I spent almost 3 hours over the last three days on the phone with folk that were at the SHM. I will summarize what I gathered, in pretty much random order. After all of the phoning I did, I thought it best to jot the things I was told down and share them with the board so that everybody could react and so that the details remained as fresh as possible.
SMELTER
The smelter is immediately north of the main building. How far away? About 50ft?
THE EXCAVATION WORK
The pictures we have all seen are the foundation work that is being done for the smelter and for the vault. One question: are there two separate buildings? I was told that one building was to be completed about Oct 15th and the other about Nov 15th. If true, what combination of functionality will the two have and which is which?
THE ABU DHABI CONTRACT
The Abu Dhabi guys will show up with their own Brinks truck. And, due to the value of the shipmant, there will be a helicopter overhead shadowing the transport truch. And get this: the heli will have a 50 cal machine gun onboard.
Also, SFMI has its choice of: paynebt on delivery in Idaho at the outset of the shipment, payment on refining, a choice to make custom SFMI coins and bars, or return of the finished product to SFMI in Idaho.. The point is that there is tremendous flexibility as regards the options for payment SFMI has.
Also, as regards the choice of who they contracted with, they were exhaustive in going out there and nosing around, and the Abu Dhabi deal was the best available to them.
THE VAULT
Currently, SFMI is using a commercial vault elsewhere to store poured bars. They did not reveal where this is, for obvious reasons. The excavation for the vault is partially surrounded by a smallis hillthat is on the property. Three sides of the vault are to be sunk into the hillside.
The rebar is 1.5" rebar; and the vault walls are to be 1 foot thick.
SECURE FEATURES GALORE
Already mentioned: the thick, reinforced walls. Then there is the vault door, which they are proud to report cost them less than they had budgeted for it. They feel very good about it.
Also, taller fencing is being put in and there will be razor with on top of it. I was told, but I forgot this detail (so somebody could help by refreshing my memory here)..... Is the razor wire going to be on the secure area fence AND on new, higher fencing around the entire property? My recollection is that the razor wire is going to be on the secure area's fence and on the new & improved guard gate area, but that the razoe wire is not going to adorn the whole fence area that is currently in place. However, I need my recollection on this detail refreshed.
NEW GAURD BUILDING & VEHICLE GATE
They have a new guard gate for people and for vehicles, that is high security. The guards also are in a new building that is high tech.
GUARDS PATROLING
Apparently, guards are armed and they are patroling the property 24/7right now. And we may not get bobby's pictures in the future because the new policy is going to be to run off people taking pictures from the road..
SECURITY CAMERAS
Apparently, there are new security cameras. The driver of the van on the tour was the contractor, apparently.
SHAKER TABLES
Right now, they re-process the ground up sand 4 times, through a circuit of 4 shaker tbles. This accounts for the concentrate's quality. This differs from last year and represents a vast improvement. We all recallbeing told in the past that they were "tuning the mill". Based on the series of 4 shaker tables, the end result of the tuning they did was this set-up of recycling the ground up rock thru a series of shaker tables.
BELT PRESS
The purpose of this equipment is to be able to get rid of the ponds by drying in the building rather than outside. This equipment is being set up. If I understood things, the building is being extended 40 ft to accomodate this equipment and the increased capacity ball mill circuits.
Also, apparently, on Saturday, CQ gave a guided tour of the mill building. I'm unclear on the details of this because, in an earlier conversation on Friday, I recallhaving been told that, due to the expansion, the mill building itself was off limits.
Did CQ conduct a tour of the facility, and did folks get to see the new belt press and ball mill?
LEACH MACHINERY
Right now, there is a silver sand (I think the stuff is silver sulfide, but I did not write it down, so please elaborate on this). At present, there is a plan to use a piece of machinery that will leech the silver from the sand and this will vastly increase the output of silver from the circuit. I was told that this machine is a closed loop and that it is very greeny-weinie, with no part of the solutions ever exposed to the outside environment. Apparently, the stuff goes in, the chemicals do their thing, and silver results.
