Some more numbersPresent guidance for 2020 is 325-365, 000 ounces. from mill heads between 7.6 and 8.3 grams per tonne. Lets say 340,000 is achievable . How do we cross check this ?? 340,000. corresponds to 85,000 ounces per quarter.
Well as I have previously posted, 2019 production strongly indicates that quarterly production was very close to 10,000 ounces per gram of head grade. This fact is pretty well independent of milled tonnage which is a reflection of the well known mining fact of life that grades tend to decrease as tonnage increases. The recent practice of milling 5 gram marginal ore shows this .
So can we better refine the likely expected head grade. Of course we can. 85,000 = 3800 X 91X 0.97 X ??? /31 where ??? is the head grade. Arithmetically this computes to 7.86 grams per tonne.
Now all these values are within the ranges provided by management. So before anyone jumps down my throat and suggests this is unrealistically low, consider the following. In the Q+A portion of last weeks dog and pony , Joe O stated that these guidance values were preliminary and then a few minutes later , re-iterated that these numbers were very provisional and we had to wait untill March for numbers we could rely on.
Call me a cynic if you want , but Joe's history of mis leading statements plus his natural lawyerly ability to avoid answering questions in a forthright manner, makes me suspect that he is a lot more confident about the low end of guidance rather than the upper.
If Q1 does come in at sub 8 gram , it will have a lot of influence on the reserve restatement. Mill heads have been dropping steadily ever since Q2 2018, almost two years ago. POG is an unknown quanity and it goes up and it goes down. What external influence can be relied on to reverse this trend?? That is why I am still bearish.