NWM Mining Corporation NWMMF

Drop in oil price from $100 to $55 per barrel

[production05]

We`ll have to wait and see if it can save our bacon. There is a good chance of it heading down to $40. A prominent UAE minister said yesterday that OPEC is not willing to reduce oil supplies to the market until the price gets to $40. All mining operations uses significant oil/gas, including NWM`s heal leach operation. Though, it`s not clear how much of the energy usage at the operation is oil/gas vs diesel. I guess it doesn`t really matter too much due to the significant fall in diesel price over the past several months also. Hopefully this will all contribute materially to reducing the Q4 and Q1 cash cost per ounce. if the gold price remains at $1200 per ounce then we can start realizing a decent margin again. They had rain/flooding problems in the main pit in Q3 and (per the MD&A) it looks like it will impact gold production in Q4 also. Hopefully they can get everything back on track in Q1, and also start incorporating significant fuel price savings in the cash cost per ounce. If the gold price stays at $1200 per ounce, or picks up, perhaps it will enable them to make a stronger pitch to a lender to refinance the debt.