Would people conversant on this expand on it please? And I'd like to know if anyone found out if this machinery is already on site or whather it is yet to be delivered or whether it has yet to even be bought.
PILES
While on the subject of the silver sulfide that is not presently being processed, is it being accumulated in outside piles? How big were thse. Also, did people see and take pictures of the end-result piles? How big were they?
And how much larger were the big piles this year than last year? And were the piles more numerous?.
CHRISTIAN QUILLIAM
Nepotism is frowned on because it suggests that CQ is not doing worthwhile work. However,I was told that the fact is that CQ is well spoken, well informed, and knowledgeable.
Also, I was told that he spends 3 weeks out of the month, every month, on site.
Aparently, he is not dead weight. Comments from those in attendance?
NEW GEOLOGISTS
They have 3 new geologists of various years of experience on board now, and they are looking for a 4th. One guy is nicknamed "The Mountain Goat" because he is a young buck who is all over the mountain, every day. He is directly involved in hands-on vein and surface feature mapping and he is living up on the mountain, with his dog.
DAILY COSTS
At the meeting, a direct question was about the costs of the mill, per day. Pierre answered that the mill costs, including salaries, $4,000 per day. He was challenged openly about this being a very low number, and he kind of revealed his cunning by pointing out that he was telling them the mill site daily costs because that what they specifically asked about. Then he told them the total daily cost of running SFMI, all costs included.. As to the total cost of the operation, he sair its about $38,000 per day (including the the aforementioned $4000 per day). I may have this number too high, so I do not hesitate to ask for a refresher.
24/7 OPERATION
They are operating the mill 24/7 right now, but this does not mean they are running the thing all day and all night. Equipment is under loads that make maintenance and downtime part of the work days. This explains why the statement elsewhere by the company had the mill running the equivelent of 240 days a year. They are up 365 days a year, but normal and abnormal support issues make the effective days a year 240. My conversations with the attendee I talked to confirms this.
REALIZING $$ IN THE 4TH QUARTER.
PQ stated that they will realize $$ in the 4th quarter. He is hoping for, but not promising, 3 shipments in the quarter, of about 1000 oz per shipment. This roughly works out to about 1 million dollars per shipment.
The concensus from the attendees is that they will achieve 2 shipments this year. Lets hope for 3, LOL.
SINKER TUNNEL
The Sinker Tunnel is complete. The MSHA is in the picture, messing things up like the govt always does, but with all issues, SFMI is right on it, and the overall completeness of the tunnel helps them.
Here's the skinny I got about it. The ventillation and water drainage pipling is installed and operational. The entrance is extended and protected by heavy guage corrigated metal arches. The old wood has been pulled out and is piled up outside. The MSHA has made them use a geometric pattterm of rock bolts to reinforce things and the work of doing this is near done.
According to Scammell, he was surprised and impressed, when he came on board, by the tunnel because its was very well done.
Apparently, the tunnel today would have cost $38,000 a foot to dig, so at over 6000 feet, this tunnel could never have been dug at today's costs. Most of the other companies I compared SFMI to the other day had less precious metal content to their resourse,and this better suituation gives SFMI a distinct cost advantage because the other companies are working with inferior assayswhich they have yet to pull out of the ground.
Now that it is clear that the Sinker Tunnel is extremely well done, it is clear to me that the company has another layer of advantage due expressly to the quality of the work of which the Sinker Tunnel consists.
VENTING FOR SAFETY
According to the conversations I had, the fact is that the planned drilling can begin without an emergency room. Thsi is because SFMI has purchased a portable room that will be close by during drilling of the core samples in the tunnel. Also, underground mining, which is still a long way off, can not begin until the secure room is done, but the fact is that drilling in the tunnel can begin as soon as the MSHA stops niggling. Please confirm this.
