Archive through September 24, 2005

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rederob

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Post Number: 1398
Registered: 10-2002

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Saturday, September 17, 2005 - 09:12 pm:

Ingot
OGD is an interesting producer in that it is NZ based.
I tried to find their total production costs per ounce but they only seem to present "cash cost" which is presently US$317/oz.
By way of comparison have a look at OXR and KCN:
(note that I have rounded to nearest $5)

Production:
OGD 170koz/year
OXR 200koz/year
KCN 145koz/year

Cash costs:
OGD US$320
OXR US$200
KCN US$220

Received price of gold:
OGD US$505
OXR US$430
KCN US$400

What remains unknown are actual full production costs for OGD, which includes items such as depreciation, amortisation and rehabilitation. OXR total costs add another US$90 to cash costs, while KCN adds another US$55 per ounce.

OGD has an excellent hedge book and will deliver about 75% of the year's output at about AU$600/oz. OXR has no forward hedge commitments while KCN is restructuring its hedge book and I am uncertain how they stand right now (but they have been the worst of the three due to poor strike prices).

Gold miners are notoriously difficult to fathom, so I use the total production cost as the preferred guide, against realised gold prices; then I look at output, reserves and life of mine; then a host of other things (especially the mark to market position of their hedge book).

Needless to say, with POG in AUD terms presently about $40 better than a month ago, expect ALL our miners to get a boost on Monday after a 5% rise in the last 2 days alone.

whitesamurai

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Post Number: 13
Registered: 11-2004

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Saturday, September 17, 2005 - 11:05 pm:

Good to see that gold is gaining attention in the Aussie media, and not too much attention that might send a contrarian sell signal. A lot of the junior miners are still in the recovery phase as they lost a lot of ground in the past year. Juniors are typically the last to rally but don't let that fool you if they continue to run hard for now - this ain't the last rally.

We are still a long way from overbought in the long term although I suspect there must be a retrace before US$500 is notched up. The break through $457 was the signal we needed to confirm the secular bull run continues. Don't forget gold trended down for nearly 20 years and while taking out a 16 year high is a huge achievement, this run has only been on for a few years. Imagine if gold continues this uptrend for another 15+ years!

I suspect a lot of funds have built up large speculative longs in the past few months. There will have to be a pullback when these are closed however gold is still moving from the weak hands to the strong so I view any pullback as a good buying opportunity.

Rederob, I remember when we used to talk about gold below $340 and silver below $5. Things have gone well since then in US$ terms and we've waited for the same action on the AUD front. We're getting that now and I am looking back on some purchases at AUD520 and AUD7.50 with a smile. The Dark Angel Batallian (whoever they were) would be proud.

rederob

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Post Number: 1400
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Sunday, September 18, 2005 - 08:26 am:

WS
Gold under $340 - yes I recall those days.
The dab hands went out in a blaze of glory!
Hardest thing is to sustain a line of bull day in day out.
Especially when the technicals break down and these traders forecast doom and gloom ahead.
The next hurdle gold will jump is another Fed interest rate hike. Again, the doomsayers are stuck in the groove that ordains POG to the scrap heap as interest rates increase, as it does not gel well with money theory.
Anyhow, there is a clan of party faithful that have maintained this thread for some time now since archer kicked it off in late 2002 (POG under $330).
I note that back then CRS was trading in the 90cent range and even LHG was higher than it is today.
months later OZ goldies fell back to earth when our stronger dollar dragged down the profits of OZgold miners (due to the exchange rate deteriorating OzPOG prices).
Hopefully the cycle will swing back and OzPOG prices will again crash thru $600 to deliver our producers some decent profits again.
If hype is anything to go by, a climb to $500 could be more rapid than I anticipated. Although the inevitable retrace will kick in then as profit takers bite the hands that fed them.

rederob

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Post Number: 1404
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Sunday, September 18, 2005 - 12:57 pm:

Dr Bug
SBM hit your 28cent target.
Can you please chart a new path for the duck shoot.
Methinks if there is a POG retrace then SBM at 24cents (the filled "gap") would be a nice pick up line.
nuff sed

greenspansgout

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Post Number: 9
Registered: 12-2004

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Sunday, September 18, 2005 - 01:13 pm:

Things have certainly heated up since I last posted.

