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Godwin Mining Ltd.
Dawson City, Yukon
Wounded Moose Creek Mining
with the
Godwin Gold Dredge System
Business Plan
Godwin Mining Ltd.
Russell K. Godwin, President
#101 – 2164 Wall Street
Vancouver, BC, Canada
V5L 1B5
Tel: 604.687.1414
[email protected]
May, 2015
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Disclaimer
This proposal has been prepared by Russell Godwin of Godwin Mining Ltd. It contains
estimates, forecasts and assumptions about the business and no warranty is made
regarding the accuracy or adequacy of the contents of this document, or its suitability for
any purpose whatsoever.
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Project and Property Summary
Godwin Mining Ltd. (GML) will be a private British Columbia company formed for the
purpose of mining the gold placer gravels located within the drainage of Wounded Moose
Creek, Yukon.
Wounded Moose Creek was named by Robert Henderson in 1895 during his gold
prospecting journeys up the Indian River basin to the headwaters of the river. During his
journey Henderson advised a prospecting party later in the year to take a short cut across
the divide, to what is now called Bonanza Creek, and if they found anything to let him
know. This group ended up finding the richest creek in the Yukon but failed to advise
Henderson as they had promised.
Gold was found on Wounded Moose Creek by Mr. Henderson, but as he was looking for
the rich source of the Indian River gold, he left after several months. The vast majority of
the Wounded Moose Creek gold has remained untouched to this day.
Wounded Moose Creek is located approximately 38 air miles southeast of Dawson City,
Yukon. The property is within the Dawson Mining district, NTS Placer Sheet 115-0-10e and
located at approximately latitude 60 deg 37’N and longitude 138 deg. 41.5’W. Access to
the property from Dawson City is by the Hunker – Sulphur Creeks road or on the Bonanza
Creek – Upper Bonanza Creek- King Soloman Dome – Sulphur road. Travel to the
property is by 2-wheel drive during the mining season except during early spring breakup
and early winter.
The valley that holds Wounded Moose Creek is almost flat with a gentle slope upstream
and the gold is not in a highly defined “paystreak” such as Bonanza and Eldorado creeks
but has a more consistent value spread throughout the gravel. The Godwin Mining System
is ideally suited to this type of deposit, and because of the system’s low cost to process
material, can render an “average” gold creek a highly profitable one.
The potential number of cubic yards of mineable gravels contained in the 51 mining claims
to be acquired is conservatively estimated to exceed 25 million cubic yards. There is also
potential for 60 more claims to be staked in the valley further upstream.
Drill testing by the current owner on the property has consistently found the valley floor to
comprise a vertical profile of 6 feet of organic overburden, 9 feet of lower grade gravel and
6 feet of high-grade gravel. Based on $1,500 per troy ounce gold, the low-grade gravel
yields a consistent average of $10 worth of gold per cubic yard while the high-grade gravel
yields a consistent average of $25 worth of gold per cubic yard. Cost to process on a 2,700
cubic yards per day operation is estimated to be less than $5.00 per cubic yard of gravel
processed all in. An increase in the grade of gold recovered, because of the efficiency of
the Godwin Gold Dredging System, may dramatically increase the profitability of this
operation.
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Proposed Financing Structure
Financing would be a loan of US$ 4,500,000 paying 8% rate per annum. The mining
company, Wounded Moose Mining Co. Inc., current owner of the claims and equipment,
and incorporated in the Yukon, would be purchased by GML. As a result, this loan would
be liened to the benefit of the financier(s) and the total monies loaned will be repaid on the
basis of a credit of 75% of the operational gross profit accruing to the debt
repayment/interest. Upon full repayment of the monies loaned, the liens on GML and the
Companies assets would be released. (See Financials) A combination structuring of debt
and equity would also be considered."
As GML will be a private company, interest payments on the loan and loan repayments at
the maturity date can be flexible and if desired, the repayments and interest to be paid to
the lender(s) could be in the form of raw gold (for tax reasons), or in bullion at a deemed
price of 90% of the London Gold Fix price at the time of financing.
Proposed Mining Production
Mining for a normal mining year would start in early to mid May 2015, subject to weather,
and end in late September to October 15, again subject to weather. As the bedrock profile
from the bottom to the top of the creek has a gentle upslope the preferred mining method
would be by dredge. This dredging process would involve a custom designed and built
dredge being floated in a hole flooded with water and the dredge bucketwheel suction pipe
would acquire gravel material moving forward, recover the gold with processing equipment
mounted on the dredge and discharge the refuse, or tailings, behind. The pond of water
would therefore move forward as the dredge moved forward.
