome?

A.Yes, we certainly want them to be picked up,however it will be good to remove the “overhang” one way or the other. Dilution may result but "cash is king". The investment market for our kind of stock is fickle at the best of times and right now is especially challenging, so it would be foolish to turn down this capital. I'm in fact about to visit the Northern Hemisphere to talk with key warrant holders and the wider market, it's important we effectively communicate our progress and this year's potential. We're confident many of the warrants will be exercised but this is largely in the market's own hands.

[elZorro]

I have been following the story behind the big GRU#1 for a few years now. First I couldn't understand why it was leased out after it had been refurbished by Dunstan Mining. It turns out it was probably being operated then, by the previous owner. Once it came off lease (to be replaced with a bigger unit on L&M's permit at Earnscleugh), it seems to have sat around for most of a year, when GEL could have generated placer income from multiple permits. I assumed there was something badly wrong with the plant. I asked Simon Henderson about this.
Q. Why has GRU#1 been out of action for so long? Surely its effect on cashflow will be immediate if working in the right area, so why the 12 month delay?
A. Could not agree more. We ourselves would have liked to have the plant working many months ago but, put simply, this was stymied by our then JV partner (who was really only comfortable with single plant operations). This is all history now, it was a little worse for wear on return so we are in the process of a significant refurbishment to the plant to put it into production alongside other operations in or before early June. (Second plant in and running next week, the big plant on probably the most important high grade resource as soon as possible).If I read this right, the heavy use on the L&M permit during the lease will have worn out some of the metal-handling surfaces and wear parts. If GRU#1 is the 'big plant', then Drybread is also 'the most important high grade resource'. It looks like the unit will be operating by early June, rather than late June. That's only 6-7 weeks away. At least we're on track now - possibly Dunstan Mining was too short on capital before, to make much headway with the fitout for another placer operation.
Q2 2011 Exploration & Mining ActivitySouth Island placer work comprised ongoing mining at Gunclub, a drilling campaign at Drybread (a target in the Manuherikia Valley, also in central Otago), processing of drill samples and field mapping/sampling in Southland. South Island placer mining at Gunclub continued with twenty five pits completed and assayed to define and test the western lode ahead of mining. Resource definition drilling commenced at Shepherds Flat in July. Six drill lines are planned with eight holes and 165m of drilling per line.Drybread RC drilling has continued with 144 holes completed and two additional lines planned. Processing of these drill samples is ongoing. Council resource consents have been granted in respect of Drybread and the grant of a Mining Permit is imminent. This will allow 2 further Gold Recovery Units to be deployed –complementing production at Gunclub.Mining at Gunclub encountered a lower grade section of the resource, as indicated by drilling and trenching results, with consequent lower production. The rebuild of GRU #3 is nearing completion and will be mining at Drybread in Q4. The leasing out of Gold Recovery Unit #1, ceased in mid-June as planned. This unit is to be reconfigured and is planned to also commence mining at Drybread in early 2012.Q3 2011 Placer Exploration & Mining ActivitySouth Island placer mining at Gunclub continued although, inhibited somewhat by winter snows and the building of a large water storage dam. Production was down although the high New Zealand gold price almost offset this.Exploration continued at Drybread with further shallow drilling and sample processing. A Mining Permit was granted for Drybread on 26 August 2011. The drilling results are very encouraging and a Gold Recovery Unit and associated plant has been moved on site with gold production expected to commence in late November. Stage 1 drilling was completed at Shepherds Flat (57 holes for 709m) and results were encouraging. Stage 2 has been planned and is expected to start in December.Shallow drilling has also been carried out on 3 other prospects in the adjoining Maniototo Valley with good results.

Looking again at Drybread, GEL now has its own shallow RC drilling rig I think, and more than 144 drills have been assayed at Drybread in 2011, with the results being "very encouraging". Here's the permit map (https://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?application=53653), and the satellite photo. Looks like flat ground, great road access, 877 Ha, that's a big mining permit.

This page from the GEL website shows the shallow drilling rig in use, could be at Drybread.

http://www.glassearthgold.com/s/Projects.asp?ReportID=450554

[elZorro]

The small cluster of farm buildings that makes up the location Lauder Creek (as opposed to the actual watercourse shown on the map above, and Lauder settlement to the south) is right in the middle of the mining permit.

Here's a letter written to the Crown about mining access for Lauder Station, in 2010. Cam Wylie is connected to the industry-good organisation Straterra, along with Simon Henderson. http://www.ausimm.co.nz/AusIMM_LauderStation.pdf Turns out Lauder Station is further to the north, see topo map.

Thanks to google street maps, have a look at the flat terrain at the 5-star intersection itself. It's dry, sheep country.

[elZorro]

Matakanui (to the west of the Drybread location) seems to have been the largest settlement in the area, with about 3,000 to 5,000 residents in the late 1800s. Some photos of the area here (http://www.promotedunstan.org.nz/PDHeritage.html#hm2), and note the image I've posted before showing the sluicing at Drybread.

It might look impressive, but this was surely an expensive and labour-intensive method. Glass Earth will be able to use mobile diggers and trucks, transporting to the GRUs in their own ponds if needed, conserving scarce water. The GRUs can also travel in a moving pond arrangement anyway. Looks like the area uses an irrigation scheme.

Matakanui has been good to some influential investors over the years. Have a look at Mr Knox D'Arcy (http://en.wikipedia.org/wiki/William_Knox_D'Arcy), whose oil discovery in Iran founded BP. Perhaps it'll be just as polite for GEL shareholders?

[elZorro]

Background RC Drilling method from Wikipedia:

Reverse circulation (RC) drillinghttp://upload.wikimedia.org/wikipedia/commons/thumb/1/1a/RC_drill_rig.jpg/220px-RC_drill_rig.jpg (http://www.sharetrader.co.nz/wiki/File:RC_drill_rig.jpg) http://bits.wikimedia.org/skins-1.19/common/images/magnify-clip.png (http://www.sharetrader.co.nz/wiki/File:RC_drill_rig.jpg)
Reverse Circulation (RC) rig, outside Newman, Western Australia


http://upload.wikimedia.org/wikipedia/en/thumb/2/2e/RC_Rig_sideview.jpg/220px-RC_Rig_sideview.jpg (http://www.sharetrader.co.nz/wiki/File:RC_Rig_sideview.jpg) http://bits.wikimedia.org/skins-1.19/common/images/magnify-clip.png (http://www.sharetrader.co.nz/wiki/File:RC_Rig_sideview.jpg)
Track mounted Reverse Circulation rig (side view).



RC drilling is similar to air core drilling, in that the drill cuttings are returned to surface inside the rods. The drilling mechanism is a pneumatic reciprocating piston known as a "hammer" driving a tungsten-steel drill bit. RC drilling utilises much larger rigs and machinery and depths of up to 500 metres are routinely achieved. RC drilling ideally produces dry rock chips, as large air compressors dry the rock out ahead of the advancing drill bit. RC drilling is slower and costlier but achieves better penetration than RAB or air core drilling; it is cheaper than diamond coring and is thus preferred for most mineral exploration work.

Reverse circulation is achieved by blowing air down the rods, the differential pressure creating air lift of the water and cuttings up the "inner tube", which is inside each rod. It reaches the "bell" at the top of the hole, then moves through a sample hose which is attached to the top of the "cyclone". The drill cuttings travel around the inside of the cyclone until they fall through an opening at the bottom and are collected in a sample bag.

The most commonly used RC drill bits are 5-8 inches (13–20 cm) in diameter and have round metal 'buttons' that protrude from the bit, which are required to drill through shale and abrasive rock.

A picture tells a thousand words, this one from GEL is a beauty. Note the approx 1988 Toyoace truck-mounted RC rig, looks like it works fine, and costs are kept in-house. They'll be able to use it on multiple permits. The truck itself might still be worth up to 10k, the rig extra, so that might be 10% of the 2011 year asset list for mining equipment. Glass Earth is using any funds carefully, by the look of it.

Looking along Glassford Rd with streetview, saw the below scene, which includes an unusual cluster of three trees, some with signs of drought or possum damage. Spot the link with the Glass Earth photo of placer drilling?

[elZorro]

The description of many placer sites is an old river course, usually in a fan shape. Drybread looks like this, it starts in the Dunstan mountains, and heads out across a flatter area, under Glassford Road. Both sides of the road are old placer or alluvial mining sites. One dotted mining site looks strongly like part of a braided river, and it points directly towards the area of the GEL placer RC drill photo.

I think GEL are looking off to the side of historic workings, rather than rework old ground for slim pickings. They only need 0.2grams/cubic metre of gold, 3 grains/cubic metre to make a small profit. Better spots will be a few grams/cubic metre, hopefully, for great cashflow. Fingers crossed.

I asked Simon Henderson if shareholders could have more detail about the mining equipment that the company now owns.


Q. Can shareholders expect to see a list of the capacities and status of the 3 or 4 GRUs and other equipment, with scaled photos perhaps? I realise that in the end, profit obtained is all that is important, but we have no ability to estimate what the earnings might be without that data. GEL insiders will have most of that information, the market doesn’t.


A. Yes. We're enjoying having full control over this gear and would like to make more of a story of what these plants can do, and how. Grade is one thing, and plant throughput is another. We're right now working on an update to the "placer" page on our website, I think I mentioned to you earlier that we are reluctant to talk about deposit ounces given landowner relationships, but we'd like to give as much detail as we can get away with - photos and details of the plant and our mining process included.

[elZorro]

There are a few things that make Glass Earth unique in NZ: the first to cover lots of the country with the latest electronic equipment, the first to hold umpteen permits allowing them to cherry-pick, rare greenfields explorers with their own mining equipment and placer deposits.

Shareholders are anticipating the arrival of GRU#1 at Drybread / Lauder Creek, to complement the current GRU that has had "an extended settling in period". We should be getting some photos of that gear soon. I suspect that Drybread is the best of the placer sites that GEL holds, in terms of size and easy access. It's a big mining permit, laid out to cover 877Ha of an alluvial fan structure.

Now the guessing starts. The total permit area is 8.8 million square metres, and assuming 2 metres depth is payable at the minimum 0.2grams/cubic metre, a total of 130,000 oz there. But even if the GRU#1 was doing 50% duty for 24 hrs every day of the week, or 5,000 cubic metres/week as L&M achieved with it, it would take 77 years to process the whole area. GEL will have to find the best parts of the permit with the RC drill rig, and it looks like there is plenty of choice. Simon Henderson has already mentioned that sometimes the placer gear has hit small areas of over 3 grams per tonne (other permits).

GRU#1 can process 60-75 cubic metres of ore an hour (approx 100 tonne/hr) , in practice 45-50 dry tonne/hr is achieved. Imagine if the gear was running 10 hours a day, 500 tonne of ore per day, and the best spots were selected to yield an average 1gram/tonne grade. Each day would recover 16oz gold, about $32,000 worth. It's nearly $12mill turnover a year off one permit. L&M had 15 staff running a 24hr process, maybe GEL would need 10 for daytime operations only, so about $2mill in costs (again this is a big guess). The result is $10mill of profit per year, which of course would cover all other overheads, access fees, 10% share, royalties and a lot more exploration drilling elsewhere.

Here's the link to the post on the operation at Earnscleugh. (http://www.sharetrader.co.nz/showthread.php?4019-Glass-Earth-IPO&p=366615&viewfull=1#post366615) Based on L&M data, the grade there averages 0.2g/tonne, but they are using a bigger GRU to get the job done in 7 years. That's an example of a large, low grade placer resource. GEL has some hotspots among their permits, suitable for the smaller gear they own.
Regarding Vinegar Hill and Shepherds Flat, JV placer areas, I emailed Simon for clarification.




Q: Thanks for your answers the other day. Here is the link to the PGI site that quotes data from Glass Earth. The units (g/m3) are not separately defined, but the article does quote data from older alluvial work in grams per cubic metre. The differences in magnitude are so great that it is important these figures are confirmed as one or the other. I could ring PGI, but as the data is from Glass Earth (I’ve not noticed the data on the JV areas before), thought it would be best to know from you.


http://placercorp.com/fileadmin/images/Praesentation/2012-02-15_en.pdf

Do you have any comments on PGI? Has some funding been expended by them?

A. (Simon): I have just had a look at the PGI data, it did not come from GEG but from a report by L&M mining in the 1990’s on Vinegar Hill. The numbers as reported by L&M are correct and they have individual 1 m intervals from drilling up to 20gm/cu m ….yes bonanza stuff. However one has to put this into perspective; there are no alluvial operations digging down to 40-60 metres…where the historically high grade drill results are reported. GEG has had individual 1m intervals up to 4gm/cu m in its recent exploration drilling on Shepherds flat, but one result does not make a resource.

We are currently seeking advice from TSX:V as to how to report placer / alluvial results, so that what we do report is in context and we don’t get a rap over the knuckles. Until we have this sorted we need to be circumspect about what we say.

PGI are in JV earning in on this project, so the current and earlier drilling phases completed by GEG (as operator) are funded by PGI.

Thanks Simon

[elZorro]

The Placer Gold Corp page that shows some L&M Mining data for JV area Vinegar Hill is below. These will be the best grades, and they are down deep, requiring a lot of overburden removal to get at them. Sounds like that's not the idea for placer mining, but 20grams/m3 is a great grade.

Remember that Vinegar Hill is just southwest of St Bathans, and Drybread is southwest of Vinegar Hill, all of these alluvial areas feeding off the Dunstan Range.

I asked Simon Henderson about staffing levels for the acquired mining operation.


Q. What are the staffing levels now? Is Dunstan Mining contracting out to other mining clients, or will it be working solely on GEL interests? Where is Dunstan Mining? Photo?


A. In addition to our existing geology and admin team, we now have a mining team of 10 and growing (to accommodate three or more simultaneous operations), plus a new Operations Manager and COO, accounts support and so on. "Dunstan Mining" (the name will be changed soon) is based in Alexandra, now in the same premises as our geology office (42 Russell Street). We've leased out more workshop and office space, and it’s become a hive of activity. It's more likely others would contract to us to mine (eg on peripheral areas) than the other way around, we have a decent portfolio of projects and many prospects to develop.

On the TSX, the share finished at C32c, about NZ39c, but plenty of interest on the buy side of over 250,000 shares. I think some are shorting the share, hoping to pick up a bargain. Current Mcap would be about C22mill based on that price, does that look like good value for a company that could easily be sitting on a pile of cash within 6 months, with all its permits?

[elZorro]

Time will tell whether the "very encouraging" drill tests at Drybread permit will result in perhaps $10mill of net profit each year, but it's likely to be GEL's biggest placer permit holding, and the other JVs are being done on the lesser finds. In the same way that Muirs has been kept as a 100% GEL holding.

I went fishing.


Q. Good to see the big grades at Muirs. Is WKP likely to be a slow burn, waiting for Newmont to run out of easy gold near Waihi, so more attention moving to Muirs?


(Simon) A. Yes and no. No because Newmont do seem committed to the project both in their words and actions, yes in that if for some reason Newmont's appetite for WKP exploration changed (and it would be naive to rule that out), we're never going to regret having developed our own independent project. Just as with our placer gold production, we think it's sensible strategy to hope for the best, plan for the worst.

I think this is a great strategy, how many companies could generate this sort of income from a few hundred hectares? Un-irrigated farmland in Otago (sheep/beef) produces only $200 of gross profit per hectare per year. GEL could achieve $11,000 from each hectare in the permit per year, while only digging up a small portion of it, resowing as grass.

[elZorro]

Press release out overnight: confirms the small text line in the MD&A report, a substantial drilling program for WKP north of Waihi is under way. The detail shows the drilling is occuring at the southern end of the WKP area, looking at the base andesite for gold hosting, as seen elsewhere in the region. These will be remote sites, possibly a helicoptered rig at a guess.

http://finance.yahoo.com/news/glass-earth-gold-commences-5-140000292.html

On the TSX, looks like a finish at C31c, but some sold at 32.5c earlier in the day, and the last trade of 2,000 shares by Jitneytrade follows a pattern of selling down at the end of the day. Again, high numbers sitting there on the buy side.

All the signs are there, the shareprice for GEL will be a lot higher in just a few weeks, unless all the exploration over the last few years has been imaginary. A great time to accumulate, I certainly am.

[elZorro]

No new detail in the NZResources article out today, but that's a reasonable amount of coin to be spent on the drills. GEL has to cover 35% of the costs, but can hold 35% of the permit value too. Try multiplying 3Moz times the gold price. There will be bigger numbers in the end.


WKP gold quest steps up on the Coromandel

Simon Hartley — 20 April 2012
A new drilling programme on the WKP gold-silver prospect near Waihi will see $4 million being spent by the partnership of Newmont Waihi Gold and Glass Earth Gold Ltd (TSX-V & NZAX: GEL).
Glass Earth has a 35% share in the project where a total of 5,500 metres are to be drilled on targets within the permit which covers 3 kilometres by 5 km, 10 km from Newmont Waihi Gold’s Waihi gold mining operations.
Glass Earth’s chief executive Simon Henderson said the joint venture WKP prospect had been inspired by earlier exploration showing broad zones of about 100m of 1 g/t gold and also silver and also “significant high grade” intercepts of widths of between 3m-9m grading between 15 to 60 g/t gold and silver.
“Results to date have demonstrated that this project represents a very large gold mineralised system. The current programme will test both the size and tenor of broad mineralised zones and connectivity of high grade intervals,” Henderson said.
Glass Earth said WKP continued to demonstrate new “enticing” targets south of the present drilling areas and higher grade intersections within the current drilled zones, such as 9.7m @ 17.2 g/t gold and 24.2 g/t silver.
Glass Earth and Newmont have another joint venture in the region, Waihi West, which Newmont is managing and Glass Earth is exploring its Muirs Reef prospect further south on its own.
Muirs Reef has produced encouraging recent results including 2m @ 38.4 g/t Au and 49.2 g/t Ag.
In Otago, Glass Earth is close to having the last of three alluvial gold production
operations begin and has also been getting positive results from other Central Otago sites. It has two operations in the Manuherikia Valley and one in Ida Valley.


ODT article from 2010 (http://www.odt.co.nz/news/business/91097/glass-earth-aiming-higher-capacity)implies that GRU#1 was earmarked for McAdies before the leasing out started (L&M). The dark green GRU shown working at McAdies in the photo pages (website) has a capacity close to GRU#1 apparently. I think it's the one that has been moved to Gunclub.

I even saw some mention of GRU#1 going to Ophir, maybe this is part of the reason for the delays in it finally going to a GEL permit in June this year (Drybread).

[elZorro]

Some of the pages on the Glass Earth website have been added to. In particular, the placer page under projects (http://www.glassearthgold.com/s/Projects.asp?ReportID=450554), which I've been keeping an eye on, so this is within 12 hrs or so. There are a couple of new images - gold being washed up and a close-up of grains from Drybread. I thought the text was interesting too.


Projects
Placer Operations Joint Venture (GEL 50%)
Glass Earth Gold actively mines for placer ("alluvial") gold across its large permit holding in the Otago region (where over 8M ounces of gold has been mined historically since the first gold rush in 1861).Current resources under mining and resource consents total ~15,000 oz, with a further ~15,000 oz under resource development.

The mining, undertaken through wholly owned subsidary Glass Earth Mining (Dunstan Mining Ltd), enables cash to be generated from ground already being held for hard-rock exploration (where we are looking for targets similar to the nearby Macraes Mine, a mesothermal shear-hosted 7.2M ounce deposit owned by OceanaGold).

Current placer production is around 2,000 oz/annum, with the immediate goal of our placer operations is to increase production to 7,500 oz/annum to cover all company-wide "General and Administrative" expenses, with further profit being re-invested into hard-rock drilling and wider exploration in Otago and up north at WKP (http://www.glassearthgold.com/s/Projects.asp?ReportID=450302) and Muirs (http://www.glassearthgold.com/s/Projects.asp?ReportID=450553)."

Drybread is now 90% GEL owned, not 50% as the header says, but it will take a while to pay off the cash expenses involved there. However, they are a capital cost, won't appear on the trading side of the accounts. Note that the intention is to investigate the placer areas for hard-rock deposits as well, so someone who knows about gold flakes would be able to tell how far they have moved. The grains shown are smaller than a mm across, some hammered flat, most rounded. But these are from soil trenching and pitting tests so far.

Placer ounces of gold (payable) held in permits is likely to be 30,000 oz, that's NZ$60 million worth of sales ready to be collected.

Placer gold info, worth having a look at. http://www.goldgold.com/gold-prospectingcharacteristics-of-gold.html

Is Drybread eluvial or alluvial, the definition seems to depend on the distance from the source. Drybread could also be a bench deposit. http://www.southernprospectors.com/id1.html

By coincidence, a google of eluvial placer with Otago picked up:


Eluvial gold placer formation on actively rising mountain ranges, Central Otago, New Zealand

D. Craw, J.H. Youngson

Geology Department, University of Otago, P.O. Box 56, Dunedin, New Zealand
Received 12 June 1992. Accepted 17 November 1992. Available online 11 April 2003.

Abstract Eluvial gold deposits in Central Otago, New Zealand, have formed and are still forming on the flanks of actively rising antiformal mountain ranges. These gold deposits are derived mainly by erosion and concentration of fine-grained ( < 500 μm) gold in mature Miocene fluvial quartz gravels.

Chemical processes during Pleistocene-Recent uplift and eluvial sedimentation have resulted in crystalline and amorphous authigenic gold precipitation and up to 2 orders of magnitude gold grain-size increase. The eluvial gold deposits are hosted by thin lithic soil and sequences (up to 60 m thick) of poorly sorted immature schist gravels. The gravel sequences consist mainly of matrix-supported mass flow deposits and channellised proximal fan deposits, intercalated on a 1–10 m scale.

Gold is concentrated in coarse lag gravels (up to 40 cm clasts) at channel bases. Topographic slopes on the rising ranges show an evolutionary trend in space and time, from gentle weakly dissected surfaces, through slightly degraded but convex slopes, to deeply incised convex streams. Eluvial gold occurs sporadically on the gentle slopes, but the most efficient concentration processes occurred where steeper convex slopes yielded an apron of fan sediments.

Gold concentration at these sites resulted from selective and localized removal (“winnowing”) of most schist debris, leaving coarse lag gravels and gold. The combination of authigenic grain size increase and residual concentration ensures that the eluvial deposits retain coarse-grained gold, and that only fine-grained gold is released to the alluvial systems downstream.· ·

Correspondence to: D. Craw, Geology Department, University of Otago,P.O. Box 56, Dunedin, New Zealand.

Helpfully, the soils in the Manuherikia area usually have plenty of schist in them. The Drybread grains are less than 1mm across, so everything points to this deposit being eluvial - Dr Youngson's research field (Placer Gold International).

[elZorro]

The February 2011 newsletter from Glass Earth might show the start of pitting tests at Drybread (somewhere in the Manuherikia Valley), as GEL didn't have a mining permit for it at that stage.

http://glassearthgold.com/i/newsletters/GEL_newsletter13.pdf

There is a photo there of the other reasonable-sized GRU (GRU#2) that Glass Earth Mining now owns. (No change to the company records has been done yet). Drybread permit currently has a pilot plant (GRU#3) operating on it, however there has been some kind of teething problem alluded to. But this plant will probably do not much more than point out where to initially site GRU#1 in June. No doubt there will be some earthworks to create a pond for it to work in.

Meanwhile, the Gunclub permit is running with GRU#2, producing about 2,000 oz per year. This permit has been called an alluvial placer area. This GRU is big enough to require a digger to feed it, but it is smaller than GRU#1 (photo from the Glass Earth website). GRU#2 has to sit on a gravel foundation above a tailings area, whereas GRU#1 floats in a pond.

[elZorro]

The method of Youngson and Craw (1999) seeks to quantify the transport distance of gold grains. It cannot allow for glacial movement, as ice transport doesn't change the gold much. I found this paper about the Nokomai area, and of course Glass Earth already has a permit application there. But a part of the discussion is very interesting, and should apply to Drybread.

http://www.nzpam.govt.nz/cms/pdf-library/minerals/2000-minerals-conference/youngson.pdf


Transport distance estimates 2000 New Zealand Minerals & Mining Conference Proceedings • 29-31 October 2000

Rounding, flattening and folding of detrital gold preserves a cumulative record of the deformation it undergoes during transport from a primary source to the ultimate site of deposition. Particle flattening is particularly important, because it progressively lowers the surface area-to-volume ratio of gold which, in turn, enhances the entrainability of particles in a given current. On-going flattening thus allows gold particles to be progressively transported to lower-energy parts of the fluvial system (Youngson & Craw 1999).

Consequently, there is a predictable relationship between the maximum flatness of gold particles and maximum transport distance in gravel bed-load rivers. This has been quantified for the Arrow-Kawarau-Clutha River system in Otago, where the gold sources are well-constrained (Youngson 1998; Youngson & Craw 1999), and similar relationships have been established elsewhere (Herail et al. 1990, Knight et al. 1994).

Fluvial transport distance estimates for Nevis and Nokomai gold (Table 1) were made using the method of Youngson & Craw (1999). This method relates fluvial transport distance to the maximum flatness index for gold particles in a particular sample [F.I.=(a+b)/2c, where a, b, and c are the mutually perpendicular long, intermediate and short axes of the particle]. The method cannot account for any glacial transport, however, as little or no flattening of gold occurs during such transport.

The small proportion of relatively more deformed gold particles in some Nevis samples has higher maximum flatness index (18–25) than that for the bulk of the gold (<15) in those samples (Table 1). Maximum transport distance estimates of 20–30 km for the more flattened gold is consistently greater than the <10–20 km estimates for the bulk of the Nevis gold (Table 1), and supports more distant primary sources and/or a recycling history for the more deformed gold. Conversely, the shorter transport distance estimates for the bulk of the Nevis gold are compatible with our inference of primary sources within the western tributaries of the Nevis. Similarly, low maximum flatness index (<15) and short (<10–20 km) maximum transport distance estimates for a-phase Au-Ag-Hg alloy in all samples upstream of the alluvial plain in the lower Nokomai (Table 1) support our inference of primary sources in the upper eastern tributaries of the Nokomai.

Furthermore, 15–25 km estimates for α-phase Au-Ag-Hg alloy within the alluvial plain are also consistent with derivation from such sources. The 25–40 km fluvial transport estimates for Au-Ag alloy in the abandoned channel and alluvial plain in the lower Nokomai are enigmatic, firstly because the Nokomai valley is only about 20 km in length (Figure 3), and secondly because detrital Au-Ag alloy has not been found elsewhere within the catchment. The fluvial transport distance estimates require either considerable fluvial recycling of Au-Ag alloy within the Nokomai, or a former connection with an Au-Ag alloy source outside the present Nokomai catchment. The absence of Au-Ag alloy elsewhere in the Nokomai does not support the possibility of local Au-Ag sources or recycling within the catchment.


Amazing. Just a quick inspection of the gold particles and a lab analysis can reveal that some are recycled, and some are simply weathered out of rock nearby, or several kilometres away. The maths up there doesn't look too hard either.

[elZorro]

The chunkiest of the gold grains from Drybread might have an F.I. of under 10, so if similar to the Nokomai area, they will have been moved less than 10km.

Glass Earth holds permit EP53182 around Drybread, and about 6km futher north is the boundary of a big permit application from them, PP53297. Others have moved in with their own permits in the area. Southwest of Drybread is a smaller mining permit MP41748 (Matakanui), now owned by Hawkeswood Mining Ltd. It's due to terminate in 2013. Andrew Hawkeswood has 30 staff, some in Auckland in other operations.


http://www.nzrallychampionship.co.nz/news/audi-driving-hawkeswood-among-those-joining-new-zealand-rally-championship-in-wairarapa

[elZorro]

The TSX and news services were blessed with news overnight, and the ODT has helpfully beaten the Glass Earth website to a story about a hard-rock find in Otago. This is adjacent to the Garibaldi Diggings. GEL's Maniototo permit EP53183 curls around the base of the mountain ranges here, looking for more eluvial/alluvial deposits. They've found some quartz reefs.

http://www.odt.co.nz/news/dunedin/206605/centrals-new-gold-discovery

There are some photos related to the news release, from GEL's website. It doesn't seem to be listed as a news release on the NZAX yet.

http://www.glassearthgold.com/s/NewsReleases.asp?ReportID=520319

The Maniatoto find is about 30km southeast of Drybread, on the edge of the range mentioned.

The other news is that the option date for the May shares at C35c has been extended to match the June deadline.

