January 15, 2021 

How to Approach Thin Veins & Cost


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 By FranSix

09/14/2010  2:56AM

Here's a discussion in exploration-processing.com about the historical Pickle Crow mine in Ontario, CDN:

 By Rick

07/28/2010  7:00PM

Dave, I will. Yup, I agree. (I't not bragging when it's true.)

Perhaps you, and all of us can send this page around to those not in the know.
 By Dave I.

07/27/2010  3:50PM


That is the best I have seen written as to the need for a responsible environmentalist to our nation. Please write the Washington Post this statement, It is honorable and to the point to who we are.
 By Rick

07/26/2010  8:18PM

I'm an environmentalist...yet evidently not "officialy" because I'm also a conservative with a rational mind...


I keep my personal environment clean at home the best I can; I don't litter, in fact I pick it up, the stuff left by others; I'm not in favor of dirty air or water, in fact I actually prefer clean air and clean water (contrary to those who melt my conservatism into my love for life and somehow think I like dirty air and dirty water); I love animals, all of them; there isn't a toxic waste-site that I wish wouldn't have happened; and I can go on and on and on.....

..and yet, I am labeled (not on this forum but in general) as "hating the environment" because I am a conservative.


This is classic. A classic version of "When did you start hating your kids" kind of box that opportunists with crappy motives stick us in, when they think they can get away with people not paying attention to the truth.

I actually don't know any anti-environmentalists...except, wait....Hmmm....

Yes I do! The environment of rational thought is under assault! The environment of freedom is under assault; the environment of private sector autonomy is under assault. And yes, the environment of pristine waters of Kanaka creek was breeched by an intrusive magmatic vein of quartz laden with sulfides (ahem...arsenopyrite) during the last volcanic activity up there where Allegany town arrived with the discovery of gold along the way.

That darned environment! Prosecute the environment, NOW!!!

What a farce and blasphemy on reality, when labels are assigned and misappropriated with politcal deeds in mind.

After all, we are all environmentalists. We sleep in the bed we make.

Yet, I, for one, will never rest when a government tries to define my environment. This smacks of why our country won our independence, and why our Constitution was written.
 By bluejay

11/11/2009  7:06PM

Last on gold is $1120.30, another push into all-time high record territory.

Hoping to remove the cheap spam with an intelligent thought process from one of the masters of Wall Street.

Yra Harris Shares His Wisdom
Posted: Nov 11 2009 By: Jim Sinclair Post Edited: November 11, 2009 at 10:10 pm

Filed under: General Editorial

Dear CIGAs,

Aussie unemployment numbers just came out and were much better than expected!

DEBT,DEBT,DEBT for that theme was alive and well in the world today.

Hirohisa Fujii the finance minister of Japan was raising concerns about the recent sell off in JGBs as the rates on ten year Japanese debt have risen 20 basis points over the last 2 weeks. There is growing concern that Japan will have trouble financing their growing national debt that is now over 200% of GDP. This is not a new story but one that has been kicked around for several years and seems to be gaining adherents in the world because of all the other government debt that has been floated since the global recession has deepened. We will pass this off as a concern of crowding out – as the low yields on JGBs cause them to be replaced by other sovereign debt.

Yesterday that great luminary of credit analysis, FITCH, raised a warning about British gilts being downgraded from AAA which caused the sterling to be sold off.

We will note that this that warning the gilts have been up for 2 days so something else must be bothering the pound, like resistance, so we send you to the charts to see if the sterling can hold support.

The Greek government has also come under attack for budgetary malfeasance but that is a problem for the European Union so its impact is diluted. But if these DEBT concerns rattle the Japanese and the BRITS, what about the U.S. budgetary morass? Anybody want to buy 30 year treasuries? And the talking heads proclaim that GOLD is devoid of reality.

We also remind those who are quick to criticize the Japanese that 95% of JGB’s are held domestically while the holdings of U.S. debt are global. We are back to good old John Connelly – it is our dollar but your problem but with Mr.Obama in Japan and China next week we will see for how long this tired old phrase holds.