The floater dredging method has many advantages:
•
Because the gravel processing plant moves to the gravel on the water (as opposed
to moving gravel to the plant), mining costs are minimized;
•
The dredge pond also acts as a settling pond for water sediments, further reducing
costs (no need to built a separate settling pond;
•
The operation has total water recirculation so that there is no process water
discharge to the creek or river;
•
Reclamation costs are minimal.
The production “cuts”, or ponds, would be approximately 100’ long by 500 feet wide and
defined by the removal prior to mining of the organic overburden using bulldozers. This
coordination of removal of the overburden and the moving of the dredge along the 500 foot
“face” would allow the processing by the dredge of up to 200 cubic yards of gravel per hour
of production. The expected life of the operation would be 15+ years and GML would
process all of the paying gravel from the left rim of the valley to the right rim of the valley a minimum distance of 1,000 feet or more and up the length of the creek for a possible
distance of 4.8 miles or more.
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Anticipating that the exposure of the pay gravel, formerly overlain by organic permafrost, is
difficult to uncover during the warmer months, this exposure of gravel is most effectively
done during the cold of the spring and fall when temperatures are below freezing. During
the cool of the shoulder seasons, as much organic material as possible will be stripped
from the surface, and the gravels exposed and readied for processing by the dredge during
the next Spring.
The processing dredge is the operations most valuable piece of equipment and was
custom designed by Russell Godwin to be flexible, efficient and lightweight. The unit, called
the Godwin Gold Dredging System, can be broken down into modular units, transported
unto the mining site using four hi-boy transport trailers, and reassembled on site in a
manner similar to a Meccano Erector set.
The Godwin Gold Dredging System unit is comprised of three main parts: the collection of
gravel, the processing of this gravel and the disposal of the waste gravel (tailings). All of
the equipment for these parts is mounted on a main dredge platform.
Collection of the material
The Ellicott excavator mounted dredging bucketwheel makes possible the continuous
excavation and pumping of underwater material while utilizing a standard model trackmounted excavator. These head components “cut” or break up the material and suction the
loose material, similar to the action of a vacuum cleaner, from the bottom of the pond into
the hopper of the “Gold Machine”.
The Ellicott Dual Wheel bucketwheel has a torque rating of 50,000 pounds per inch, and is
capable of cutting through hard material such as permafrost, granite and coral.
The advantages of the Dual Wheel bucketwheel in gold recovery are as follows:
•
•
•
•
•
•
•
The bucketwheel operates constantly with equal efficiency on both port and
starboard swings,
The bucketwheel produces a positive feed which allows control over the slurry
density,
Heavy material, gold nuggets and fine gold are fed directly into the suction opening
minimizing the possibility that they will be left behind,
The bucketwheel is equipped with a special wide body dredge pump that transports
virtually all excavated material delivered by the bucketwheel,
The excavating and feeding capabilities are not reduced at depth because the
“digging angle” of the bucketwheel remains constant,
The bucketwheel is equipped with interior scraper plates which make the wheel
virtually impossible to plug with clay or sticky material,
The cost to operate a duel wheel bucket dredge, such as the Godwin Gold Dredge,
is currently the cheapest manner to collect gold bearing material in the Yukon.
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Dual Wheel Bucket head unit
mounted on end of excavator boom
Dual Wheel Bucket Head
Processing of the material
The base of the main processing unit is a custom designed barge that “floats” the
processing and production units.
Once the material is on board the dredge it will be deposited into the hopper of a “Gold
Machine”. The Gold Machine, manufactured by Ray Brosseuk of Revelstoke, BC, is a self
contained mobile unit, weighting 53,000 lbs. and mounted on a step deck trailer, and able
to process 200 cubic yards per hour. This machine is the most effective way of separating
gold from placer gravels currently available. Its continuous cleaning process, utilizing an
internal reverse helix lip, has a greater than 92% rate of gold recovery to 300 mesh size
and uses much lower rates of water than other processes. Because of its effective rate of
recovery and the lower operating costs, it’s quickly becoming the “Gold Standard” of placer
recovery machines. Lower costs and better recovery equals more profit.