From NZResources:


Potential hard rock target for Glass Earth in Central OtagoSimon Hartley — 25 April 2012
A fourth potential gold discovery is being explored by Glass Earth Gold Ltd (TSX-V & NZAX: GEL) in Central Otago with plans afoot to continue trenching, then to move towards a drill programme.
Glass Earth at present has two of three alluvial gold production units operating in the Maniototo area with the third scheduled to get under way shortly, the trio targeting a quadrupling of weekly gold production to 100-110 ounces; the company's sole cashflow.
Late last week Glass Earth announced the partnership with Newmont Waihi Gold would spend another $4 million on drilling the WKP gold and silver project near Waihi in the Hauraki goldfield.
At the new fourth site in Otago, on the Little Rough Ridge in the Gimmerburn area of Maniototo, Glass Earth has indications of gold deposits in bands of both quartz and schist rocks, following about 600 metres of digger-trenching to depths of 2-3m.
Glass Earth chief executive Simon Henderson said Little Rough Ridge is adjacent to the historic Garibaldi diggings.
“This new discovery is a turning point in Glass Earth's hard rock gold exploration in Central Otago,” he said.
The discovery attested to the science-driven exploration programme focused on discovery of gold deposits similar to Oceana Gold's 7.2 million ounce Macraes gold deposit in the metamorphic terrain of Central Otago.
Earlier rock chip and soil sampling around Little Rough Ridge was followed up by the about 600m of digger trenching.
Glass Earth has spent more than $35 M in mainly South Island exploration in the past five years and in March posted a $NZ2.13 M loss for calendar 2011. However, it retained $C3.6 M cash for ramping up its Central Otago gold-extraction programme.
Henderson said income from alluvial mining this year -- which in calendar 2011 was $C316,000 from a former joint venture near Alexandra -- would enable the company to continue trenching and initiate a drilling programme; using its own drill rig.
“The plan is to continue trenching then begin drilling once the width and length of the system is known,'' he said.
In February Glass Earth bought out its southern joint-venture partner for $4 M cash and scrip, covering one tenement in the Ida Valley and two in the Manuherikia Valley near Alexandra; taking over all alluvial gold production.
Unlike Glass Earth's other three alluvial production areas, Little Rough Ridge is potentially a hard rock discovery.
Henderson said until the estimated gold resource was proven, no decision would be made on whether it would remain a 100% Glass Earth-owned venture or to seek a joint venture partner, to share in the higher production costs of hard rock mining.
*Simon Hartley is chief reporter for the Otago Daily Times.

[elZorro]

There is more detail on the GEL website regarding the equipment held by Glass Earth Mining. Includes 6 excavators, 2 dump trucks, but no picture of GRU#3, this is still a mystery. There's a cryptic note about the throughput, I assume each GRU can put through up to 70 cubic metres per hour.

http://www.glassearthgold.com/s/Projects.asp?ReportID=450554

[jonu]

Hi el Z

I take it this morning's announcement is seperate from that on your earlier post. Garibaldi being adjacent to what you were quoting. If so things are certainly positive

[elZorro]

Hi el Z

I take it this morning's announcement is seperate from that on your earlier post. Garibaldi being adjacent to what you were quoting. If so things are certainly positive

Hi Jonu, this is the same news that was posted on the TSX on their 23rd April. Someone must have missed posting it over to the NZAX. But yes, a hardrock find is good to have, very shallow and probably picked up with the electronic systems they use. The Garibaldi Diggings area looks to be a sheep farm now, the original discovery was by an Italian family.

Nice change to see the share moving up this week.

[KiwiGeologist]

Does anyone know if there is future drilling planned for the Garibaldi? The big question for me is; with a hardrock prospect at shallow depth is the mineralisation supergene or primary mineralisation? I guess the only way to find out is to poke a couple of holes into it.

[elZorro]

Does anyone know if there is future drilling planned for the Garibaldi? The big question for me is; with a hardrock prospect at shallow depth is the mineralisation supergene or primary mineralisation? I guess the only way to find out is to poke a couple of holes into it.

Welcome to ST KiwiGeologist, I cannot answer your question because I don't know what the two types are yet :mellow:.. but the press release implies they'll do some more low-cost trenching and think hard about a drilling programme.

Data collected from a survey of Otago had identified shear zones similar to the Hyde-Macraes shear zone.
On-ground exploration had led to the discovery, which Glass Earth said was characterised by a network of quartz veins from which systematic soil and bedrock trench samples had returned grades ranging up to 16.1 g/t Au.
The zone of interest is 900 metres in strike length and 300m wide.
Glass Earth said it would finalise additional fieldwork to plan and recommend a drill programme.


It's a big zone of interest, that's for sure.

[KiwiGeologist]

Thanks for the welcome elZorro.

16.1g/t is a good grade even if the veins are narrow. In simple terms, supergene is where water percolates down through the top (weathered) part of a rock formation and concentrates minerals at the base of the weathered zone. This area at the bottom of the weathered zone is now enriched and would have higher mineral grades than the rock below (the primary mineralisation). Sometimes the difference in grade between the supergene zone and the primary zone is substantial. This leads to uncertainty as the grades in the supergene zone may not accurately reflect the grade of the primary mineralisation. A supergene zone may not contain enough material for economically viable mining.

The only real way to find out would be to drill it, probably using diamond ($$$).

[elZorro]

OK, that makes sense, thanks. What do you think of GEL's outlook geologically at the moment - with all their permits do they have a good chance of making it big - or is there a long way to go?

Edit: sorry this is a big question, thought you might have had a look at the permit list on their website.

http://www.glassearthgold.com/s/CurrentWork.asp

Total permitted area is about 1200 km2, plus under application brings the total to nearly 10,000 km2, or 1 million hectares.

Vicarage Capital report from 2nd April 2012. Interesting map of Muirs.

http://www.vicaragecapital.com/reports/2012/apr/GEL.pdf

[elZorro]

Highgrade has a short article talking up Garibaldi's prospects. I think they might have mistaken the normal press byline from Glass Earth into meaning that this is expected to be a huge find. It's spread over a wide area of interest, and there would need to be a lot of drilling first.

Glass Earth has always said that its primary objective is to find large hard-rock deposits of gold, using the latest techniques.


http://www.highgrade.net/article/2012-04-25/Glass_Earth_chases_another_Macraes

More detail from another mining magazine, hmm.


http://www.azomining.com/news.aspx?newsID=6278

James Spedderi, an immigrant from Malta, mined at Garibaldi Diggings from 1864 as a member of a company there. Garibaldi was a popular Italian politician, hence the name given to the area. Within 20 years, Spedderi obtained the lease on nearby land for farming, land which was noted in records to be auriferous (http://paperspast.natlib.govt.nz/cgi-bin/paperspast?a=d&d=OW18940705.2.27.3), and every effort was made to ensure that mining could be carried out on this area in perpetuity.

From local family records on the net:


Leo Charles Spedderi Dougherty who is the Grandson of James Spedderi and Bridget Sullivan tells us some history of 'Garrawaye'.
James Spedderi who was born in Malta in 1832 arrived in the Naseby gold diggings in 1863. He prospected on Rough Ridge in a deep Gorge which he names Garibaldi after the Italian revolutionary leader Guiseppe Garibaldi. James Spedderi married Irish Colleen Bridget Sullivan in 1865. A split of large farming estates in the Maniototo allowed James to aquire 100 acres in an 1878 ballot. His daughters Bridget Ellen, drew two blocks giving one to her recently married sister Rosina. James' son Lawrence (Larry) also drew a block in a later ballot. The blocks were joined together as one farm 'Garrawaye'. A small sod cottage was built on the farm and later superseded by a four bedroom dwelling in 1901. James Spedderi's wife Bridget died at 35. Daughter Bridget Ellen, called Ellen by the family, cared for her father and brother. Charles and Sarah Dougherty (buried in the Ranfurly cemetry) and their son Patrick arrived in New Zealand. They bought land in Gimmerburn and the Garabaldi gorge becoming neighbours to the Spedderi Family. Bridget Helen married Patrick Dougherty (Poppa to his Grandchildren) in 1909 after her Father James died. (Bridget and James are buried in the Naseby cemetry). Andrew and Neil Kearney, brothers of Charles' wife Sarah Dougherty also immigrated from Ireland taking up land in the Maniototo. Leo and Eileen (nee Elliot) had a family of seven children. Lawrence the second eldest's son Stephen and wife Nicky now run the 3,300 acre sheep and cattle farm.

Video of a trip through the farm by the family, and an old stone cottage at the top.

http://www.youtube.com/watch?v=MMXuyRxTANk

Hunting trip photos with background photos of the terrain

http://lisawiltse.photoshelter.com/gallery/G0000BtCxNQevKeA

[elZorro]

Newsflash - just found..

There is a new slideshare presentation that has been put online by CHFIR in the last day or two. It mentions Garibaldi, has a great graph on the expected gold outputs from the placer deposits, predicts US$6mill in annual gross profits from these alone, within a year or two. It's in line with some maths I was doing earlier up the thread.

http://www.slideshare.net/CHFIR/glass-earth-gold-limited-gelv-oct-2010

Looks like Gunclub is a relatively low-grade, only 750 oz per year there, and GRU#2 is not much smaller than GRU#1. There is a pilot plant already running at Drybread, unsure of the size of it, so maybe the step up to 2000oz was helped by better grades at Drybread. This would also explain the move to obtain the Dunstan Mining assets and IP. But look at the jump to 5000oz, this must be GRU#1 arriving at Drybread in June. If 3000 oz is obtained in 250 days, 10 hours each, then the grade would be about 0.75grams/tonne, entirely possible. If they go 24hours x 7 days, the grade is lower.

[Vtrader]

EZ,
I got around to it, but too late for a bid today.
Placed a sighter bid for tomorrow.


Not very interesting posts from an EWT student, all I know is 1,2,3,4,5,a,b,c, and a few variations.
Lets see how well I can count.
V.

[KiwiGeologist]

OK, that makes sense, thanks. What do you think of GEL's outlook geologically at the moment - with all their permits do they have a good chance of making it big - or is there a long way to go?



I have some general thoughts.

WKP looks good. High grade intersects that "join up". This points towards a larger system. It is open at depth and towards the south so there is potential upside there. The J.V with Newmont gives GEL access to Newmont's expertise and long history working in the Coromandel. It is also close to the old Golden Cross mine that closed because of geotech issues not from lack of resource. There seem to be parallels with the orientation of potential ore shoots between Golden Cross and WKP. IMO WKP is the best GEL prospect to date.

Muirs also has OK intersects. Nothing to set the house on fire as the intersects seem to be discrete i.e don't "join up". However there is very little post mineral cover (potential overburden). This would keep mining costs down.

IMO the company has too many permits and applications. The potential "rental fees" are a liability. Let's not forget that Glass Earth are a junior explorer with a small staff. I believe the company needs to prioritise and rationalise its permit holdings.

With that said, alluvial production is a novel way for a junior explorer to manage its cash flow. A good move to buffer investor sentiment in Canada.

I sincerely hope I don't have to eat my hat but I think that GEL will be around for a while yet.

[elZorro]

I have some general thoughts.

WKP looks good. High grade intersects that "join up". This points towards a larger system. It is open at depth and towards the south so there is potential upside there. The J.V with Newmont gives GEL access to Newmont's expertise and long history working in the Coromandel. It is also close to the old Golden Cross mine that closed because of geotech issues not from lack of resource. There seem to be parallels with the orientation of potential ore shoots between Golden Cross and WKP. IMO WKP is the best GEL prospect to date.

Muirs also has OK intersects. Nothing to set the house on fire as the intersects seem to be discrete i.e don't "join up". However there is very little post mineral cover (potential overburden). This would keep mining costs down.

IMO the company has too many permits and applications. The potential "rental fees" are a liability. Let's not forget that Glass Earth are a junior explorer with a small staff. I believe the company needs to prioritise and rationalise its permit holdings.

With that said, alluvial production is a novel way for a junior explorer to manage its cash flow. A good move to buffer investor sentiment in Canada.

I sincerely hope I don't have to eat my hat but I think that GEL will be around for a while yet.

Sounds good KG. WKP looks like the permit to keep an eye on then, long-term. In the short term the placer income looks to be substantial, like I'd hoped, even with the high cost of recovery. Let's say GEL gets to profit by C$6mill or NZ$7.5 mill, that's all they need to operate for each year, and do about the same exploration as they can fit in now.

I've compiled a spreadsheet of their permits, which I keep current. At the moment the permit fees are about NZ$420,000 a year. It's high, but not crippling when you have placer income. I think they have rationalised these permits, I see land being dropped quite often, and of course more put in for applications. The really big areas (prospecting permit applications, cheaper) are a substantial portion of the total applied for, and together they'll have close to 10,000 km2 if all get approved. This seems to be a magic figure that GEL don't want to lower. They have used it in all of their marketing.

They're in a unique position of having the IP from the big electronic scans, so they can pick out the most promising parts from the Central and Otago areas. Looks like this is working for them, results coming thick and fast at the moment.

Overnight, one bidder popped the GEL price back to C35c before sellers appeared. Still a bit of an overhang by the look of it.

[elZorro]

Someone at head office (probably Andrew) has added a photo of GRU#3 to the website placer page recently. Thanks for that.

http://www.glassearthgold.com/i/photos/GRU3.jpg

I'm not sure, but it does look to be a decent sized unit, and maybe it floats also. If all three are working through at least 50 m3 each, per hour, that's quite a lot of ore (225 tonne/hr). Good to have three units - in case one needs a repair, there will still be some income.

Also new to the website: references to the disappointing Serpentine prospect have been removed, but now there is a page on the Garibaldi region. Photos on the trenching work using the excavator. It must be great not having to schedule the equipment, it's GEL's. Some of the shallow soil sampling returned grades of 10grams/tonne.

http://www.glassearthgold.com/s/Projects.asp?ReportID=520364

Which reminds me: we haven't heard about Hindon/Game Hen yet, where contract diamond drilling has started a month or so ago. There might be some WKP drill data out soon also.

Vtrader, good to see you getting involved too, there's still buying opportunities out there lower than my average cost.

[Vtrader]

Z,
you know so much. and find out so much more.
me I am just a technical trader.
V

[elZorro]

VTrader, I hope no-one notices that I'm only good for one share.. not exactly spreading out my equity investments like I should :).


Very light trading on the TSX overnight, no news either. Sellers have all but disappeared. The price is up to C33c.

[Vtrader]

VTrader, I hope no-one notices that I'm only good for one share..

Z,
Back yourself, you are GREAT at one share.
Sellers disappeared, of course, just when I need some!
A 1 share thread over on ST ASX
(http://www.sharetrader.co.nz/showthread.php?8786-Single-Share-Bids-in-Illiquid-Stocks-(not-DMA))V.

[elZorro]

Cheers VT. On the TSX, a small price drop to 31c, but higher volume there too, we'll see what it finishes up at. Still plenty of bids, not many offers.

Stockhouse reports that GEL is running some advertising on BNN, to the huge Canadian goldies market. BNN is their only full business news channel. Around mid-morning our time, after the close of trading, Brent Cook is sheduled to give his top picks for the week, on BNN. He still shows Glass Earth as a top pick/buy on a website, (http://www.stockchase.com/Company-sl--slq-ID-slv-Glass--Earth--Gold.php) so unless anything major has changed, this should help the share price within a day or two.

Current pointer to the show: needs broadband. http://www.bnn.ca/Shows/Market-Call-Tonight.aspx

I've just had a look with better broadband: the Part 2 section covers Glass Earth from a fielded question.

Brent Cook likes (and owns) GEL, and has been out to NZ on a visit 2 weeks ago. He expects the Newmont drilling at the large system WKP will be aiming to show more continuity in the gold strikes. He mentioned the deep-pocketed partner, which should be JV holder Newmont, regarding a possible takeover. Of course ACC and Geoff Louden are large GEL shareholders. Placer profits were mentioned again as a way of covering most costs and reducing any dilution effect. Sounds like Dr Youngson's consultancy was being used to differentiate alluvial gold from hard-rock gold.

Previous to this, two other junior explorers (Perseus and Baja) were covered, not so positively.

[elZorro]

Well, the volume was up overnight on the TSX, price stayed the same by the end. There are more wanting to buy in (300,000 shares).

Just saw this in the ODT: Glass Earth's JV contractor back then, Dunstan Mining, dug up a small pile of mining tailings at Vinegar Hill and was pinged for it. No long-term damage done, it's just they needed to seek the proper permission first.

http://www.odt.co.nz/your-town/alexandra/207941/glass-earth-fined-damaging-historic-site

[Vtrader]

Sellers have arrived on NZAX sufficient to get me part filled @.41
Dont tell P but at .41 I am averaging down...
V.

[elZorro]

Sellers have arrived on NZAX sufficient to get me part filled @.41
Dont tell P but at .41 I am averaging down...
V.

That's a bit jammy VTrader, good timing. And now we wait..

Looks like Brent Cook was over here with a camera crew..


BTV-Business Television Travels to New Zealand for Glass Earth Gold And Peru for Estrella Gold



Thu May 3, 2012 6:00am EDT

VANCOUVER, BRITISH COLUMBIA, May 03 (MARKET WIRE) --BTV - Business Television - Watch our business news show online and features via links:

http://www.b-tv.com/the-btv-show/episodes.html

On May 5 and May 6, 2012 - on National TV, BTV - Business Television profiles the following emerging publicly traded companies:

Glass Earth Gold (TSX VENTURE:GEL)(NZAX:GEL)
http://www.b-tv.com/i/videos/GlassEarthGoldMay12.wmv

- Analyst Brent Cook joins the BTV crews in New Zealand to learn more about GEL's new techniques for extracting gold and their joint venture project with mining giant, Newmont.

Estrella Gold (TSX VENTURE:EST)http://www.b-tv.com/i/videos/EstrellaGoldMay12.wmv - BTV crews are in Peru to learn about the success of this exploration company's prospect generator model; one that has joint venture agreements with majors on 28 of its 32 properties.

Commentary from: Barry Allan, Vice Chair Mining Group, Mackie Research Capital, shares what he looks for when investing in junior mining companies.http://www.b-tv.com/i/videos/BarryAllanEp274.wmv

Mickey Fulp, Editor of the Mercenary Geologist, on gold:http://www.b-tv.com/i/videos/MickeyFulpEp274.wmv

John Embry, Chief Investment Strategist, Sprott Asset Management, offershis predictions for gold: http://www.b-tv.com/i/videos/JohnEmbryEp274.wmv

Kevin O'Leary, Chairman of the O'Leary Funds, shares interesting metrics he uses to gage a country's economic growth:http://www.b-tv.com/i/videos/KevinOLearyEp274.wmv

BTV, a half-hour weekly business news program, profiles emerging publicly traded companies across Canada and the USA. With Host Taylor Thoen, BTV features companies at their location, interviews the company's key executives, features their products and services, and unveils their plans for future growth. BTV BROADCAST TIMES: CANADA: BNN - Saturday, May 5 @ 8:00pm EST & Sunday, May 6 @ 9:30am EST Bell Express Vu - Saturday, May 5 @ 8:00pm EST & Sunday, May 6 @ 9:30amEST U.S. National: Fox Business News - Sunday, May 6 @ 5:00pm EST America One - Saturday, May 5 @ 10:00am EST www.americaone.com (http://www.americaone.com) Biz Television Network - Sat. May 5 @ 1:30pm, Sun. May 6 @ 1:30pm, Wed.May 9 @7pm, Thurs. May 10 @ 10:30am and Fri. May 11 @ 6:30pm ESTwww.biztv.comContacts:To Be Featured on BTV - Business Television Contact:(604) 664-7401info@b-tv.comwww.b-tv.comCopyright 2012, Market Wire, All rights reserved.

Have a look at the video, very professional, better than anything Glass Earth has put out so far, and the GRU is seen running at Drybread, there's a pilot plant being used for testing in the lab, staff getting into their jobs.

http://www.b-tv.com/i/videos/GlassEarthGoldMay12.wmv

[elZorro]

Looks like the video will have a profound effect on the shareprice, overnight 255,000 shares sold, a big buyer at Dundee Securities mopping up any lower offers, closed at C35.5c, although 32.5c to 33c was the day's average. Now there's a high number of bids and offers, but after the market has had time to digest the contents of the video over the weekend (which will screen on more than one channel), buying pressure alone should bring the shareprice up.

From an FA perspective, this is also what should happen. Look at the current positives.

Cashflow issues - gone.
Income - rising from placer areas
Permits - very promising Moz areas Muirs, WKP
Linkages with big companies like Newmont Mining
Exploration expenditure $45mill since 2006, compare current MCap of C$28 mill
MCap undervalues estimated in-ground resources (which could be 3Moz + 1Moz) by a long way. Just $7 per ounce in-ground now, if it later proves up, it could reach $200 per ounce.

[elZorro]

Plenty of detail yet to emerge from the BTV video, but Glass Earth has obviously shown the film crew the Muirs site, one or two lab spaces, and Drybread. The primer green GRU seen there is GRU#2, which has been running OK at McAdies and then Gun Club, but with lowish grades on average, by the look of it.

While GRU#3 is perhaps still unreliable, and GRU#1 is yet to complete its refurbishing (due very soon), GRU#2 has apparently been transported over. The three excavators might be partly in use to create a large pond for GRU#1. (It's also possible the video shows the Gun Club permit near Moa Creek).

The voiceover on the video states that GEL will soon cover all general running and exploration costs with the placer returns. Analyst Brent Cook is slightly more circumspect, and the line in the past from Simon Henderson has been for placer returns to cover G&A costs of about $2mill.

But the grades at Drybread must be good enough to cause an immediate acceleration in the rollout of the placer operations.

The video has Simon mentioning good results from trenching at Sparrowhawk. This is a site on the Western flanks of Rough Ridge, with Drybread being on the Eastern side. There might be a short video clip from the trenching, it's in the side of a hill by the look of it.

Sparrowhawk was also mentioned in the July 2008 Newsletter, number 11. (http://www.glassearthgold.com/i/newsletters/GEL_newsletter11.pdf)

[elZorro]

News from JV partner Newmont Waihi: their ore mill has been returned to operation after a substantial refurbishment.


Refurbished Waihi gold plant back in action

Ross Louthean — 7 May 2012
The refurbished gold plant for Newmont Waihi Gold is back in operation to put the company back on the full production trail.
The mill was given a massive overhaul over the past four months.
The company said there has been very little gold and silver produced this year but ore supply is resuming.
Mining has begun at the new Trio mine and ore is now being excavated from the Martha East open pit layback.
Stockpiles of residual ore built up over the last few months from the mature Favona underground mine are also feeding the mill.
The Trio underground mine, under Union Hill, is now operational.
The company’s community newsletter also disclosed that a house in Haszard Street near Foresters Hall is to be knocked down to make way for the entrance to the new Discovery Centre being developed by the company.
The Haszard Street house, owned by Newmont Waihi, was unoccupied and is one of several vacant and “unsafe” houses that will be knocked down or re-sited.


I wonder how the drilling is going at WKP. In the background of the Glass Earth video was a map on a wall of the WKP area, and since Simon was wearing a visitor's badge, I assume they were allowed to film from inside Newmont's HQ. The map showed that to the south of the current drilling at WKP was a large area of andesite, the preferred host for gold in the Coromandel Range.

The laser pointer was being waved about in this region during the discussion, an area that hasn't been drilled yet.

[elZorro]

Here's the news release from the WKP31 drill results as at 29th February.

http://www.glassearthgold.com/s/NewsReleases.asp?ReportID=510008

This showed a good solid width of about 1/2oz grading, at 146 metres. All data from 328 metres downhole onwards has yet to be released. By comparing the WKP24 drill data and the supplied 50mtr scale (see image), it can be seen that there will be a lot of interest in the area intersecting the andesite dyke and drill WKP31. The best wide grade in drill WKP24 was at this intersection (13.8 mtrs of 6.6 g/t) with the highest thin grade interval of 30g/t. being 60mtrs further up the drill.

It's likely that Newmont will be looking for grades that can justify underground mining, so it is very important that some continuity in the veining is seen. Brent Cook mentioned this in the video, or in his reports.

[bermuda]

The GEL thread has gone quiet for a few days now.

The price has softened a bit to $.35

I've re-entered by picking myself up another holding today.

Yankiwi,
This was Graeme Teague's nom de Plume aka Oiler. Can you please give me a background as to why you are using his call name . Thankyou.
Are you a relation of Graeme? As you may know our beloved Yankiwi passed away late last year.

[bermuda]

Hi bermuda,

I've replied to your quiry via PM as to keep the GEL thread on track.

If any other members share this sort of question with MY "handle" I suggest you have a look at my profile page here on ST and I'm sure it should answer any questions on this.
Yankiwi,
Thanks for that. I understand.

Graeme was a great guy.

[elZorro]

The GEL thread has gone quiet for a few days now.The price has softened a bit to $.35
I've re-entered by picking myself up another holding today.

Great timing there Yankiwi, I don't think you'll be seeing that price again. I kept an eye on the Glass earth website to see if they'd post the new presentation that CHFIR had. They have done that, but it's a new upmarket version with new data for us.

http://www.glassearthgold.com/i/presentations/GEGL_Presentation_April2012.pdf

Take-homes:

Garibaldi is listed as a possible major find, drilling soon.

WKP31: no more data yet. Great satellite map of the WKP area showing how close it is to Golden Cross and the Martha Mine (Newmont).Newmont's threshold for mining WKP appears to be 5Moz. WKP listed for the first time as a probable 3Moz deposit with known data, more to come. Grades shown for alternative open pit or underground, looking at options maybe.

Muirs shown as possible 1Moz deposit, great new maps.

GRU#2 is still at Gunclub, 20oz/week, so Drybread is a substantially better prospect, 2 GRUs there soon, one (GRU#3) running properly since late April. Looks like the BTV video showed Gunclub, not Drybread.

Glass Earth is becoming much more serious about marketing itself. This is very good news for investors, and those wanting to start with a smaller holding. I'm still waiting for my Glass Earth Gold embroidered cap, I reckon I've earnt it.

[elZorro]

Time for a realistic look at a valuation for GEL, as there are some figures now.

Since GEL has inferred resources mostly, we have to use the lowest figures given in this article:

GEL might be undervalued by 1/2 right now, but I don't think there are 43-101 ratings for the gold in ground. Muirs is getting closer. I think the reason Newmont wants to see 5Moz at WKP is because they have only 65% of the resource. If they moved to own GEL outright and then announced they're mining WKP, the valuation of the gold at WKP would be greatly increased. Of course, they'd only need 3Moz confirmed to make it worthwhile mining over there.


Here’s How to Value a Junior Miner’s Gold in the Ground

At any given time, we know the international spot price for an ounce of refined gold but what about the gold an exploration or mining company has in the ground – how do we value that? [We have the answer. Read on.]
So say Louis James and Andrey Dashkov (www.CaseyResearch.com (http://www.CaseyResearch.com)) in further edited excerpts from the original article* which Lorimer Wilson, editor of www.munKNEE.com (http://www.munknee.com/) http://www.munknee.com/favicon.ico(It’s all about Money!), has further edited ([ ]), abridged (…) and reformatted below for the sake of clarity and brevity to ensure a fast and easy read. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement. The authors go on to say:

There are several different ways to value a junior miner’s gold in the ground:
1. Given sufficient data, you can estimate a reasonable net present value (NPV) for a project and deduce what each of the company’s ounces should be worth. To do this, you need to know annual output of the proposed mine, proposed capital expenditures, energy and other costs, and many more things. Unfortunately, for most deposits held by the junior companies we tend to follow, there is just not enough data available.
2. Another approach is to compare the value the market is giving a company per ounce of gold in hand against the average value the market gives companies with similar ounces. The most obvious way to define “similar” ounces in the ground is to use the three resource and two mining reserve categories defined by Canada’s National Instrument NI43-101 regulations – the industry standard. These are combine these into three broad groups:
a) Inferred:
The lowest-confidence category, based on just enough drilling to outline the mineralization.
b) Measured & Indicated (M&I):
These higher-confidence categories have been drilled enough to establish their geometry and continuity reasonably well.
c) Proven & Probable (P&P):
These are bankable mining reserves – basically Measure and Indicated resources with established value.
So, what does the market give a company, on average, for an Inferred ounce of gold? M&I? P&P? To answer this, we combed through every company listed on the Toronto Stock Exchange (TSX) and the TSX Venture Exchange (TSX-V) and pulled out the ones with 43-101-compliant gold resource estimates (or mostly gold) – no silver, copper, etc. Of these, we kept only those with resources that fall almost entirely into only one of our three broad groups: Inferred, M&I, and P&P leaving us with about 90 companies to calculate some averages on and we got these numbers:
• US$20 per ounce Inferred
• US$30 per ounce for M&I
• US$160 per ounce for P&P




Resource

Potential

Percentage

GEL's

Valuation at $20/oz

Valuation at $160/oz



Name

Gold, Moz

For GEL

Moz

Conservative, C$mill

Once P&P, C$mill













WKP

3

35

1.05


$21


$168



Muirs

1

100

1


$20


$160



Garibaldi

0

90

0


$0


$0



Game Hen

0

90

0


$0


$0



Ophir

0.5

50

0.25


$5


$40



Placers

0.3

90

0.27


$5


$43













Totals

4.8


2.57


$51


$411




Moz


Moz


C$mill


C$mill













Valuation per share (approx 68 million on issue)

$0.78


$6.23



Multi-bagger status from today's price


2


18

[troyvdh]

dear zorrow...I recently topped up on GEL buying 3000 at 35.....having bought in some years ago....not meaning to put you on the spot....and you may well have declared your status in the past...but do you hold GEL....cheers...

