Thursday, February 17, 2011

PEAs for the Terminally Obtuse

The delayed Snowden PEA has hit the fan with predictable suspension of rational disbelief and the contradictions are obvious to a child.

"The current resource is sufficient to sustain a two year production forecast ..."

That's lame as hell IF every oz could be scooped up with a plastic shovel at the surface, but lets not get ahead of ourselves.

"During the first year, mining only occurs in the 3000 and 330 zones of the Crystal Mine. The Mystery Mine begins production in the 18th month."

One assumes the "330 zones" is actually the "C3300" zone, and has this blogger not wasted enough greenhouse gas explaining why that is not gonna happen anytime soon and certainly NOT without an EPA water discharge permit?

There are 101k assumed mineable tons with 87.5k of that in the Crystal zones (C3000 and C3300). 90% of this multi-million dollar fantasy riding on ore that cannot be mined. Is there 6 months worth of mineable sulfide ore available, scratched from multiple sources (Southern Cross & Mystery) that St Andrews somehow missed? Even that optimistic assumption seems a very large stretch.

And what of that nebulous water table? Well holy krap, this ultra dopey promotion has finally admitted, sort of, that there's a problem in the henhouse.

"Mining to Depth: Approximately 50% of the mineral inventory is at depth in the Crystal Mine. At present this is a zero-discharge operation. The water table has not been defined at present. The mine is quite dry with inflows of <1.0 l/s, though the water level at the bottom of the mine is known to fluctuate seasonally by as much as 6 vertical metres. The Company has several plans in place to facilitate mining to depth, including the installation of dammed reservoirs in the mine to contain mine water, recycling mine water for drill requirements, using spraying misters to evaporate excess water."
Yeah sure. Alaskan evaporation will save the day, if underground dams won't do the trick, don't be bloody damn ridiculous.

More utterly frikkin insulting smoke and mirrors, and EVERY possible plan was examined in detail by St Andrews at great expense and discarded as not feasible. And the water table is "not defined" ? Absolutely defined according to the environmental assessment filed with the Alaska government ... or the Golder Associates study on grouting and pumping ... if we had it of course.
"The third groundwater system is the regional water table that is encountered at the base of the Crystal mine. The water elevation in the bottom of the Crystal mine varies seasonally but it has reached an elevation of approximately 475 ft (145 meters) above sea level in the mine or about 800 ft (244 meters) below the surface of the Crystal portal."

Wednesday, February 16, 2011

Fleecing the Stupid Sheeple

There has been yet another "analyst" report breathlessly touting the vast potential of Nixon Fork and Fire River Gold.

This time out our grossly incredulous and badly beaten brow is being treated to copious bullchit from Mr. Michael Fowler, M.Sc, MBA (Senior Mining Analyst) and Mr. Leonie Soltay, M.Sc (Mining Analyst)
Is this the same Loewen, Ondaatje, McCutcheon Limited that loaded up on millions of wholesale units in late 2009? Well gee whiz it sure bloody is. So what kind of ridiculous stupidity are these highly qualified professionals with unassailable reputation dishing up for the public and presumably their clients?

How about 50,000 ozs gold production a year, annual cash flow of $ 36m by 2012, and a conservative target price of $ 1.40? Before we get our unbelieving lather in a tizzy dissecting the patently insulting lets take a quick gander at the disclaimer ...

"The information contained in this report is drawn from sources believed to be reliable, but the accuracy or completeness of the information is not guaranteed, nor in providing it does LOM assume any responsibility of liability."

Well O.K. Its grossly misleading garbage, acknowledged as such, and liability is expressly denied to everyone who reads it. Now we know where we stand exactly.

The first assault on our fine sensibilities is the amazing ESP powers of our "analysts". Our boyos have intimate knowledge of what was going through the heads of previous operators at Nixon Fork and have no difficulty spewing it as gospel fact.

"Nevada Goldfields closed the mine because of low gold prices. St. Andrews failed to meet production targets because of excessive mine dilution probably caused by insufficient definition drilling of the ore body and consequently closed the mine in 2007."

Nevada Goldfields closed the mine because of ore face issues as the water table was encountered in the C3100 and C3300 zones (and insolvency) and St Andrews failed to meet production targets for the same reason after expending millions studying the problem AND they did extensive definition drilling before writing the project off completely.

Our brilliant analysts then go on to describe the indicated reserves in those zones and darn it, is there a whisper anywhere about the heavily referenced Golder Associates Study on grouting and pumping OR the fact every gram is below the water table? Weeeeeell, not exactly. "The underground portion of the drill program is focusing on ore definition and expanding ore resources, particularly in the 3300 zone, 3500, 3100 and other areas."

It goes on (and on) ...

"with approximately 94% of resources close to current mine development or on surface in tailings, the company is in a position to bring production back on‐stream in a short time frame."

Lets be extremely blunt with the truth. This is no analysis of a mining project by professionals. This is a grotesque tout from paid whoores with a special interest in lying like sidewalks so that worthless paper can be cashed out on the public.

Thursday, February 3, 2011

The Enigma up the Mystery Creek

The unanswered question with this improbable promotion is why the Golder Associates study on grouting and pumping was never posted on by St Andrews. By absolute rights a body would expect a report this material to be found there.

The answer to that question is very straightforward after delving through St Andrews news releases around that period.

"St Andrew issued to holders of record of its outstanding common shares on May 7, 2007, 1.9 rights for each common share held, pursuant to the Rights Offering in which St Andrew intends to raise gross proceeds of up to approximately $124 million."

"St Andrew Goldfields Ltd. announces that it intends to conduct a non-brokered and brokered private placement offering of common shares for expected gross proceeds of up to $20.0 million."

SAS had over 144 million reasons to keep the problems at Nixon Fork under wraps for as long as possible and thats exactly what they did. The excuse eventually given when SAS stopped production entirely, besides the oblique reference to "ore face issues", was that it was ...

" ... in order to concentrate its efforts on better defining the existing mineral resources and identify new zones of gold-copper mineralization at the property ..."

So SAS continued drilling and did NOT release the damning Golder Study because doing so would have jeopardized a VERY badly needed capital infusion. By the time the dough was safely tucked away the entire Nixon Fork property was written down to zero.

When that happened there was no longer any obligation to release the Golder Study, or the acculmulated drill results, because they were no longer material or relevant to company affairs. Another obvious motivation was the fact it would show clearly that management was playing "hide the wiennie" with its financial backers at a critical time.