Portex Minerals Inc STACF

Proper use of IN-SITU VALUATION

[random88]

Just because many people use it, does not mean that it is right. Just like the eye ball counts in the world of internet, In-Situ value is the giant number in the mining world. The rule of thumb is that cheaper the metal is, less the relevancy the In-Situ value is. In case of PAX, the effective grade should be somewhere about 6%. Basically, the first 6% should not count, bank will only fiance a project based how much ore exist at above 6% Zinc equivalent. (Indeed, this is not a accurate statement either, since it hugely over simplified mining financing.) There was a joke in mining financing community. Assuming half of the mines in the world is unprofitable, what the metal price would be. Let use that number, and see whether your project will hold water or not. Just imagine, if Harlan cannot handle a high grade small ore body project like Wolverine, how he even think about attacking a project like Selwyn. There is an interesting excise to anyone interest in this subject. Look at all the Zinc producer, and try to figure out the break even grade for each company. Then, you will see something very interesting -- the breakeven grade is vastly different from one mine to another. From that point, you will start to understand the stupidity of In-siut valuation.