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It is interesting to search on google images or for mining videos on YouTube so you can get a visual of what a waste mountain at a gold mine actually looks like.
I mentioned a while ago and was Johannesburg South Africa which was founded by gold and diamond mining. They have always had and still to this day have problems with the gold mining waste. My point is the previous management got away big time by not removing the waste.
It’s bing corrected now, but surely there must have been a massive visual.
Saved a fortune by not employing a waste removal contractor, enough to make up £300m.
B’Nora!
Absolutely Razor's,
Unfortunately this type of sharp practice of hiding an unavoidable, but a considerable proportion of the full operational cost of mining operation is used by a number of unscrupulous mining companies to reel in the uninformed and naive investors, the environmental damage is huge,, as is the cost of putting things right,but by the time it becomes apparent the directors have usually filled their saddle bags with swag and moved on to another project!
There was nothing obvious to see in the open pit.
The removal of the waste was hidden within the wall of the open pit, which was a sharper angle than the accepted 45 degrees.
thus making it unstable.
So it was clear the angle of that face had to be reduced.
Difficult to achieve, some from on top and much more no doubt from below mabe in stages ,having to cut roads into the faces ,though no doubt many existed from the original cut.
I hope you can visualise it.
A stepped pyramid upside down
Thank you mrBond, what I can understand is that I’m not knowledgeable enough to understand. But I still feel “Alias Horgan and Jerrard” are capable of correcting matters. And with Cote d’lvoire have a possibility of catapulting the company ahead of where it was prior to the crack in the wall news. Leapfrogging all previous valuations.
Yes I wonder how long it had been since they visited sukari.
And yes Horgan and crew ,I feel ,more than capable .
Proof is in the pudding.
We’re all running on the blind, that’s why I’d like to see large Horgan and Jerrard share purchases. It eats at me that they’re possibly not fully committed.
We need skin in the game, the more the better.
To me,I imagine Horgan is confident of achieving and is not interested in showing anyone he needs to put on a show .
It could be shown as a weakness trying to convince anyone. Playing to the audience of investors.
More importance the final result.
The final result will prove competance.
Fair points. 👌
The CEO always needs to put on a show. If he or she does not, then its time to go.
Very simple. Everyone is replaceable ...
the gnome
Thank you Mr Bond,
This confirms what I asked Kees Dekker explained to me around four years or so , he also explained about the importance of not allowing the pit wall to become too acute!
Kees seemed to think that some analysts wouldn't know what they were looking at anyway and relied upon what the management showed or told them!
So one must ask the question Is it really prudent to put any reliance upon the majority of number punching corporate analysts when considering whether to invest in a mining company!
I'm not defending anyone, but i would expect it would be very difficult by eye to spot an angle a few degrees either side of 45.
I share Mr T's and others frustration at what has gone on and we cannot change the past. It looks like Martin Horgan has decided to clear the waste and open up new areas.
IF things picked up for us/ we get a decent set of figures/ waste clearance coming to an end, then I suppose we would all say that Horgan did the right thing. However I think even with a good dividend, some of us would still have lurking suspicions because of what has gone on in the past. That is human nature.
I'd really like to to see things on track and a decent dividend. As I said the other week. If they have the money in the bank, they could get a better rate of interest than they are paying on the dividend, so it wouldn't be costing them anything.
I'm hoping that the dividend will increase a lot after this one----but that will mean about May next year. That is a long time to wait.
Hi Paul,
I feel your statement expressed very well the feeling of a number of us, a couple of years ago I actually suggested to Marin Horgan that the company could be getting a return of around 0.5% -1% on the company spend and at that time a return of 5%- 7% or so on some of its cash, (with increased rates more now} by linking up with Kinesis so the money banked would be bullion backed in the Swiss vault , the cash deposits would be available instantly and the bullion available within 24hrs .
He explained the people he had to deal with(I suspect investment funds and institutions} expected at least a 30% return?
Here we are two or so years on and the cash is less than half of what it once was and the company is now hedged, there is certainly no sign of any 30% return as far as I am aware?
Possibly this many help you to understand why I still have some doubts?
Best
Tibbs
Exactly Razor's, I am puzzled that if Martin Horgan has such confidence in the present company strategy then why doesn't he purchase 3 million or so shares , this action alone would boost market convenience and the share price tremendously!
We have had over 3 years of really enthusiastic sales talk, but now its time to walk the walk and deliver!
Surely this is'nt too much for shareholders to ask?
Tibbs
So difficult to paint a picture of waste v ore because unless you are a geologist it can all look the same. All mines have waste there is no such thing as a wall of minerals. The ore also has waste when delivered to the plant hence the 1% grade per tonne of ore.
I am always fascinated at the complexities involved and the skills involved particularly at the start of working in a given area. Try to imagine a large expanse of an open area and the drill and blast team placing explosives in the ground lifting the ground under a controlled blast so that it can be dug by equipment. This is to remove waste to access ore? Or is it to free up ore to enable diggers to access the ore? You need to ask the question. So you won't see a waste mountain because it is below your feet.
So even the likes of Kees Dekker will only see the operation as it is not the whole picture of what it should or could be.
The analysts will be given presentations, they will look at the pit's and processing plant doubtful they will go underground due to health and safety and little will be seen because equipment will be at the face not accessible by a group of visitors.
Doubt they will see areas such as waste dumps which aren't overly exciting albeit this can be an area that exposes inefficiencies or hopefully professionalism.