There was an interesting story out on Tuesday that the Chinese Investment Corp [CIC] has agreed to purchase a 15% stake in the large U.S. energy company AES. The agreement also includes the buying 35% of the firm’s wind power unit for another $570 million for a total investment of 2.1 billion dollars. This may not be deemed a significant amount of money but its importance lies in the concept that the Chinese are testing the Americans to see if they will block this deal under the auspices of CIFIUS.

Remember the last few times the Chinese have attempted to buy into U.S. assets they were rebuffed under the guise of strategic value to the U.S. With Obama in China pressing for possible appreciation of the Renminbi? The trade off may well be allowing the Chinese to purchase high technologically valued assets in the U.S. If the CIFIUS committee were to block this deal, we won’t know for a while, look for great friction to develop between the U.S. and China

Also out of Asia, tonight the Taiwan central bank announced that they are banning foreigners from putting money in bank time deposits. This is a new type of effort to place constraints on capital flows like the Brazilian 2% tax announced last week. We must stay alert to more of these actions as emerging markets attempt to halt the rapid appreciation of their currencies. The impact on the Brazilian REAL has been negligible but we can look for continued efforts to do so. If this becomes contagious the equity markets will be the recipient of that pain.

From the realm of the absurd we have our man Timmy Geithner in Japan reiterating his strong dollar mantra. Do they ever tire of looking like idiots on the world stage? The last time Geithner was in China college students openly laughed at him in a Q and A session he was having and that was in June.

What exactly has the Secretary of Treasury done to put any bite in that statement? We want to report that the Rick Mishkin piece in the FT elicited a couple letters to the editors that followed upon our criticism. One was written by an economist we admire greatly, Andrew Smithers, who noted that of course you can discern a bubble. Smithers has done a great deal of work on valuing Wall Street by using Tobin’s Q theory so when he is critical you should take notice. There are no good bubble periods for they only create pain further out in time as we saw with the bursting of the Dot.com bubble. The Fed held rates far too low for too long and created the housing bubble. Enough said. And then his eminence Sir Alan followed Mishkin with a speech in which he discussed how the recent equity rally was smoothing the way for recovery. Oh the rehabilitation of Greenspan is a work in progress. Reminds one of Lin Piao.

Yra Harris
 By FranSix

06/25/2009  12:43PM

I came across the following article written some time ago by Murray Pollit, it more or less answers a lot of what I was wondering about:

 By FranSix

03/14/2009  7:09AM

Whether large gold discoveries destabilized economies with inflation in the past would require a huge effort in determining the relationship of yields vs. inflation and the track of the gold price. Since gold was fixed, the only other example we have is silver, which fell out of use as a standardized form of money.

A really excellent chart on that relationship is available in the 10-year T-bond yield minus inflation(scroll down a bit)


02/23/2009  7:26PM

No one will ever corner the gold market. Hunt Brothers tried silver. Almost did it. Lawyers changed the rules by govt. action. Broke Hunts’ play. Gold held by too many ideologically challenged people, banks and countries. Gold mined makes world richer. Don’t agree with comment below that discoveries 100 years ago destabilized gold. World needs capital. Gold is capital. Look what FRD price change in 1934 did for production and stability.
 By FranSix

02/23/2009  9:57AM

I'm glad to see the debate unfold and some historical perspective applied here.

One thing I would like to add is that in the last 40 years, gold has been abolished as money. Many gold mining projects have faced chronic corrections in the gold price as a result.

But prior history shows that gold was chosen as a monetary asset due to its perceived stability. (it only become unstable as large discoveries flooded markets 100 years ago.)

I would presume that this perception of stability is returning to gold as an asset, given the nature of the breakdown of financial assets, especially those associated with sovereign debt. The availability of gold is in decline, since no new discoveries of large gold deposits are know to exist.

A market corner is possible in gold, much as it had occurred in the oil price last year, though its still some time in the future. With a continuous rise in the gold price against all assets a central bank fix in the price of gold is also possible. (I assume it would be around $5k/oz. to eventually see a zero knocked off currencies around the world.)

