For those also questioning the ability of SFMI to be able to afford the lease payments here's my very back of the envelope numbers. We know they have over 300,000 tons which represents at minimum 10 years of tailing's processing. Where do you think the price of gold/silver is going over the next 10 years. Those that truly understand the gold market Sinclair, Alf Field, Armstrong have some very big numbers. So are we looking at an average over the next 10 years of $1200, $1500, $2000, $3000 who knows, but I'm sure you get my point.

Now the tailing's has well over 100 samples taken. In order to calculate the feasibility of this project they used the lowest grades they had which was about 6 gr/ton gold and 70 gr/ton silver. They have many assay with findings over 1 OZ/ton gold and some with mutiple OZ's/ton. [don't forget the old timers discarded ALL the silver].

On a side note to show the richness of the ore, here is part of a report showing 3.6 oz Gold/ton..........
"An ore analysis was reported by D.A. Yeager, and C.K. Ikona, of Pamicon Developments, Ltd. "Investigations indicate at least one year's reserves in place at the bottom of the Illinois-Central; with ore indications of 11,205 tons @ 103 g/t Gold (3.6 oz Gold/ton)," wrote Mr. Yeager"

We know the processing costs for tailing's is reported at $140/ton which can now be decreased, as the mill is much closer to the tailing's piles.

So if we can come close to 1 oz/ton [with silver credits] and can do the 100/ton per day [once fine tuned] at 300 days per year we get about 30,000 ounces/ year.

So what is 30,000 oz worth? Well pick your number over the next 10 years!

Todays price we get about about $32 million. Now subtract the 15% royalty [4.8] and we end up with 27.2 mil.

Take off the cost of production using the old number of $140/ton which = 4.2 mil and we should have a net profit remaining of 23 million which shows the lease payments and extra's of 1.2 mil are VERY affordable.
Now again we are using gold at todays prices of $1060. Any upside in the price of the pm's will greatly effect the bottom line.
There is one new expense we can't calculate in and that is the payback time for the recent financing which will be thru gold sales. I'm thinking its around 1/2 mil which over 10 years won't be a concern.

This will also allow plenty of money for the share by back program which if memory serves me correct was about 10% of net.


SFMI has run the numbers and that is why they plan to finance the development of the rich resource on War Eagle mtn thru the proceeds of the tailings and that to me is where the REAL story will unfold.
glta