See a video of the Gold Machine in operation
http://www.thegoldmachine.ca/-The_Gold_Machine_.html
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The Gold Machine working on land.
Deposal of the waste material
Material exiting the on board processing equipment will be moved to a discharge hopper
and travel up a 36 inch wide by 40 foot long, suspended and inclined conveyor belt similar
to the picture below. The discharged material will empty into the back of the pond thereby
backfilling the pond.
Picture of typical tailings conveyor
Testing for gold on the virgin ground claims via churn drill would begin during the first year
as soon as possible.
Mr. Russell Godwin will be the operating Manager of the mine. Mr. Godwin has many years
of practical involvement with the mining industry and prior experience with placer mining
operations. During the early 90’s Mr. Godwin was a co-owner of a placer mining operation
at Spanish Mountain, BC, with Sandy Main, P.Geo. and Gordon House, P.Geo. In addition
to Private and Public company management, Mr. Godwin has years of “hands on” northern
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experience, having worked as a heavy equipment operator in “bush camps” located in
northern British Columbia, northern Alberta and the Northwest Territories. Mr. Godwin has
a history of successfully managing difficult projects to completion under trying conditions.
A further staff of 4 to 5 people per 12-hour shift will be needed to operate at full capacity.
Mining Claims
The 51 placer mining claims and processing equipment to be acquired are owned by
Wounded Moose Mining Co. Inc., and all the shares in this Company are in turn owned by
Mr. George Abermeth of Richmond, British Columbia. The size of each claim is 500 feet up
the creek, measured from a center base line, by 1,000 feet to the left and 1,000 feet to the
right. Therefore each claim is 500 feet by 2,000 feet. The length of creek controlled by the
Wounded Moose Mining Co. Inc. mining claims totals ~4.83 miles.
A water license and a “Use of Land” permit from the Yukon Government is in place and is
valid until the year 2020. Godwin Mining will not need to transfer ownership of the licenses
upon purchase of Wounded Moose Mining Co. Inc., as GML will be acquiring 100%
ownership of the Company that owns the licenses and permits.
Physiography, Geology & Placer Gold Mineralization
Wounded Moose Creek is accessible by 2-wheel drive vehicles starting during the Spring
when the snow has left the road and the mud has dried. The access road is straight,
doesn’t have switchbacks, and therefore will allow semi trailer trucks access to the project
campsite without problems.
The area around Wounded Moose Creek has never been glaciated and the creek gravels
are underlain by rotted bedrock comprising Yukon group micaceous schists with the pay
gravels over the bedrock being from 12 to 15 feet deep. The gravel is classified as cobble
gravel with the occasional boulders from 1 to 2 feet. The valley gravels are overlain by 6
feet of black organic muck and mostly comprise 9 feet of low-grade material over 6 feet of
higher grade material. GML will mine all the gravel and an additional 2 feet of bedrock
material. Wounded Moose Creek placer gold has a consistent assay purity fineness of 845
fine or 84.5% pure gold.
Equipment and Property Economics
The Godwin Gold Dredging System
“A NEW CONCEPT IN MINERAL PROCESSING FOR THE 21ST CENTURY”
History of Equipment Development
The first dredges were developed in Europe during the 16th Century and were used to
excavate harbors and over time their design and efficiency greatly improved. The
adaptation to placer mining began in New Zealand in 1882 when gold-saving equipment
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was added behind the excavators. The first successful dredging operation in the U.S.
started at Bannock, Montana, in 1895.
After a very successful and profitable period of dredge mining from 1895 to 1942, most
gold-placer operations in the U.S. were closed down by United States Government Order
L-208 issued during WWII. Some gold dredging operations were resumed after the war,
but most remained closed because of the widening gap between rising mining costs and
the price of gold.
Dredging Systems
Dredging systems are classified as hydraulic or mechanical depending on the method of
digging; both are capable of large production. A floating dredge consists of a supporting
hull with a mining-control system, excavating and lifting mechanism, beneficiation circuits,
and waste-disposal system all designed to work as a unit to dig, classify, recover values,
and dispose of waste.
Hydraulic System
Hydraulic dredging systems, whether the lifting force is suction, suction with hydrojet
assistance, or entirely hydrojet, have been used much less in placer mining than
mechanical systems. However, in newly designed digging operations where mineral
recovery is the objective, the hydraulic or suction dredge has greater capacity per dollar of
invested capital than any mechanical system because the hydraulic system both excavates
and transports the dredged material more easily, hence the “Godwin Gold Dredge”
concept.