I suppose the way to advance for this company would be to ensure that its shares are traded both in the pink sheets and the CDN venture exchanges. So far, its impossible to get a quote as the shares are unlisted.

I don't think labour availability is really a problem if you have subcontracted labour as you would in the forestry sector.
 By Hans Kummerow

02/16/2009  6:22AM

Rick and bluejay -

I agree with both you.

Let's get rid of the debt while gold prices are still near record highs.
And then let's go ahead and rebuild the collection on debt-free terms.
 By Rick

02/15/2009  5:33PM

First, thanks for writing back Hans.

Second, Bluejay, as always, direct and to the point.

I am encouraged that the current collection is now on sale as individual pieces. I've brought this up, many times, that the collection is worth selling (whole or in pieces)to establish a new solvent direction, debt-free to create a new collection that may just surpass what is current.

Let's remember that the current collection of gold specimens was accomplished with balanced books.
 By bluejay

02/15/2009  11:14AM

Our corporate vessel has a leak in it. We need to fix the leak before we can move on with anything else. We need to eliminate our debt and stop our shareholder blood letting in the form of continuing counterproductive interest payments. Until the board accomplishes this, I think discussing technology will prove to be futile.

The country is in the very beginnings of another Great Depression. Will the board please wake up and smell the coffee.
 By Hans Kummerow

02/15/2009  5:23AM

Here is my reply, Rick.

In the first place - I am not offended at all, Rick. We are all expressing opinions and here is my opinion in more detail.

In my judgement, the most cost effective way to exploit the Allegheny Vein System would be to repeat the success, that was achieved in the mid-nineties with the arrival of electro-magnetic detection devices.

Technological progress has been made since then. And more will be made in the future. It should now be possible, to create detection devices with a larger range and an improved signal recollection.
That is one approach that I would like to see pursued.

As soon as better detection gear becomes available, the neccessary funds for further development can be raised by collecting more gold inside the existing workings and selling them in the market-place. As bullion or gold-laced quartz-cristals or any other marketable form.

That is what I mean by relying on own forces. Let us pitch in our talents and skills to create better detection gear and put it to use without a lot of capital expense.

I'll check again tomorrow to see, if that has answered your question, Rick.
 By Rick

02/14/2009  8:04PM

Hans, it's instructive that you are reading our responses. In case you didn't notice, allow me to point out that I, for one, disagree with your notion that wiating on the sidelines has any merit at all.

I'm sorry if that possibly offends, please understand that it is not meant personally.

It just didn't make sense to me. For the mine and investors to wait around, as perhaps you read in my previous comments, one has to wonder...wait for what?

Let's move ahead instead.
I'd like to ask you and hope you answer:

Given the historical success in both recovery/ton and this mine's unique potential, why did you write what you did?
 By Hans Kummerow

02/14/2009  1:33AM

I would like to thank every writer for presenting his own view on the subject of cost-control in hard rock mining in the Allegheny Mining District and how to best exploit this truely amazing vein system.

Relying on own possiblilities is a successful strategy in difficult times. Don't spend money or pledge valuable assets against credit. Rely on own talent.

Get rid of existing debt that might strangle the property as soon as gold prices start to decline for some unforeseen and unlikely reason.

And wait for better chances to raise capital for new develepments from proceeds of the mine itself.

If the only thing that used to be sure at the Origsix in the past, was the fact that the next winter season will arrive, there may be another thing that will prove true in the future as well. Technological change will happen.

02/11/2009  8:41PM

Hans, don’t know where to begin but here’s a start. Development is the answer for the Sixteen to One mine. Working capital is the issue, not line item costs.

There is no known gold deposit on earth more richly endowed with gold than the Alleghany Mining district in California. It’s focus is a long lasting producing company of consolidated mines with reported production from 1854 to the present (over 1.5 million ounces), mines with different claim names but all included in this small northern district under one ownership. You must read and study two important statistics that Mike posted under the NEWS heading: “What is a High-Grade Gold Mine” and “High-Grade Pockets Found in California”.

Let me start your study with “What is a High-Grade Gold Mine” first. The numbers span a twenty-year history of only high-grade reported production. The percentage column shows the percentage of total production came from separated high-grade. The remainder of gold (to 100%) came from the low-grade mill run. Look at the first two columns, total ounces and pounds of ore. It is POUNDS OF ORE! It is not tons of ore. The grade is 1.25 ounces per pound! Not tons! This grade computes to 2,500 ounces per ton. The great major gold producers today measure their gold assay at grams per ton. A grade of .03 per ton brings them bragging smiles. Wow, the Big Boys only needs to mine 100 tons to get an ounce of the yellow stuff. A 100 tons of ore at the Sixteen to One statistically yields two million five hundred thousand ounces of gold. One ounce can be found in less than a pound of ore.

The size of all the high-grade ore during the twenty year span is about sixty tons. These miners break about fifteen to twenty tons per round, depending of the ground. The second column shows the actual ounces of gold for that year from high-grade or 165,512 ounces of fine (.999) gold. Statistically the twenty-year production could come from four days of mining. Well, that is very unlikely or is it?

Study that chart. Put dollars to the numbers and then today even at a gold price approaching the $1000 per ounce stratosphere, this Sixteen to One gold has a market value far greater than the spot price. (Mike doesn’t mention this too much but specimens bring two to ten times spot and the gemstone market sometimes brings more.)

Is this just a crazy dream of people, sometimes called gold bugs? Has all the gold from the mines owned by Original Sixteen to One Mine been mined already? For the answer, ask any geologist familiar with the property. Now go to NEWS and look at “High-Grade Pockets Found in California”. Number one was over 83,000 ounces. It is right off the 800-foot level. In fact the miners walk or ride past this pocket regularly. Mike doesn’t publicize everything about the mine. How could he, there is so much information; but maps are available that show the trends of the pockets, the size and more. A dreamer, no; a visionary, no; a trained eye can make credible projections about the future for mining in this one of a kind high-grade gold mine. If anyone doubts this, look at the notable gentlemen who financed or worked in Alleghany, who succeeded in finding gold. Gold bugs? Humbug, they were businessmen, adventurers and gold miners.
 By bluejay

02/10/2009  11:10PM

Today I listened to Jim Rogers state on a recent YouTube interview that because capital markets are so tight that it will be another 13 to 14 years before a major mine is constructed again.

With the government intent of capping the gold price in the $920 to $925 area, how much longer will it be before the $1000 area is breached again when general attitudes about investing in gold mines chnages to positive?

With the DOW Jones Averages appearing to lose footing in the 7900 to 8000 area, it appears gold stocks, because they are stocks, may suffer if the DOW suddenly starts cascading downstream again. What I am saying is enthusiasm for investing in gold stocks may take a hit in the coming weeks, to a month or two.

I don't believe we can rely on outside help until gold gets firmly placed over $1000 an ounce or until the gold shares move much higher. Too much propaganda has been pushed against gold and gold shares as an investment by the banking controlled media.

Why can't we get contract labor back in the mine and cut these guys in for a percentages of their finds?Also, let's lower our selling prices on our gold specimens to market levels where transactions can take place in an attempt at reducing our debt and getting labor back in the mine hunting for gold again.
 By Rockroby

02/10/2009  10:23AM

I agree,we need to get the stock moving in the marketplace.If people see more movement they will go to the website,see the gold this mine can produce and maybe say hey I want to own a piece of this mine.If given the chance Mike can and will find the biggest pocket ever found in the mine.Lets give him that chance he deserves it.The stock went up .24 cents a share today lets get in their and put in bids & tell all your friends to do the same.
 By Rick

02/09/2009  5:51PM

This latest discussion on cost anaysis, new innovation robotics, yet-to-be-proven and still conceptual modern metal detection devices, side-line sitting (perish the thought) all bring to light a huge question that I need some help understanding:

How is it that many millions of dollars, and actually millions of ounces of highgrade gold, have been mined from the veins of the Original Sixteen to One vein system, whether micro-vein or the thirty-foot foot-wall to head-wall potential...how did this happen without all these new theories?

It seems to me that the best cost-control is to go mining NOW, the effective way the mine has historically been successful. Get in there, break rock, muck, break more rock to find the pocket, use the best technology now available to identify the most beautiful gold-in-quartz on the planet, bring it up and cheer; go back, do it again, true methods in place.

It has baffled me that investment potential must be sitting (waiting?) on the sidelines for something better to come along. The double-jack did the job and nobody was sitting around waiting for pneumatic drills. The true potential is just sitting there with an amazing successful historical outcome for all to see.

When (not if) technology advances and more cost-effective method shows itself as a viable alternative, upgrade.

This procrastination is like wondering if the baby should ever need to have a bath...and waiting around to see if someone can come up with a better bathtub.
 By Mark Wolff

02/09/2009  11:56AM

My understanding is that management has embraced advances in metal detection for some time now as an R&D priority, perhaps having already run up against practicality limits. Sophisticated technology like robotics, to be differentiated from remote-operator control (available now), won’t come knocking at the door…such innovation arises from necessity, a compelling reason to change the way things are done. In the presence of inexpensive substitutes and entrenched industry practice, the hardrock niche remains too small to warrant expectations of a complete, integrated solution anytime soon.

An analogous situation plays out before our eyes now in the debate over economic stimulus measures. Billions in aid for ‘education’ is the issue, brick-and-mortar capital projects to create jobs and train people for better jobs, etc., yet our leaders ignore the carbon footprint aspect to bringing students to such schools each day in order to learn, and more importantly, that for a decade now, jobs have been going to places like China and India where the Internet enables folks to sit in virtually on lectures given at MIT or Harvard by the very best at their discipline. Does anyone hear calls from Washington for developing home-study via Internet as a serious alternative to hiring more ‘teachers’ and building more classrooms? It would seem that teacher’s unions and vested interests will prevail, our newly minted graduates left to wonder at competitive realities which ‘outsource’ brain power from abroad, much as is the case too in resource extraction labor economics.

My recommendation is to aggressively pursue solutions conceptually, relative to specific challenges at the 16-to-1. My other recent posts on the ‘thin veins’ thread about thermal fragmentation methods as an alternative provide bait for the curious, even as the veins at Alleghany may be 30 ft. thick in places. A couple of years back I wrote to Mike and he phoned back to discuss remote-operator controlled methods, something clearly beyond budget practicality at the time, yet as things are with ‘maintenance’ status at the mine, necessity as mother of invention begins with finding better ways, which in themselves could attract investor attention.

Rather than give away the shop posting more tech ticklers on this forum, it would be nice to see if this thread can stimulate discussion regarding strategic investments in R&D as a managerial imperative over incremental production targeting, towards maximizing shareholder value. Now that zero-emissions monitoring standards couple with worker safety ‘best methods’ practice as socially responsible investment criteria, especially in today’s capital markets, anything less remains clouded by perceptions of unpalatable risk, which is why Origsix languishes in need of capital infusions. Beyond defensive measures, per your suggestion, to protect and ready the 16-to-1 for beneficial innovation to come, contemplating such alternatives available today also makes sense, doesn’t it, in seeking data useful in arriving at meaningful cost/benefit capitalization estimates for future production scaling via creative new application solutions, as a way of amortizing anticipated R&D over longer terms?

If you build it, they will come, and like Tom Sawyer’s fence in need of whitewashing, players will arrive for their own reasons, if management is clever in forging alliances with component providers who clearly perceive a positive stake in expanding their markets to the underground. If it’s the sizzle, not the steak, of reserves holdings facing ready markets offered up by management today, why not try adding tech innovation as a more familiar entrée to the back burner, or should that be the one up front? Investor appetite for geologic risk is renown, measured still in g/ton and share prices, and so it also goes with such estimates of market size and share, so remove the unsavory other risks from the mix with improved designs, and capital should arrive to make a meal of your core asset, tempted too by demonstrated leadership in innovation and ancillary revenue potentials from commercialization of promising ideas elsewhere.

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