Sabre Gold Mines Corp (SGLDF)

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KERR MINES TRIES PRODUCTION START IN ARIZONA

Kerr Mines has successfully rehabilitated the Copperstone project in Arizona. Now the company is aiming to start production by 2019.

Sometimes you do not have to reinvent the wheel to get to your destination. There are many projects worldwide that have had to adjust their production in weaker gold price phases. And there are at least as many mines that have failed due to management errors. Often it sounds simple, but with one or two changes to the operation, you have a fully functional mine and produces cash flows. However, many projects have simply gone too far into production without having really understood the geology and texture of the rocks.

On average, it takes eight to ten years from the first well to the first casting of a gold bar. But you do not always have to start at zero. Many projects can be purchased or revived. At Kerr Mines, production could begin in early 2019, in less than 1.5 years.

Location, location, location

Based in the Canadian Toronto, the company is owned by the Copperstone project in the US state of Arizona. The prestigious Fraser Institute leads Arizona to number seven of the world's best places to operate or explore a mine. So it does not get any better.

Benefit from the mistakes of predecessors
In June 2014, Kerr Mines took over the then almost insolvent producer American Bonanza Gold and thus the Copperstone Mine. American Bonanza was forced to drive down the mine in October 2013 before commercial production was reached.

Kerr's predecessor built the mine in 2011 and started to operate the mill in November 2011. But from the beginning it did not go well. According to the last feasability study, construction costs should be $ 17.7 million.

At the end of December 2011 the costs were already at a rich US $ 27.4 million.

Kerr Mines saves millions
The additional costs are primarily due to two factors. A mere $ 6.6 million had to be raised to replace the contracted service provider who was to operate the mine. So you were forced to buy your own mining fleet and then wait. Kerr now owns exactly this mining fleet.

From Kerr Mines' point of view, another point is pure gold. The former owner has already complied with the requirements of the regulatory authorities in every detail. Thus the tailings-Pond was adapted during the construction. Instead of as originally calculated 1.7 million US dollar, it cost then 5.1 million US dollar. Kerr can now also save on these costs.

Savior with proper timing
The mill on the Copperstone project itself is also brand new. The capacity was originally designed for an annual production of around 46,000 ounces of gold. During the picking phase, however, the desired utilization rate of at least 60% was not achieved over 30 days. The reasons for this have been manifold. Among other things, the squeeze of the service provider, who was to manage the mine, caused significant delays. In the end, American Bonanza simply ran out of funds to continue the mine. In the course of the merger, Kerr Mines jumped as a savior to the company in 2014.

However, the mill on Copperstone worked excellently and delivered earnings rates close to the target of 90%. In the course of the decommissioning of the mine, American Bonanza has also ensured that all equipment is stored in such a way that it can be reused directly. Kerr Mines also benefits from this.

The biggest advantage at all
A point that has so far gone a little bit: Kerr Mines is by taking possession of all permits for the operation of the mine in Arizona. Often, this factor costs most of the time and thus a lot of money. Kerr Mines already holds all the permits and is likely to have saved a double-digit million sum.

Translated from German to English..

https://www.godmode-trader.de/analyse/kerr-mines-strebt-produktionsstart-in-arizona-an,5393620

"...Phoenix, Arizona (May 23rd, 2017) – Sound money advocates rejoiced today as Arizona governor Doug Ducey signed House Bill 2014 into law last night. The measure, which passed in the Arizona state Senate on May 10th by a margin of 16-13, removes all income taxation of precious metals coins at the state level.

Under House Bill 2014, introduced by Representative Mark Finchem (R-Tucson), Arizona taxpayers will simply back out all “gains” and “losses” on any precious metals that are in legal tender form and reported on their federal tax returns from the calculation of their Arizona adjusted gross income (AGI).

If taxpayers own gold or silver to protect themselves against the devaluation of America’s paper currency, thanks to the inflationary practices of the Federal Reserve, they frequently end up with a “gain” when exchanging those metals back into dollars. However, this is not necessarily a real gain in terms of a gain in actual purchasing power. This “gain” is often a nominal gain because of the slow but steady devaluation of the dollar. Yet the government nevertheless assesses a tax..."
https://www.moneymetals.com/news/2017/05/23/az-ends-taxation-bullion-coins-001079