Hydraulic/suction digging is best suited to relatively small-sized loose material. It has the
advantages over mechanical systems in such ground when the material must be
transported from the dredge to the point of processing.
With efficiently designed units and powerful pumps, the size of the gold that can be
captured by these types of dredges is greatly increased. The ability of these dredges to
pick up material in large part depends upon intake and transport velocities relative to
specific gravity and size of the particles. Larger material requires moving velocities which
requires more horsepower. On the other hand, when the flake size of the gold is very fine,
higher velocities make gold recovery much easier and profitable.
The digging power of the Godwin Dredge System is greatly increased with a Dual Wheel
bucketwheel head attached to a suction pump. The Ellicott Dual Wheel rotating wheel is a
60 inch cutting tool that can achieve up to 70% solid content. The wheel allows material
production of up to 200 cubic yards per hour.
In recent years the hydraulic wheel/suction systems have been used to strip
unconsolidated overburden and pay zone material:
1. Often with considerably less effort,
2. Often more cheaply,
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3. Often as the only logical method when the material to be stripped is water saturated
or lies wholly under water.
Mechanical Continuous System
Until recently the bucket-line dredge was more efficient than any hydraulic system in
capturing values that lie on bedrock or in scooping up the material which sloughs or falls
from the underwater face. The new Godwin Gold Dredging System is more efficient when
digging in hard formations (permafrost) because of its heavy support arm (excavator boom)
which can be made to rest on the cutting head providing it with more ripping force. Size
and speed can be varied with formation changes in the deposit therefore increasing the
volume of material that can be processed through the Gold Machine plant.
The Godwin Gold Dredge will have a compact gravity-system processing plant (the 200
yards per hour Gold Machine) mounted on the same hull as the excavating equipment. The
waste stacking unit, also mounted on the same hull, combines with other dredge functions
to make the dredge a complete and efficient mining unit. The advantages of a fully
integrated waste distributing system trailing behind the excavator become readily apparent
as over 5,000 cubic yards of oversize waste can be disposed of each day.
To assure a high percentage of running time, dredge components must be designed for
long life and relatively easy and quick replacement of parts. Dredging experience has
shown that most parts need to be larger and heavier than theoretical engineering designs
indicate, and the simpler their design, the less their replacement and installation costs. All
of these issues have been taken into consideration in the design and production of the
Godwin Gold Dredging System.
Summing up, the advantages of the Godwin system as compared to the old hydraulic
dredge are as follows:
1. It lifts both pay zone material and water at a ratio of up to 70% solids to water;
2. It increases the recovery of material fines (containing most of the fine and small
fraction gold) and therefore increases the contained gold value per yard;
3. It can dig more compact and hardened material (bedrock) with its 60” bucket head;
4. It can clean and remove bedrock more efficiently;
5. It allows more positive control of the mining pattern;
6. It has a simpler waste disposal system as compared to other types of dredges;
7. It requires less horsepower.
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Godwin Gold Dredging System
(Comments made by Russell Godwin - July 14, 2014)
“What we currently have designed is a production unit – cutting head and suctioned
material going into a mounted “Gold Machine” on a dredge deck - that has flexibility with a
low cost per unit of material moved. And it's small - the total dredge platform is only 30'
wide by 60' long - and therefore flexible and inexpensive to transport and operate relative
to the gold values recovered.
The advantage of this system is that the cutting head will be used to break up the material
to be mined in the water at the front face of the "cut" next to and into the bedrock and
suction this material up into the hopper at the front of the Gold Machine. (The Gold
Machine trommel will not be used as a "break up the material" machine). The Gold
Machine’s value to production is a reverse helix inside the outer shell of the trommel and
the use of this helix in this "turning around" design (trommel) using the helix "lip" to pull the
heavier material up to the top of the unit and therefore separate the gold from the other
lighter material. I know of no other design in the marketplace today that does this process
simpler and easier. By simply turning the trommel shell you have a built in weight separator
and material remover.
Outside the upper lip, the resulting material - maybe 5% of the starting volume - is run
through a side sluice with a nicely controlled water flow and the gold drops out quickly with
the use of expanded metal and "miners moss" matting. In addition, the resulting passthrough material from the center of the trommel is also run over a sluice run where
estimates are that up to 5% of the total recovered gold will be found. Total recovery of the
available gold has been demonstrated to be up to 92% down to 300 mesh or about 50
micron size.”