These analysts I doubt will turn up with stop watches and fully understand the details of the mining operation to understand how well the operation is performing as this will take weeks and studying multiple cycles of the operation and involve experts in earth moving and processing experience.
Maybe Cowichan who as advised by Tibbs is a Geologist can explain the differences and complexities.
Sorry should read 1 gramme not 1%.
Hi Dasut,
As always thank you for giving everyone the benefit of you professional insight.
Considering your past professional involvement with the Sukari operation I realise that you must feel possibly even more disappointed, or frustrated to put it mildly by past events which have brought about a 4 year setback and necessitated the huge increase in AISC to rectify things at Sukari.
To be fair to the analysts who visited the site Kees did explain to me in the past just how little can be apparent to even the most experienced eye in a days visit to the mine and confirmed most of the points you raised in your post.
It seems then that the analysts on these guided tours are really only shown what the company wants them to see and their conclusions and subsequent ratings are really not to be relied upon.
Best
Tibbs
Tibbs yes and no it will depend upon questions asked because a day on a mine site for people with experience will throw up pertinent questions for those that the analyst's are representing, also I would hope many will arrive with in depth questions.
Am I frustrated again yes and no because I have never been on a mine that doesn't go through growing pains, it just feels as though previous management had the Ostrich syndrome and rather than do what Horgan and his guys are now having to do, they buried their heads and ploughed on digging themselves into a corner.
AISC is abnormally high because so much investment is having to be made so fingers crossed this time next year we will see the benefits of the abnormal expenditure.
The cash reduction is as I see it delayed expenditure that should have been spent in years past, could however say the old guard were making provisions for a rainy day.
Thank goodness they did have cash in the bank just imagine how disastrous it would have been if they had to declare insolvency so as I say yes and no, because you would think it would be difficult to go bankrupt having gold in the ground but I have seen it happen.
However definitely a yes because I hate waste and excuse the pun but Centamin have wasted considerable "time" trying and yet to achieve the production and profit consistency.
Easy to criticise what Horgan and his team are doing because they are spending considerable funds and as I say yet to achieve the consistency. Problem I have is I don't have any alternatives to make constructive criticism and feel Kees Dekker is in the same boat and will say proof will be best judged frustratingly this time next year.
Thank you again Dasut,
I agree with you, certainly regarding the "Ostrich syndrome" it seems Andrew Pardey suffered acutely with with that from 2015 onwards, although he was certainly aware that the open pit grade problems were inherent at Sukari and that the viability of the mine was far more dependant upon the underground production than anyone at the company was preprepared to admit!
To be fair Kees respects Martin Horgan and is of the opinion that there really is no better alternative to what is taking place at present to put Sukari right.
That said in view of present AISC anyone who is hoping for a meteoric rise in the CEY SP is going to be disappointed, that is of course barring a meteoric rise in the POG!
So here are again!
Tibbs
Yes the "ostrich syndrome" by the previous lot is what got us into the mess although I think maybe it was more "Mushroom syndrome" for us.
We have a rough date for the end of the waste clearance which is next summer. Maybe they can bring it in a couple of months earlier. Do you have any idea of how much that would reduce costs?
I hope that the next dividend after this one, which will be about May 2024 will be a good one because with the dividends being close together, it is a long wait for the May one to come around again!
If Centamin did start churning out cash like "A demented cash machine" I suppose us LTH's would be suspicious after last time. However I cannot see them falling in the the old bad practice ways again.
I would like to see the board put their hands in their pockets and at least one of them a month buy 50,000 + shares. That should show and give a bit of confidence.
Obviously the price of gold will go up to help us. I mean with China buying gold, Basle 3, Kinesis and Andrew Maguire to help it, surely it should start to move upwards?
Two factors need to be taken into account with strip ratios.
1. The economic price to mine gold. If the previous strip ratio is linked to $1350 per ounce and it has changed to $1700, the amount of resource devoted to stripping to access new ounces of gold increases.
2. The delivery of newly discovered reserves and resources may also have a stripping element attached to it. The Capex value as being economic to mine may have a figure of say $2,000 per ounce. When gold stabilises above that figure Capex is spent on stripping to gain access to newly discovered gold. It then changes on-going stripping ratios.
As a consequence stripping activity is a moving target. Once the mine life gets extended with more ounces the original statistics applied to the original model have changed.
If gold price retreated sharply say to $1500 an ounce. Centamin would have to declare new reserves data and identify what was being lost as being uneconomic to pursue. Stripping ratios become important when gold prices retreat significantly.
Hi Tornado,
Then it would for the best if the company would clarify or explain these points, doing so may allay fears or concerns and may have a positive effect on the share price.
Tibbs
Hi Paul,
Fair comments, remember the Cleopatra slope ,never gets any mention now, possibly the grades were even more mediocre than other areas of the open pit operation , fortunately the underground grades tend to be better quality, it would be helpful if the "Bonanza" grades exist to boost the grade quality further, without the underground production as it seems Sukari isn't that viable I
Keep well!
Tibbs
Started up by 2p today, didn't last long back to normal spanked down again,must be those pesky traders who don't care a jot about what anyone above the age of 14 thinks!
Still anyone buying must bear in mind that they are backing a dead horse until the AISC are reduced by a reasonable amount!
Even then without any evidence to the contrary of Cowichan's post this share is severely obbled and going nowhere much!