I think the figure to use is 31 grams to the ounce. It gets a little confusing because we are talking about troy ounces, which is what we use when we are talking about an ounce of gold.

The basic premise is correct though. When judging viability, you want to know the cost per tonne to mine, and the revenue per tonne. One of my other favourite producers only has an average grade of less than one gram per tonne, but their cash cost is $12 per tonne. At a grade of .8 g/t you get revenue of $36 per tonne. That is a large profit margin.

What I do not know is what the cost per tonne would be for GNH but the revenue per tonne would be easy enogh to figure out. Take $1400 per oz divided by 31 = $45 per gram. In the T1 zone, they give an average grade of 2.8 grams/t *$45= $126 per tonne in revenue.

The other mine is in Mexico, so I would assume their labour rates are cheaper. The Goldex mine is viable and right next door I believe. I copied some of their stats from the Agnico-Eagle website:

http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=8,0,0,0" classid="clsid:d27cdb6e-ae6d-11cf-96b8-444553540000" align="middle" nodeindex="4" width="501">

Key Facts

Location: Quebec, Canada
Proven and probable gold reserves*: 1.6 million ounces (24.7 million tonnes at 2.1 g/t)
Measured and indicated resource*: 0.0 million ounces (220,000 tonnes at 1.8 g/t)
Inferred resource*: 0.8 million ounces (10.5 million tonnes at 2.4 g/t)
Gold production: 2011e – 184,000 ounces
Total cash costs per ounce: 2011e - $349
Secondary metals: n/a
Type of mine: underground
Estimated mine life: 2008-2017
Employees: 231