[elZorro]

dear zorrow...I recently topped up on GEL buying 3000 at 35.....having bought in some years ago....not meaning to put you on the spot....and you may well have declared your status in the past...but do you hold GEL....cheers...

Hi Troy, apart from a brief spell of disillusionment, I have held GEL since the IPO. I have enough stock that my eyes water and my wallet shrinks before me if the share drops.

[troyvdh]

cheers....understood and appreciated....troy....go well

[elZorro]

cheers....understood and appreciated....troy....go well

I guess that's "Go well, go GEL" . That's a tasty parcel of shares sitting at NZ35c there this morning, I hope someone's not confused over the exchange rates. GEL finished at about NZ42c on the TSX last week. The shares might not move far above NZ45c (C35c) until the options thing is settled in early June, but that is also the time GRU#1 will be adding to cashflow at Drybread. From that date on, the price should trend upwards.

I had another thought about WKP: Newmont could buy out just the waihi area JV permits from GEL, and mining would then be at a threshold of 3Moz, and they have an added sweetener in several areas of the permits. The cash would then free up GEL to mine Muirs, or move on to a lot of exploration drilling. Sort of what has happened for Ophir Gold (Bob Kilgour), but on a much bigger scale.

[elZorro]

GEL on C36c or NZ46c overnight, better volume on TSX. Seems to be more awareness about the company's prospects there, than in NZ. Maybe there will be some news in the first part of this week, but I will be away chasing trout, it's raining.

[elZorro]

A bit of contagion affecting most goldie shares, but GEL is holding up better than OGC on average, from what I can see.

Last year, GEL put out the first quarter report on 25th May, and the options are expiring on 7th June. So I'd be expecting some WKP31 data, Game Hen drilling data, any new WKP drilling, and maybe a placer update within a few days. GRU#1 should be nearly ready for transport to Drybread by now, if it's not already there.

[elZorro]

GEL doesn't usually put out news at the end of the week, so perhaps next week we'll see something.

I had a bit of a look for any new permit applications at NZPAM: nothing of note except that Goldmines NZ has applied for a 2 year extension to its large Southland permit that surrounds GEL's area down there. Of course GEL now owns all of Goldmines NZ.

http://www.nzpam.govt.nz/services-drm-web/RetrieveDocumentServlet.svt?documentId=E3E6E660398 A6C67E940936B0B2B19D8&p_access_no=011CE71C9751D2362112F9A7FF0B09BD

[Vtrader]

EWT position over on ASX gold thread
(http://www.sharetrader.co.nz/showthread.php?7449-Gold&p=374234&viewfull=1#post374234)If I can count correctly now could be a good time to get some more GEL.

Z,
This gold price point could dry up your eyes, I would like POG to rise also.
You were not wawy from ST for too long, did you catch a big fish?
V.

[elZorro]

Hi Vtrader, I wish I could have turned a more colourful phrase about GEL.. but feel sure there will be some good news before the options expire, and anyway the first quarter report is due.

Regarding fishing, it was partly a working break, but I can report that of 10 people fishing a small stretch of the Waitahanui (Taupo) the other day, I was the only one who landed a trout during an hour or so. And some of those fishing looked like permanent fixtures. I have just baked some of it, mighty fine little trout (about 2.5 lb).

I will have a look at your EWT work on the gold thread. Cheers.

OK, no charts to help me out there VT, but goldbug sentiment tells us to expect a recovery in the gold price. I have kept an eye on OGC too, without investing while it travelled aimlessly sideways. It's plumbed the depths lately, and I bought a little bit today. But as P says, why would you buy when you're not sure it's stopped dropping? I'm poor at that rule.

I'm sure OGC will be looking good by the end of the year anyway. How could they muck it up this time?

GEL: we'll need to have a good look at the quarterly report, and I have to say, surely they know what happened with the rest of the WKP31 drilling by now. Either it would have a bearing on the market, and it should be notified, or it has no bearing, so will wait for the quarterly report. 14 market days until the options expire.

[elZorro]

An interesting (if wildly mathematically inaccurate) article in the Waikato Times this morning about Newmont Waihi, and this is part of the PR towards the Correnso Mining application due soon. Here's an article about that, will wait for the stuff.co.nz item to appear on the web.

http://www.radionz.co.nz/news/regional/101268/newmont-releases-property-policy-for-waihi

OK, here's the article from the Waikato Times, most of it. The text seems to be the same as I read this morning.

http://waikato100.co.nz/blog/2012/05/18/the-goldminer-2/

The reporter, Matt Bowen, has obviously not sent the proof to Newmont, or had anyone look at it carefully. Would any employer of long standing employ 300 workers for a turnover of $2 million a year? Matt - Newmont sells about $200mill of gold a year, over $600,000 worth per worker. This is typical of the Times, you just can't trust their figures, so how much of the rest of it is accurate? :(

Interesting that a footnote says Newmont is looking in the near region for mining sites that are capable of being underground mined, with a low surface footprint. That fits WKP, as long as it gets above 5Moz total in partnership, or 3Moz if Newmont owns it outright.

Correnso is quite a lot less in scope (about 650,000 oz), and that's still worth going after.

Detail on the mill repairs (March):


Mill Overhaul

Newmont Waihi Gold’s mill has produced very little gold and silver this year but the
workers out there at Baxters Road are busier than they have ever been.
The processing plant is having a major overhaul. Just some of the works include:
• stripping and overhauling the SAG and ball mill motors
• emptying, cleaning repairing and repainting the leach tanks
• removing and lining the elution column and replacing the carbon transfer vessel
• cleaning and overhauling the tailings lines and pumps
• Finite Element Study on the SAG Mill to enable us to more fully understand its future
maintenance needs
• Replacement and corrosion removal of structural members in the various buildings
• Relining SAG and Ball Mills
Much of this work involves the use of large cranes, sandblasters, painting, fabrication
and welding and extra truck traffic delivering and removing equipment. There are
approximately 60 contractors as well as suppliers working with our staff to carry out
specialist tasks including Mount Maunganui Engineering, General Engineering, Porter
Engineering, ISS, Hutchins Engineering, Bay Sandblasting, Valley Sandblasting, Coastal
Sandblasting, Pollock Cranes. AWF, TRL, Kawerau Engineering, Applied Conveyors, SGS,
Baxter Electrical, Contract Resources
Most of these extra contractors are from the local area and are familiar with our operations.
As we announced midway through last year, this maintenance shutdown is an opportunity
that has arisen due to there being a gap in the supply of ore to the mill in early 2012. The
open pit is excavating limited amounts of ore to feed the mill while development continues
in the layback to the east wall of the Martha open pit. The Favona underground operation
is also providing very little ore as it has been winding down towards completion. The Trio
underground operation is scheduled to begin supplying ore later this year.
When the mill is up and running again the machinery will be optimised and updated to see
us well into the future.

[elZorro]

It's a holiday in Canada, Victoria Day, 21st May. Some financial and exploration data due out from GEL HQ soon. Here's the background to many goldies at the moment: HUI has been dropping, but staged a pin reversal in the last few days. Newmont and Barrick Gold follow the HUI strongly, as expected.

[elZorro]

Just had a scan of permits at NZPAM (as you do) and Glass Earth has surrendered the Hindon permit in Otago recently. So from that, I'd guess the drilling at Hindon and Game Hen wasn't exciting compared to other ground they have. It wasn't entered into my hi-tech valuation chart except as an option, so just as well. But at least we know that area won't do the job. That's exploration so they say, drill the best bets, but you won't always find anything much.

Nothing else has been dropped from the permit list, and Garibaldi is a recent new find to be drilled.

[elZorro]

This autumn Mining newsletter has some stories on Talisman, Newmont, Alton Drilling and Glass Earth. Both of the GEL online presentations and the article fail to mention Game Hen or Hindon, but do mention Garibaldi, WKP, Muirs.

http://waterfordpress.co.nz/site/waterfordpress/files/MNZ//Mining%20NZ%2026-33.pdf

Late May or early June for Drybread with GRU#1, this will be welcome news.

[elZorro]

The next cornerstone investor in GEL could be..

http://www.abc.net.au/news/2012-05-23/gina-rinerhart-worlds-richest-woman/4028686?section=business

[percy]

The next cornerstone investor in GEL could be..

http://www.abc.net.au/news/2012-05-23/gina-rinerhart-worlds-richest-woman/4028686?section=business

The two seats on the board of Fairfax she wanted,were they just for her or did she want one for another person as well.?

[elZorro]

Percy, I couldn't possibly comment. It ain't over..

[percy]

Percy, I couldn't possibly comment. It ain't over..

elZorro,
You are too much the gentleman.!!!!
Your posts here are excellent.Keep up the good work.

[elZorro]

Cheers Percy.

No more news from GEL this week, so after today there are only 7 trading days left for the big investors to pick up their options at C35c. In these 7 days we should get the first quarterly report, maybe some other news around it.

One article about a small gold mine in the Coromandel shows how hard it is to make a dollar these days.

http://www.stuff.co.nz/business/industries/6981039/Coromandel-gold-mine-shut-down

Looks to me like the costs to put in a second egress would stop this small tourism operation and hardrock miner. That's a shame for Stuart Rabone, who I think is a geologist with a doctorate, and he was the lead author of a very good scientific paper on the WKP area. GEL have it loaded on their website (http://www.glassearthgold.com/i/pdf/WKP_Geology_S_Rabone.pdf).

According to the web, Stuart has family who had been helping in this small mine, and GEL employs (or contracts) the legal document services of one of them, Thomas (http://uk.linkedin.com/in/thomasrabone), who is now resident in London.

Short video inside Broken Hills Mine.
(http://www.teara.govt.nz/en/hauraki-coromandel-places/7/4)
http://www.glassearthgold.com/s/Consultants.asp

[elZorro]

They say that the first 5 years of any business operation is the testing ground. Those that are still operating after that time, have better chances of success.

Glass Earth Gold was first established in 2002, and the capital raising's public stage was in September 2006 (the IPO).

Here's an article by NZPAM, 2004. http://www.nzpam.govt.nz/cms/news/2004/news_item.2007-05-07.1800011830

So in just 10 years, Glass Earth has gone from an idea, to a listed company with international links and strong cornerstone shareholders (ACC, Loudon etc), with two or more large to internationally significant gold deposits being proved up, and is a useful NZ employer and funder in the greenfields and alluvial/placer area. Next on the list, a solid cash balance in the bank from gold sales.

And I would say that this move can't come too soon. Glass Earth will be one of the few gold explorers with a good cashflow that doesn't require the issuing of shares. They will stack up really well against other juniors, and investors are already looking hard to see which, if any, they will hold. Have a look at this video.

http://www.ino.com/blog/2012/05/rick-rule-avoiding-the-ugly-in-the-junior-resource-sector/

[elZorro]

Not to put too fine a point on it, the companies office reports no change to the shareholdings of Dunstan Mining Ltd or Goldmines NZ Ltd, which are theoretically in Glass Earth ownership.

GEL is due to pay another $1.5mill to Bob Kilgour's company on 11th June, and I can see the importance of the 35c options timing, being 7th June. Still, that is not a lot of cash, when secured against all the hardware and the permits that came with the purchase. The rest of the payments are timed to be met with part of the placer returns, much easier if all goes well at Drybread, and it should.

The next two-and-a-bit weeks might be the last time GEL needs to quickly come up with some capital, and in any case I think they will have a number of funding sources only too happy to help out. Now they are on a true business footing, even a bank or equipment financing loan wouldn't be much of an issue.

I forgot this link too: Stuart Rabone was the second author in a more recent paper on WKP, dated around 2005 or later, that I've posted on before. It's on the GEL website - have a read - (http://www.glassearthgold.com/i/pdf/Christie_p137.pdf) because with the more recent drilling, those Newmont geologists must be sniffing the gold out by now..


CONCLUSIONS
WKP has had much effort expended in exploration and research,
particularly in the application of XRD and fluid inclusion
analyses from exploration and research viewpoints. The prospect
exhibits a variety of favourable features to encourage
exploration: it is a large mineralised system, which hosts a
significant quartz vein stockwork zone within quartz-adularia
altered host rhyolite; locally the veins carry high-grade
mineralisation albeit over narrow intervals. The system is open in
two directions and not well tested where it occurs in basal
andesite host rocks, which are typically better host rocks for
epithermal vein style mineralisation in the Hauraki Goldfield.
The fluid inclusion and wall rock alteration data suggest that
polyphasal boiling has occurred within the system; however,
major upflow conduits are yet to be discovered. Although there is
isotopic evidence of fluid mixing, specific mixing zones, also
prime targets for gold mineralisation, have not been identified.
The strongest mineralisation and vein development intersected to
date is in the south of the gorge section (in DDHs 20 and 23).
Low amplitude-long wavelength magnetic anomalies are extensive
in this area, despite the presence of outcropping unaltered
Whakamoehau Andesites. This suggests that Whakamoehau
Andesite post-mineralisation cover here is thin and that alteration
extends a considerable distance south of the gorge section.
Significant exploration potential consequently exists in this
direction beneath cover rocks (cf Golden Cross; Mauk and
Purvis, this volume).
ACKNOWLEDGEMENTS
Rabone, Barker and Merchant were at various times part of the
teams of exploration geologists that worked on WKP. Research
by Christie was funded by the Foundation of Research, Science
and Technology under contracts to the GNS Mineral Resources
Programme managed by Ian Graham. Julia Vodanovich and
Carolyn Hume drafted the diagrams and Pat Browne reviewed
the manuscript.

[elZorro]

Putting some of these WKP maps and charts alongside each other gives us a few more clues. The original work done over a century ago provided a tramway line all the way to the coast, not sure of its condition now. But the sample they sent from a small shaft or adit at WKP for processing at Thames was well over 1oz of gold per ton. Back then, perhaps this was getting marginal for inaccessible hard rock mining that needed processing. Several greenfields explorers have checked out WKP since, using some quite new techniques, the same ones GEL has used in Otago and CVR. When GEL bought the prospect from HPD, all this info came with it.

Newmont are still concentrating their drilling in the same area around the WKP river gorge that has exposed the quartz veins, but has been successful in finding much bigger gold-bearing veins further underground, as Rabone and Christie predicted. Note that further south, large tracts of unexplored drilling space are waiting, with gold in the soils on the surface. Newmont's drilling in the next phase, of 5,500 mtrs, is the same amount that was drilled by three other companies in the period 1978-1993, that's 15 years, 23 drills.

So Newmont has only spent a few million on WKP so far, have earned in 65%, but are spending a lot more on their areas around Waihi to get to the mining stage. With a bit of luck and hard work, some continuing finds at WKP should encourage even more capital outlay. Newmont ramped up their exploration spend around 2008 to over $10mill p.a., and a change in policy over their intentions for Waihi was linked to the gold price.

http://www.contrafedpublishing.co.nz/QM/December+2009-January+2010/The+undecided+miner.html

Various timelines have been proposed, but Newmont appear to have moved to Option Four.


The fourth scenario, “Regional Exploration,” offers no timelines, just the continued targeting of underground deposits within 100 kilometres of Waihi.

WKP is of course just a few km away. And Muirs? From the GEL website:

The Muirs gold prospect lies 65 km southeast of the Martha Mine (Newmont Mining, 10m oz Au) at the southern end of the Hauraki Goldfield.


Going too far north of Waihi and up into the Coromandel proper might be asking for trouble, so Glass Earth's permits should be in the ball-park.

[Vtrader]

Low volume on the NZX as always, but B:S spread opened to 30% during today, from 36 bid to 48 Sell.
Seller came down to 42 by days end, merely a 16% spread.
Interesting times if you are bull on gold.
V.

[elZorro]

Low volume on the NZX as always, but B:S spread opened to 30% during today, from 36 bid to 48 Sell.
Seller came down to 42 by days end, merely a 16% spread.
Interesting times if you are bull on gold.
V.

Vtrader, like you I wonder where the gold price will go next. In the meantime I had a bit of a look over Newmont's articles for some figures on their expenditures. For example, they spend $10m on exploration each year around Waihi, and will spend about $700m on Correnso over 7 years or so, if it is approved. The return should be about $1500mill from 650,000 oz.

Then I created this bar chart (OK, I had some help from a yr13 IT professional) to show what WKP would look like if it had 5Moz of gold taken out at current prices.

Two things I noticed:
-It's a lot of money
-Would Newmont really allow Glass Earth Gold to have 35% of it, or would they make a move at some stage?

[Vtrader]

Vtrader, like you I wonder where the gold price will go next. In the meantime I had a bit of a look over Newmont's articles for some figures on their expenditures. For example, they spend $10m on exploration each year around Waihi, and will spend about $700m on Correnso over 7 years or so, if it is approved. The return should be about $1500mill from 650,000 oz.

Then I created this bar chart (OK, I had some help from a yr13 IT professional) to show what WKP would look like if it had 5Moz of gold taken out at current prices.

Two things I noticed:
-It's a lot of money
-Would Newmont really allow Glass Earth Gold to have 35% of it, or would they make a move at some stage?

Z,
A chart!
After all your FA and you play TA also.
Black white or grey, opposites attract.

TA suggests that GEL.v could have just started up from an EWT minor 2.
A low volume chart, prone to error.
Something to lighten my day.
V.

[elZorro]

Cheers Vtrader. Only 5 trading days left in NZ before the options are due. Will GEL roll out some news before then? I wonder. It's a busy time of year for me, so I won't be posting too much detail for 2-3 weeks.

[elZorro]

First quarter results are out, had a quick look and nothing too surprising, although the latest drill at Muirs will be interesting when the assay is reported.

http://tmx.quotemedia.com/article.php?newsid=51643556&qm_symbol=GEL

By midday 31/5/2012 NZ time the MD&A full version is not available on the web, at the GEL website or on SEDAR. The map (pdf) of the permit areas that links to the news release is old, it shows a permit around the Talisman Mine, for example, and that area is now dropped, Renison Mining are looking to take it on. So a 50% mark for accuracy and speed of this update, to GEL. ("Achieved" is the current mantra I believe).

The full MD&A should give a lot more detail, might even talk a bit about what has happened since 31 March.

This third quarter coming up could be the most important GEL has seen, regarding cashflow from operations. It could be very good. Pity we seem to be three months behind on information.

[elZorro]

The SEDAR site has been updated to show 30th March data within the last 2-3 hours. So here is a cut-down version of the MD&A for Q1, and again it makes interesting reading.



Q1 2012 EXPLORATIONACTIVITY (Otago)
A network of gold bearing quartz veins has been discovered at new prospect Garibaldi. 2011 mapping and sampling at SparrowHawk South revealed anomalous gold and lead to the identification of a quartz vein system at Garibaldi. A trenching program commenced to follow up on positive rock chip geochemistry associated with quartz vein T4 (up to 8.73 gms/t gold). Eight trenches have been completed exposing a stock work of quartz veins, up to 1.5min width. 172 rock chip samples have been collected from the trenches; initial assay results indicate grades up to 16.1 gms/t gold.

A first pass program of stream sediment sampling was started in the Kakanui Range (north-east Otago). 84 samples have been collected to date with 250 remaining.

A full technical review of Hindon and Game Hen 2011 drill results(and all other exploration data) was conducted. This prospectivity review concluded that the late-stage fault hosted gold mineralization at these sites occurs in narrow zones, of low grade and with poor continuity. It was deemed that further exploration work on these prospects is not warranted and the permits have been relinquished and the associated accumulated exploration costs written off.

Q1 2012 EXPLORATIONACTIVITY (Placer)

In late March 2012, GlassEarth took full ownership of its placer gold production joint venture. Settlement of the transactions took place onMarch 19, 2012. Taking full control of placer mining activities should enable the Company to significantly accelerate and increase gold production capacity.

Glass Earth is continuing with gold production at the "Gunclub" mining operation while preparing for two additional operations to commence nearby in New Zealand's Otago region. Site preparation has been completed at the "Drybread" mine site, with the second placer Gold Recovery Unit (“GRU”) mining operation being commissioned in late May 2012.

The Company is also refurbishing and upgrading its GRU #1, which is expected to be installed and running as another operationat Drybread by June 2012.

A drill program was completed at Waikaia from the 6th to the 23rd March. A total of 34 holes were drilled. Three samples returned between 500 – 650 mg/m3 and one sample of 15,300 mg/m3 gold.

A second phase drill program was completed at Shepherds Flat with the completion of 45 drill holes and a total of 558m drilled. The average wash grade was 452 mg/m3 at a depth of 14m with an average thickness of 4.5m.

Q1 2012 EXPLORATIONACTIVITY (WKP)
No drilling occurred at WKP in Q1 2012. A 5,500m drill program commenced in April 2012.

Q1 2012 EXPLORATIONACTIVITY (Muirs)

The seventeen hole Muirs Reef drill programme continued at the Massey Reed in Q1 2012.

MSDDH10 reached end of hole at 127.9m PQ core on the 5th March. The hole intersected a wide zone of weathered and altered coarse grained andesite with zones of quartz veining from 55m to 120m. This includes individual quartz veins up to 1.5mwide and areas of stockwork veining. Results from MSDDH10 include 2m at 2.6 g/t Au.

MSDDH11 reached 189.5m PQ core by the 17th March. The hole was terminated because of decreasing intensity of alteration. Results awaited.
MSDDH12 reached 49m by the end of the quarter with several metre scale quartz veins between 0 -49m within a zone of intensely altered andesite with stockwork quartz veining. Results awaited.

A review group has been selected to analyze and re-rank the Hauraki and CVR targets in Q3 2012.

Exploration Expenditures
Mineral exploration costs form the bulk of the Company’s expenditures together with placer mining development costs. Exploration activities in Q4 included drilling at Muirs and various placer targets – some exploration, some infill drilling to improve confidence. Glass Earth contributes its 35% share to exploration costs in the Hauraki JV with Newmont. Narrative descriptions of exploration activities for the year(and prior years) are set out in the previous sections.

Exploration permits at Hindon and Game Hen (Otago) were relinquished during the period and expenditures associated with them have been written off during the period.

Mining operations suffered somewhat due to attention being diverted to the rearrangement ofownership of the placer JV, with Glass Earth acquiring full control in late March 2012.

Mining at Gunclub (Gold Recovery Unit #2) continued but mining at Drybread was suspended by mutual agreement in January. A reconfigured leased GRU suitable for fine gold recovery is being commissioned at Drybread in late May. Gold Recovery Unit #1 is nearing completion of its major refurbishment and is planned to also commence mining at Drybread in June2012.

Note (to costs)
1. General and Administration costs include accounting services ($34,000), insurance ($22,000) and New Zealand office costs ($25,000).

2. Professional fees are audit fees and legal fees incurred during the period.

3. Net salaries after exploration recharges are principally composed of the costs of the full time Chief Financial Officer, most of the costs of the Data/IT manager, and 25% of the Chief Executive Officer’s salary (to reflect the split between exploration activities and the other corporate based work that he undertakes).

4. The Company is developing an improved Investor Relations program, which covers the Canadian and European investor base (including London). The objective is to ensure that the market is fully informed of Glass Earth’s progress as it enters an exciting time in itsd evelopment path. Increased expenditure on personal presentations by the CEO and internet based dissemination of information, as assisted by IR professionals in Canada and London are budgeted to continue but at a lower level.

5. An earlier AGM has pulled share registry costs associated with that forward and the number of press releases has increased relatively.

6. The external legal fees and taxation advice costs related to the acquisition of placer activities.


So don't expect too much placer cash from the second quarter either, as a leased GRU is only just now running at Drybread (is this GRU#3, the brown primer unit pictured on the GEL pages?) and GRU#1 is getting cranked up in June. But from then on more money should be flowing in.

Some good prospects on the exploration side too. The Shepherds Flat placer gold is 14mtrs down, sounds expensive to recover. But that's for later, under a JV.

[elZorro]

Link to a new press release on Muirs: Massey Reef proving up fine, going for a NI 43-101 resource grading by the end of 2012.

http://tmx.quotemedia.com/article.php?newsid=51687290&qm_symbol=GEL

[elZorro]

I bring good news.

Two days ago, GEL was granted six exploration permits, all in Otago, mostly placer type areas. The total area is about 250km2 or 25,000Ha.

The permit names are
Argyle (EP53174)
Ida (EP53180)
West Dunstan (EP53185)
Sparrowhawk (EP53189)
Fruid Burn (EP53190)
Lee Stream (EP53229)

The time available for having a look is 4 or 5 years. Sparrowhawk looks to be immediately useful, being mentioned in despatches.

The normal procedure is to carve out a mining permit from within the EP areas, and some of these will be prospective spots for the GRUs.

No word yet on how the capital raising is going. I assume there is a bit of a shortfall in the bank account to pay the next instalment to Bob Kilgour. If the warrants are not picked up at C35c in big enough numbers, they'll have to do a private placement. Going on past history there will be a sweet deal for investors who put up their hands and take on the risk.

Although with the GRUs getting into full action and no shortage of areas to work over, I don't think there is much risk at all. Can't supply numbers yet with any accuracy, but if L&M mining could use the GRU#1 for over a year (24/7 under lights), then so can GEL. And that's just one GRU, there are three in use.

So in the next little while, we should see the GEL website being updated in the placer area and the permit tables. I'll try to keep an eye on that.

[elZorro]

ODT put out this at the start of the month, confirms the need to find the $1.5mill for the payment, or to replace it in the bank account if it was made on time today.

http://www.odt.co.nz/news/business/211525/glass-earth-raising-activity

Plenty wanting to buy GEL over on the TSX, but the bid is low, bracketing around C20c. I still think this should be the last time GEL is on its knees over cashflow issues. Onwards and upwards.

[Vtrader]

Onwards and upwards,
I count an EWT 12345abc since 2009.
That makes an EWT 2 of cycle degree.
Will add to this post after I buy some more.

Yeah, yeah promises promises...
Too much engineering to get to the markets, I do not need to be the turning trade...
V.

[elZorro]

Onwards and upwards,
I count an EWT 12345abc since 2009.
That makes an EWT 2 of cycle degree.
Will add to this post after I buy some more.

Yeah, yeah promises promises...
Too much engineering to get to the markets, I do not need to be the turning trade...
V.

Might have been a good idea to wait Vtrader: GEL at C19c and larger volume overnight, after this press release about a private placement..

http://tmx.quotemedia.com/article.php?newsid=52060665&qm_symbol=GEL

[elZorro]

The TSX price for GEL ended up slightly below C20c, reasonable volume there. The market is saying that this private placement at 20c should be a fair valuation of the value of each GEL share at the moment.

It is true that while GEL has produced the Q1 MD&A report and filed it with regulatory authorities, you cannot find it on the web except by digging into SEDAR or by looking at my cut-down version futher back in this thread. Neither is there any update to the website from the last two media outputs. Ordinary shareholders are all still very unsure about the details on the GRUs, and of course we will not be told the average grades at each permit, only the total gold ounces recovered. This will not allow shareholders to gauge the profitability of the placer mining, and a big chunk of the predicted profits will need to go to Bob Kilgour under the repayment plan.

Make no doubt about it, this data is critical for an FA evaluation of the company for the next year or two, because as we have seen, mining exploration is done in terms of years of drilling, not in months. Despite my fond hope of Glass Earth using an asset finance company loan or short-term bank overdraft going forward, this has not been the case. The C35c options are now gone as a liability or overhang on the shareprice, but in return the only avenue for fund raising seems to be another firesale of shares.

I have had occasion to borrow money for a business case, not in this league of course. Banks are hard-nosed, and usually, unencumbered land and buildings are the security they will seek. They will not be very interested in second-hand mining equipment, and permits with promise but no immediate surplus income. This is where the private shareholders and the market must step in.

Just as long as we are all aware that the banks, finance companies and even the private placement investors are saying that GEL is not a "no-brainer investment" yet. It's kind of poetic that the current TSX price is C20c. That's the IPO price (2006), but we've had a 1 for 5 consolidation since then. A long-term holder would have done very poorly, we must all learn from that.

[elZorro]

20 days after the Q1 report was notified to the market, it's now posted in full with the MD&A, on the GEL website under the financial reports section. Still very hard to dig the data out from within a big long text listing.

