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American Bonanza Gold Corp ABGFF



GREY:ABGFF - Post by User

Post by materialsgirlon Feb 08, 2012 9:25am
361 Views
Post# 19504067

Not bad not great

Not bad not great

Oops.  I just saw the press release*** It contains nothing worthy of note.

(1) not bad.  It is saying that they started trying to get production going in November 2011.  They ran into several processes that need to be debugged and they are progressing incrementally towards full production. Full production of 45,000 to 50,000 ounces annually will start in July 2012.  This would be about 4,000 ounces per month  or $6.5m in gross revenue per month.  They hinted that grades may be higher than the business model so this is why we could produce a lille more than 46,000 ounces

(2) Not great.  All miners hope to avoid a slow ramp up that takes 6 to 8 months.  BZA hoped for this.  But it did not happen.  It hardly ever does.  In our case we had second hand used mining gear so this added some risk.

The above comments are my interpretation of the underlying meaning and my projection of specific timing and profits.

The great news is that we have no debt and we will have between $3m and $4m in net profit per month after all expenses within 4 or 5 months.  It feels good.  Good execution in mining and reserve expansion and $1,800 or $1,900 gold should produce a share price of over $1.  It is worth waiting.

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