That is one massive cup, Goldbug, for SBM. A nice sideways trend would be just peachy from where I'm looking at it.

Things are falling into place for gold: let's not look too far ahead into the future. Interest rate rises will only be incremental, and won't change the ball game overnight. High oil prices have changed the ball game, though, but then they've been with us for some time now. At the end of the day that is the overriding fundamental factor at work here, and it will be for some time into the inflatory future.

greenspansgout

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Post Number: 10
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Sunday, September 18, 2005 - 01:34 pm:

Rederob:

SBM: possible cup 'n handle, though obviously still a ways before being confirmed.

goldbug

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Post Number: 273
Registered: 02-2004

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Monday, September 19, 2005 - 10:44 am:

morning' all...

SBM alert .... breakout ....
be careful...

Regards

GB

goldbug

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Post Number: 274
Registered: 02-2004

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Monday, September 19, 2005 - 11:57 am:

and heres the chart:

Mr Sed .... you may have to work on your pick up lines ...

Regards

The Bug

greenspansgout

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Post Number: 11
Registered: 12-2004

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Monday, September 19, 2005 - 03:08 pm:

Would be expecting a handle at some stage: hopefully forming higher than what the cup is at the moment!!

rederob

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Post Number: 1408
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Monday, September 19, 2005 - 05:27 pm:

Slightly stronger greenback and weaker euro are having an interesting time with POG at the moment.
Presently POG is euro$377.65 and AU$599.95 which is a touch over weekend closing prices (despite a one cent decline in the euro today).
Although we need to see what New York will do with POG tonight, the fact that POG has increased in other currencies during the day is an exceptionally bullish start to the week.

rederob

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Post Number: 1409
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Monday, September 19, 2005 - 09:10 pm:

Dr Bug
Hope you are carefully taking this patient's temperature.
Since my rounds at 5.27pm POG now weighs in over euro$3 heavier (euro$380.78) and has broken to AU$602.
It seems that Greenspan's diet has been goosed and a golden egg is in gestation.
The beneficiation of POG is likely to continue for some considerable time and we must consider returning her home for more abundant recovery in the near future.
Yet again the technical specialists were not able to understand that chart direction is subservient to a stronger will.
That the patient was ill for over 15 years does not imply a death sentence.
I suspect they mis-diagnosed a benign comatose state on the assumption that POG would soon be pronounced dead given the euphoric nature of fiat currency in recent years.
A close watch on this patient over the week is required in case surgical intervention is necessary to circumvent the inevitable periodic relapses we have become accustomed to.
nuff sed

rederob

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Post Number: 1411
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Monday, September 19, 2005 - 10:56 pm:

A bit of equivocation after POG bolted to the gate at $464 and got a rude shock.
So did all the onlookers.

rederob

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Post Number: 1414
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Tuesday, September 20, 2005 - 04:31 pm:

POG is again off and racing and leaving the shorts in misery as it keeps hitting new contract highs.
Overnight spot gold peaked at $468.10 before dropping back on profit taking.
Today POG has consolidated through the day and is getting a new head of steam after Allords closed half an hour ago: POG @ US$467.50 as I write this.
Excellent news on the euro-greenback disconnection, too, with europog at $383.70 and ozpog @ $607.50 - both commendable improvements over yesterday's prices.
Looking for an early break to US$475 before profit takers decide to cool their red hot hands.

rederob

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Post Number: 1416
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Tuesday, September 20, 2005 - 06:02 pm:

POG takes out $470.50 as I type - heck of a pace.......
Silver can't run fast enough - $7.40

rederob

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Post Number: 1421
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Tuesday, September 20, 2005 - 11:51 pm: