The annual meeting attracted the highest percentage of shareholder proxy response and attendance in the company's history. The board of directors presented in Newsletter No 20 was confirmed and Johan Raadsma, our mine manager since 1984, became the Company Vice President. We are looking forward to working together on the challenges and opportunities before us, some of which are outlined here.
In late May, the Company negotiated an option with our largest shareholder allowing us to purchase 500,000 share of his stock at $1.45 a share. Re-issue of these shares at a higher price will allow us to raise a significant amount of working capital without diluting existing shareholder interests. As the stock stands at $2.50, it appears that this agreement represents a significant new company asset. The option cost $25,000.
Media interest in the Sixteen to One gold strike ahs been sustained. Since the last newsletter, the Sixteen to One has been featured on CBS national radio; ABC national television: CBS television based in Reno; the Associated Press; the front page of the Sunday San Francisco Examiner; Globe magazine; and USA Today, as well as on local television and radio and in local newspapers. The Discovery Channel was up at the mine last week, filming a show for presentation in the fall, and the cover article in the September issue of the Gold and Treasure Hunter will be devoted to the Sixteen to One.
The strike has also received extensive coverage internationally. It was the subject of a two-page center spread in Today, an English tabloid with a circulation of 1.4 million, and has been featured on television, radio and newspaper coverage in Japan, Australia, Canada and Germany.
Exploration of New Technology
Metal detectors, successful though they have been, only provide reliable gold detection up to 8 inches into the quartz. Geologists have compared the Sixteen to One ore body to a big bowl of plum pudding. We continue the quest for a method to locate plums deeper in the pudding. The greater our capacity to detect gold deep in the quartz, the more efficient, low cost and profitable our mining will be.
We are currently exploring ground penetration radar (GPR), nuclear resonance and neutron activation technologies, each of which has a potential for deep gold detection (6 - 8 feet for GPR, as much as 410 feet claimed for neutron activation). To avoid wasting money on equipment unproven in the mine, we are offering the Sixteen to One as a testing ground for the companies developing these technologies, with each side bearing its own costs in the equipment trials.
Status of the Mill
As those of you who have been following these newsletters know, the Sixteen to One acquired its own mill in April 1992. Most necessary renovations were completed as scheduled in June, and milling began on July 13, 1992. Selected stopes (underground explorations) surveyed by meat detectors contain about four thousand tons of rock with good potential for gold recovery. It is difficult to predict the value or grade, but we expect to recover about 1,000 ounces of gold from this rock by September 15, 1992.
De-watering the 2400 Level
Only the 2400 level of the mine remains under water. The 2400 is a long level dissecting ore zones, so it is a good target for the type of detection that has been successful over the last six months. The miners will begin lowering pumps during July to remove the standing water, and we hope to have the level clear in August.
A major television newscaster has expressed interest in covering our first explorations on this level of the Sixteen to One to be reclaimed from the flooding of the 1950's.
Part of our excitement about seeing this level open again stems from a story many of us at the Sixteen to One have heard for years. Legend has it that a miner leaving the level at the start of the flooding tripped while carrying out a piece of high-grade the size of a watermelon. The gold supposedly fell into an underhand stope below the water line and was never reclaimed.
You can think of us next month doing our best to prove the story true by recovering the long-lost gold.
Michael Meister Miller