RE: RE: My conclusion and calculation The difficulty in lowering the cut-off grade will be in coming up with a lower processing cost per tonne. Based on their $16/tonne cost, an incremental ounce of production at 0.4 g/t would cost $1322/ounce just to process (excluding the mining cost). ($16/(0.4/31.1*94.1%)). A cut-off of 0.3 g/t would cost $1760/ounce just to process.
Based on the total cost of $29.30/tonne, mining cost of $2.00/tonne and processing cost of $16.00/tonne, I calculated an implied strip ratio of 5.65 tonnes waste:tonne ore and cash costs of $880/ounce. The strip is high relative to Osisko's 2.28 - however, this should come down if the cut-off is lowered.
The key will be to increase the size of the mill they are assuming in order to reduce processing costs. For reference, Osisko has a mill cost of US$5.66/tonne and recoveries of 85.8% and use a cut-off of 0.3 g/t. Incremental ounces at those assumptions cost $684/oz (or $1026 @ 0.2 g/t).
I assume the second 43-101 would look at trade off studies to increase the size of the assumed mill, thereby decreasing the cut-off grade. I wouldn't expect anything below 0.3 g/t though, based on Osisko's numbers.