Ganalene - VAN
posted on
Feb 15, 2009 04:30PM
Creating shareholder wealth by advancing gold projects through the exploration and mine development cycle.
Gan, no I am not a geologist; I used to work for a mining company and still do consulting for mining and metals companies, but my expertise starts after the ore is out of the ground.
One huge issue these days is the capital costs of a project and then energy and transportation costs. Any property far away from a sea port has a great disadvantage both in terms of getting the ore or concentrate out and to get the energy in.
In terms of nickel projects there are tonns of nickel known and many projects already on the books; for a new project to take off if it is in a remote area it has to be really spectacular in terms of grade and tonnage.
As far as I am concerned the ROF area has all the disadvantages and very few advantages, I can't see it being deveoped for many decades. Kodiak's nickel exploration up north is the same thing, it basically has zero chance. You can be in these areas when you look for gold or diamonds but not base metals. As an example, the BIM(Baffinland) iron ore project in Baffinisland is promising but the railroad is estimated at more than one billion alone, this is about 10 million $ per km of rail. It may not be completely typical but it illustrates the costs required for transportation.
Uganada is nearly in the centre of Africa, I don't know much about it,but personally I have a hard time seeing a nickel mine there. I must admit I have not looked at the project.
These days with increased environmental controls, any sulphur in the ore is eventally converted to sulphuric acid, and the tonnage of acid is greater than the tonnage of nickel or copper produced. Again this leads to huge issues related to transportation, you have to bring the acid to market somehow and that can be very costly.