The GEL price is on the move to NZ29c, which is curious since the Canadian price is stuck hard on C20c or lower. So while all of the volume activity happens on the TSX, some NZers are paying 20% more for the share over here. And I doubt whether we can lead the share up.

My attitude at the moment, is that Glass Earth has the cash they needed to temporarily make good on the deal they struck with Bob Kilgour. Like OGC before them, they saw the prize and simply sold more shares at a lower price to get the required capital, diluting those of us who are longer-term holders. I know they tried hard to get the C35c options picked up, but this sort of marketing needs to be sustained over months, not weeks.

Now if we wanted to, we should be able to buy raw shares near C20c (without the future warrant sweetener offered to the private placement investors), and I am doing so, over on the TSX.

[elZorro]

Interesting story in the SST today, Fairfax article about an alluvial goldmining operation.

http://www.stuff.co.nz/sunday-star-times/latest-edition/7158753/Where-on-earth-is-Hugh-McAllister

I checked the numbers, if the floating GRU in use here is similar to GRU#1 owned by Glass Earth, the grade is at best 0.2grams/tonne if it's used about 15 hrs/ day. Lower grades on average (less than 45oz per week), means it's still a tough way to earn a living.

[elZorro]

The actual records for GEL's permits are now differing from the website's table by a significant amount. I've attempted to attach a pdf of the spreadsheet I keep current, based on the NZPAM public filings.

So the current details are:

Total area in unexpired permits is 1376 km2, at a cost of about $465,000 a year in fees.

Also applied for, another 7388 km2, see table.

While I wouldn't think GEL is allowed to do any exploration over these applied-for areas at the moment, in some cases they have held the permit previously as part of larger areas, so they have kept other parties out of the areas of interest.

Note the Komata area has been dropped, which is a large permit that surrounded the Talisman Mine across from Waihi. That makes it obvious that the latest map associated with the Q1 MD&A is incorrect, and the phrase (oft-repeated) about the total area under exploration is also technically incorrect.

While the MD&A report is more accurate, here's the phrase from the very latest press release, which advises that a clip from the editorial video has been posted around the web.


Glass Earth Gold is one of New Zealand's largest gold exploration companies, with its experienced geological team exploring promising gold prospects across a land position of approximately 10,000 square kilometres, in both the North and South Islands.

The "work in progress" page on the website was a good idea, except it hasn't been updated for 6 months..

I am putting all this in one place at the moment to illustrate that, contrary to their legal requirements as a listed company, management is not being proactive at supplying timely information to the market, and is regurgitating old data without checking for accuracy. And that's a polite version of what I'm seeing.

[elZorro]

Glass Earth gathered in $2.4mill from the sale of shares in the private placement.

http://tmx.quotemedia.com/article.php?newsid=52264228&qm_symbol=GEL

That appeared to be hard work, and about 1/3 of the funds were from investors introduced to the company by other parties, so there was a commission fee of 6% paid for those. Note that the company is still apparently exploring near enough to 10,000 sq km....yeah right.

GEL shares are selling for about C18c to C18.5c overnight, small volume.

Around 14 June 2012, the company Goldmines NZ Ltd shed Bob Kilgour as a shareholder, and on 19th June Dunstan Mining Ltd was renamed Glass Earth Mining. Shareholding status at the Companies Office is now 100% Glass Earth Gold's. GEL still has to make 25 monthly payments (in gold maybe?) to complete the deal. Peter Liddle and Simon Henderson are directors of both companies.

[elZorro]

Well, my post must have worked. The GEL website has been updated on the current projects page, as at yesterday. There is no new data as far as I can see, it's just up to date again, for the first time in a few months. The current permits are also shown, along with their areas this time, in Ha or km2. No total, but if you add the granted permits up, it's about 123,436 Ha, or 1234 km2.

Just a few words on each major exploration area. We'll have to wait for any new info. I wonder how the GRUs are going at Drybread?

From the ODT, nothing new, but there are the payments stretching out for 25 months.

http://www.odt.co.nz/news/business/214716/glass-earth-refinances-canadian-funds

Another earlier article adds some news: the three GRUS require about 20 staff to run them, and the target is 110oz of gold a week. GRU#1 should be almost running by now, based on the timing in the article.

http://www.odt.co.nz/news/business/213910/ambitious-glass-earth-recapitalises

Note to the reporter, GEL only needs 3,000 oz for $6mill, about 6,000oz really, considering the production costs (not 30,000 oz). Target is 7,500 oz.

[elZorro]

News release overnight: GRU#1 is running at least one shift.

http://tmx.quotemedia.com/article.php?newsid=52343682&qm_symbol=GEL

Heckler is the family name running the sheep farm at "Drybread", the location being called Lauder Creek. 42 ounces of gold a week from both Gunclub and Drybread is short of the intermediate target of 110 ounces, the longer term target being 144 ounces a week for 7,500 ounces a year.

If we extrapolate C$700 profit per ounce from the higher volume scenario (the profit could be a lot less for now), 42 ounces will do little more than cover the $80,000 a month payments that are needed for Bob Kilgour. In turn this means that one or more GRUs will need to be doing longer hours than currently.

But this is all a big step in the right direction, 20 staff working the GRUs and 10 staff doing exploration work elsewhere.

[elZorro]

This is a bit of PR from Glass Earth, in the ODT on 20th June. Might be worth figuring out what the various permit names are, in the description of the GEL placer sites.

http://www.odt.co.nz/news/dunedin/213928/otago-again-going-gold

Some interesting photos there, from the Alexandra workshop.

[elZorro]

Did anyone see Glass Earth all over the news on TV3 tonight? The weekly gold recovery figure quoted was 80 ounces, nearly twice the last figure we have been given. This would be from all three GRUs. If it is correct, this implies the grades are good.

A landowner with the surname Moran was interviewed, and Simon Henderson had a small spiel too.

I received an email from Andrew Hamilton (GEL head office IT) today, clarifying where the GRUs are, and this has helped my understanding of the Drybread area.


With regards to the GRU’s:


#1 is at Morans, #2 is at Nevilles, and #3 is at Hecklers.
I would have to check if you really want to know, but I’m fairly sure all three are owned by GEGL.

I was down in Alexandra last week and had a trip out to the Drybread site to see the operations for myself, and was impressed. We’ve got a few nice photos I’ll try and get uploaded onto the webpage, and if the videos I did on my phone are any good I’ll put them on too.

The decision regarding names was to not use Farmers names in any public communication, however as we routinely use them internally this hasn’t been strictly adhered to. As such the 3 sites at Drybread should be referred to as Drybread 1, 2, 3 not Hecklers/Morans/Groundwater, and I’ve not heard Lauder Creek before.

Regards,
Andrew Hamilton, Glass Earth Gold.



Looks like the Moran farm might be near Muddy Creek Road, which would be to the south of the Hecklers homestead, still on the Drybread permit. See the topo map in this earlier post.

http://www.sharetrader.co.nz/showthread.php?4019-Glass-Earth-IPO&p=372356&viewfull=1#post372356

Nevilles and Gunclub have been linked before.

[troyvdh]

Thanks El...again...in fact just arrived back from Alex...(went for deer...got goats only)....had I have been aware of the Drybread site...I would have called in....

PS....bloody cold down there....minus 7-9......about 3 during the day......still its pretty much heaven....cheers

...have been buying GEL....hold 15000....

[JBmurc]

Thanks El...again...in fact just arrived back from Alex...(went for deer...got goats only)....had I have been aware of the Drybread site...I would have called in....

PS....bloody cold down there....minus 7-9......about 3 during the day......still its pretty much heaven....cheers

...have been buying GEL....hold 15000....

where'd you go to shoot the deer/goats me n mate going for a shot tomorrow

[elZorro]

I've just had some wild pig/deer sausages we bought in town, for dinner, does that count? You SI guys should start a new thread on hunting, or at the very least cruise past Drybread and take some photos for me...

My cousin did the Otago Rail Trail bike ride recently and I'm very envious.

I have figured out that Groundwater is probably another farm on the other side of Glassford Road, to the west of the Heckler area. Part of this farm must be on the permit.

[troyvdh]

...JB....you know the rules....deer and that .....just over the hill......that way.....

Dear el....no...it does not.....re the ORT......its great but make sure you have the prevailing wind.......behind you........its a flat ride......but.................

[elZorro]

...JB....you know the rules....deer and that .....just over the hill......that way.....

Dear el....no...it does not.....re the ORT......its great but make sure you have the prevailing wind.......behind you........its a flat ride......but.................

Yeah good one Troy. Up here the local farmers talk of pheasants with tails as long as shovel handles.

For those of us who missed the TV screening , here is the video. Sure enough, the reporter mentions 80 ounces a week. Hmm..If the Moran site has GRU#1, it should be sitting in a big pond.

http://www.3news.co.nz/Modern-gold-boom-for-Otago/tabid/369/articleID/259873/Default.aspx

[JBmurc]

Yeah it's great explorer country round here love my trailriding now I've got a new 13lt fuel tank should give the KTM least 180km range a good days riding the mountain ranges...pently wildlife round them hills that and gold LOL

[elZorro]

Yeah it's great explorer country round here love my trailriding now I've got a new 13lt fuel tank should give the KTM least 180km range a good days riding the mountain ranges...pently wildlife round them hills that and gold LOL

JB, just be careful that your shiny new metal detector doesn't get caught up in the front wheel.. I assume you've bought one?

[JBmurc]

JB, just be careful that your shiny new metal detector doesn't get caught up in the front wheel.. I assume you've bought one?

no detector yet don't know if I'll get one,, might instead get a 2in backpack dredge etc paid for by gold shares when they re=rate

[bermuda]

Yeah good one Troy. Up here the local farmers talk of pheasants with tails as long as shovel handles.

For those of us who missed the TV screening , here is the video. Sure enough, the reporter mentions 80 ounces a week. Hmm..If the Moran site has GRU#1, it should be sitting in a big pond.

http://www.3news.co.nz/Modern-gold-boom-for-Otago/tabid/369/articleID/259873/Default.aspx

Thanks for this video elZ

[elZorro]

Thanks for this video elZ

No sweat Bermuda, now we need to see a good bank balance in the Q3 books.

JB, sounds like a good plan with the dredge, that's what I call commitment..

[elZorro]

In the last quarterly report, which I've only skimmed through so far, there are some grades attached to the non-current placer areas. These could be handy.


Placer exploration & mining work in 2011 was concentrated on Gunclub, Shepherds Flat and Drybread. South Island placer mining at Gunclub continued throughout 2011 inhibited somewhat by winter snows and the building of a large water storage dam.

Resource definition drilling was completed at Shepherds Flat (57 drill holes and 709m of drilling). Results were encouraging and a full analysis of drilling was presented to Joint Venture partner Placer Gold International who agreed to proceed to stage two of the Shepherds Flat Joint Venture.

RC drilling and pitting was continued at Drybread to provide grade control and resource definition in preparation for mining. Encouraging results allowed progression with mine planning. Council resource consents and a mining permit were granted allowing two further Gold Recovery Units to be deployed – complementing production at Gunclub.

Q1 2012 EXPLORATION ACTIVITY
In late March 2012, Glass Earth took full ownership of its placer gold production joint venture. Settlement of the transactions took place on March 19, 2012. Taking full control of placer mining activities should enable the Company to significantly accelerate and increase gold production capacity.
Glass Earth is continuing with gold production at the "Gunclub" mining operation while preparing for two additional operations to commence nearby in New Zealand's Otago region. Site preparation has been completed at the "Drybread" minesite, with the second placer Gold Recovery Unit ("GRU") mining operation being commissioned in late May 2012. The Company is also refurbishing and upgrading its GRU #1, which is expected to be installed and running as another operation at Drybread by June 2012.

A drill program was completed at Waikaia from the 6th to the 23rd March. A total of 34 holes were drilled. Three samples returned between 500 – 650 mg/m3 and one sample of 15,300 mg/m3 gold.

A second phase drill program was completed at Shepherds Flat with the completion of 45 drill holes and a total of 558m drilled. The average wash grade was 452 mg/m3 at a depth of 14m with an average thickness of 4.5m.


As we now know, GRU#1 is up and running as they'd hoped at Drybread, and Drybread appears to be an amalgamation of three separate hotspots into one permit. Shepherds Flat is a bit longer term, it's also a JV, and the reasonable grades appear to be about 14 metres down. A long way to fall, and a long way to dig.

So now, have a look at Waikaia, EP52844, 223 Ha. (https://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?permit=52844)This is a more recent EP that Glass Earth obtained in the Southland region. It's not in the deep south, but on googling Waikaia I see that L&M Mining had a go at an adjacent permit MP41602 (http://www.stuff.co.nz/southland-times/business/3801746/Gold-hopes-revived-in-Waikaia-dig)and stopped working on it when the gold price was not high enough. Waikaia Gold Ltd seems to be an amalgamation of interested smaller shareholders, and they're going to work it starting October 2012, in the style of the Earnscleugh permit. So it's a placer site, the flood plains of a good-sized river (https://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?permit=41602).

The map of the bigger MP area shows GEL's EP off to the west. But it's not far away, and my attention was drawn to the huge grade they've found there. Just one of the shallow drills, sure. 15.3 grams per m3, about 7g/tonne. If you average the three drills with good grades, you'd get 5.5g/m3. We are told that a GRU needs just 0.2g/m3 of gold to break even. A single GRU could produce (if the three sample areas kept going) 5.3g/m3 x 50m3/hr x 24 x 7 = 44,520g spare gold per week, or 1436 ounces per week, nearly 75,000 oz/year.

This would be a gross income of $150mill a year. It's only 5 grams in a cubic metre, but I have to admit gold is a very rare element.

This is all conjecture, who knows, there might be grades like this in parts of Drybread too. Relatively small areas with these grades will make a big difference to the profits. It is curious timing that the drilling at Waikaia was mostly completed just before GEL struck a deal with Bob Kilgour in mid March.

In the April 2012 presentation uploaded by CHFIR (http://www.slideshare.net/CHFIR/glass-earth-gold-limited-gelv-oct-2010), the placer gold production costs were lower at US$800/oz, and Waikaia was mentioned as one of the future placer prospects. From the production chart, Gunclub, PigBurn and even Shepherd's Flat are not expected to add a big percentage to the annual production.

Besides Waikaia Gold, who have enlarged their area with another EP, there are two smaller miners, and NZ Minerals Ltd, normally GEL's 10% partner in Otago permits, has a big prospecting permit application 54316 surrounding GEL's permit. GEL's permit reaches one side of a river or stream, the Garvie Burn.

From an archeological report for Waikaia Gold's MP, 2010:

The gold is largely located within a 200 - 400 metre wide channel on the Waikaia Valley floor,
sitting in a basal wash at an average depth of 19 metres.
The proposed area of mining extends for approximately five kilometres along the west bank
of the river from the Garvie Burn in the south to the Dome Burn in the north. While the main
proposed mining path is located between the Riversdale - Waikaia Road and the Waikaia
River, the proposed path also follows the main gold bearing channel a kilometre up the
Garvie Burn, south east of Waikaia - Riversdale Road in an area lying between this road and
Pyramid - Waiparu Road (Figure 2, 3).

I wonder if GEL read this article too, and made a beeline for the area. Waikaia Gold will work the true left bank of Garvie Burn lower down to the Waikaia, and GEL has an option to work the right bank a kilometre or two upstream.

Waikaia Gold was given the go-ahead in February 2012.


(http://www.stuff.co.nz/southland-times/news/6478655/Go-ahead-given-for-gold-mining-in-old-riverbed)

[elZorro]

The TSX price dropped a bit on very low volume overnight, that would be the place to buy GEL at the moment. But I have recently formed the view that we're fairly safe buying here at a slightly higher price. There are many reasons for this.

1. GEL has been at C75c /NZ85c in late August 2011 on good news.
2. Unexplained increase in the placer gold recovery from 42oz/week to 80oz/week (News item) as the two GRUs got stuck in at the Drybread areas.
3. The images of Drybread show shallow workings. I'm picking that the GRUs are being fed with the lesser grades on the top of the profile, and that as gold always gravitates downwards, there is better yet to come. I hope it's not down 14 metres like some other spots, but if they're doing 80oz/week now while still warming up to the task, there could be very good news in future.
4. The current 30 staff might need at least $5mill/year to operate with, allowing for equipment and fuel costs. GEL has in the past year or two used maybe $4mill annually, the big external survey costs behind them. They have been frugal. Even 80oz of gold/week will supply $8mill annually, and in view of operating costs (maybe not capital costs), this is a major change for the company.
5. Company valuation could be at the level of 5x net profit from placer plus the value of all the permits, so if the gold throughput improves further and GEL has a positive cash balance that funds more exploration and needs no shareholder support, there will be a steep re-rating of the share price.
6. Sites like Pig Burn and Waikaia will need extra equipment. There might be some more gear in the Dunstan Mining inventory, but just in case, I had a quick look for new GRUs. Are they out of the question for GEL? No.
NZ has maybe 3-4 suppliers of GRUs, here's one (http://www.minequip.co.nz/):
I was cheeky enough to ask how much, for a 100m3 unit (Model 1200). They can't keep up with demand for them at the moment, they are $150k to $180k each. In view of the money that might run through them, and the lower maintenance, new GRUs are not going to be an issue for GEL, if they have enough good permits to put them on.

[elZorro]

I've had a closer look at the TV3 video. Looks like this showed two views of cut-down GRU#1 at Drybread No.2 (Morans), and GRU#2 at Gunclub. GRU#3 was not shown, it is probably still in primer red.

Maybe GRU#1 is designed to rest in the bottom of a pond, and as the team digs down to the deeper and probably better grades, we'll see a pond forming.

Note the yellow small-scale gold separator being used in the lab on the video, looks like it processes the sample bags from the RC Drilling rig that's mounted on a truck, maybe any placer area trenching samples too.

To save myself further confusion, Garibaldi is a hard-rock discovery triggered from nearby Sparrowhawk South. It is not a placer site, because the gold is bound up in rocks. It'll need drilling, trenching and assays like WKP and Muirs.

[troyvdh]

..gee el.....the way you are going....you will be recipient of some sort of medal......somehow......cheers...troy

[elZorro]

..gee el.....the way you are going....you will be recipient of some sort of medal......somehow......cheers...troy

Troy, I'm still waiting for my embroidered GEL cap, it hasn't worked yet..
Now answer me truthfully, are you convinced to increase your stake in GEL yet? Things are changing fast with the GRUs in action, that's what I think.

More on Garvie Burn from the extensive report (http://otago.academia.edu/AngelaMiddleton/Papers/938119/Waikaia_Alluvial_Gold_Project):


According to Miller (1966: 61; see also Tyrrell 1999: 52-53) dredging began in the early 1890s at Gow’s and Dome Creeks, but these were not a success. Another dredge, the Golden Crown, was built at Landslip in 1896 (Hamel 1998: 2; Tyrrell 1999: 52-53). This was a failure and moved to the Shag River less than two years later. Further dredging was established in the upper Waikaia area in the late 1890s and at the Garvie Burn, the lower reaches of which were known locally as Muddy Creek. A dredging boom began from about 1902 - 1903 with the success of the Mystery Flat and Muddy Creek dredges, and the use of this technology continued until the 1930s, when in late 1935 the last dredge that worked west of Freshford Plains Station and McDonald’s roads was closed down, dismantled and transported to Waikaka (Tyrrell 1999: 52 - 54). Tyrrell’s (1999: 52-53) table provides details of the names,dates and other details of the various dredges in operation in Waikaia, some of these returning the richest payouts in Southland for their investors at the height of the boom times. For some of the dredging returns, see Tyrrell (1999: 54) and Hamel (1998: 3). Although the Waikaia field was known as the most ‘productive and profitable’ in Southland, the rich lead below Waikaia that ran south to the Garvie Burn was worked out by about 1914, with many dredges closed down by that date.



That last dredge was working somewhere near the GEL EP, which is mainly west of McDonalds Road.

In 1906, here's the output from the Muddy Creek Dredge, 100 oz in a week. (http://paperspast.natlib.govt.nz/cgi-bin/paperspast?a=d&d=OW19061128.2.70.3&cl=CL2.1906.11&e=-------10--1----0--)

Waikaia gold might be close to its source, 1890s. (http://paperspast.natlib.govt.nz/cgi-bin/paperspast?a=d&d=OW18910326.2.32)

This chart (http://inflationdata.com/inflation/images/charts/Gold/Gold_inflation_chart.htm)shows that the current gold price is about 3x the value available in 1935, when the last Waikaia area dredge was pulled out, during the depression years.

Lucky for some.. (http://superiormining.com/_resources/articles/080327-NZHerald.pdf?phpMyAdmin=781d5a28f54f6d83b0f050f5ab d2038f)

In 1910, a Californian report on the NZ Goldfields stated that the "most consistently remunerative dredging field... (see below)

A map off to the east of GEL's permit shows the rough historical positions of 10 dredges in the area, some working on the land.

[elZorro]

Here's a hybrid map of the area showing some topo detail. There is a curiously barren and slumped area just below GEL's permit space which could be where the last dredge worked, see the black ringed area. GEL has grabbed the ground beside this space, like they did at Drybread.

There is a permit covering the space where the dredge had possibly worked, MP 41772, and near the junction of Freshford Plains Station Road and McDonalds Road there is a small water race and a dam. Looks like more of a duck pond on closer inspection, and for a 9 year old mining permit there seems to be a lot of grass still available for sheep. No broken ground at all..so this mine permit restoration might be finished ahead of time.

https://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?permit=41772

[elZorro]

Here's a new suction dredge that has been built in Nelson for the Cold Gold Clutha Co. It needs about 6 people to operate it, but can only grab 30m3 of gravel from the river bed each hour. The suction nozzle is controlled by a camera from above.

http://www.odt.co.nz/regions/central-otago/197279/stuck-truck-delays-start-clutha-river-gold-dredging-project

Expecting 4 oz a day from 13 hour operation, yields about 0.32g/m3. They could go for a 24 hour licence later, but even so it's not a great grade on the face of it. I saw a very old article saying that one of the big dredges from 100 years ago recovered 1230 odd ounces of gold in a week. That was a record for river-based operations, it was probably a bucket dredge.

Extra data:http://www.commoditytrademantra.com/gold-trading-news/a-new-gold-rush-150-years-otago/

At least 4 Rotary gold screen manufacturers near Greymouth..

http://www.rotarygoldscreens.com/video.html

[elZorro]

More history - here is the Hartley and Riley dredge which was on the Clutha River gathering staggering gold amounts, from about 1898 to early the next century. This is an early photo, before the covers went over everything. You can see a trommel (the rotating screen) and the massive riffle areas should be where the two blokes are. The elevator to the left would have dumped the washed rocks and gravel back into the river, or onto the banks maybe. Not sure how they got the gravel from the river bed up into the top of the trommel, but it looks like this was an early example of a bucket dredge, which was quickly copied by other startups once the dredge began recovering over 1,000 oz of gold in a week.

This whole huge structure was run by a 10HP or 12HP motor, probably a steam engine.

A bit about the upper Waikaia in this recent thread about a Clutha mining permit for sale.
http://golddredgingforum.proboards.com/index.cgi?board=general&action=display&thread=938

Dredge designs, IPENZ (http://www.ipenz.org.nz/heritage/documents/THE%20%20%20DEVELOPMENT%20%20%20DREDGES%20%20%20AN D%20%20%20DREDGING%20%20%20TECHNIQUES.pdf)

The Lady Ranfurly dredge, an electric powered unit, apparently obtained the record weekly production of 1234oz in 1900, on the Kawerau River, now Lake Dunstan. It eclipsed the recent record of the Hartley and Riley dredge.
http://thefieldofgold.blogspot.co.nz/2010/08/gold-from-river.html

A strong connection here to Bob Kilgour's family. http://thefieldofgold.blogspot.co.nz/2010/09/tunneling-for-gold.html

[elZorro]

Glass Earth was on the TV3 news again this morning. It looked like a spare bit of video footage from last week, cobbled together in a similar article. So I'm unsure what that was all about. Short of new news?

This time the weekly recovery amount wasn't mentioned, but it was stated that each of the three GRUs is processing about 50 cubic metres per hour. They won't all be running 24/7 of course, but it helps with estimating the returns. Here's the video..
(http://www.3news.co.nz/Otago-gold-mines-still-making-money/tabid/369/articleID/261053/Default.aspx)
Text of the story.. (http://www.3news.co.nz/Otago-gold-mines-still-making-money/tabid/421/articleID/261053/Default.aspx)
(The item might have been about redressing some perceived treatment of the topic, there was a lot more about finding a hard rock deposit at the end of the item, that being the main object of the company).

Just spotted that Glass Earth has been granted Kakanui, permit PP53297. They'll need to take 200 BLEG samples, 200 gold pan samples, and 20 shallow gold drills within 2 years. No problem. The permit is 533,950 hectares, stretches way over the top of Macraes Mine.

Maybe they've been looking here already, see the Q1 2012 report:

A first pass program of stream sediment sampling was started in the Kakanui Range (north-east Otago). 84 samples have been collected to date with 250 remaining.

So GEL now has 6801.81 km2 of permits, another 2121km2 in the pipeline.

[elZorro]

Not too much has been happening with the CVR permit areas Glass Earth holds. I remember GEL has a wholly owned company (Glass Earth Geothermal Ltd) connected to the geothermal side of the permits. They decided to put this on the backburner in 2009, because they can't secure the IP under current rules.

http://www.contrafedpublishing.co.nz/Energy+NZ/Issue+2+Spring+2007/Exploration+investment+thwarted.html

The implication is that Glass Earth knows of some prospective new geothermal sites, and maybe one day these will be worth something too.

Waihi Gold (Newmont) has dropped EP40687 recently, this was a small permit around Golden Valley Road, a short drive away from, and east of the Martha Mine in Waihi.

[elZorro]

The Manuherikia and Ida valleys are fully allocated for water uptake. The govt is part funding a search for new water sources and management systems. Funnily enough, the water allocation is related to mining use until 2021, must be an historical thing. I'm wondering if the data that Glass Earth provided from their aerial scans has been of any help here. GEL is placer mining in both valleys.

http://www.scoop.co.nz/stories/AK1207/S00419/iaf-grant-for-manuherikia-catchment-strategic-water-study.htm

Thanks to Andrew Hamilton at Glass Earth head office, an article in the ODT earlier this year.

http://www.odt.co.nz/regions/central-otago/195751/aerial-study-finds-water-ida-valley

[elZorro]

CHFIR has just put out newsletter No.70, which has a small writeup on Glass Earth (first one since 2010).

http://chfir.com/sites/all/files/chf_client_in_briefs/July2012-eNewsletter_07-26-2012.pdf

Here's the text, and I think the last line is encouraging: management are not wanting any more firesales in future, the placer gold should provide the bulk of the funding.

Grade is king, GEL should catch a good break there sometime.

[elZorro]

It's near the end of July, and Glass Earth set a target for placer production of about 84 to 100oz/week by the end of the month. After the newer placer sites get up and running, the target is 144oz/week (7500oz/year). I dug up an old email from Simon Henderson, which I've already posted.


February 2012: In alluvial production we quote grade in grains per cubic metre, not grams per tonne. (A grain is roughly 1/15 of a gram, and there are about 2.5 tonnes of gravel wash in one cubic metre).

We'd regard a grade of 3 grains/m3 as an acceptable cutoff point for profitable mining (high volume throughput, no crushing, gravity separation and so on all mean that far lower grades than that needed in a hardrock environment can be profitable), but of course can run into far more than this on richer leads - in fact we will have on occasion run into 3"g/t" ground..

Given the small size of these deposits and the difficulty and expense required to define an official resource (plus the sensitivity our JV partner has required us to have towards reporting grades in Otago, based on keeping results confidential to each landowner) it makes more sense to have a solid estimate of projected ounces per week production, and then the total net revenue we are achieving - net profit from alluvials measures for us what these deposits are worth in terms of what they add to our company. We're actually going through a significant (and exciting) overhaul of alluvials, I can't tell you more than that today but we are looking forward to some real progress, and profit, this year. Our placer mining is shaping up as a very useful and unique side to how we operate - it began as a survival tool but is starting to look like a true opportunity for self-funding meaningful hardrock exploration. So when laid alongside our current projects and land package it's very compelling.


Here is where the maths gets interesting (but not hard!). 3 grains/m3 is roughly the same as 0.2grams/m3. Each GRU processes 50 m3 per hour when it's online. Since it takes almost exactly 3 hours for each GRU to produce an ounce of fine gold flakes at the minimum cutoff grade, then the approximate running costs for a GRU is about US$300 per hour (we've also been told the cost of each ounce is US$900). The cutoff grade will change if the price of gold goes up or down, but it is low compared to other mining methods.

