RE: Are the grades high enough ?Fred,
In my opinion you are asking exactly the right question, and as SEA's fate hangs on the answer I wish I had it for you. The grades are low, no question, and it will take a lot of confidence in sustained high metals prices to put both KSM into production.
You asked, "if a major has to put up a minimum of $1.5 billion to put the propertyinto production at 30 or 40K tpd and has an all-in operating cost,including copper credits, of $650 per ounce, is he going to be anxiousto pay SEA $100 per ounce for the gold in the ground ?"
As we go through this financial crisis, and as the US dollar crumbles, eventually asking about operating costs vs. the price of gold as they are denominated in US dollars will be meaningless. Once the US dollar crashes (in a more dramatic sense of 'crash' than we have seen so far) KSM will look like a dream, due to the flight of capital to hard assets, and the need for the US (and Canada by extension) to export something valuable. But the life of mine would be decades, and who knows what will happen beyond the crisis which we are now in... we are looking at a new world monetary order, and what does a lot of low-grade gold in the ground mean in that context? Wish I knew.