ONLY $150K NECESSARY TO DELIVER SECURE VENTING & SECURE ROOM
I was repeatedly told that the attendees were told that the plan is to connect one of the existing mine shafts to the Sinker Tunnel by a bit of blasting that will be only a few feet and which will cost only about $150,000 to complete. This will also provide alternate ventilation shafting. This is a simple, low cost solution and IMHO, it is fabulous news.
Also, they were told that water is being pumped out of the shaft to which they will connect.
MULTIPLE EXPOSED VEINS IN THE SINKER TUNNEL
Apparently, the prior reports that the Sinker Tunnelhas many vein systems is true. Please confirm that this was covered at the meeting and/or the tunnel tour.
THE 43-101
Apparently, one of the new geologists made the statement from the podium at the meeting, that he expects to complete the 43-101 and get it submitted by January. The 43-101 is a report that gets added to over time, so a base one can be easily done, according to what the geologist told the shareholders from the podium at the SHM. In that this kind of pubplic committment was made, it casts doubt of the idea that the huge 43-1101 expense of a lot of other companies is not what SFMI is intending to promulgate. They have an advantage with above ground rock that can easily be assayed, and they have a tunnel that has numerous exposed veins.
A 2ND LARGER MILL CIRCUIT
A second mill circuit is going in. It will be parallel to the existing mill circuit and will not require the existing mill circuit to be shut down. Also, the manner in which the set-up is going to be done is to do it in a single pass, as it were, rather than to slowly build it out. Confirmation of this would be appreciated.
TRUCKS WORKING 4 DAYS A WEEK
I was told that the trucks are delivering 4 days a week right now, in advance of the snow flying soon. Friday & Saturday they do not work because the mountain has tourist activity on weekends.
Did anybody get told how many daily truckloads? Or how long they have been at it this summer? And how much they have brought down? And how much they plan to bring down by the time they have to stopfor winter this year? Did anyone see the piles representing the hauling that has been being done?
Also, I found out that there are some piles that are not road accessible. Did anyone find out which piles are not accessible?
Also, the BLM is being asked to let raods to the inaccessible piles get built. How far along in this permitting process is SFMI at present? Was anybody told anything much on this subject? TIA
DRILLS FOR DOING THE TUNNEL DRILLING TO ARRIVE NEXT WEEK
I was told by one of the attendees that the core sample drills to do the Sinker Tunnel drilling will arrive next week. Anyone find out when exactly? I was told that workers at the Sinker Tunnel showed off the drills they are using in connection to fastening rock bolts every few feet,asper MSHA mandate, but the equipment that will arrive next week is for core drilling. Anyone who can supply details on what they saw or were told would be a great help to us all. TIA on this.
APPROXIMATELY 42 NEW CLAIMS
There are now about 50 claims owned by SFMI, where before there were only 8.
2 NEW BOD MEMBERS
I found out that there will be 2 new BOD members soon. How soon? Anyone find out antything on this? Also, I was told that the new guys will be experienced mine types.
BUYBACK IS FOR REAL
I found out over the weekend that there was definite confirmation at the SHM by PQ himself that the share buyback will indeed begin immediately upon the generation of income stream. Did anyone follow up on this?
ROGER SCAMMELL HAS FREE REIGN
Somebody was reported to have directly asked PQ how much operational freedom RS has. PQ answered the fellow by telling him that RS has totally free reign to make decisions himself
AND THATS ABOUT IT....
I was not able to attend, but I was greatly impressed by what i heard from the long conversations I had with folk in attendance. Like I said above, I talked for about 3 hours total over 3 days and I tried to think of asking questions about every area of interest.. Thanks to the folk I got all this from and please, anyone who has answers and/or elaborations to my many subjects (above), add what you saw and heard.
Hope all this helps.
Personally, I do not see any way, part from an earthquake, for this thing to come off the rails at this point.
Peace.
Imperial Whazoo
AI