$300 needs to cover the wages of about 3-5 staff per GRU/hr, any downtime costs, maintenance, fuel. All GRUs need to contribute to the monthly settlement payments for Bob Kilgour, and at each site the landowners will have a small percentage (http://glassearthgold.com/i/pdf/land_access.pdf)(unknown, left out of my calcs).

But assuming GEL didn't drag the GRUs out there for anything less than the minimum cutoff, then running GRU#1 for 24/7 hours, and the others for about 60 to 70 hrs/week, will recover the gold they are talking about. There would be an annual profit of about US$2.6 mill at 100oz/week, at the lowest grade.

However, if Drybread sites offer 0.4grams/m3 of gold, the annual net profit from just the sites and gear they have going now, would be US$8.6 million. That's enough for everything that they normally do in a year, all paid for.

To put this into perspective, each excavator scoop of 1 m3 needs to be fed to a GRU at about once a minute. The dry weight would be about 2 tonne, 2.5 tonnes wet. At the minimum grade, 3 grains of gold (0.2 grams), needs to be present. A single .177 lead slug pellet weighs about 9 grains, or 0.6 grams, so that small weight of gold per m3 is three times the cutoff value.

Note: gold is about 70% more dense than lead, so Glass Earth are hoping to see no less than 1/3 of the weight of a slug gun pellet (in gold) in each scoop, and 1/5 of the volume of the pellet.

[elZorro]

L&M Energy confirms consummating Alton Block deal with NZEC
18 July 2011
The active petroleum and coal seam gas explorer L&M Energy Ltd (ASX & NZX: LME) last week announced reaching an agreement for AGL Energy Ltd to sell its 50% share in PEP 51151(the Alton Block) to New Zealand Energy Corporation (NZEC).The deal would be subject to gaining New Zealand ministerial consent.

L&M Energy earlier said NZEC agreed to fund 100% of L&M’s share of expenses in the currently drilling Talon-1 oil exploration well – estimated at $1.75 million, including $250,000 of completion costs in the event of a discovery. L&M Energy would retain its existing 50% interest in PEP 51151. Talon-1 is the first well to be drilled on the permit which is in the onshore southern Taranaki Basin “which also contains multiple further targets.”The joint venture is targeting mean reserves of 2 million barrels of oil recoverable in the shallow Manutahi Sands in a structure geologically identical to the adjacent Manutahi oilfield operated by Origin Energy. NZEC is a subsidiary of a privately owned Canadian company which earlier this year appointed well known NZ petroleum sector consultant Ian Brown of Ian Brown & Associates as an executive.

NZResources.com said in February that NZEC was going to focus on oil and gas exploration in NZ with a focus on exploring for both conventional and unconventional oil and gas in proven, but under-explored areas.


Why post this here? Ian Brown's consultancy was in the mix when Glass Earth first started up, and Ian was a director of Glass Earth. Geoff Loudon owns a good-sized chunk of LME, and has recently stumped up $5mill for LME to continue other gas/oil drills. The most immediate one of interest could be Kahili-2, a new drill into an already proven (but disappointing first well) field that has gas/oil takeoff plant ready to go.

Geoff Loudon has sizable interests in Glass Earth Gold too, so both will be keen to see how the rest of 2012 shapes up.

NZEC is listed on the TSX as ticker NZ. It has raised $85.5mill since the IPO in August 2011. It has its own gas production station tied in to a gas line, at Waihapa. 50% share of Alton Permit, soon 65% etc.

In March 2011 NZEC bought Ian Brown Consultancy, and the staff work for NZEC. This company was only conceived in 2010, they have moved very quickly.

http://www.newzealandenergy.com/About-NZEC/History-of-NZEC/default.aspx


Stock-based compensation for the year ended December 31, 2011 totalled $2,203,548 compared
to $9,996,000 recognized in 2010. Of the total non-cash charge for the year ended December 31,
2011, $1,000,000 related to the IRBA asset purchase agreement, on the valuation of the shares
issued, that was executed on February 21, 2011.



IRBA Agreement
The Corporation entered into an asset purchase agreement with Ian R. Brown Associates Limited ("IRBA"), a private company owned by the COO, pursuant to which the Corporation acquired certain of IRBA’s assets, including geological data, office equipment, personnel and an office lease in Wellington, New Zealand. In consideration for the transfer of the assets, the Corporation paid $400,000 and issued 2,000,000 common shares to IRBA, at a deemed price of $0.50 per common share (Note 12a).

[elZorro]

The AusIMM conference is on in Rotorua this month, the main part of it being from 27-29th August, in Rotorua. Here's the programme. (https://custom.cvent.com/7D44ECD432654B6DA64826C592F01E88/files/8c3278d9fde44900958c4c42efb0aca4.pdf)

There are some industry heavyweights speaking at the morning sessions, including Mick Wilkes (OGC), Glen Grindlay (Newmont Waihi), Chris Baker (Straterra) Geoff Loudon (L&M Energy, L&M Mining). The chairman of the organising committee is Tony Christie (not the singer, the scientist from GNS). Dr Christie was the lead author in papers on the WKP area and the Coromandel.

Simon Henderson has a 20-minute slot on the first afternoon, where attendees have a choice of two sessions. He has chosen to discuss the Garibaldi discovery process, which could be a heads-up for that hard-rock area. On another day an Otago University student, James Stewart (who may or may not be of Scottish descent..) will discuss the morphology differences in placer gold between Nevis and Garibaldi.

That's something else GEL is good at, providing placements for geology students by the look of it. There will be another session by GNS covering new geothermal discovery work near Taupo. So plenty of links here to GEL, including some time spent on the blind Correnso deposit in Waihi, which may trend towards a GEL JV permit with Newmont.

Something for JB: a trailer mounted trommel system? (http://www.wildboarprospecting.com/)

[elZorro]

Here we are at the start of August, another month gone and with no press releases of any useful kind from Glass Earth Head Office, I'm wondering what planet they were on when they promised better feedback for shareholders on their operations. They're obviously beavering away at Drybread and Gunclub, and in view of the effect a lowered bank balance regularly has on the shareprice, are they doing well down there or not?

On having a look at the news releases page (which is only noting the "good" news releases), this is perfectly normal.. one month or more gap in news after each closing private placement, of which there have been a few. http://www.glassearthgold.com/s/NewsReleases.asp

This could just be a coincidence, that once the bank balance has been restored temporarily, there was nothing to report to the market. Just in case they don't know, yes, we're out here, waiting for news.

I've taken a wild guess at what hours the GRUs could be doing in the future, used the $300 an hour operational cost for each, and even after paying out for the equipment purchase price, there should be a good profit left at the cutoff grade. Of course, like any business, many costs are fixed, and so the profitability goes up once the overheads are covered. Here's a graph showing that effect for GEL's placer, if the grades go up.

I have left off any profits from new areas not even started yet, but these could also help a lot. As for the grades, Waikaia had one drillhole tested at 15g/m3, but we have not been supplied average grades for any of the permit areas. But let's hope they'll do better than the cutoff grades on most permits. That profit would certainly keep them in cash for each year's exploration and admin needs, and would lead to a rerating of the shareprice.

A bit of perspective: the true shareprice is 20% of that asked for during the IPO in 2006. Current EPV is about $18mill, no increase after all the new shares added. An average grade of 0.4g/m3 could produce more than the projected 7,500oz per year from all current and near-term placer permits.

But the first graph does point out one thing: the grades they find there on the placer permits have a lot to do with the immediate cashflow of the company.

I've added a chart of the annual ounces that would be produced by higher grades. GEL is bound by TSX and NZX rules to be relatively conservative in their data outputs to the market. However it is true that two other placer deposits being worked in Otago by other parties appear to have grades around the 0.2 to 0.4g/m3 mark, based on the data provided. But Glass Earth will have the biggest choice of sites in the country, and if one site has markedly better grades than the cutoff, the strong cashflow would allow more resources to be employed there quickly.

[elZorro]

Newmont Waihi has started to be a bit more public about the prospects at WKP, at an industry conference. This could be fairly important, via NZResources.


Newmont Waihi Gold Limited

8 August 2012
Higher grade targets identified at WKP (http://www.sharetrader.co.nz/showarticle.aspx?id=3585&gid=30003585)
(http://nzresources.com/showarticle.aspx?id=3585&gid=30003585)by Ross Louthean
The usually coy nature of Newmont group about the progress of the WKP gold find near Waihi wasn’t evident with the positive comments made by a senior executive at Diggers and Dealers in his presentation on the Asia Pacific operations...

More on this if you pay a subscription.
http://nzresources.com/showarticle.aspx?id=3585&gid=30003585

From another reporter, no mention of WKP, it's hard to pronounce in full. (http://www.brecorder.com/agriculture-a-allied/183/1224543/)

Mining Weekly had this report. (http://www.miningweekly.com/article/newmonts-apac-keeps-production-promises-2012-08-06) Which Waihi underground mine in 2016? It's probably Correnso. But there must have been some mention of WKP too.

Jeff Huspeni has been an exploration geologist, and has visited Waihi since his new appointment as VP of the Asia-Pacific region for Newmont in 2011.


Higher grade targets identified at WKP

Ross Louthean — 8 August 2012
Operator for the exciting WKP gold discovery near Waihi, Newmont Waihi Gold, has been able to identify potential high grade zones at the prospect which may accelerate exploration.

At the Diggers & Dealers Forum in Australia’s gold capital of Kalgoorlie, Newmont Asia Pacific’s senior vice president Jeff Huspeni told NZResources.com that recent diamond holes into the prospect had identified what could be a feeder zone.

There would now, he said, be a focus on adding grade to what appears to be a large system.
Newmont owns 65% of WKP with the balance held by active New Zealand gold explorer Glass Earth Gold Ltd (NZAX & TSX-V: GEL).

NZResources.com suggested to Huspeni that WKP was perhaps the most exciting emerging gold discovery in New Zealand. He did not disagree.

In his presentation on the Waihi Golden Link project, Huspeni said the company was advancing the Correnso and Martha Deeps projects and it was projected that Correnso-Martha Deeps would cost $US240-250 million to develop and would achieve operating costs in a range of $US800-$US900/ounce.

The company was targeting starting a Martha exploration decline in the second half of this year, once permitting was obtained.

Currently Newmont Waihi Gold’s focus is on finalising operations on the Favona Lode underground mine and advancing development of the nearby Trio underground operation that will provide an operating life before Correnso comes on stream possibly late in 2014 or early 2015. Huspeni said the Waihi Golden Link project was aiming for production in the range of 100-125,000 oz per annum.

Newmont Asia Pacific's production from its region – taking in mines in Western Australia, Northern Territory, New Zealand and Indonesia – was targeting 2012 production in the range of 1.73-1.8 M oz and operating costs ranging from $US800-850 M, and attributable copper production of between 145-165 M lb.

A pearl for the Australian operations remains the Callie mine in the Northern Territory’s Tanami Desert, a region that has produced 8 M oz, with 75% coming from Callie where the company is now sinking a deep vertical shaft to access deeper ore positions on this durable and high-grade mine.

Deep intersections on Callie Deeps have included 10 metres @ 23.3 grams/tonne gold, 45m @ 28.8 g/t and 43m @ 11.5 g/t Au.

Exploration near the mine has outlined the Oberon discovery which Huspeni said had “Callie-like” mineralisation and that this “exciting” target could expand the inventory of open-pit and underground mineralisation.
He said the Callie Deeps shaft would also provide potential access to deeper ore in Oberon.

The other major Australian asset was the 50/50 joint venture on Kalgoorlie’s Super Pit – which again holds the crown as Australia’s largest gold producer – where in the six months to June attributable production to Newmont was 175,000 oz.

Attributable reserves at the Super Pit were 4.4 M oz.
Another global giant Barrick Mines is the project partner.
In the quest to contain operating costs the now-imposed carbon tax by the Australian Government would, according to MiningBusiness.net add a per annum $US36 M to operating costs within the country, and for the relatively new Boddington mine it would represent between $US24-27 M.
Attachments
Newmont's Diggers and Dealers presentation. (Adobe PDF File) (http://nzresources.com/attachments/3585/newmont.pdf)



http://www.sharetrader.co.nz/icons/pdf.jpg









Newmont is determined to replace all reserves as they are mined, and to increase production to reduce per ounce costs. (http://www.brecorder.com/agriculture-a-allied/183/1224543/) In perspective, Boddington is a big mine already, 1Moz having been recovered within 1.5 years. But if WKP can step up to this kind of output, it would make a big impression on gold mining in NZ. Maybe this WKP feeder zone is the undisclosed results from the lower half of drill WKP31.

[elZorro]

Still no news out, but in the background the Glass Earth website has been updated in one or two places, including the permit list, which now has its own page. Kakanui is on the granted list, and it's shown in km2, it's huge. 32 + 1 permits in all, another 16 applications.

Of great interest to me is the update on the placer page, which now has three short videos of GRU#1 in operation at Drybread.

http://www.glassearthgold.com/s/Projects.asp?ReportID=450554

Note that the amount of material going into the biggest GRU is anywhere between 50m3 and 100m3 per hour. That upper figure is twice what I'd been using in my calculations. I had no idea the gold was pumped up into a header tank, before being extracted in jigs. These don't seem to be anything like a riffle box. Some sort of dual plunger seems to bring the gold out of suspension, and then the concentrate flows into a series of Knudsen Bowls.

The web tells me that these are a type of centrifugal extractor that was more common in the 1960s, but is still used by placer miners (amongst other offerings) to recover fine gold. Drybread is known to have fine gold flakes. They'll have to stop the gear every so often to extract the gold, and maybe the final process is on a vibration table.

GRU#1 seemed to be running fine, from all the work nearby there was a pond forming, but they'll need this to conserve water and stop any runoff.

[Citizen Erased]

Thanks for the regular updates, elZorro.

As a potential investor, I recently signed up at the Glass Earth website to receive email updates, but so far haven't received anything (not even a welcome email).

I've learned more about the company by reading this thread from start to finish than I could gather anywhere else.

[elZorro]

Welcome to Sharetrader, Citizen Erased (do we call you CE for short?). You must be a real goldbug like me if you read most of the posts, it would take a while.

Potentially an investor CE.. well from my point of view it would be very good timing, there are a lot of interesting vibes and opportunities for GEL in the near future.

You'd be jumping in when a lot of investor hard graft (read..losses) have occurred, but exploration companies that move into production (or are able to sell off what could be a major asset like WKP) are often multi-baggers.

Short term of course, my interest is in the placer sites, as cash from here will mean no more dilution and private placements. ACC, as a cornerstone investor, is also patiently waiting. There is already plenty of smart money invested in this company, and the next few months will be very interesting I'd say.

[Citizen Erased]

You can call me whatever you like :)

Yes, I'm a gold bug, but I only own physical bullion. This will be my first ever share purchase.

I think I'm ready to dip my toes in.

[elZorro]

CE - good plan, shouldn't be much risk from here on. We'll know more about that when the new press releases are made.

A gold hoarder eh? You should contribute to the Gold thread on the ASX side, I'm sure Skol will have some comments for you.. I wish I'd bought gold a few years ago.

Regarding GEL: off to the side a bit, but Geoff Loudon has received an award for his contribution to the industry, at Diggers and Dealers.

http://www.news.com.au/national/sandfire-the-envy-of-the-mining-industry/story-fndo4e3y-1226446249834

Note also that Sandfire Resources managed to get a new copper-gold mine up and running just 3 years after the initial discovery. WKP has majority partner Newmont waiting with plenty of cash reserves if need be. Average grade is the only major unknown now, surely. Everyone knows it's a big deposit.

[Citizen Erased]

Unfortunately I don't have time to contribute much to another forum or debate this Skol dude :)

I frequent the forum at www.silverstackers.com (http://www.silverstackers.com) (an Australian precious metals forum) and spend a lot of time reading all the blogs I've subscribed to.

My top three blog recommendations if you're interested in physical precious metals:
http://www.jsmineset.com/
http://www.tfmetalsreport.com/
http://fofoa.blogspot.com/ (you might need a spare week to read through the archives)

To cut to the chase, I believe gold will re-enter the monetary system at some point in the near future (within five years).

To protect yourself from the coming global currency crisis, you should own physical gold. It's definitely not too late to enter the market.

Dividend-paying gold mining stocks will be a good future source of income. Jim Sinclair put it this way: they will be like the utility companies of the future.

[troyvdh]

..im intrigued ...why would one call one Citizen Erased,,,,sounds spookey....

..your very welcome nonetheless....despite you being "erased"....cheers

[elZorro]

Thanks for the links CE, since you read more widely than most of us about gold, it would be of great amusement and interest to me if you tangled with the legendary Skol on occasion..but up to you. Just two words, Jim Sinclair, would be a good post starter:)

A friend of an old flatmate used to go to great lengths to be tramping on census night, so that he was off the electoral roll. Is that the meaning of your moniker? (This would be Troy's question..)

I stockpiled a bit of silver a while back, not such a great short-term investment but I'm hoping for better with Glass Earth.

The chart and the numbers tell the story, but GEL is currently at a low valuation. Punters have already had one chance to make exponential gains, but would have needed to buy shares just after the GFC. Now that the excitement of finding WKP has worn off, we're waiting to see if the placer returns will stop more of the regular dilution effects, and for grade results from several drills. A more clear notice of intention from Newmont regarding the JVs would be a big bonus. Already it looks like things are moving in a positive direction.

Newmont would like to see 5Moz at WKP, I guess that's for underground. Maybe less gold for opencast, 3Moz was mentioned a year or two back. The fact that they're still looking fairly hard tells me there's a good chance WKP holds 5Moz or more. So the optimistic table values GEL at 4x current shareprice, if the gold in ground is worth just $20 an ounce on paper. This is a normal figure for greenfield explorers. Once it is proven, the figure goes up to about 160$ an ounce. Muirs is going to be certified late 2012, early 2013.

Click on the table to get a larger version, almost readable..

[Citizen Erased]

A friend of an old flatmate used to go to great lengths to be tramping on census night, so that he was off the electoral roll. Is that the meaning of your moniker?

Cool story, bro, but it's nothing like that. I was just trying to think of yet another forum user name and picked the title of a song by one of my favourite bands.

I haven't bought any shares yet. There are three things that concern me:
1. The lack of regular updates from the company (nothing since June 28).
2. The stock is very illiquid, with little market depth.
3. I'm not convinced that mining shares will outperform the price of physical bullion in the long term as there are so many other factors at play.

[elZorro]

Hi CE, so it's Muse, the rock band? Found a video of your song..very cool. No I'd never heard of them, don't get out much...

Muse: Citizen Erased
(http://www.youtube.com/watch?v=W4R84e1HqvU)
Fair enough..valid points about Glass Earth. I have emailed Simon Henderson recently with some questions about progress. No reply as yet, which is unusual.

Points 1 and 2 are linked.

3: Companies that move from exploring to mining gold very commonly have big shareprice ramps. Unfortunately, many explorers never make it, or take a long time getting there. So it comes down to how likely GEL is to make this step, and how far off are they?

I think they're in with a good chance, as they have a lot of permit area, some big players on board for such a small company, and JVs with the second biggest gold miner in the world. If they map out a big deposit, funding to mine it won't be a problem, or their interest will be purchased from them.

L&M Mining's Earnscleugh is progressing apparently, one big GRU doing over 100oz a week. 30 staff on the job. One of the photos in the article on NZResources is of the manager Mark Coleman, he was the owner of GEL's GRU#1 and leased it back for a year or so.


Earnscleugh lifts production after service work

Ross Louthean — 15 August 2012
Production of gold at the alluvial mining operation at Earnscleugh in Otago lifted significantly in July after some performance issues and a maintenance shutdown a month earlier.
The operation owned by private company L&M Group lifted production in July to 577 ounces, after low production, maintenance and recovery issues the previous two months.
L&M Group’s chairman Geoff Loudon said what is helping improve the performance has been the skills now being shown by the local trainees and he believes the project – which had its opposition from locals concerned about noise and their perceptions about mining – is now welcomed in the region.
Project manager Mark Coleman told NZResources.com that the operation now has grown from having one person on site to a staff of 32 and several machines and sub-contractors on site.
“The local community’s fears have been allayed because we have kept a low profile and have made an effort to employ local people and use local contractors and suppliers thus making a large financial contribution to the local economy,” Coleman said.
Experienced staff have helped train inexperienced local workers who were now among the operation’s best operators.
“This has helped us immensely also as it is very difficult to find people with mining industry experience in the Central Otago region,” he said.
Coleman admitted that L&M has had a fair share of production issues as the operation ramped-up. When the No 8 plant was assembled and commissioned there was a steep but good learning curve for all staff in coming to grips with the new systems installed on the plant.
Several months ago Geoff Loudon told this writer that the back-up from technical suppliers had been disappointing.
However, Coleman said the technical support was improving with key suppliers bringing extra staff into the area to meet requirements.
“Other suppliers are moving up with us as they gain more understanding of the nature of our business. There have been no significant projects in this area for some time and services like freight deliveries are very limited,” he added.
The strength of improved community understanding was reflected in the open day called by the mining operation with the latest event helped by the fact it did not have the inclement weather of the 2011 open day, yet it still attracted 300.
The March open day this year, in fine weather, attracted 1,000.
This, Mark Coleman said, was also a great opportunity for people to gain a good understanding of the project.

[elZorro]

Signs that GEL on the TSX is recovering, as quite a few shares sold overnight, some as high as C21.5c or NZ27c. There should be another quarterly report out soon, and by the law of averages, a press release or three. Last year the release date was 29 August, and it started off a great run in the shareprice. This year the Ausimm conference is around that date too. Always good to have something to show off while the audience is there.

I have a feeling that we're only one good press release away from a solid shareprice increase, to something sensible. That's what I'm telling the better half too..

[elZorro]

Newmont begins permitting process for Correnso mineRoss Louthean — 17 August 2012
Newmont Waihi Gold has lodged an application with the Hauraki District Council for a land-use resource consent for the Golden Link project at Waihi.
This incorporates the proposed Correnso underground mine which Newmont Asia Pacific vice president, Jeff Huspeni, highlighted as a new development in New Zealand at last week’s Diggers & Dealers Forum in Kalgoorlie.
Newmont Waihi Gold expects the council will publicly notify the application within the next few weeks.
The company said that when the application is publicly notified it will publish a guide to preparing a submission under the Resource Management Act.
Meanwhile, the company also said that the Martha open cut mine expansion plan was now with the Environment Court and, after the just-completed hearing, it expects to hear the court’s recommendations later this year.


From NZResources. The Correnso area is under a small part of Waihi, and GEL has an adjacent JV with Newmont to the West of this area, also under the township. There is a possibility that the rich seam of gold at Correnso also extends into GEL's JV.

[elZorro]

A bit more background from a mining magazine, on Newmont Waihi, GEL and Talisman. I may have posted this already, from about April 2012.

http://waterfordpress.co.nz/site/waterfordpress/files/MNZ//Mining%20NZ%2026-33.pdf

[elZorro]

It's been a long time since a news release for Glass Earth. Last time I looked, NZPAM had granted a prospecting permit to GEL, it's right beside OGC's Globe Progress mine in Reefton. A couple of EPs have been extended for another 5 years. These become quite expensive at that stage, so they must be good spots, right? According to my table, GEL now spends over half a million on fees for the various permits each year.

I had a look at the SEDAR reports for GEL, found out a bit about the latest private placement. An early warning report on 21st June 2012 states that Woolwich International Holdings Ltd purchased 5 mill shares at C20c, bringing their holding to 15.55% of the total issued and outstanding shares. At about the same time Sprott Asset Management LP dropped their holding by dilution mainly (they probably took no part in the PP) to 6.1% of the shares.

Total shares are now about 80.1 million.

Been a bit of press about Newmont's interest in a permit called Puhipuhi up in Northland. Like WKP, it has potential to be a few Moz, and here's a link to the EP51985.

http://www.nzpam.govt.nz/cms/online-services/current-permits/banner_template/CMINPSCURR

Various mining companies have had a recent look here for 10 years or so. Newmont says they're just at the start of the exploration on foot, and it takes years. In that case WKP, with active drilling, is a lot further ahead.

Well-known area.. (http://paperspast.natlib.govt.nz/cgi-bin/paperspast?a=d&d=TAN18891120.2.27)

[elZorro]

The AusIMM annual conference kicks off this weekend, and Glass Earth has a part to play there. No doubt there will be a few useful meetings.

I sent another email to Simon Henderson with a few questions, and he has again been helpful.

I asked how the GRUs were going on the placer permits:

SH: Placer results: you asked if the machines are going well, I’d answer with a qualified “yes”. They are highly sensitive units and must undergo weeks of calibration and tinkering before they’ll deliver. This is compounded by the ground we’re working: a far higher than typical fraction of feed is “undersize” (sub-10mm gravels which must be processed within the plant instead of being bypassed) meaning we must carefully regulate feed rates (one plant is currently being fed at 45 loose cubic metres/h, the other ex-Earnscleugh plant at around 55lcm/h). Also, a far, far higher than typical fraction of the feed is extremely fine clay which means our sediment ponds and recirculating water need intensive management and treatment to keep the plants running. Others have given up on similar ground but we believe we’re now a step ahead.

Simon is talking here about GRU#3 (doing about 45 m3/hr) and GRU#1 (doing 55 m3/hr). Both are at sites on the Drybread permit. The tricky ground may be helpful to the cause, it might have been out of favour in the past. I have read that in rivers, gold is often found on the top of clay pans, or in layers underneath them. So the presence of quite a bit of clay could also be good, especially if they're working the top of the permits and the test RC drilling gave better grades lower down. I'm not sure how the clay will be causing an issue with the pumps and settling ponds, maybe it blocks water filters.

Here's a very informative article on jigs, the primary recovery method GRU#1 uses, at least.

http://mines.az.gov/Publications/circ052jig.html

The video of GRU#1 (GEL website) shows the plungers working, and this method appears to be self-cleaning and less likely to block up with heavier minerals like ironsand. It's also good for fine gold, better than riffles. So if GRU#3 and GRU#1 are working similar grades, GRU#1, with its bigger capacity and the jig system, should do better. You'd probably be able to run it for longer without washing up the gold.

[elZorro]

Simon added more detail in the email of 24th August. This relates to the hours of operation of the two GRUs at Drybread.




Both sites are working single shift, 12 hours each day, 6 days per week – currently we’re experiencing up to 65 hours of processing time each week, but it requires constant effort to forecast and manage plant shutdowns.

The nature of alluvial deposits means grade fluctuates daily but, over time, it’s reconciling closely with our exploration.....It has been a long winter (and not over yet), both sites are still leaving the bedding-down phase, and at least another month of full, unhindered operation is needed before we can announce sensible news.

But long story short – we believe our forecasts of consistent 100oz per week production by December are achievable.


That must be a tough job working for 12 hours in Otago over winter, maybe as the weather improves they'll look at running 24/7 on one or more GRUs, with 2 or three shifts. This information implies that we'll get a fairly good picture of the placer operations by the end of September. The gear is being run reasonably intensively, nothing is holding it up too much, and the targets look like they are (or will be) achievable.

A bit more interest being shown in GEL shares today, with the Q2 report due soon and some chance of a news release around AusIMM, this is a good time to hold onto any cheaper shares that you've picked up, IMHO.

[elZorro]

A small note from Simon about WKP in the email:


WKP: I can be more open about progress once results and report from Newmont are available. I can say there is nothing geologically to dampen our interest and the enthusiasm that Newmont have expressed (at Diggers and Dealers) is justified, although whether this can translate into impetus being provided from Newmont (up in Denver) is another matter. I’m meeting with Lorrance Torckler (Newmont’s chief geo in NZ) at AusIMM and planning a press release to go out by the end of the month or shortly after.

He's referring here to an earlier post, notes from a reporter at the Diggers and Dealers conference. WKP is big scale in NZ. The only question now, is where it fits in with Newmont's global strategy. But there is a Newmont mill and mining staff sequestered close by to the WKP permit, and it's being diamond drilled.

[elZorro]

I asked if the Pig Burn permit was next for a placer site.


SH: Yes, I think Pigburn is next (but many irons in the fire) and is in the early stages of planning – we’re considering mining in partnership to allow a quicker startup.

Garibaldi: we are drawing breath, awaiting results, and working at the desktop rather than in the field to assess our work to date. At Muirs drilling has been paused (extremely difficult drilling, holes often have to be redrilled, and there is an exceptionally long delay in assay turnaround from the lab we use in Waihi) so we are now regrouping and calculating the resource.

We’re also working steadily on our JV with PGI at Shepherd’s Flat – some interesting results and data being reviewed while we plan some further drilling with our own rig.

Anyway, I hope that’s gone some way to filling you in and at least putting you on notice of what news we hope can come soon.


There has been an article written on Simon's Garibaldi talk at AusIMM.

