RE: Mackie Report Ounce Total....
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National Instrument 43-101 (the "NI 43-101" or the "NI") is a mineral resource classification scheme used for the public disclosure of information relating to mineral properties in Canada. The NI is a strict guideline for how public companies can disclose scientific and technical information about mineral projects on bourses supervised by the Canadian Securities Administrators.
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Disclosures covered by the NI 43-101 code include press releases of mineral exploration reports,reporting of resources and reserves, presentations, oral comments, and websites
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Plainly put, the purpose of the National Instrument 43-101 is to ensure that misleading, erroneous or fraudulent information relating to mineral properties is not published and promoted to investors on the stock exchanges overseen by the Canadian Securities Authority.
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The NI 43-101 was created after the Bre-X scandal to protect investors from unsubstantiated mineral project disclosures.
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"The gold reserves at (Bre-X's) Busang were alleged to be 200 million ounces (6,200 t), or up to 8% of the entire world's gold reserves at that time. However, it was a massive fraud and there was no gold. The core samples had been faked by salting them with outside gold. An independent lab later claimed that the faking had been poorly done, including the use of shavings from gold jewelry. In 1997, Bre-X collapsed and its shares became worthless in one of the biggest stock scandals in Canadian history."[citation needed]
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The promulgation of a codified reporting scheme makes it more difficult for fraud to occur and reassures investors that the projects have been assessed in a scientific and professional manner. However, even properly and professionally investigated mineral deposits are not necessarily economic, nor does the presence of a NI 43-101-, JORC- or SAMREC and SAMVAL-compliant CPR or QPR necessarily mean that it is a good investment.
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Similarly, the publication of a complex technical report with all the inherent jargon, technical wording and abstract geological, metallurgical and economic information may not actually significantly advantage an investor who is not able to fully nor properly understand the content or importance of this information. In this way the NI 43-101 may not serve the interests of those it is designed to protect— the retail investors who may easily misinterpret such information.
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Bre-X first soared to $280 per share, a $6 billion valuation, and then collapsed to zero.
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The NI 43-101 constrains what a company can say about it's resource. It doesn't necessarily reveal what is actually in the ground.
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A good example of this is Goldcorp's $3.8 billion purchase of Andean with a 3.1 million oz. NI 43-101 resource in Argentina. Goldcorp was criticized by many for extremely overpaying for Andean. Goldcorp's management and geologists knew better. In about 6 months Goldcorp's drilling proved up a 43-101 resource of 5.4 million ounces (doubling reserves to 4.3 million ozs.) – I'm sure Goldcorp pretty much knew this when they purchased Andean.
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So to answer your question Tony, the 5.5 million ounces is an intelligent but conservative estimate by McClintock of Oromin's world-class project. It is not something that Oromin can say because it is not 43-101 compliant.
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So much appreciation to John McClintock for having the guts to reflect (conservatively) what is the reality. That reality is that Oromin has a whole lot more gold than their NI 43-101 3.8 million ozs. That number is probably a lot closer to 9 million ounces than 5.5 million ounces.
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This is what Oromin writes in their corporate presentation:
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OJVG’s updated resources at its 8 gold deposits, 7 new discoveries and targets along with the large additional mineral potential identified will allow for a significant expansion of the mine plan as outlined in the 2010 Feasibility Study
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ADDITIONAL MINERAL POTENTIAL: Based on the interpretation of known zones of mineralization, an additional 24 to 47.5 tonnes of mineral potential grading from 2 to 4 g/t Au is targeted beneath 4 of our existing deposits.
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We believe that the total mineral potential at the OJVG Gold Project will ultimately exceed 9 million ounces gold – an excellent base for one of West Africa’s next large gold mines
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They can't legally say any more.
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Also note that nobody gets paid for more than 10 million ounces. The discounted value beyond this is almost zero. 10 million ounces at a huge 500,000 ozs. per year would last 20 years.
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It's time for one of the big boys to own this project.