That is interesting but I think this model only works where gold is not the primary mined metal but can be used for credits to bring the overal cost of mining down. That it why this model works so good in silver. Silver is almost always the byproduct of mining something else.

Not so fast! Gold Wheaties can work for small primary producers as well. Say I'm a small mining co. with 2 M oz's. but no money to get them out of the ground. I can sit around waiting for a buyer, I can go to a bank and try to get financed (which means hedging future production) or I can go to GW. It's the same as dealing with a bank, except you're dealing with miners who have a better understanding of the industry, and will be more flexible in their terms.

I think GW may be the go-to company for juniors who want to get a mine up, but can't attract a major, and don't like the bank terms. I think the market sees this too, which is why the shell co. jumped 50% on the news.

For the investor, this is a great way to play gold without the risk of being slammed to the mat by any number of factors, with which we're all too familiar here on the good ship lollipop.

ebear