It should be remembered that gold placers as a whole are non-uniformly distributed lowgrade deposits and that $10 gravel, or gravel that averages $10 worth of gold (at $1,500
per ounce) per cubic yard contains by weight just 1 part gold in about 6.5 million parts
waste.
The Godwin Gold Dredge System expects to recover a minimum of 0.01167 ounces gold
per cubic gravel yard processed at Wounded Moose Creek and at $1,500 per cubic yard
this works out to approximately $17.50 recovered at a production cost of less than $5 per
yard.
Physical Characteristics of Dredging Wounded Moose Creek
Gold dredging is most applicable to large, flat-lying deposits and dredging is most
applicable on surface grades up to 2% although there have been isolated instances where
grades up to 6% have been traversed. The quantity of material in a deposit or in a group of
deposits to be dredged influences not only the capacity of the dredge to be selected, but
whether the dredge should be portable. In the case of Wounded Moose Creek, the surface
grade has been calculated at around 1.5% over the entire distance in the claims to be
mined. The initial capital costs of a portable dredge system are somewhat higher than for
non-portable systems.
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The Godwin Gold Dredge System is projected to mine the gravels and bedrock on
Wounded Moose Creek at the following rate:
Yards per Season:
Number of yards per day:
Mine life:
Number of days per season:
Number of yards per hour:
Number of hours per day:
Acres mined per season
324,000 cubic yards
2,700 cubic yards
~15 years or more
120 days
150 cubic yards
18 hours
23 acres
25,502 ft.
Wounded Moose Creek surface grade is approximately 1.5% over the 25,502 linear feet
from the bottom to the top of the claims to be mined.
The depth, character, and quantity of gravel to be mined influences the shape and size of
the mining system which in turn influences the design and capacity of the processing plant.
Depths that should be determined are those from water or pond level, whether natural or
developed, to bedrock and from water level to the ground surface. Within certain ranges,
suction dredge capacity is increased as the thickness of the material from water level to
bedrock increases.
Availability of Water at Wounded Moose Creek
The quantity of water required varies with the size and type of dredge and with the
character of the formation to be dredged and treated. The fresh water that runs into the
dredging pond does not necessarily indicate the quantity of water used in the operation,
because the water from the dredge pond is constantly reused. Of primary importance in the
recovery system is the condition of the water---the cleaner the better.
The mining of the Wounded Moose Creek claims using the Godwin Gold Dredge System,
and with the bucket wheel suction capability, would enable a total surface area of
approximately 23 acres each year to be processed. By removing the overburden and an
area of the pay gravels down to bedrock, a “pond” of approximately 6 to 8 feet deep of
water can be used to float the dredge and start the operation. The depth of this pond will
accommodate the “draft” needed to adequately float the dredge for maximum gold
recovery. The pond water will be used by the processing system at a rate of about 1,500
gallons per minute which will adequately wash, sort and classify the gold bearing gravels
during the operation.
The Wounded Moose Creek stream flows through the center of the claims, flows all
summer season, and is more than adequate to supply all of the needed water for the
operation.
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Labor and Climate
Labor required to operate a dredge, in terms of yards excavated, is the least of all types of
mining. The Godwin Gold Dredge is a completely mechanized, large-volume, selfcontained mine-mill unit that digs, collects, and processes the gold bearing gravels,
bedrock and finally backfills its waste in a matter of minutes. Since the Yukon is isolated
and has a short work season, it is customary to work 12-hour shifts. The operation of the
dredge will use 2 men on a day shift totaling 12 hours until the “bugs” are worked out.
Upon the operation working as designed, the dredge will start working 2 shifts of 12 hours
for 7 days per week. Additional labor will be used to run equipment needed to strip organic
overburden in front of the working dredge pond, to contour the processed material mined
(tailings) back to a natural setting and to provide support for the camp and the mining
operation.
Adverse Climate
Climate can determine the length of the working season, the number of yards produced per
season and the return on invested capital. The season in the Yukon usually lasts from
about the middle of May to the last week of September and numbers from 110 to 137 days.
Local and National Regulations
All existing or prospective laws governing use of water, mining practices and restoration of
land surfaces will be adhered to. The Wounded Moose Creek property will be completely
restored to its as-found condition or better, and the tailings from the operation will be top
contoured with organic material and re-seeded for environmental satisfaction.
