Good work and good numbers. You've arrived at the same conclusions that I have; they'll have to go a second shift or work a lot of overtime to meet their yearly allowance. At a 95% production rate based on a maximum of 150 yards per hour (142.5 yards/hr @ 95%), they'd have to work 474 eight hour days to meet their alloted yardage.
The limiting factor in all of this is the 142.5 yards per hour throughput. If they go to a second shift, they'll probably need at least one and probably two more trucks to haul gravel to keep the plant running at peak capacity. At the stated 1,000 yards per hour rate for September they'll be at 88% of the plant's maximum capacity. If they run the plant at 95% of capacity for the third quarter we're looking at 1,140 yards per hour.
The other critcal variables in any calculation are the recovered grams/cubic yard, the price of gold when it's sold, the amount of water they're allowed to use (geotube water recycling helps here), time lost to maintenance and breakdowns, and the loose vs in situ cubic yard issue that Johnny Trader brought up.
For what it's worth here's a copy of the email I sent to Mitch the other day.
Mitch:
There have been several questions about the numbers used in company press releases and documents on IHUb recently, so I'm writing this to see if you can provide us with some clarification. Some of the questions I have may be proprietary, so I won’t feel put out if you can’t answer them.
First, one of the posters with a civil engineering background pointed out the difference between BCY or Bank Cubic Yard ( in situ yards or undisturbed soil) and LCY or Loose Cubic Yard. Several questions have arisen because of this. My assumption is that the BCY would apply to the permitted 810,000 tons that we’re permitted to excavate per year. Does the BCY calculation also apply to the royalty payments or are they made based on LCY’s? I’ve used LCY for my calculations relating to operations after the gravel is out of the ground. I’ve used 1.5 LCY’s per ton in my calculations. Is that a valid number? I’m also assuming that your 150 yards per hour maximum plant capacity are LCY’s.
Second, there has been some debate about the cost of a geotube bag. It would help quiet down the posters if you could provide the cost per bag and the estimated installation cost.
Third, I’ve a question about the Blackfire settlement. Does the 15% apply to the full $450,000.00 or does it apply to only a portion of it? Since the disputed claims were roughly 1/3 of the claims involved do we only have to cough up 5% of the $450,000.00.
Fourth, you cited .4 grams per cubic yard in the August 15th PR. Is that .4 grams the amount of gold recovered or is it the gold content of the gravel?
Fifth, I live in Tucson, Arizona, so I’m well aware of how precious a resource it is in a desert. How much water are you permitted to use per year? How much water does the plant use per hour? What percentage is recycled with the geotubes?
Sixth, does the $270,000.00 operating cost per month include the royalty payments.
OK, that’s it; I hope I’m not being too inquisitive and am looking forward to hearing from you in the near future. In closing, I’d like to congratulate both you and Rob on the great job you’ve done so far. Lesser men would have quit long ago. PCFG is a true Cinderella story, so lets hope the market finds out what a gem this stock really is. You guys really deserve a well done for all your efforts.
Sincerely yours,
{Edit} Just reread the post; the extra trucks won't be needed until they expand the plant. Sorry, it's early, not enough caffine in my system yet.
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