This discovery is big , but not that big.
TwoSides2aCoin
Posts: 44,364 ✭✭✭✭✭
TwoSides2aCoin
Posts: 44,364 ✭✭✭✭✭
TwoSides2aCoin
Posts: 44,364 ✭✭✭✭✭
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We just need to find a mine 450 times larger to settle our debt . That’s about 36 trillion. And it still won’t pay the miners wage.
supply affects price. Be a while before it hits the street.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
It's a non-event.
First, the size of the claim is likely exaggerated by thei Covid Bat Media.
Second, it will take years to access the ore.
Third, we don't know if the ore is economical.
Fourth, assuming a 20-year average lifespand, this is about 50 tons of gold per year which is about 1.5% of the annual gold mined.
You might be completely wrong on all points. I prefer to be open minded.
All valid points. Media and typical exploration geologist's hype. The high ore grades stated are questionable.
I would need to see more detailed 3D, mapped angled core drilling grade results, stated per meter and along depth to get a clearer picture of this deep underground mineralization.
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I could...but they just issued a press release less than a week ago. You know how long it takes from press release to mining gold ?
It takes YEARS.
The amount is not a market mover -- it's easily absorbed by current or future demand. Central Bank selling would be a game changer.
This is NOT another Bre-X, pre-hoax (look it up).
Goldminers here is a geologist and actually worked for a mining company....he can tell you better than I can even if the find is legit and the ore profitable, it's a small amount relative to existing production AND it will still take years to hit the market. Probably 2030 at the earliest I would guess.
That's like saying you have a 40 acre gold claim that on average is yielding a half gram per ton...your a millionaire, you just have to get it out of the ground.
Actually, I am a mining engineer. Being called a geologist, is a bit of a downgrade
Geologists get paid to find mineralization and they always hype it as if it was just there for the taking. Mining engineers evaluate all aspects of their discovery to evaluate, cost, design, and develop operating and financial strategies to see if the mineralization can actually be an ore deposit and mined economically. Once it makes preliminary economic sense on paper, then financing needs to be obtained and multiple years of feasibility studies need to be reviewed and vetted, just to see if the projected returns are adequate to justify billions more for project capital approval for construction and development.
I was directly involved evaluating major gold deposits all around the world for more than 25 years. I am not even counting the first 15 years I worked in operations both surface and underground in several mines just to gain the experience needed to even understand what is really involved to develop a greenfield project like this into a producing mine. I could go on for days, just trying to explain some of the details involved.
This is a great set of drilling results worth pursuing significant, additional evaluation on mining methods, milling design and recovery, development costs, metallurgical studies, community and environmental impacts, etc. It does seem to have major potential to generate future ounces that will mostly all stay in China.
It will have minimal impact on any actual new gold supply or pricing in the worldwide market for probably 10 years or more, and gold production will mostly just replace other gold mining operations that shutdown in the meantime.
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My apologies, I will try and get you knighted and address you as "Sir" in the future to make up for it.
Great analysis and commentary, seriously.
If you have seen this chart of gold supplies over the decades, do you think we have seen the last of the huge ore finds...or do you think some Permian-fracking gold renaissance might be in the future but we just haven't hit on it yet ?
I also wonder what it is with the geology of those deep mines in South Africa that led to such a small area having such prolific gold production. Even oil wasn't as concentrated in the Middle East as gold production was in a few deep mines in SA.
Is this a report from the Chinese State Media?
Knowledge is the enemy of fear
The SA reef mining districts are not small. The geologic mineralization area extends more than 40 miles wide, but the ore zones are only about 1 to 3 ft. thick, and the current mines are around 6,000-13,000 feet deep. The problem is they are very high cost. Even though the ore grades are high, a lot of waste has to be moved and hoisted. Conditions for the miners are unbearable with underground rock temperatures of 120-140 degrees which requires expensive ventilation and cooling.
The China announcement talks of 1,000 tons of gold; by comparison, the Witwatersrand Gold Fields historically already produced half of all the gold ever mined in the world, around 1.5 billion ounces or 50,000 tons.
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It's amazing, really. We see gold mines talked about in TV shows and you think it means big chunks of gold sticking out of the rocks and you just have to clear away dirt and maybe 5-10% of the total mass is gold.
I think it's like 1-3 grams out of like 4 or 5 wheelbarrows of dirt or something like that....like 1% of 1%, right ?
Amazing when you think about it.