Production Estimates for Wounded Moose Creek
Assumptions and calculations for project;
•
•
•
•
•
•
•
•
•
Over burden is approximately 6 feet of organic material
Lower grade gravel averages 9 feet of depth
High grade gravel averages 6 feet of depth
Approximately 10.625 million cubic yards of high and low grade material have been
defined equaling 32 years of mine life (report has used 15 years for calculations)
High grade material currently varies and yields an average $20 to $30 per cubic
yard. (Report results from current owner based on $1,500.00 USD per troy ounce)
Low grade material currently varies and yields an average $5 to $15 per cubic yard.
(Report results from current owner based on $1,500.00 USD per troy ounce)
Calculation for financials uses average of $17.50 USD per cubic yard or 0.01167
ounces per ton (opt) at $1,500 USD per troy ounce.
Conservative hours of production (18 hours per day) were used although in practice
the production rate, with equipment working as designed, would be more likely to be
21 to 23 hours per day. (Remainder of day for refueling, preventative maintenance,
shift change and dredge repositioning.)
Purity assays from gold recovered have consistently been 84.5 % (85% used in
calculations)
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Assumptions Year 1:
Gold Price:
Yards of material per hour/day:
Yards per Season:
Days per Season:
Season No. 1 (limited production)
Project Life at 324,000 yds per season
COGS: Cost of production
Gold recovery per yard:
$1,500 per oz.
150 yph/1,800 ypd
180,000
120 to 137 days normal season
100 days
*15 years – conservative mine life calculation
$5.00 per yard
0.01167 oz./yard
Using the newly designed Godwin Gold Dredging System, GML expects to produce
approximately 21 gross ounces per day at 85% purity thereby netting 17.86 troy ounces
during the first mining season – June 1, to Sept 30, 2015 (120 days) totaling 100 working
days of operation at 12 hrs per day with down time of between12 to 17 days for dredge
setup, preventative maintenance and gold recovery tuning. (Normal season 120-137 days)
The approximate operating cost per yard is expected to be in the $5.00/yard range. At the
rate of 150 yards per hour x 12 hours = 1,800 yards x 100 days = 180,000 yards per
season or $900,000. (Daily production for first year will be increased as the “bugs” of the
new machine are worked out and the system is fine-tuned.)
Gross Income is calculated to be $2,679,000 for year 1 (1,786 net ounces Au).
First Year gross Income is calculated to be
COGS:
Gross return
Repayment of debt to sinking fund
at a rate of 75% of Gross until paid
Net remaining with Company
$ 2,679,000
$ 900,000
$ 1,779,000
$ 1,334,250
$
444,750
Assumptions Year 2 thru 6:
Gold Price:
Yards of material per hour/day:
Yards per Season:
Days per Season:
Project Life at 324,000 yds. per season:
COGS:
Gold recovery per yard:
$1,500 per oz.
150 yph / 2,700 ypd
324,000
110 to125 (total potential work days 137)
*15 years (see below - mine life calculation)
$5.00 per yard
0.01167 oz./yard
GML during a full mining season expects to produce approximately 31.51 gross ounces
daily at 85% purity netting 26.7826 troy ounces per day during the mining season – May
15, to Sept 30, 2015 (137 days) totaling 120 days of operation at 18 hrs per day with down
time of between 12 to 17 days for preventative maintenance, equipment breakage and gold
cleanup. (Normal season 120 days)
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Using 26.7826 net oz per day at 120 days of operation the gross revenue at $1,500 per oz.
the total amounts to $4,820,877 USD
The approximate cost per yard is expected to be in the $5.00/yd. range. At the rate of 150
yards per hour x 18 hours = 2,700 yards x 120 days = 324,000 yards per season or
$1,620,000.
Gross Income is calculated to be $4,820,877 years 2 through year 6
(Year 2 through year 6 – 3,213.91 net oz. gold)
Years 2 thru year 6
COGS:
Gross return
Repayment of debt to sinking fund
at a rate of 75% of Gross until paid
Net remaining with Company
$ 4,820,877
$ 1,620,000
$ 3,200,677
$ 2,400,507
$
800,169
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Revenue Projections based on $1500 per oz. Au and 8% interest. These numbers are
based on information as shown above in the assumptions and are rounded off.
