RE:new 43-101
Firstly I don't think that the 500m SW extension will be included. A comment in the recent NR said that they wanted to drill this area further in order to ''get a resource estimate. I might be reading it wrong, but my guess is that 18 holes in an area that is 600m wide, 500m long and 500m deep is insufficient for SRK to give anything for the 43-101. The last 43-101 which was 1.3mil oz covered an area of 650m long, 600m wide and I think around 500m deep (if anyone knows better then please correct me). I am ignoring the 2 deposits (F15 and F17) on the Murghor Cliffs property. The new resource estimate will be based on the main zone that is now 850m long, 600m wide and a depth which I am guessing is around 700m. They will also get some credit for the deposit under the Red Dog, which is rich, but only 3 holes can be included in the resource estimate so I’m not expecting a large amount of ozs to be included. My back of a cigarette packet calculation therefore goes like this. 1) Assume previous 1.3m oz in the old gold zone is improved by the drilling that was done in the Spring and Fall 2013. A modest increase will move it up to 1.6m. 2) The previous 43-101 was made up from a volume of 650X600X500m = 195mil cubic metres. The new gold zone is 850X600X700 (my guess) = 357mil cubic metres. 3) That is an 83% increase so the conclusion is the 43-101 will be around 2.4m plus whatever they get for is under Red Dog and maybe a little something for the 500m SW extension. 4) In summary I think that the 43-101 will double. Now if my assumptions in 1) and 2) are too low, the 43-101 will be higher. I’m a complete amateur but I do like to have some sort of logic when I am investing in gold mining companies. I think that the current market cap of EAG is very low compared to what they might have in the way of gold deposit in the ground. The aerial IP that they have done could lead to further deposits that are similar to what is currently in the main zone. If that is true then this project could get very big in the next year or so. Rubicon has 2.8m oz of mineable gold of a similar grade to EAG and their market cap is $1/2Bill. They have plenty of cash and are further down the line with PEAs and infrastructure but it gives an idea of where EAG could be.