Most all numbers I am used to for mining evaluations, from working overseas, are metric. So, 1 gram per metric tonne is only one part per million. Your 1% of 1% is 100 parts per million, or similar to 100 grams per tonne.
The very highest grade current underground mines in the world are around 10-20 grams per tonne mined, or about one-half an ounce per tonne mined.
Keep in mind the ore grade drilled reported by geologists is often nothing like the ore grade mined, due to the waste that is required to mine to get to the ore, and due to the ore dilution with the waste around it after blasting, etc.
Mining is a very tough business, and it requires a lot of engineering expertise to make it profitable to mine, regardless of "how much" is found in the ground.
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Absolutely.
It's why a rising price of gold hasn't been enough to make many of the companies' stock prices take off. They've done terribly and if you told them 10 or 20 years ago the price of gold would be 3-5x higher, they'd have thought they'd be minting $$$.
It's much easier to bring liquids (oil) or gas (natural) out of the ground than it is solids like gold.
"Bigly", perhaps? "Wash, rinse, repeat. Here we go again. SMH! THKS!!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
>
Yeah, you shouldn't have taken Goldminers' career for granite!
**That's pretty good ground, any hobby miner would like to work those numbers.
**
A few of you either missed the point or just wish to ignore it. It’s not enough gold to pay off our deficit. And those who say it takes “years” to see any effect , that there won’t be any…. etc., are some of the same who predict five or $10,000. per ounce gold in five years.
It is a link from Yahoo. they might be an arm of the Chinese State Media. I don’t know.
Obviously, I agree with you if your point was to compare the feeble size of it with the US debt. A discovery of this size we likely wouldn't even be allowed to mine it here, due to US environmental regulations, lack of public support, and delays in permitting.
The US federal debt will never be paid off, it will only be extended out into the future. The best I expect is the government will keep paying the interest on the treasury bonds I hold.
PS. I have never said anywhere that I believe gold will be $10,000 in 5 years. I have been selling my gold collections and registry sets at GC. If I thought gold would go up that much, that soon, I would not sell any of it.
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It was a rhetorical question, as the article clearly cites the CSM as the source.
Knowledge is the enemy of fear
https://www.yahoo.com/finance/news/geologists-might-stumbled-upon-largest-133000185.html
Same rhetoric, different day
Look, I'm bullish on gold and hope the price doesn't rise too much before I can add some more gold coins.
But worrying about monetary debacles like the 1970's isn't worth much time. What if it takes 50-100 years for the bleep to hit the fan ? You have to live in the Here and Now and that means using dollars to buy everyday stuff and also investing and generating a decent return, not sticking with something that may or may not appreciate and pays NO dividends and NO income.
Most of the Apocalypse Now crowd have uninvestable points of view that would require people to lag the financial markets for years or decades. That simply isn't logical. Neither is using a BRICs or EU or SDR or other currency in place of dollars for a country whose home currency IS the dollar.
Dude …. It was a simple article about the amount of gold found. Don’t get all philosophical on me.
I agree with the OP...it's not that big. I wouldn't be surprised if the ultimate recoverable is maybe 10-20% of the original "find."
Here's an excellent analysis of the problems of gold mining companies and stocks using what was once the best-managed gold company in the world, Barrick Gold.
Registration is free. The analysis is done by Paul Sankey, probably the best oil analyst and an old colleague of mine from decades back. Though an energy analyst (and a damn good one !), Paul's comments and analysis are applicable to miners as he was saying the same things about energy companies for years:
https://sankeyresearch.com/2024/11/23/thematic-gold-a-personal-history-with-ice-cream-mixers/
Registration is free and you could do worse than read his comments on the markets (including oil). Paul was the first analyst to call for NEGATIVE oil prices in 2020.
One of the main reasons mining companies are risky investments is clearly evident in what is happening to Barrick in Mali. Newmont in Uzbekistan several years ago, etc. It is tough to do business overseas when the contracts you sign are declared invalid and your executives are imprisoned for ransom to get extra millions for the new folks who took over the country.
Barrick's CEO has an arrest warrant for him in Mali and their large mine there will not provide the returns envisioned. Look at the stock vs gold, totally flat during one of the largest gold price jumps in many years.
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GM, not sure if you read Paul's commentary, but this new mine -- even if it has the promised ore -- is in the middle of nowhere...there's no infrastructure at all....and you are basically trying to enlist the support and find labor from warring tribes and ethnic groups.
You might need $3,500 gold to make the promised ROIC..and even then...who knows ??
It’s a hot mess