[elZorro]

Here's the article on Garibaldi- quite interesting grades at up to 1/2oz/tonne, and close to surface


AUSIMM NZ 2012: New Glass Earth prospect presented to geoscientists

Ross Louthean — 28 August 2012
The new gold discovery in Central Otago for Glass Earth Gold Ltd (TSX-V & NZAX: GEL) was aired during a geosciences session at yesterday’s opening day of the AusIMM NZ Minerals Conference in Rotorua.
Managing director Simon Henderson stood in for petrologist Anthony Coote to detail the progress being made on the Garibaldi prospect. This is situated roughly between the Macraes gold project and Alexandra in Central Otago.
Henderson told NZResources.com that the likely search programme for the balance of this year would involve about 1,000 to 1,500 metres of drilling on the known structure to depths of about 50m. Drilling would proceed after the lambing season.
While this was a hard rock target, he reminded delegates that historically 8 million ounces of gold has been produced from alluvials in Central Otago.
The company now had three relatively small alluvial gold operations in the region from which it was seeking to produce more than 21 oz per week.
He said Garibaldi lies within a geophysical domain of the Otago schist in which extensive positive magnetic field anomalism correlates directly with the distribution of magnetite-bearing mafic schist.
Henderson said the estimated surface anomalism of gold soil anomalism, quartz veining and hydrothermal alteration on a key target had a strike of about 1,600 metres and was up to 300m wide.
Within a 6.5 km by 2.5 km area there were five anomalous zones and east-west orientated quartz veins had shown individual grades ranging between 1-16 grams/tonne gold, while “inter-fingered mafic schist grades varied between 0.5-2.65 g/t gold.


There must be a mistake in that article, the three or four placer machines (GRUs) should produce 21oz a day, they'll need to do that to get to 7,500 oz a year. But keep these figures in mind, based on the throughput and the hours we've been told about, it won't be too hard to figure out some annual profits later.

[elZorro]

The Q2 report and MD&A is out, best to look at this on the TSX if you want the real news. For once, we get to act on the report before the TSX.

http://tmx.quotemedia.com/article.php?newsid=53889140&qm_symbol=GEL

OK, some exploration has been written off, four permits at least dropped in the last few days. But there is a clear intention to hold the best spots, and the geographically isolated permits seem to be the ones that are being let go.

Good noises being made about the placer prospects, there could be something quite interesting going on in the Drybread mining areas, because Gunclub has been put on hold and the gear moved to Drybread. I have a little spreadsheet going that I'm keen to fill out with some actual figures, but let's just say that grades above 0.5 grams per cubic metre would reap millions of dollars of annual profit, even at 65 hours operation per GRU per week. Run any of the machines for 24/7 and there would be awesome-looking returns. This cash would come in very handy when it's time to work on the other hardrock permits, where the huge potential remains.

At last, an accurate permit map showing that the area around Talisman is gone, and shows the massive Kakanui permit.

http://media3.marketwire.com/docs/MapGEL829.jpg

[elZorro]

GLASS EARTH GOLD LIMITED
QUARTERLY OVERVIEWEXPLORATION (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.

(http://www.odt.co.nz/news/business/223953/explorer-confident-despite-write-offs)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-now.html?clip=GlassEarthGoldMay12.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 discoveryRoss 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.:eek2:

More about the Gore prospecting permit (http://www.lmgroup.net.nz/displaycdaa.html?ss=ba&pri=19&sec=650&cid=5326&tpl=1): the Waikaka River had a lot of dredges near it too (http://nzetc.victoria.ac.nz/tm/scholarly/tei-Cyc04Cycl-t1-body1-d7-d127.html), like Waikaia further to the north.

http://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?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-library/minerals/publications/Commodity%20Reports/report14_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. (http://www.stuff.co.nz/waikato-times/news/7598058/Huntly-and-Waihi-locals-suffer-over-pits) 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 OVERVIEWEXPLORATION (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?

[elZorro]

GRU#1 looks to have two circular jigs on the underneath of it, see jig video. (http://www.glassearthgold.com/s/Projects.asp?ReportID=450554) The same arm drives both jigs, in reciprocal motion.

Here is a modern jig set with electronic control.

http://www.rmsross.com/overview/circular-jigs.html

The stroke height and stroke speed of the jig is critical for the capture of fine gold, and needs to be tuned for every prospect, along with the water flow, mesh sizes and table angles. This would be hard to do if they're all mechanical adjustments. I don't have a clue as to what the two GRUs are using for specific equipment, so we'll have to wait and see what is reported.

1995 basic data on jigs. (http://mines.az.gov/Publications/circ052jig.html)

[elZorro]

Glass Earth did quite a bit of moving today, but I can see no news kicking around. In a sign that the head office has been busy, the permits table was updated yesterday. (http://www.glassearthgold.com/s/Operations.asp?ReportID=540731)According to my spreadsheet, GEL now pays only about $175,000 in fees for the permits, down from what could have been over half a million. About 2,800 km2 in permits, looking to add another 1,100 km2 more.

Dropped are 50841, 53378, 53174, 53380, 53911, 53185 and 53182 which is the large space around Drybread has been halved. So GEL are not going to mine the West Coast Beaches (a good decision I reckon) and have pulled back from all West Coast positions. Argyle is gone, also Whataroa River, West Dunstan. So at the moment there are about 23 permits to work on, still a large undertaking, but more manageable.

Why the sudden changes now? It could be a sign that there is enough potential in just these permits, to keep GEL staff working hard. In the same way that GEL have looked over some areas after earlier teams have done some prospecting, other firms can now look at those areas that have been dropped.

[ynot]

hi ez. was only $11k volume but yea, somthing could be up. wink wink.

[elZorro]

hi ez. was only $11k volume but yea, somthing could be up. wink wink.

Hi ynot, 11k of volume only indicated a building interest in the share, so it was interesting to see quite good volume on the TSX overnight, the price moved to C26c (NZ32c), and there are not many sellers left.

It's a long wait for the news, for keen holders of GEL like me. On the law of averages, and if they are not wanting to be seen as tardy again, management will need to produce at least one press release this week. We're already well past early September. The news could cover WKP drills or placer recovery results, or both.

[elZorro]

OK, still no news by this morning, a small chance it'll pop up on the TSX after Friday trading, but I don't think so.

The message from GEL management might now be: "We hope to bring you an update on progress, sometime in September".

I would guess that Simon Henderson (CEO) has no interest in the subtle games of the sharemarket, and for a listed company, risk-based funding for an eventual positive return for all parties is the aim. However there are certain written and unwritten rules for guidance in the treatment of shareholders - big and small. GEL management made every implication in the Q2 release that there would be news on several fronts, early in September.

The market has clearly anticipated something appearing last week and this week, and two weeks is a long time in the sharemarket. So many other shares to look at. Other listed companies that do have a bit more feedback, and are a bit more honest in their timelines.

The GEL permit table is still changing. PP50950 has expired, but GEL has lodged a very similar (EP)54765 application to replace it. 54765 and EP53184 are two permit areas just over the top of the Macraes mine area near Dunedin - they're still very keen on this area.

As implied on the 17th Sept, permits 53174,53911,53185 and 53378 are gone-burgers. Some applications to reduce the area of about 4 permits are still in process.

[elZorro]

At last, here's a release about WKP. The rest of drillhole WKP31, which wasn't terrific but OK, and each of the next three holes has hit gold, as per usual. Better grades here, some of them are short bonanza grades, and the next drill WKP36 under way.

http://tmx.quotemedia.com/article.php?newsid=54511439&qm_symbol=GEL


WKP 35 drilled into the Eastern Graben structure(EG zone) intersecting significant quartz veins and strong mineralisation features - assay results are awaited;

The map of the drills:

http://glassearthgold.com/i/newsreleases/2012/Images/GEGLPR_24Sep2012_WKPMap1.jpg

[elZorro]

The new map of the WKP drilling area shows the three main zones, which have been adjusted from earlier communications. In addition there is a new zone, the EG or Eastern Graben Zone. There is only one drill into that space, WKP35, yet to be reported on. It's a big long drill, and another one 200mtrs south is proposed, which could be WKP37. WKP36 is also a long drill. With 200mtrs between drills, I don't think that would be called infill drilling, it's still exploration. The drilling spots are heading south, these are in rugged terrain, and have not been drilled before. Scientific papers written on the WKP area have always pointed out the potential in the undrilled southern area of WKP.

The brief note about WKP35 implies that there were very good visual characteristics in that drill core, so the report on that will be interesting later on.


Simon Henderson, President and CEO of Glass Earth Gold, commented "Exploration within the WKP area continues to demonstrate that it is a large permissive gold system with potential to host significant epithermal gold deposit(s). The current 5,500m program is testing both northern and southern extensions of known targets, and probing the Eastern Graben margin which has shown promising resistivity features indicative of a major fault structure."

The grades of the other two drills are consistent, some real hot spots, and 111 metres of a mineable grade is not to be sneezed at. Gold is very rare, it's priced that way.

Missing in action from the press release: progress upate on the cashflow from the placer mining. I get the feeling the news will be staggered over the next few weeks. Good start here, anyway.

[elZorro]

With the lack of any exceptional news out today and the 18% SP drop on increased volume on the TSX overnight, I sold off my parcel with a 10% profit after fees.

It's quite interesting that the SP on the TSX closed down 18.5% to .22CAD but the NZX was up 5.7% to .37NZD.

If $.22CAD = $.265NZD, is the NZX 40% overpriced or the TSX 40% underpriced?

With most of the GEL shares traded on the TSX I felt it was wise to follow their lead and lock in a bit of profit.

Good luck to holders and I'm sure I'll be back in if the NZ SP get back to the .25 to .30 range and in the two markets are back closer to a balance.

Yankiwi, not a bad short-term position - that we've seen you take before. I have started to realise that if you can't afford to hold onto goldie shares for a reasonable length of time, best to try something else. Reading between the lines on the latest press release today, there could be a bit of insider excitement brewing about drill WKP35. Every drill that goes into the rock at WKP finds gold. It's a rare element, so this is a good thing, right? I'm not sure what the term 'permissive' means when it comes to gold prospects, but the four words "large permissive gold system" have been carefully chosen. That press release is bound by TSX rules.

The TSX market last night might well have been driven by similar issues to those Yankiwi has - should I take a small profit now, or wait for a bit? I agree, these are not brilliant intercepts, but they are consistent. Mining of WKP (if planned) is a while off, and I'd suggest, will follow success at Newmont's Correnso.

Meanwhile we wait for reports on the placer mining. Three GRUs are working on the Drybread permit, and if they are able to recover reasonable grades, GEL should be awash with cash before long. Enough to explore all of the top quality permits that GEL still has in its portfolio.

Yankiwi, have you done the maths on the value of a few million dollars from possible placer returns in Glass Earth's bank account?

[elZorro]

I had a look at Wikipedia, the incidence of gold on average in the Earth's crust is around 0.0031 to 0.004 ppm. 1 ppm is one gram per tonne of crust.

This means that payable placer grades (0.2g/m3) are already 25x more concentrated than the average crust (and it's free gold), and mining grades at say 0.6g/tonne are 150x more concentrated than average. Bonanza grades are of course rare, being above 30 g/tonne, and are 10,000 times more concentrated than normal.

Looking at the WKP drills again, this is promising. NZResources wrote an article.


Fresh drill results enhances WKP discovery

Ross Louthean — 26 September 2012
The latest round of drilling results from an epithermal gold-silver deposit near Waihi in the Hauraki goldfield has re-sharpened interest in the project.
Junior partner Glass Earth Gold Ltd (TSX-V and NZAX: GEL) detailed the progress assays received from a new 5,500 metres diamond drilling programme on the WKP project in which managing partner Newmont Mining Corporation is operator and holds a 65% stake.
Newmont subsidiary Newmont Waihi Gold operates the open cut and underground mining operations at Waihi – New Zealand’s only large hard-rock gold operation on the North Island.
Glass Earth said hole WKP32A had an intersection of 0.5 metres grading 61.3 grams/tonne gold and 19.4 g/t silver within a halo of 111m @ 0.6 g/t Au and 1.8 g/t Ag.
Hole WKP33 produced 8.2m @ 6.6 g/t Au and 2.7 g/t Ag.
Glass Earth Gold’s managing director Simon Henderson said the current drill programme, which began in April, has delivered encouraging results from drill holes WKP31, 32A and 33, and confirmed the tenor of high grade veins within a broad lower grade central mineralised central zone.
This drilling phase aims to confirm the major structural controls on mineralisation, with WKP35 “already providing further new and encouraging visual evidence of a major mineralised structure on the EG (Eastern Graben) zone, allowing a focus on resource definition in follow-up drilling campaigns.
Glass Earth said that back in February drilling on the WKP T-Stream high grade vein WKP 31 defined an interval that has been followed northwards in drill holes 33 and 34.
Significant results not previously reported from 31 include 6m @ 1.5g/t Au and 1.5 g/t Ag from 232m down hole. A previously announced result from WKP31 was 9.7m @ 17.2 g/t Au and 22 2 g/t Ag.
On the project’s Central Zone, drill hole WKP 32A tested the southern extensions and into the Western Zone anomaly at depth, demonstrating that this broad zone of mineralisation is persistent to the south, with narrow high grade veins (0.5m @ 61.3 gm/t Au, 19 g/t Ag; 1.2m @ 20.3g/t Au and 12.4g/t Ag), residing within a broader.
This broad zone of +0.5 g/t Au mineralisation is persistent over 750m.
“Exploration within the WKP area continues to demonstrate that it is a large permissive gold system with potential to host significant epithermal gold deposits,” Henderson said.
The WKP prospect covers a 3 kilometre by 5 km mineralised alteration zone, 10 km from Newmont's producing Waihi mining operations where 10 million ounces of gold equivalent has been produced. It is also 5 km north east of the Golden Cross mine that produced 634,000 oz of gold.
The budgeted cost of the current drilling for the joint venture is about $C3.3 M ($NZ4.1 M).
The WKP epithermal system has magnetic/alteration characteristics similar to the Martha epithermal system and has open-along-strike potential of at least 1-2km.


The highlighted bits are comments not reported in the press release. WKP has hotspots of high grade in a lower grade orebody. So does Martha Mine, and no-one forgets how many Moz came out of there. Special mention of WKP35, it must have been a great-looking drill core. They'll be following that up, for sure.

Mind you, there are talks of 20 job losses at Newmont's Waihi Gold. And they're talking about scaling back on exploration. Just as well WKP doesn't cost much at the moment, and has a huge potential.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10836378

[elZorro]

I think it's possible there are two drill rigs running up at WKP. WKP32A and WKP35 are collared at the same spot, which is 600-700 metres south of WKP33 and WKP34, collared together. Only half of the drills from each spot have been reported on. The southern extension drills also appear to be a lot longer.

In April Simon reported that one of the jobs of this programme is to test the southern extensions.

http://www.highgrade.net/article/2012-04-11/Glass_Earth_looks_beyond_Martha

We've been told that WKP36 is being drilled. The rig had to be uplifted from the WKP35 collar and resited no doubt. This makes it possible that WKP35 was drilled by early August, at which time Jeff Huspeni had the announcement at Diggers and Dealers:


Higher grade targets identified at WKP

Ross Louthean — 8 August 2012
Operator for the exciting WKP gold discovery near Waihi, Newmont Waihi Gold, has been able to identify potential high grade zones at the prospect which may accelerate exploration.

At the Diggers & Dealers Forum in Australia’s gold capital of Kalgoorlie, Newmont Asia Pacific’s senior vice president Jeff Huspeni told NZResources.com that recent diamond holes into the prospect had identified what could be a feeder zone.

There would now, he said, be a focus on adding grade to what appears to be a large system.
Newmont owns 65% of WKP with the balance held by active New Zealand gold explorer Glass Earth Gold Ltd (NZAX & TSX-V: GEL).

NZResources.com suggested to Huspeni that WKP was perhaps the most exciting emerging gold discovery in New Zealand. He did not disagree.


The WKP 'EG' zone is a completely new one, there are no legacy drilling locations on the lower parts of it. The other zones have been relabelled and the latest map put up on the GEL website. This zone lies beside a fault, on the other side of which is Andesite, and the zone is over a Rhyolite Flow. If the EG zone is what's termed a feeder zone, the next drill about 200mtr south would confirm it (WKP37?), and the grades could be impressive. Guess we'll have to wait and see.

More detail in the paper from Christie et al: http://glassearthgold.com/i/pdf/Christie_p137.pdf

Very clear indications that the best drill results obtained in 20 years of legacy work on WKP were DDH20 and DDH23. These were both about 100mtrs above WKP35, heading in the same direction. The gold is normally hosted here in a NNE trending rhyolite flow (snap) with intrusive andesite nearby (snap). Dr Christie clearly suggested "drill to the south of here" in his paper. He almost put an X on the map perhaps.

[elZorro]

Attention at Waihi is firmly on the Golden Link project, which includes Correnso. There's a lot at stake, although Newmont appear to have a bob each way by continuing on with WKP exploration in the meantime.

http://www.3news.co.nz/Waihi-gold-mine-seeks-underground-extension/tabid/423/articleID/270662/Default.aspx

I've had a look at a TOPO map of the WKP area. Looking at the area just below the circular track that skirts the older mining region, the purple dots are old drills mentioned in Christie et al, and the rough location of the latest WKP drills are shown. Old drills 20 and 23 were the best of the original set, with a grade of 3oz/tonne over a short interval being included. Drill 21, 400mtrs south of WKP35, was not without a strike, with 0.12g/tonne over 65 mtrs. Drill 22 pointed in the other direction, only found a little. The Martha Hill main prospect yielded over 10Moz, and is no wider than about 800 metres.


Older drill 20 (DDH20) intersected a broad zone of consistent mineralised sheeted quartz veins, averaging 1.4g/t Au over 83 metres from 159m downhole (Rabone, 1991a).

[elZorro]

Guided by a post on Stockhouse, I've found the BNN clip from the evening of 27th September, yesterday, where in part 7 of his normal spot, Brent Cook was asked about Glass Earth Gold.

Glass Earth is one of 20 junior explorers in his portfolio, and each one of these has been chosen for its outstanding prospects, from a pool of 1500 similar companies worldwide he's researched with his team. He's decided to keep GEL in his portfolio, based on the latest news release.

http://watch.bnn.ca/#clip771133

Have a look from the middle of this clip. Brent is going to write up GEL's prospects and his current opinion in his subscription broadsheet, this weekend.

He seems to think that if Newmont find continuous high-grade veins at WKP, either the project or GEL itself will be bought out. (Newmont have been keen to suggest that any future mines on the Coromandel would be underground). Brent also said that Newmont needs more good ore for its mill in Waihi, and that WKP is just over the hill, it would be feasible given good grades.

[elZorro]

Strong buying pressure for GEL on the TSX overnight as I'd expected. A lot of investors listen to Brent Cook.

Since 2007, the gold price has just kept going up, and naturally Newmont's plans have changed too.

This from Contrafed.
http://www.contrafedpublishing.co.nz/QM/The+charming+of+Waihi+-+A+lesson+in+community+relations.html

The Vision Waihi Trust (VWT) helped organise the moving of the Cornish Pumphouse, and are involved in running tours of the Martha Hill minesite and environs. John Dow, Chairman of Glass Earth, was chaiman of VWT in 2006 and is still one of three trustees. He retired from his position as Chairman and MD of Newmont Australia in 2005.

All of this goes to my point that GEL is not a fly-by-night operation, there has been a lot of long-term planning in setting it up for what could be a very exciting time ahead for shareholders.

[elZorro]

This document describes WKP prospect historically as a bit of a failure, written by David Wilton in 2007. (http://www.thetreasury.org.nz/Wharekirauponga/Wharekirauponga.htm)

The Treasury is a historical society based in Thames. Mr Wilton is qualified in the IT field, not geology, and has an interest in history and in helping the kiwi recovery program, according to the web.

However, the background of WKP is fascinating. A lot of effort went in over a century ago, when everything was stacked against them. Motor vehicles had barely been invented, steam or fast flowing water was the main driving power, and there was very poor access into the Coromandel bush. At the time the Hauraki mines were stamping ore with an average grade of 3oz/ton. The cutoff was 1oz/ton, and while that cutoff is now called a bonanza grade, I think the mines must all have been underground, and religiously following only the rich veins. They had no automatic underground miners, dump trucks, no ball mills or automation to speak of. In real terms, gold is now worth at least three times as much, and it's easier to extract large ore volumes from underground.

This writeup does explain very clearly that the walk into the WKP prospect area is about 1 hour each way, it's relatively easy going and well signposted, at least if you stay on the track. It's a public DOC walking track, anyone can go in. (http://www.doc.govt.nz/parks-and-recreation/tracks-and-walks/coromandel/coromandel/wharekirauponga-track/)

Newmont Waihi, 2010:

The Future – Exploration
Visit Waihi’s Gold Story in the Waihi Visitor Centre, upper Seddon St, opposite the Cornish Pumphouse for
further information about exploration.
Favona decline (gradient 1:7) is currently 4,690 metres long and 332 metres below the surface. More than
16,800 metres of drives have been completed. The portal (underground entrance) was officially opened in
November 2004. Has been producing ore from stopes since September 2006.
Exploration drilling is taking place in and around Waihi and at Onemana. Diamond drills extract core samples
for analysis. Drill core is 5 – 9 cm diameter. A drill site uses approximately 10m x 10m area. All drill sites are
rehabilitated.

Newmont's interest is in high grade deposits in low-value conservation localities that can be mined by small
footprint underground methods. Ore would be transported to Waihi for processing at existing facility.

The RMA consultation process is rigorous and transparent and will be in place for any consent applications.


Here is part of the detailed consent process under way for the Correnso Mine. (http://www.hauraki-dc.govt.nz/news/Mining-issues/GoldenLinkRCAp/pg8-23-AEE.pdf)

Correnso is designed to use infrastructure from nearby mines Favona, Trio and Martha Hill. If they are given consent, Newmont will start developing the mine access in mid 2013, start mining in 2015, and have it completed by 2020, backfilling with crushed ore and concrete mix as they go. Trio and Favona mines would overlap production with Correnso for one year, and then 330-400 workers would be required on Correnso, with Trio and Favona being closed. A lot of the activity on Martha Hill (the pit) is stope stabilisation by decreasing the slope angle, to meet permit requirements. They are retrieving a limited amount of gold at the same time. This must be a loss-making exercise.

The mining technique proposed for Correnso appears to be by blasting, with smaller charges nearer the surface to meet consents (at least 150m underground). The longest blasting time is 18 seconds duration, with mining blasts being shorter, 8 seconds. The grade of gold at Correnso is less than 1oz/tonne, but in many places, not by much. Good solid seams too.

By August 2011, a newsletter included:


If approved, construction of the Correnso Mine would start in mid 2013.This would see a continuation of underground mining after the Trio Mine project’s anticipated finish in 2014. We expect
the Correnso Mine could operate to the end of 2020, but
potentially longer if additional resources are discovered.



If Newmont are loaded with cash and bullish in future, that should be a good thing for GEL shareholders. HSBC seem to think Newmont are well undervalued anyway.

https://www.research.hsbc.com/midas/Res/RDV?p=pdf&key=2v7A2bLpF5&n=331666.PDF

The very detailed report includes mention of Correnso, but not WKP. Newmont only started drilling WKP in 2010 I think, a year after the discovery of Correnso. Three years later, the mining consent process for Correnso has started. Good grades demand action.

Why opencast is not usually a topic for conversation near Coromandel.
(http://www.stuff.co.nz/dominion-post/news/politics/3498002/Opencast-mining-not-in-plan-says-Key)

[elZorro]

Brent Cook has a subscription newsletter called Exploration Insights. Very recently, he has clipped out some sections of those weekly newsletters and put them into one big document for general background information. It does indicate that there is a lot to know about gold exploration, and WKP gets at least one mention.

https://www.explorationinsights.com/MediaLib/Downloads/Home/Geo-Insights_Aug2012.pdf

WKP mention I spotted:



CSAMT
From Exploration Insights:7/10/11

A CSAMT (Controlled SourceAudio frequency MagnetoTellurics) survey involves transmitting a controlled set of electric signals into the ground at one site and measuring the returned and natural signal, plus the magnetic field at other sites. The recorded orthogonal,horizontal electric and magnetic data is then filtered and processed through a complicated mathematical process to determine the relative resistivity of the area being investigated. The survey is a fairly easy and inexpensive geophysical tool that can be used to cover large areas and “see” up to hundreds of meters into the earth.

In the case of WKP, the resistivity anomaly relates to nearly massive silica associated with the hydrothermal system that replaced the host rock with quartz (and a bit of gold). Hence the resistivity anomaly is showing us where the center of the mineral system is.


One resistivity cross-section is helpfully provided on the WKP page on GEL's website. It lined up with the longest higher-grade intercept found by WKP24, over 150 metres at 1.6 g/tonne.

http://www.glassearthgold.com/s/Projects.asp?ReportID=450302

[ynot]

Thanks for the link EZ. This guy is good reading.

[elZorro]

No problem, apparently Brent Cook's report will be out to his subscribers on Monday, so they'll get the first use of the data on the TSX if GEL gets a mention.

In the meantime, I've been reading geological reports for WKP so I can understand more about what a good drill looks like. At the end of a permit, the explorers have to write a report to NZPAM, and Dr Stuart Rabone wrote this one in 1993, about all the recent drills up to DDH23 (Newmont's drill WKP24 in 2010 was the next time anyone drilled on the prospect).

In progress as the file is too big..

Dr Rabone remained fairly convinced that (the WKP ) zone is open along strike to the north and south. This means that the Wharekirauponga Stream has cut through the rhyolite and exposed quartz veins, and the early exploration drills focussed on that. All of this area is a graben or sunken, faulted area. Increasingly research moved from these broken-up veins and non-continuous gold strikes to areas immediately to the north and south, with DDH19-23 mostly in the south, near the confluence of Edmonds stream with (another one), which ends up as the WKP stream. Here's the last sentence:


The prospect continues to have very significant exploration potential; however prospecting work is seriously hampered by difficult access, and by constraints imposed on use of access-ways and potential drilling sites.

[elZorro]

The Brent Cook newsletter has not come out yet, but I did find this collection of anecdotes about WKP from mostly over 100 years ago.

http://www.ohinemuri.org.nz/chook/wharekirauponga/royal_standard_mine.htm

Going over the magnetic survey map (Rabone, 1990), there is a large magnetic anomaly right in the middle of the WKP area. WKP36 is drilling through part of it. WKP32A found quite a bit of gold, and is on the northern edge of it. Gold in soils has been found above it, but up until recently it has not been drilled at all.

[elZorro]

The newsletter must be out, certainly big interest shown on the TSX overnight. From the front page of Exploration Insights, title for this week's writeup starts as "Glass Earth getting close", however I don't have a subscription (US$140 a month). Might be worth it though.

Also on the front page, why we're looking at GEL in the first place..


Why invest in minerals exploration?Virtually no other investment sector provides the opportunity for ten to hundred-fold share price increases on penny stock investments. The mining industry is extracting over 75 million ounces of gold; 675 million ounces of silver; 15 million tonnes of copper; 90 million pounds of uranium; etc., annually. These companies need to replace the depleted minerals with new discoveries. Economic mineral deposits are extremely rare, however, and finding one a very difficult and time consuming process; therefore, new mineral discoveries can be exceptionally valuable. When a junior exploration company makes a discovery, its share price and market capitalization increase dramatically. That early discovery, high reward, spot is where Exploration Insights is focused—that is our area of expertise and what we are really all about.

[elZorro]

Hi Yankiwi, I knew you'd be back.. I think you like a ramping share price just as much as I do. It's been a long time coming for this share, but I still like the law of averages. So many permits, so many drills, the GRUs, the contacts and the technology. Sooner or later GEL is going to strike it big. What's the CV now, $30mill? If WKP ends up being 5Moz (half the size of Waihi's Martha Hill area) the gold is now worth US$10 billion once extracted. GEL has 35% of it. Newmont are the second biggest gold producer in the world - loaded with capital - the maths is simple.

We all need to keep a very careful eye on the WKP assays. This might be a once-in-a-lifetime opportunity.

[elZorro]

Glass Earth has recently been granted EP 53184, 1432.5 Ha in Otago, and has applied for (EP)54765.
The latter permit application is a bigger one, and both are sitting just above the Macraes Mine area, north of Dunedin.

[Citizen Erased]

You must be pleased with the recent price action, elZorro? Good for you.

I took the conservative option and bought more physical bullion, rather than shares.

What do you think the future share price potential of GEL is, if they strike it big?

[elZorro]

You must be pleased with the recent price action, elZorro? Good for you.

I took the conservative option and bought more physical bullion, rather than shares.

What do you think the future share price potential of GEL is, if they strike it big?

