From the yahoo board
I spoke with Jim Bagwell today for another 8 minute conversation. I was curious as to why the mill recovery rate dropped in the 3rd quarter from 85% to 71% after going up from 48% in the first quarter. Jim told me that this was due to the quality of the ore being run.
This lead me to my next question as to why the ore grade had gone from .27 ounces per ton to .12 ounces per ton and finally to .08 ounces per ton. Jim explained that during the 2nd and 3rd quarters the mine was still organizing the underground and some of the areas that were mined to get access to higher grade areas had lower ore content. This process has been mostly completed for now. ( In a working mine this is an unavoidable side effect. If you mine through lower grade ore to get to the better grades and you have the capacity, you might as well process it.)
I asked about changing the mining rate up to 700 tons per day and Jim told me that first they needed to get to 450 tons per day. They would also need to obtain permits to operate at 700 tons per day, existing permits only allow 450 tons per day. Jim also thought that increasing the permits to 700 tons per day would not be a long involved process. The Mill is currently capable of 700 tons per day.
Finally I asked about the current schedule at the mine. I was told that the mine is running two shifts 7 days a week for a total of 16 hours a day.
Hopefully the 4th quarter will show improved numbers over the 3rd quarter. We can take a positive note from the fact that the amount of mined ore has gone from 10,353 tons in the first quarter to 17,116 tons in the second quarter to 27,066 tons in the third quarter.
As always this conversation is second hand. Take responsibility for your own investments and do your own due diligence.