Mill permit, very high grade assays and production imminent. The churning of volume in the stock ought to stop when we receive cash flow from Newmont direct shipping ore, along with permitting of the Bishop mill. We will not have to pay any toll milling charges to Newmont once Bishop is up and running, since we can crush, and screen the ore with several different extraction methods. I expect that the pending permit grant is imminent and that stockpiled ore will soon be put through the Bishop mill, which will reveal exactly what the blended average of the high grade core will be, and what the percentage recoveries will be. My guess is that it will be in the neighbourhood of 2.5 to 3.0 ounces per tonne with a recovery rate of 93%. In addition to this, CMC will recover a certain amount of costs upfront before any revenue sharing begins with PB, and PB will have to pay CMC for processing 50% of the ore due to PB for custom toll milling charges. If we are fortunate, then I believe that the AISC per ounce of production could be as low as $565. Since the plan is to mine this very high grade core which could contain 100,000 ounces or more, then CMC could net a profit per ounce of about $635 based upon $1200 gold today. Obviously, we are highly leveraged if we get into a gold rally and prices take off to the upside. If we get $2000 gold, then CMC could become a market darling and with additional profitability, the mill and mining operations could then be expanded. At $1200 gold today, and 2.5 ounces per tonne average, that is $3000 revenue per tonne of ore processed. So, what are the input costs to CMC to mine, mill, ship, process just one tonne?
I know that there are certain fixed costs regardless of grade, and only management will be able to quantify and calculate precisely what these costs will be once Bishop mill is fully operational. Even if I am wrong about the $565,
and let's say cost turns out to be somewhat higher like $750 per ounce, we would still net a profit per tonne of $1125 at a grade of 2.5 oz yield, based on this current $1200 gold price. ($750 X 2.5 = $1,875) or ($565 X 2.5 = $1412.50) At $2000 gold, one tonne of ore would be worth $5000 less our costs per tonne of $1,875 which would net a gross profit of an amazing $3125! It is no wonder that the conservative price projection is in the .50 cent area. We are finally getting very close to realizing the upside that we all have been waiting for.
A little patience is in order right now, since we are so very close and the golden prize will be awarded to shareholders. Since the Silver Hart project in the Yukon is so high grade, it is a natural that steps should be taken to secure a mining permit as quickly as possible. I don't think that it is fair to impose restrictions on the extraction of a bulk sample regardless of the grade since CMC could provide jobs up north and then demonstrate to the Yukon government how Silver Hart could become a viable producer and help the local economy while generating revenue too.