You should do all right with gold bars CE. Certainly while open-ended QE3 is in progress. OGC is perhaps another local stock which will follow gold, but at a bigger percentage margin both ways. I'm unsure why Baker Steel is backing out of it, they usually know what they're doing.

But the big question is, where could GEL go from here? Worst case, a big mine is a long way off while they wait for a good few intercepts. They still have their placer mining permits, which can fund exploration and overheads given basic grades of ore to work through. So I can't see them going backwards from here, unless a large capital cost looms up.

However I'm increasingly optimistic that one of the next drill(s) at WKP could hit the mother lode. Either the intermediate gold veins from the original epithermal event (a feeder zone rather than the broken surface expressions), or a concentrated seam trapped by the adjacent andesite. I still have a lot of research to look into when I have time, these documents are held on the NZPAM website. It looks like the geothermal waters that brought up the gold from the lava below, were coursing through the WKP area for many many years. There is still a warm spring near the WKP Stream.

What do we know about the Hauraki gold mines from 100 years ago? The old miners were bringing out gold from the underground veins that averaged 3oz per ton. Colossal grades nowadays. No-one has yet found consistent veins like that at WKP, but some short intercepts are at that level. As we have seen, the area is rugged, hard to get to, it discourages long-term drilling. For that you need a big partner like Newmont.

There have been mentions here and there estimating about 3Moz, even 5Moz of gold at WKP. Considering the big mineralised area, and comparing it with Waihi's Martha mine (11Moz), that sort of level doesn't seem impossible. Lihir (http://www.miningweekly.com/article/newcrest-cuts-production-at-lihir-2012-09-21)for example is a lot bigger (40Moz), but they can opencast it.

WKP is of little value until the grades and continuity are at a level where Newmont see they can profitably underground mine it. If Correnso is anything to go by, 0.5 oz/tonne and say 3 to 5Moz total would probably get them interested. It's a bigger step up than Correnso, where they are beside existing structures and equipment. That's why the WKP assays are so important.

At 15grams/tonne average grade, a volume of ore 300 metres square and 70 metres deep would yield about 6.3Moz of gold. If the ore is 3 oz/tonne grade average then they'd need only one sixth of that volume. But as you can see, it's not a very big volume compared to WKP's mineralisation area. Drilling at 200 metre spacings to find that high-grade gold (if it's there) could take a while, but they seem to be getting closer. Every drill finds gold.

Proven/probable gold in-ground is worth about US$250 an ounce, maybe a bit more as the price keeps going up. This theoretically puts GEL's 35% share of say a proven 5Moz resource as about $440 million. Shares would then be worth about US$5.50 each, NZ$6.90, a 1470% increase on today's price. But in the scary world of the junior explorer, this is not the norm, they don't all find enough gold for a mine, as Brent Cook pointed out. It's very heartening to see someone like Brent Cook backing GEL as one of 20 junior explorers that have a good chance of making it.

[elZorro]

I never covered Geology, so the research papers on WKP left me bewildered about the age of gold and silver mineralisation. Somewhere between 6 and 7 Ma. Wikipedia had the answers:


The volcanoes off the West coast of the North Island, together with Taranaki and the Tongariro Volcanic Centre, are responsible for the black iron sand on many of the beaches between Taranaki and Auckland (http://www.sharetrader.co.nz/wiki/Auckland).
Shortly after (18 Ma), a volcanic arc developed further east to create the Coromandel Ranges (http://www.sharetrader.co.nz/wiki/Coromandel_Range) and undersea Colville Ridge (http://www.sharetrader.co.nz/w/index.php?title=Colville_Ridge&action=edit&redlink=1). The initial activity was andesitic, but later became rhyolytic (12 Ma). In the Kauaeranga Valley (http://www.sharetrader.co.nz/w/index.php?title=Kauaeranga_Valley&action=edit&redlink=1), volcanic plugs (http://www.sharetrader.co.nz/wiki/Volcanic_plugs) remain, as does a lava lake that now forms the top of Table Mountain (http://www.sharetrader.co.nz/w/index.php?title=Table_Mountain_(New_Zealand)&action=edit&redlink=1). Active geothermal systems (http://www.sharetrader.co.nz/w/index.php?title=Geothermal_systems&action=edit&redlink=1), similar to those that now exist near Rotorua (http://www.sharetrader.co.nz/wiki/Rotorua), were present around 6 Ma, and produced the gold (http://www.sharetrader.co.nz/wiki/Gold) and silver (http://www.sharetrader.co.nz/wiki/Silver) deposits that were later mined (http://www.sharetrader.co.nz/wiki/Mining) in the Coromandel gold rush (http://www.sharetrader.co.nz/w/index.php?title=Coromandel_gold_rush&action=edit&redlink=1). Later (5-2 Ma), volcanic activity moved further south to form the Kaimai Range (http://www.sharetrader.co.nz/wiki/Kaimai_Range).
After this, activity shifted further East to the Taupo Volcanic Zone (http://www.sharetrader.co.nz/wiki/Taupo_Volcanic_Zone), which runs from the Tongariro Volcanic Centre (http://www.sharetrader.co.nz/w/index.php?title=Tongariro_Volcanic_Centre&action=edit&redlink=1) (Ruapehu (http://www.sharetrader.co.nz/wiki/Mount_Ruapehu) and Tongariro (http://www.sharetrader.co.nz/wiki/Tongariro)), through Taupo (http://www.sharetrader.co.nz/wiki/Taupo), Rotorua (http://www.sharetrader.co.nz/wiki/Rotorua), and out to sea to form the Kermadec Ridge. Activity was initiated around 2 Ma, and continues to this day. The Tongariro Volcanic Centre is composed of andesitic volcanoes, while the areas around Taupo and Rotorua are largely rhyolitic.


The other part of the puzzle: 1Ma is 1 million years before the present day. This means that around six to seven million years ago, an active geothermal system was present at the WKP permit. It would have looked similar to what is seen around Rotorua today. It looks like the andesite material was there much earlier, then the rhyolitic intrusion occurred, followed by the geothermal activity and quartz gold/silver mineralisation which which is laid down in fissures in the host rocks, as veins.

So this mineralisation was probably not laid down in a few years, but over hundreds of thousands of years. Geologists look for hydrothermally altered rocks by mapping the magnetic or resistive signatures of a large area. Glass Earth (and Newmont) will have staff adept at using the computer mapping software, and no doubt the aeromagnetic survey carried out around the time of the IPO is still useful. They've added more field data since. Even the old 2D aeromagnetic map in the 1990 Rabone paper looks interesting.

Since the hydrothermally altered rock at WKP covers 3km x 2km, and also extends 3km Southwest, it's quite possible WKP links up with the mineralisation at Golden Cross Mine. Coeur Gold (https://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?permit=40598)still hold the immediate area around their mine.

[Citizen Erased]

EZ, can you explain to a newbie like myself, why there is such a wide variation in the current share price on the TSX and NZX? I mean, even with the higher brokerage fees, you'd be much better off buying on the TSX at the moment (a 27% discount).

[elZorro]

Hi CE, yes, you're right, the NZ price is overblown compared to the TSX price. Considering the volume is higher over there, most days we should be following their price. Some of the retail investors over there might feel they're a bit out of the loop, and will look to the NZ share price for guidance. If you try buying through Direct Broking, I don't think they do it anymore, and most banks charge a big spread on buy/sell, so if you do give it a go, get one of those foreign exchange trading accounts set up, or make longer-term decisions.

Here's some disturbing news from the TSX after the end of trade Friday evening, and no, it's not on the GEL website yet. It wasn't shown on the NZ exchange today either, in what is a very bad oversight.

http://tmx.quotemedia.com/article.php?newsid=54830704&qm_symbol=GEL

Head Office needed CAD$360,000 in a bit of a hurry. Since the terms are exactly the same as the previous big PP deal of June/July, I can only assume Woolwich International has bought another 1.8mill shares for a firesale price. In turn, this means that the placer at Drybread is not yet doing any better than covering most of its costs.

Could this explain why we have not been given much information about the equipment and progress on the placer sites for quite a while? One of the company's biggest asset purchases, and no progress data for the market. Except we now have to guess that either the placer grades are not terrific, or the machines (GRUs) are not correctly tuned up yet. Or both.

This asset purchase of GRUs and other mining equipment came with some permits and applications, most of which have been dropped in the latest economising/rationalising round. The company effectively paid a lot of goodwill to Bob Kilgour. And they now also have a bigger staffing level, which is great if the operation is making good profits.

I think the shareholders deserve to see a much more open policy for disclosures and press releases. If we can't have information on certain parts of the company operations, we should be told why not, and in the meantime I'm unsure what to say about the valuation of the company. The person(s) with the chequebook says CAD 20c.

I still say that's a bargain, but then I suspect this outfit knows a lot more about the company's prospects than you or I do. At least they're still investing.

[elZorro]

Glass Earth raises more capital
SimonHartley — 12 October 2012
Small-scale Otago gold producer GlassEarth Gold Ltd (NZAX & TSX-V: GEL) has raised a further $C360,000($NZ456,000) in private placement funding as it juggles cash-flows againston-going exploration costs at North Island prospects. Glass Earth remains one of thecountry's largest gold explorers with two other targets being drilled in theHauraki region, including a joint venture on the WKP project with Waihioperator Newmont Waihi Gold.
In late-June Glass Earth clinched$2.95 million from private placements, to refinance the $4 M buy-out of itsformer joint venture partner, then for the half-year to June booked a $8.49 Mloss on the back of accumulated exploration cost writedowns.
Glass Earth has spent almost $40 M inless than six years exploring around the country, much of it around Otago;largely from Canadian investors on the Toronto stock exchange's and ventureexchange.
Glass Earth chief executive, SimonHenderson, has said recently cash allocation has been refocused on the goldtargets with the best potential, plus there had been a pruning of its overallportfolio of prospects.
A target of producing $2 million ofgold had been set for the second-half of this year from the Maniototo, withgold revenue targets in 2013 of $6 M.*Simon Hartley is senior businessreporter for the Otago Daily Times.

This was on NZResources today, maybe it'll be in the ODT as well. Looks like more information will be dispersed in due course.

[elZorro]

I have missed something in the press release for the last private placement:

The proceeds of this private placement will primarily be used to provide for exploration and acquisition activities.


This was pointed out to me in an email from Simon Henderson. Some kind of a deal is in the wings perhaps.

Another comment was about placer recovery rates:


The alluvial mining has been going well for the last two months, both plants are working smoothly and producing 30-40 oz each per week, i.e. cumulatively 70-80 oz/week. Our best week to date is 97oz.

All this puts a new, more positive complexion on the press release. I'll have a look at my placer spreadsheet to see how that looks, but the placer operation could well be turning a profit, not too bad at this stage of the proceedings.

Strenuous efforts are also being made to get prompt assay results from drill WKP35.

The spreadsheet results were that the average grade could be about twice the cutoff value, and at the moment, annual gross profit after Dunstan Mining and the placer team are paid, would be approx $4mill p.a. assuming no great maintenance overheads. Some of the return will go to the landowners. But there could be about $75,000 a week spare cashflow.

[elZorro]

Further to communication received from Glass Earth (both Simon Henderson and Thomas Rabone):

Placer results are a snapshot in time, and until a few more weeks have passed, they will be careful about what is reported as the recovery ounces. For security reasons as well as commercial reasons, they cannot separate out the results from each GRU. That's understandable. However, they are using some new technology like variable speed motor drives (VSDs) to improve the results over older methods. Sounds good.


Simon Henderson: I think it's fair to say we're not reluctant to publicise this, just making sure we don't over promise or jump too soon, and can record good, robust production over a meaningful period.

Regarding the rationalisation of the permits:


SH: We have not reduced any of the significant alluvial assets, and remain optimistic that there is a lot more alluvial/placer potential out there. We have dropped significant portions of our second tier hard rock exploration targets that we don't wish to pursue. The costs of holding these permits was in excess of $250,000 p.a..

On WKP:


SH: We're committed to long-term success, and that means getting reliable and important information out promptly. This has been frustrated on our most important project by the assay turnaround at WKP, we still await "urgent results" on WKP 35. I've just been in Waihi trying to facilitate better information and assist Newmont in getting better assay turnaround.

I had a quick phone call with Thomas Rabone, he's on the staff of GEL. His father is Dr Stuart Rabone, a geologist well versed in the terrain around WKP and Golden Cross. Thomas has formal legal training, has worked underground, and is helping get things sorted out at Alexandra in the meantime. I think I detected a lot of optimism for the months ahead.

[gonzo56]

Hey elZorro,

I’m starting to take an interest in GEL, so I had a look at the earnings report ended JUNE 2012. Glancing over it, I see that it mentions that Gold recovery was “thwarted by the snow of the southern winter" and that there were high establishment costs that quarter (which are now resolved).

The report also mentions the fact that the second Gold Recovery Unit (GRU) became operational in late May and therefore is only partially reflected in the result. Furthermore, the third GRU became operational only in the last few days of June.

Considering the last report barely took into account two of the GRUs, what is your opinion on the result GEL will release in November? (How big are these two GRUs..?)

[elZorro]

Hey elZorro,

I’m starting to take an interest in GEL, so I had a look at the earnings report ended JUNE 2012. Glancing over it, I see that it mentions that Gold recovery was “thwarted by the snow of the southern winter" and that there were high establishment costs that quarter (which are now resolved).

The report also mentions the fact that the second Gold Recovery Unit (GRU) became operational in late May and therefore is only partially reflected in the result. Furthermore, the third GRU became operational only in the last few days of June.

Considering the last report barely took into account two of the GRUs, what is your opinion on the result GEL will release in November? (How big are these two GRUs..?)

Hi Gonzo56, good point, as the next quarterly report will be the first one to show a substantial gold income on the books since the IPO. The GRUs are above the hobby level unit, but still a lot smaller than many other systems. L&M are running one 4x bigger than any of GEL's at Earnscleugh.

GELs' units can handle 50-70 cubic metres an hour, which is 50-70 scoops from a big 25 tonne digger in an hour, each. 0.2grams per cubic metre of gold is the breakeven grade, and I think they're doing twice that, so on current performance (a snapshot), they could have a net profit of $4mill a year. If they run any of the gear 24x7, this would greatly help further. But I think they are keener on tuning up the GRUs at the moment, and getting the third GRU operational. For that they'll need daylight.

Regarding the merits or otherwise of a stake in GEL: Brace yourself in the best possible way for quite a bit of news from GEL's head office dept. This has all been intimated to the market, while the weeks stretch on, but certainly quite a lot should have happened by Christmas.

WKP 35 drill assay, and other drills from WKP, could be a big impact on the company
Garibaldi - some exploration may be occuring, new hardrock find
Ophir - a JV and the other party now has cash
Muirs, report due sometime
Placer results (Drybread), 3rd GRU, JV with John Youngson, other sites
Latest PP part ear-marked for an acquisition?

Bear in mind that this is not a billion dollar company like OGC. Any results that imply some hard-rock mining is part of the future for GEL should have a proportionately big effect on GEL's shareprice. Current Mcap ranges from only $18mill to $25mill. They've spent a lot more than that on exploration, and I contend it has not been wasted.

Current price on the TSX is cheaper than over here.:)

[gonzo56]

Ok, thanks for your thoughts. It seems like they do have a lot on.

Yeah, I would prefer to keep it simple and stay in the NZ market though. On a side note, the TSX listing has had a bit of a volume increase late Sept early Oct so the chart doesn't look too bad. I look forward to hearing more about GEL, Cheers.

[ynot]

Well Gonz your certianly in the right place for that thanks to our man EZ.

[elZorro]

Talk about pressure.. I hope this share does the business sometime then :eek2:

There's been a lot of volume on the TSX all of a sudden (at C25c), a general reflection on the lower liquidity of the share when there's little news. If you need to sell a lot of these shares at the moment, your timing has to be good, or they'll go for a song. I think head office already knows that too.

The flip side is that there have always been opportunities to buy GEL shares at a low price, most years. It's also true that if GEL makes the jump to being a hard-rock miner (or is connected to a mining permit of the right size), then these changes in the company valuation will be nothing but noise. Junior explorers moving to the next stage, do so spectacularly.

I have not bought GEL shares to play it safe. I'm definitely hoping for a life-changing experience at some point.

[elZorro]

The odds of Newmont's Correnso project getting the go-ahead look good. This would assist GEL, in that a positive cashflow from Newmont's operations in the Waihi area increase the chances of a long-term interest in the WKP JV. The CHFIR page mentions that the aim is to prove the WKP permit holds more than 3Moz of gold.


Golden Link hearings for Waihi begin in DecemberRoss Louthean — 24 October 2012
Submissions are in for the Golden Link gold development in Waihi and mine operator Newmont Waihi Gold has noted that most submissions are in favour of the project.
There are almost 500 for the consents hearings to be heard for Golden Link by the Hauraki District Council, scheduled to begin on December 3.
Newmont Waihi Gold said it is aware of the sentiments expressed in the submissions as a copy each must also be given to the company as the applicant.
The Golden Link project takes in the area around the Martha open cut mine and the proposed Correnso underground mine that would provide ore to carry operations through until 2020.
The company said the submissions are about three to one in favour of the project, with a small number not expressing a view either way.
“The main issues raised in the submissions that opposed the project are effects on property values, and vibration and noise,” the company said.
Newmont said that while it has consents to blast at night at the developing Trios underground mine at Waihi, the company has no plans to undertake blasting at night at the Correnso operation.

[elZorro]

I was just reminded after looking at permits (nothing for GEL has changed lately) that Renison Consolidated Mines (ASX:RSN) has a big permit application below GEL's WKP permit, being 54215. As I figured from a look at their chart a few months ago, they are suffering from a lack of credibility, and cash.

http://www.asx.com.au/asxpdf/20121011/pdf/429b3ftgyh47k4.pdf

[elZorro]

Here's a very new slideshow produced by Evolution Mining (http://www.slideshare.net/SymposiumEvents/gold-investment-symposium-2012-jake-klein-evolution-mining)for a Symposium.

Jake Klein runs this company, only formed in 2011, and he's also well up the tree in OGC. Both of these companies are worth over 1 billion dollars. The funny thing is that Evolution only has about 3Moz of gold reserves, but of course has strong cashflow from mines it purchased in the setup. Hard-rock mining is fundamental to the valuation of many goldie shares.

Putting everything in perspective, Martha Hill contained 10Moz. Golden Cross was in the order of 0.74Moz overall. WKP was also formed in the same time band of 6-7 million years ago, the time band that has fitted 90% of the gold recovered in the Hauraki-Coromandel area. We've been told that Newmont's target for JORC resources at WKP before they'd make a move would be over 3Moz, preferably 5Moz. They're diamond drilling it almost continuously, with two rigs I think.

GEL has 35% of this prime, company-changing opportunity. Take a look at the TSX, the GEL price there is drifting back towards C20c, and the reason is probably that some are taking a very small profit on the private placement shares that they purchased for C20c. These shares have only just this week been freed up for trading. Assuming good news this side of Christmas, the next price halt will be at C35c, or about NZ44c, as the PP investors have 1 for 1 options at C35c.

However, I think those investors have been very lucky to obtain the shares at such a bargain price, and if they were a bit less risk-averse, they should hold onto them for the medium term. At least until the latest drill assays from WKP have been released.

[elZorro]

Platinum quest underway in Southland

Ross Louthean — 31 October 2012
The unrealised potential for platinum group metals (PGM) in Southland has seen a new company putting up its hand.
A Dunedin-based company has been given exploration rights to explore land on Tiwai Peninsula for gold and PGM.
Placer Investments Ltd was given a five-year exploration permit by New Zealand Petroleum and Minerals (NZP&M) last month.
The permit covers the entire Tiwai Peninsula east of the smelter, part of which is Department of Conservation (DOC) land leased by the smelter and run as a reserve.
Placer Investments director of operations Darcy Schack told the Southland Times that while gold and PGM were the primary goal the quest would also take in other metals.
The company hoped to start work in the New Year and the company said about 200 holes would be drilled after preliminary field work.
In the past three decades there have been several quests for PGM and gold in Southland, with a major focus on the Longwood Ranges – an area NZP&M has earmarked for exploration overtures after the area being frozen out of exploration last year.
One of the fundamental problems with PGM quests in the Longwood Range has been a lack of sustained exploration focus, with several companies talking louder than their actions. One, a short-lived Canadian company, was looking at the scope for nickel as well as PGM.
Source: stuff.co.nz/southland-times


Glass Earth is looking to extend Prospecting Permit 39336, also down in Southland (https://data.nzpam.govt.nz/PermitWebMaps/StaticReport.aspx?permit=39336). The green exploration permit inside it is already held by GEL, near Round Hill. Both permits extend to PGM.

PIL (http://www.google.co.nz/url?sa=t&rct=j&q=darcy%20schack%20geologist&source=web&cd=5&cad=rja&ved=0CEUQFjAE&url=http%3A%2F%2Fi-grafix.com%2Findex.php%2Fnews%2Fnew-zealand%2Ffirst-hp-scitex-lx800-in-south-pacific-goes-to-mosgiel.html&ei=pumQUKS0ApCXiQf0v4HAAQ&usg=AFQjCNFkQLbWl7089-rDMNfbD1iszDIHdA&sig2=VXGDJVooLg2nvk4TQ4ST9A) will use similar equipment to Glass Earth's - magnetic/gravity sensing equipment used on foot (http://www.stuff.co.nz/southland-times/news/7874902/Search-on-conservation-land-for-gold-platinum), and perhaps an RC shallow drill rig.

[elZorro]

Some of the assay results from WKP35 were released to the market last night, in time for trading on the TSX.

Here's the link to the GEL website. (http://glassearthgold.com/s/NewsReleases.asp?ReportID=555606)

The TSX responded positively. Note the images attached to the release - the drill cores are very recognisable to geologists involved in Martha Hill deposits apparently. I guess when they were undergrounding and open casting Martha Hill they simply looked for ore areas that looked like those shown, and left or removed the rest. The next drill hole testing this area will be WKP37, 200 metres to the south and with a similar inclination.

This press release might be a snapshot of the first core samples to be assayed, as WKP34 has been left waiting, and maybe we're only seeing part of WKP35. Perhaps there is a massive holdup in the assay labs.


Glass Earth Gold Limited ("Glass Earth Gold" or "the Company"; TSX-V:GEL) is pleased to announce its 5,500 metre diamond drill program at the WKP gold-silver prospect, Hauraki, New Zealand (Glass Earth Gold 35%; Newmont Mining 65%) continues to demonstrate that it is a large permissive gold system with potential to host significant epithermal gold deposit(s).

WKP35 Intersection of 7.9m @ 5.1 g/t Au and 12.1g/t Ag



Including 3.4m @ 8.3 g/t Au and 16.6g/t Ag



Major new structure hosts Martha--Favona-Golden Cross style epithermal gold mineralization


New Zone - East Graben (EG) gold bearing quartz vein

As previously reported on 24 September 2012, drill core from hole WKP 35 on visual inspection exhibited quartz veins with potential gold mineralisation over a core length of 8 metres. Assay results have now confirmed the intersection is 7.9m grading 5.1 g/t Au and 12.1g/t Ag including 3.4m grading 8.3 g/t Au and 16.6 g/t Ag.A full compilation of assay results for WKP 34 and 35 is awaited. Drilling continues with WKP 36 (targeting extensions to the Eastern and Central zone southward), followed by WKP 37 testing the Eastern Graben structure 200m to the southeast of WKP 35.What is most significant is the style of veins and the host lithology's, being episodic high level crustiform banded veins, hydrothermal and tectonic brecciation corresponding with multiple phases of mineralisation, hosted on the juxtaposition of rhyolite and andesite lithology's (see Figure 1 (http://www.sharetrader.co.nz/i/newsreleases/2012/Images/GEGLPR_31Oct2012_WKPMap1.jpg)). This is new for this project and important because the styles of mineralisation here mirror those associated with major gold mines in the vicinity, namely Martha, Favona, and Golden Cross.*
The veins lie on a major north-north--east trending structure marking the intersection of rhyolite (west) and more intermediate andesite pyroclastics (to the east). This is a major structure, identified on magnetic and resistivity (geophysical) data, and may represent the primary focus of significant coherent mineralisation in the WKP area. The structure can be mapped for several kilometres and is open both up and down dip, and along strike (See Figure 2 (http://www.sharetrader.co.nz/i/newsreleases/2012/Images/GEGLPR_31Oct2012_WKPMap2.jpg)).
Simon Henderson, President and CEO of Glass Earth Gold, commented "Every drill hole completed by the JV has intersected significant mineralisation and demonstrated potential for both narrow (3-9m) high grade gold veins, and or broad low grade mineralisation (in excess of 100m of +1 g/t gold). The discovery of this new Eastern Graben structure is a major step forward for the WKP project because the style of mineralization intersected in WKP-35 shows strong similarities to other productive gold-silver veins in the district. We are very encouraged by the result from this hole. Step-out drill testing is already underway".*Martha goldmine is the Newmont operated mine 10km south of WKP, and is widely regarded as the type-system for epithermal gold deposits. The mine, currently in production has approximately 10Moz gold equivalent in historic production and current resources.*Favonagoldmine is a satellite deposit associated with the Martha system.*Golden Cross goldmine lies 4-5km southwest of WKP and produced 634,000 ounces gold (1991-1997).

[elZorro]

Well, a week has passed and there is no public data to add to the previous post, I've been looking. No updates to the GEL website since the press release, the permit map and the current project pages are out of date.

Since we have a small set of data for drill WKP35, there must be a big holdup in getting assays done. WKP34 and the rest of WKP35 is in the assay pipeline, and I suspect WKP36 (in a southwest direction) has also been drilled. It's possible the 200 metre step drill WKP37 is in progress, and again this is looking for the East Graben (EG) intercept with the andesite, hoping to find a high-grade area.

The WKP permit is far from flat, it's bush covered, and maybe the costs to underground mine an ore deposit are a lot lower from Newmont's perspective, considering the main milling operation would be done in Waihi with existing gear. Environmental concerns are relevant here too, of course.

So I'm keeping my fingers crossed for WKP37, let's hope for another intercept with an auriferous vein.

[elZorro]

Puhipuhi is arguably the hottest permit area for gold in the North. There are parallels for WKP in the description of the mineralisation perhaps. If Newmont are now slashing their global exploration budget (the complete opposite tack from what they were saying at an Australian conference recently) then the fact that WKP is still 'on the go' is heartening for GEL shareholders.


Perth explorer to acquire Puhipuhi

Ross Louthean — 9 November 2012
The long-known but lightly explored Puhipuhi epithermal gold-silver prospect in Northland has been taken up by Western Australian junior explorer De Grey Mining Ltd (ASX: DEG).
De Grey has signed a definitive agreement with Waihi Gold Company Ltd, subsidiary of global gold giant Newmont Mining Corporation to fully acquire Puhipuhi after it the American company decided to sell because it was slashing its global exploration budget.
The prospect near Whangerei is an exploration permit granted to Waihi Gold in 2009 and has a term of five years with the right to a further five year extension.
De Grey will acquire the permit subject to the acceptance of the transfer of ownership of the permit by the Ministry of Economic Development, New Zealand.
De Grey’s executive chairman Peter Batten said though exploration at Puhipuhi dates back to the early 1980s, and involved companies such as Homestake Mining, BHP and Macraes, the area remains relatively under-explored.
A more recent holder of Puhipuhi was Canadian company CanAlaska which subsequently withdrew from New Zealand gold exploration to focus on uranium exploration in North America.
Of the 50 drillholes completed within the project area, 18 are less than 100 metres in length, 28 between 100 and 200m length and only four greater than 200m in length.
The drilling has been into what has been interpreted from petrology, geochemistry, mapping and geophysics to be the top of an epithermal system.
Batten said Puhipuhi “is endowed with a number of walk up drill targets.”
Previous significant drilling results include 18 metres grading 3.38 grams/tonne gold and 10.3 g/t silver, including 2m @ 17 g/t Au and 15 g/t Ag) and, in another hole 2m @ 7.6 g/t Au and 70 g/t Ag.
Recently completed geophysical work by Waihi combined with anomalies generated from historic geochemistry surveys has resulted in 11 target areas, nine of which are considered high priority including the two historic mercury mines -- the Rising Sun and Puhipuhi mines.
He said the abandoned silver mine, known as the Northern Silver workings, has not yet been the subject of systematic exploration despite Macraes reporting that sampling of the mine area returned results as high as 1.35 ppm gold and 304 ppm silver and high antimony from the surface as early as 1994.
Puhipuhi is interpreted to represent a well preserved hot spring sinter-breccia system that formed as an outflow from a venting geothermal system.
Mineralisation in these systems is commonly restricted to fluid upflow settings and very low gold contents are deposited near surface.
De Grey thinks Puhipuhi has potential for fissure vein epithermal gold-silver mineralisation that have been developed at Hishikari in Japan, Cracow in Queensland, Sleeper in Nevada and at Waihi.
“The potential for Puhipuhi to host such a fissure vein system has been recognised by several explorers during the last 30 years, however drilling to date has only been relatively shallow, and hasn’t tested the deeper parts of the system where the gold-silver mineralisation is expected to occur,” the company said.
Other drill targets generated from multi-element surface geochemistry and ground based geophysical surveys (IP and CSAMT) also remain untested within the Project area.
Peter Batten, said Puhipuhi was an excellent advanced greenfields epithermal system with defined and untested drill targets, a supportive Government, excellent infrastructure and a very low country risk.
Earlier this year anti-miners in Northland at a public meeting made some amazing and alarmist statements about mining and accused Newmont of undertaking secretive night-time drilling, which the company denied emphatically, saying it was too early to even consider drilling.