Year 1
Yards
Processed/Day
Year 2
Year3
Year 4
Year 5
Year 6
1,800
2,700
2,700
2,700
2,700
2,700
2,679,000
4,820,877
4,820,877
4,820,877
4,820,877
4,820,877
900,000
1,620,000
1,620,000
1,620,000
1,620,000
1,620,000
Gross Profit
1,779,000
3,200,677
3,200,677
3,200,677
3,200,677
3,200,677
Net Income
1,779,000
3,200,677
3,200,677
3,200,677
3,200,677
3,200,677
Debt & Interest
Repayment
1,334,250
2,400,507
1,519,872
0
0
0
Cash flow after
debt repayment
444,750
800,170
1,680,789
3,200,677
3,200,677
3,200,677
Revenue
COGS $5.00/yd
Amount of Loan
Year 1 -
$4,5 million USD
Interest paid =
$360,000
Debt reduced =
$974,250
Loan remaining
Year 2 -
$3,525,750
Interest paid =
$282,060
Debt reduced
$2,118,447
Loan remaining
Year 3 -
$1,407,303
Interest paid =
$112,584
Debt reduced
$1,407,303
Loan paid off of $4.5 million USD
Interest paid on unpaid balance at 8%
$754,644
Total principal and interest paid
$5,254,634
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*Mine life calculation
51 claims - Land area is approximately 15,000,000 square feet of mineable gravels.
•
•
Approximately 1.7 Million square yards of surface (2.5 cubic yards x 1.7 million
square yards of surface to get 4.25 million cubic yards of high grade sluice material)
Approximately 4.25 million Cubic yards of high grade added to 6.375M cubic yards
of low grade gravel = 10.625 M cubic total yards or 32 years of mine life at the
current projected rate of production (15 years used for calculations)
Alternate calculation
•
•
Production gravels available would be a minimum of 1,000 feet wide X 25,000 feet
long X 17 feet deep (Pay zone is 15 feet of high and low grade gravels and 2 feet of
bedrock) = 425,000,000 cubic feet ÷ 27 = 15,740,740 cubic yards X gold grade of
0.011 = 173,148 gross ounces gold in ground.
Production at 18 hours X 150 yards X 120 days = 324,000 yards divided into
15,740,740 yards of reserves = 48 years production life at 3,781.2 gross ounces of
gold production per year.
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Use of Loan Proceeds
Purchase of Wounded Moose Mining Corporation shares and Mining Equipment
Equipment
Description
Wounded Moose
company shares
Bulldozer (2)
Used Cat D9N
Excavator (2)
Front end loader
Used Cat 300b or 345b
Used Cat 980 or 988
Dredge (7 piece) total
70’ long by 40’ wide
by 5’ deep sectional
pontoons
Ellicott duel
bucketwheel wheel
head & pump
Gold plant
Sluice Water Pump &
Pipe
Transportation of
equipment to the site Yukon
Camp pickup truck &
trailer– 2005 or
earlier, 4x4 Duelly,
manual tranny
Fuel tank (10,000 gal)
& field fuel trailer
Service truck
Service building and
gold room
Cook Shack
Bunk Trailer (2)
Gold Room
equipment
Spare Equipment &
Misc
Contingency and
working capital
Total
Year
Cost
Currently Located
$1,400,000
Used Robishaw
Engineering portable,
interlocking modular
floats able to be
transported by truck
19891995
1990 2000
2010
$500,000 Prince George, Fort
St. John, BC
$300,000
$200,000
$231,500 Seattle, WA
$425,000 Baltimore, MD
New – 200 yard per hour
“Gold Machine”
New - 6 x 8 inch 1,500
gal per minute & 6” pipe
2013
$414,000 Revelstoke, BC
$30,000 Portland, OR,
$200,000 Vancouver, BC
Used
New or used
Used
New – Norsteel Building
New - Atco 58 foot’
combo, storage-cookwash trailer
Used – Atco
New - Gold jigs, shaker
table, Misc., from
Madden Steel Inc.
Misc. pumps, camp
water pipe, camp
generator, parts, tools,
etc
$43,000 Vancouver, BC
$30,000 Langley, BC
$50,000 Vancouver, BC
$30,000 Calgary, AB
$180,000 Calgary, AB
$100,000 Calgary, AB
$75,000 Brighton, CO
$100,000
$191,500
$4,500,000 US
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