Auckland, Nov 7

Australian explorer De Grey Mining will target 9 high priority drill target areas once it completes the acquisition of the Puhipuhi epithermal gold/silver project about 30km from Whangarei on the North Island of New Zealand.

De Grey will pay Newmont Mining subsidiary Waihi Gold Company $A100,000 plus a 2% net smelter royalty for 100% of the project.

Despite exploration commencing in the early 1980s by companies such as Homestake, BHP
and Macraes, the project remains relatively underexplored.
Executive chairman Peter Batten says Puhipuhi is an advanced greenfields epithermal system with defined and untested drill targets, excellent infrastructure and very low country risk.

De Grey Mining Limited (http://www.sharetrader.co.nz/content/de-grey-mining-limited)

Exchange Code:
ASX: DEG

Website:
http://www.degreymining.com.au

Based In Perth, the company explores for gold, silver, base metals and uranium in Australia and Argentina.



The company has released a lot of field data about the prospect. Their Mcap is very small: A$7mill at the moment, and they have a lot of permits in Argentina.

http://www.degreymining.com.au/_content/documents/771.pdf

[elZorro]

More on Puhipuhi: this permit has just passed the 3 year stage. In each of the next two years, 1500 mtrs of drilling is required to be done, under the NZPAM terms.

http://www.nzpam.govt.nz/services-drm-web/RetrieveDocumentServlet.svt?documentId=7C7CEE52192 7190F0E1C61EB4EAC75FD&p_access_no=A2B8E465295587CB564C86AC64FF1A2C

While the terrain is partly farmland, so easier to access than WKP, 3000 metres of drilling will cost perhaps $2-3 million. There has also been a bit of local opposition to drilling because of the natually occuring mercury levels held underground. One site was a mercury mine at one stage. Of course there will be no mill nearby, or other trained workforce, so mining it would also require a lot of capital.

I'm wondering if the dropping of Puhipuhi by Newmont will be good news for the WKP prospect, in that their exploration geologists will be more focussed. Since the drilling reports from WKP are few and far between, and there is a holdup on assays that had masked drilling progress, it's possible there is just one helicoptered drilling rig at WKP at the moment.

Other companies I've looked at on the web are using four rigs at once, drilling 4x the distance, but this is usually for infill drilling, to get a JORC figure.

If Newmont sticks to just one rig, and there's a big wait for assays, progress is going to be slow.

[elZorro]

OK, today is shaping up as being interesting. Glass Earth have a new presentation available on the website, posted yesterday.

http://www.glassearthgold.com/i/presentations/GEGL_IR-Tour_Nov2012.pdf

Shareholders need to have a really good look at this one, because there's a lot of data there that we have been waiting for. The placer mining gold recovery is split out for each of the GRUs, showing some variance, but a high point of 88oz in a week back in August. There are just two GRUs running at the moment. Groundwater has a lower grade but is a bigger resource.

The title of this document includes the word 'tour'. Simon might be overseas again. There's also a table spelling out capital requirements for the next year, and taking off about 3.6M for placer profits, it's a shade short of $3mill needed. One interesting line is the "New Project" which is clearly not WKP or Muirs, or Garibaldi, and it'll need $1.7mill for exploration/resource mapping. This project is pending.


There are some new very detailed resource maps for WKP and Muirs, but Muirs is shown to have a resource of about 226,000oz. Hmm.

[gonzo56]

What happened to the third GRU? (Nevills)

[elZorro]

That got moved to the Drybread area, but not started up yet by the look of it. Maybe it's going to Pigburn. Note that the presentation has 7 pages on WKP, 2 on Muirs, 2 on Placer. WKP is where the money is going to be, the placer will help them get there.

[gonzo56]

oh ok, thanks. I wonder how much of an effect that will have on their earnings report, should be out any day now...

[bucko]

After seeing the increase in gold output from the placers im quitely optomistic of that earnings report! Am i safe to assume we could see GEL maintain the 88oz production throughout the summer due to improving conditions?

My first post on GEL, El Zorro you seem to be the king of this forum, some great posts here!

[elZorro]

Thanks for your post Bucko. Please send more in. I'd actually forgotten that a quarterly report might be due soon, so thanks Gonzo.

That placer page on recovery ounces will be fascinating to have a look at when I've got time. Maybe the ground is variable in grade, maybe some days the tuning on the GRUs goes astray. The clay could be clogging up all the screens etc. But here for the first times are the grades on the permits, and these are up to 3x above the cutoff grade at Drybread. Not a bad business as a standalone, C3.6mill profit, or NZ$4.5mill a year. It'll be even better once Bob Kilgour is paid out fully.

[elZorro]

Here are two screens from the presentation, both of them with important new data.

First, the grades and weekly recoveries from the GRUs. The biggest GRU is at Morans, but the best current grade is at Hecklers. Groundwater is a site that has yet to be started, and they're all within the Drybread permit. Output can be 50% down in a given week, but the overall picture is good. Much better than was achieved at Nevills, where the grade must have been poorer. We have not been given an explanation as to why the third GRU is not in action again, yet. If the trend for the month of August had continued, we'd have seen the company knee deep in cash by now. The target for production by the end of the first year was set at about 144oz/week, assuming three GRUs in use (7,500oz in a year). Total potential resource for the areas in the table is about 24,000oz.

But then there's another cryptic line, Southland 100,000oz? GEL has a permit down there.

The resources page for WKP gives approximate figures for the gold contained in the better known sections. The Central area potentially holds 2.3Moz, the original East area 1.4Moz, the Western area and EG areas are too new to delineate by the look of it. But even the earlier areas have a total possible resource of 3.7Moz. It's not a big jump to 5Moz, the supposed trigger point for Newmont. There's confirmation that WKP37 is being drilled, and this is looking for another high-grade intercept. Looks like there is just one drill in use.

[elZorro]

Here's a section out of the general writeup on Glass Earth, done in 2011. The Gunclub permit has been wrapped up for over a year now. It gives an indication of the staffing needed at Drybread.

Glass Earth is currently producing gold from its Gunclub Project, a placer/alluvial deposit in the Ida Valley between the Raggedy and Rough Ridge Range. It’s a shallow deposit holding from 1,000 to 2,000 oz. Though it is a relatively small deposit, the gold is recovered quickly and economically. The operation is worked by four men using three diggers, a truck and a trommel-based gold recovery unit (GRU). The project is worked systematically and reclamation is accomplished almost simultaneously with gold recovery. Top soil is removed and stored nearby, one metre of overburden ground is then stripped and moved aside, the alluvial gravel is removed and placed into the trommel where it is washed, and the heavier, gold containing concentrate is collected in a trap under the trommel. The concentrate is removed and taken to be processed on a shaking table, a mechanical process similar to panning. Using this method, Gunclub is producing approximately 100 oz of gold per month.


Included in the latest presentation, is an update on the size and grade of the Correnso deposit that Newmont is keen on recovering at Waihi. 850,000 oz at 11 grams/tonne, these days that's a great deposit. It's 1.6 billion dollars worth.

Glass Earth is looking at the feasibility of trucking ore from the prospective Garibaldi deposit to Macraes. This must be part of a decision-making tree.

[elZorro]

http://www.glassearthgold.com/s/NewsReleases.asp?ReportID=558357


So, this is the new project - I wasn't aware of this area at all. I did notice that GEL has a permit application in for an area called Neavesville North, I don't think it's been granted yet.

Formerly a JORC resource of nearly 300,000oz gold, that's great for a start point as it appears to be shallow, and three times the amount of silver with it. That'll help a small amount with extraction costs. Over another 100,000oz underground accessible. From the supplied map, there's andesite up there, also a good marker. Not too far from Waihi either. A 50% JV with Geoff Loudon interests, means that the other half of the capital won't be a problem. GEL isn't big enough to do a project of this size by itself, but it's also too small for the likes of Newmont. GEL's connections with Newmont would be helpful though, if the ore needs to be processed cost-effectively. No doubt Newmont's facilities at Waihi have some spare capacity at the moment.

I need to spend a lot more time looking at this, but it would appear the terms of one of the permits means it'll be time to do some drilling soon. Payment for the area seems to be on a spread basis and assuming gold is produced in the near term (unless this is going to turn up from placer), or it can be GEL shares or cash equivalent.

GEL now has JV permits covering quite a bit of the area around and above WKP. A good big block if it ends up being mined soon.

For Neavesville, assuming all three permits had a total of say 500,000oz, the valuation being about NZ$250 an ounce inground, at the point they are called NI 43-101 Reserves/resources, then this is a value of $62million to GEL for a 50% holding. A few bills and some drilling to go first (shared costs), but added to nearby WKP it's a tidy picture. WKP has only been drilled 36 times, Neavesville 63 times, but they were on average shallow drills, avg 140metres. There is potentially more lower down, if the surface is the top of an epithermal gold resource, as is normal for the area.

Eurasion's view of the transaction. (http://www.marketwire.com/press-release/eurasian-minerals-announces-acquisition-option-agreement-sell-neavesville-new-zealand-tsx-venture-emx-1727993.htm)

[elZorro]

NBR just published something about the new project, made things a bit clearer.

http://www.nbr.co.nz/article/glass-earth-shares-22-percent-option-buy-coromandel-goldmine-bd-132599


Glass Earth shares up 22% on option to buy Coromandel goldmine

Tuesday November 20, 2012

Gold miner Glass Earth has gained rights to take over the Neavesville gold and silver prospect controlled by Canadian resource developer Eurasian Minerals.
A complex set of arrangements will see Glass Earth make limited up-front payments, with most revenue flowing to Eurasian once commitment to a mining operation has been made.
The announcement saw shares in Glass Earth leap 22% to 33 cents, although they remain 52% below their high point for the last 12 months.
Located immediately north of Newmont Gold's major producing mine, Martha Hill, Neavesville has been identified in the past as containing a JORC code-compliant resource, although the resource measurement exercise will be repeated and updated because of changes to the way JORC certification rules now work.
"The Neavesville project offers the opportunity to have management control over the development of a significantly advanced gold/silver project, with an already established (historic) resource, with the immediate objective to update and improve the potential of the existing Bluff resource," chief executive Simon Henderson says in a statement to the NZX.
The project also offered "tantalising new targets" to increase its size.
Long-time New Zealand gold mine developer Geoff Loudon, chairman of Nautilus Minerals, will take a 50% stake in Glass Earth's rights to the Neavesville project.
Eurasian will receive an immediate payment of $C85,567 in reimbursement for recent exploration costs and will be eligible before December 31 next year for an option payment – made either as 850 ounces of gold, its cash equivalent, or in Glass Earth shares – at Glass Earth's election.
Glass Earth will then have 24 months or until December 31, 2015, to produce an updated JORC resources report, at which point it will elect either to take over ownership of the project or walk away.
If it exercises the option to proceed, it will then be up for payments equivalent to 2% of net smelter royalties from the production of the mine, and additional payments of 75oz gold or its equivalent annually before the option exercise, and 100oz gold annually after exercise until production commences.
On completion of a JORC-compliant feasibility study supporting a mine construction decision, Glass Earth will make a payment in gold, or cash or shares to its equivalent value, on a 1:100 ratio up to 500,000oz on those and subsequently reported reserves. Above 500,000oz, the ratio drops to 1:200.

"What we like about this and worked hard to negotiate is that most of the payment occurs after we've got a positive decision to mine," Glass Earth's chief financial officer told BusinessDesk....


The AUSIMM conference included papers on both prospects.

Neavesville Epithermal Au-Ag Deposit, Hauraki Goldfield
R G Barker, L K Torckler and RL Brathwaite

131


Exploration of the Wharekirauponga Epithermal Au-Ag Deposit,Hauraki Goldfield

A B Christie,S D C Rabone, R G Barker and
R J Merchant

Hauraki Gold Ltd obtained both permits that GEL is looking at: 51-767 and 52-759. Both need 1500mtrs of drilling soon, the first one by April 2013.

Hauraki Gold is owned by EMX NZ (BVI) Ltd, which in turn is a wholly owned subsidiary of Eurasian Minerals Inc, (EMX on the TSX-V). EMX have about $40mill in cash, but a lower value of exploration assets than GEL. They don't pay a dividend either.

Eurasion is about 10% owned by Newmont, the CEO David Cole was from Newmont (video (http://www.youtube.com/watch?v=FUJBed9Em2k)), and they have one or two other key staff ex Newmont. Their idea is to get hold of permits, do the initial process and then hand them on to explorers (including Newmont - Haiti permits), getting them to pay most of the exploration costs, but still keeping a finger in the pie (royalties). Eurasion only seem to have these two permits in NZ (no mention of them in the last annual set of books), curiously they are both close to Waihi. Barrick and Sprott Asset management are also shareholders in EMX.

[elZorro]

Glass Earth Gold Doubles Placer Output in Central Otago, New Zealand
WELLINGTON, NEW ZEALAND--(Marketwire - Nov. 20, 2012) -Glass Earth Gold Limited(TSX VENTURE:GEL)(NZAX:GEL) ("Glass Earth Gold") announced today it doubled its gold production from the placer (alluvial) mining operations in the Manuherikia Valley in Central Otago.
Production from placer operations at Drybread (Hecklers and Morans) is now achieving approximately 70-80 ounces of gold per week, doubling its output since last update (reported August 29, 2012). This higher gold production has been achieved in some lower grade areas and now, both gold recovery units are working their way to higher grade ground where further production increases and efficiencies are anticipated.
This production improvement builds off a modest base that averaged 10 oz/week of gold from a single plant in March this year.
View weekly gold production graph at:
http://glassearthgold.com/i/newsreleases/2012/Images/GEGLPR_21Nov2012_Chart1.jpg
View map of gold production at:
http://glassearthgold.com/i/newsreleases/2012/Images/GEGLPR_21Nov2012_Map1.jpg
Simon Henderson, CEO of Glass Earth Gold said, "We are delighted with the steady progress in our placer production and look forward to further efficiencies and improvements as we mine higher grade material during New Zealand's summer months ahead".
Cash flow from current operations are covering General and Administrative expenses and modestly adding to its exploration budget at the WKP prospect (north of the Martha mine at Waihi, North Island).
The recent announcement that Glass Earth Gold has acquired option rights to the Neavesville gold/silver prospect (just north of WKP) will mean an increased exploration focus in the Hauraki region.
About Glass Earth Gold
Glass Earth Gold is one of New Zealand's most active gold exploration companies with landholdings proximal to world-class gold deposits and cash flow from its wholly owned placer projects. With an experienced geological team the Company is exploring promising gold prospects across both the North and South Islands. The Company held a net cash position of C$1.0 million at the end of Q2 2012.
In the North Island, exploration efforts are focused on large epithermal gold systems in the Hauraki Region, akin to the 10Moz gold equivalent Martha Hill mine, (Newmont Mining).
In the Hauraki Region, Glass Earth Gold has identified and developed significant ground positions around the active Martha Hill gold mine operations at Waihi. The Newmont-Glass Earth Gold Waihi West JV (Newmont earning in) and Hauraki JV (65/35), including drilling at the WKP discovery, are being actively explored and managed by Newmont in collaboration with Glass Earth Gold.
Glass Earth Gold has also defined several significant epithermal gold targets to independently explore in this region, including the Muirs Reef Gold project.
In the South Island, exploration efforts are focused on the Otago Region, home to OceanaGold's 7Moz Macraes Goldfield, for identification of mesothermal "Macraes-style" gold targets and revenue generation through placer (alluvial) gold production.




This also looks promising, because any increase in placer grade is pure profit when all costs have been met. No mention about having any more GRUs operating soon. But even two GRUs can generate millions of dollars in annual profits, from a modest grade area. As stated in this release, the grade should improve as they move along in their areas. By my crude calculations they'll each be in a grade of about 0.4g/m3 at the moment, if they're still running 65 hours a week. They can do more hours, run more machines, try higher grade spots discovered by the RC drilling. And the tuning of the machines might improve yet.

[elZorro]

Glass Earth strikes new deal in the CoromandelSimon Hartley — 21 November 2012
Active explorer and boutique gold miner Glass Earth Gold Ltd (TSX-V & NZAX: GEL) has taken an option to purchase a gold and silver prospect north of the Martha mine in the central North Island, in a 50:50 venture with well known mining entity Geoff Loudon.
If access agreements can be struck, Glass Earth hopes to initiate a “minimum” 5,000 metres drilling programme in the 30sq km block later this summer, which is mainly felled forest area criss-crossed with logging tracks for access, as opposed to expensive helicopter-borne transporting.
Glass Earth Gold, which is producing alluvial gold from tenements in the Maniototo in Otago, is expanding its central North Island prospects from three to four in holding its option on the Neavesville (CRRT) tenement.
Chief executive Simon Henderson said Neavesville offered an opportunity to manage and control an established historic resource with the “immediate objective” to update and improve data on the potential estimated resource.
This could be seen as an implication from the 35% holding in the WKP gold discovery to the immediate north with Waihi mine operator Newmont Waihi Gold – where the exploration pace has not always been to Glass Earth Gold’s liking.
Between the 1970s to 2007, several companies explored the Neavesville area.
Glass Earth director, Peter Liddle, said from Auckland that once the estimated resource was updated, to new international standards, a decision would be made on acquiring Neavesville from Eurasian Minerals Inc, (TSX-V: EMX) which has held the tenement for less than a year.
Historically, the area is estimated, from 63 drill holes totalling 8,900m, to have an estimated resource of 289,000 ounces of gold and 944,000 oz of silver, including one deeper resource having a gold grade average of 7.1 grams/tonne, or 107,000 contained oz from 470,000 tonnes of ore. A shallower resource of 3.2 Mt graded 2.7 g/t Au and 8.9 g/t Ag.
The main discovery area from historic and recent drilling has been on Trig Bluffs.
Christchurch-based Geoff Loudon is an international explorer and mine developer, having been a foundation director of Lihir Gold Ltd, and is at present chairman of Nautilus Minerals and L&M Energy; the latter for which Loudon's New Dawn Energy Ltd launched a full takeover bid in early-November.
At the end of June Glass Earth held $C1 million ($NZ1.25 M) in cash. In late-June Glass Earth clinched $2.95 M in a private placement to refinance the $4 M buy-out of its former Otago joint venture partner, then in early-October raised a further $456,000 in private placement, out of Canada.
Under the deal with Eurasian Minerals, the joint venture will:


Immediately reimburse Eurasian’s recent exploration costs (C$85,567).
Make an option payment of 850 oz gold prior to the end of 2013.
Undertake 5,000m of drilling and produce an updated JORC/NI 43-101 compliant resources report prior to the end of 2015.
Exercise of the option to purchase the shares in the company owning the Neavesville permits and execute an agreement to pay amounts equivalent to a 2% NSR on production from the permits.
Additional payments at the rate of 75 oz gold per annum, prior to exercise of the option and 100 oz Au after exercise of the option, until production commences, whereupon the deferred consideration and the additional payments paid are credited against 80% of the deferred consideration.
Upon producing a compliant feasibility study, supporting a decision to construct a mine, payment of gold in the ratio of 1:100 on all probable and proven reserves included in that report – up to a limit of 500,000 oz on those and subsequently reported reserves. Payment of gold on reserves above 500,000 oz would be in a reduced ratio of 1:200.

*Simon Hartley is senior business reporter for the Otago Daily Times.
- Additional reporting by Ross Louthean
Attachments

http://www.sharetrader.co.nz/icons/pdf.jpg
Neavesville project technical presentation. (Adobe PDF File) Download (853KB) (http://www.sharetrader.co.nz/attachments/3971/NeavesvilleProjectTechnical_lr.pdf)




Extra data from management here. I think this is Maori land, looks like access has to be arranged. Good and flat though, compared to WKP.

[gonzo56]

Cool elZ, things are heating up.

I just saw this: https://www.nzx.com/companies/GEL/announcements/229999 You wrote about it a few posts ago, extra revenue with no extra costs... sounds good! ; )

Are you ready to dip your toes in yet?? (You don't have to answer this :sneaky2: )

Although, there hasn't been a response on the TSX, it's still at 19cents...

It's funny how the media portrayed GEL yesterday, "22% rise" wooaa the traders must have been clambering over each other to get shares. But really it was one small $3000 trade in the morning, where someone decided to take a bite out of a big 50,000 share sell order. :laugh:

- When the market opens there will be 11,000 shares of that order at 33c left. (Update - The order is now filled)

[elZorro]

Cool elZ, things are heating up.

I just saw this: https://www.nzx.com/companies/GEL/announcements/229999 You wrote about it a few posts ago, extra revenue with no extra costs... sounds good! ; )

Are you ready to dip your toes in yet?? (You don't have to answer this :sneaky2: )

Although, there hasn't been a response on the TSX, it's still at 19cents...

It's funny how the media portrayed GEL yesterday, "22% rise" wooaa the traders must have been clambering over each other to get shares. But really it was one small $3000 trade in the morning, where someone decided to take a bite out of a big 50,000 share sell order. :laugh:

- When the market opens there will be 11,000 shares of that order at 33c left. (Update - The order is now filled)

Hi Gonzo, sorry about the slow reply, had a busy day. So I didn't see GEL going up to 36c until now.
Am I ready to dip my toes in yet? I've been holding this share for years..in various amounts. I reckon it's a share you own when you are comfortable with other investments outside the sharemarket. It's not a sure bet, pays no dividends, but if things keep going like they are, GEL could easily be worth 10x or 20x current Mcap in future. The trouble is it'll be a step change, and no-one knows when it'll be. A big drill assay, a change in policy from a big player, many things could make GEL a target for takeover, or we could see them as partners in a mine at WKP for example.

ODT article: not much new there, although I'm now unsure if Neavesville holds approximate resources of 289,000oz or more than that.


Glass Earth may buy NI prospect

Home (http://www.sharetrader.co.nz/) » News (http://www.sharetrader.co.nz/news) » Business (http://www.sharetrader.co.nz/news/business)
By Simon Hartley (http://www.sharetrader.co.nz/history/65) on Wed, 21 Nov 2012

Explorer and boutique producer Glass Earth Gold has taken an option to buy a gold and silver prospect north of the Martha mine in the central North Island, in a 50:50 venture with mining entity Geoff Loudon.
If access agreements can be struck, Glass Earth hopes to initiate a "minimum" 5000m drilling programme in the 30sq km block later this summer, which is mainly felled forest area criss-crossed with logging tracks for access, as opposed to expensive helicopter-borne transporting.
Dual-listed Glass Earth, which is producing alluvial gold from tenements in the Maniototo, is expanding its central North Island prospects from three to four in holding its option on the Neavesville tenement. Glass Earth shares were up more than 20% after the announcement, at 33c.
Glass Earth chief executive Simon Henderson said Neavesville offered an opportunity to manage and control an established historic resource with the "immediate objective" to update and improve data on the potential estimated resource.
Between the 1970s and 2007, numerous companies explored the area, but none of them subsequently went into production.
Glass Earth director Peter Liddle said when contacted once the estimated resource was updated to new international standards, a decision would be made on acquiring Neavesville from Eurasian Minerals Ltd, which had held the tenement for less than a year.
Historically, the area is estimated, from 63 drill holes totalling 8900m, to have an estimated resource of 289,000 ounces of gold and 944,000 ounces of silver, including one estimate of a gold average of 7.1g of gold per tonne, or 107,000oz from 470,000 tonnes of ore.
New Zealand-based Mr Loudon is an international explorer and mine developer, having been a foundation director of Lihir Gold Ltd, and is at present chairman of Nautilus Minerals and L&M Energy. Mr Loudon's New Dawn Energy Ltd launched a full takeover bid for the latter company in early November.
At the end of June, Glass Earth held $C1 million ($NZ1.25 million) in cash.
In late June, Glass Earth clinched $2.95 million in a private placement to refinance the $4 million buyout of its former Otago joint venture partner, then in early October raised a further $456,000 in private placement, out of Canada.


Glass Earth doesn't have to come up with a lot of immediate cash to hold the option for Neavesville. If they drill in the next few months and it looks promising, that will cost the partners a few mill for contractors, and they have to pay 850oz gold or about C1.5mill to Eurasian at the end of 2013. If a JORC mine feasibility looks good and say there's a 500,000oz gold resource, the partners will pay about C8.5mill across to gain the permit. Plus 2% of all gold produced later. Upfront fees of over C$10mill plus ongoing royalties. So I have two questions: How did they miss picking up Neavesville before Eurasian did, and why are they so keen now?

GEL should get the big permit above Neavesville, that will be cheaper for the company.

[gonzo56]

Oh ok, you are holding. I thought you were waiting for the perfect time to buy in, but like you said, when it goes it'll go in a hurry, so you don't want to miss out! I too hold a small position now, I don't wont to be too exposed to the big swings in price.

[bucko]

Thank you for your email.
I have been advised that we are expecting to file our Q3 financials by the end of the month.
Regards,
Andrew Hamilton

Not long to go!

[gonzo56]

They'll probably leave it to the 30th I reckon bucko.

There have been two large spikes in volume this month at 100,000 shares. Nov 7th and today - so people are clearly waiting in anticipation.

Update: An interesting day. Today saw the highest ever volume of GEL shares traded. (131,451)

[elZorro]

Yes, Bucko and Gonzo, it'll be an interesting quarter report for sure. Might look a bit scary at first, with some permits that were let go that'll have to be expensed on the books. They've already had their effect on cashflow long ago. In the latest quarter the placer sales should start to look quite impressive against normal annual expenditure. Have to keep an eye on the placer expenses and allocation of output for possible Neavesville payments though.

Just following the Puhipuhi permit story, I did have an idle thought that this was the project GEL was looking at, but of course a hardrock project closer to the Newmont mill at Waihi is a lot smarter.


De Grey places big focus on epithermal gold-silver

Ross Louthean — 23 November 2012
The Perth junior explorer De Grey Mining Ltd (ASX: DEG) is placing a strong focus on high grade epithermal gold and silver – with a new spotlight on projects outside of Australia.
The company was announced earlier this month as the new holder of the Puhipuhi project in Northland and subsequently detailed the acquisition of epithermal prospects in South America.
The company this week gave a presentation in Australia on its new focus that takes in permits in two provinces in Argentina and Puhipuhi. These properties, the company said, contain “walk-up drill targets.”
The Argentinian projects take in the Sierra Morena, Pachi, Halcon and Boeadora prospects in the Deseado and Somuncura massifs in the Santa Cruz and Rio Negro regions which are “pro-mining.”
The company said that at Puipuhi there are nine priority targets generated from work to date, and more than half of the historic drill holes on the prospect were anomalous.
De Grey said that a total of 50 drill holes had been completed on Puhipuhi and only four went to depths greater than 200 metres.
Meanwhile, the minerals director for New Zealand Petroleum & Minerals (NZP&M), David Crawford has given a briefing to the Northland Regional Council on Government plans to open up exploration in Northland both for minerals and petroleum.
The Northern Advocate reported that a small but well behaved group of anti-mining advocates was present.
The newspaper reported that a survey by GNS Science found that the Reinga Basin in Northland could hold promise for oil and gas discoveries.
Crawford reportedly told the council that that from the time a licence was granted to a shovel going in the ground could take about 10 years.
He said the expectation was that, when granted, an exploration permit would last for five years, then another five years to determine the size of the resource, which would likely involve drilling.
Crawford said responsibility for ensuring environmental standards were met during the process lay with the NRC and the relevant district council under the consent process.
However, clearly the anti miners have been bending journalist ears in Northland citing that there would be a public meeting this week in Whakapara to discuss a Western Australian company “mining the Puhipuhi hills.”
No doubt there will be some colourful claims like those aimed several months ago at Newmont Waihi Gold, the former holder of Puhipuhi which was accused of under-hand night drilling on the property. Newmont made it clear no drill rig had been in Northland as there were no specified targets.
The article claimed that De Grey had paid Newmont $1.27 million for Puhipuhi and that issues of concern put up by the Mine Watch Northland coalition included “risks from mining the mercury laden-rock and complex underground water and stream system.”
Sources: nzresources.com data base and northernadvocate.co.nz