Lost Password :: Posting Pictures :: Who's Online :: Stats :: Memberlist :: Top Posters :: Search
:: :: So you wanna placer mine
Unsubscribe From Newsletter



Welcome, Register :: Log In Welcome to our newest member, Agent67.
Users active in this forum:
Users active in this thread:

people online in the last 1 minutes - 0 members, 0 anon and 0 guests. (Most ever was 29 at 13:36:32 Sat Aug 3 2002)

Pages: [ 1 2 3 4 5 ]

[ Notify of replies made to this post ][ Print ][ Send To Friend ] [ Watch ] [ < ] [ Add Reply ] [ > ]

geowizard
15:31:13 Thu
Oct 18 2012

Offline
posts
Reply
Re: So you wanna placer mine

Mobe and de-mobe represent the largest cost of placer mining in remote areas. Any notion of striking it rich on a placer mining operation within 50 miles of the road system in Alaska is FANTASY!

This summer, I was visiting with a senior helicopter chief pilot and asked about the cost to charter an A-Star B2. She quoted the Cost at $4,500 per hour with a 10 hour minimum plus fuel.




This helicopter has a useful load of 2270 lbs. Useful load includes fuel and pilot. One hundred gallons of fuel - 600 pounds and an average pilot - 170 pounds = 770 pounds. The payload could be no more than 1500 pounds.

- Geowizard
[2 edits; Last edit by geowizard at 15:49:57 Thu Oct 18 2012]

  
overtheedge
17:07:33 Thu
Oct 18 2012

Offline
600 posts
Reply
Re: So you wanna placer mine

Don't forget density/altitude. Usually not a problem for most of Alaska if we stay out of the mountains. Can be a real biggy in the lower 48 during summer.

Then there is that last 1/2 hour or so of fuel which belongs to the pilot. Don't bother trying to dicker for a few minutes more.

If you have refueling capability, you can get a bit more payload by lifting less fuel. You just have to refuel more often.

Internal loads fly faster than external aka sling-loads. But externals can have a faster turn-around. It is all about packaging and load personnel.

Typically, no PAX with external loads.
--------------
Cost/ benefit ratio is the deciding factor for everything having to do with mining including exploration.

I haven't had to but a seat on single engined fixed wing in years, but for the sake of argument, I'll figure $250 an hour. Let's figure this is strip to strip. Roughly 100 mile radius for $500. Roughly same payload. Walking another 10-15 miles from an airstrip might have an economic upside.
------------------
You have to know what your economic cut-off level is. How much you can afford to lose. Your physical and psychological ability. Your knowledge/skill base.
-------------------
On every placer deposit, there is an economic threshold and a point of diminishing returns.

There is only so much gold per yard. For one-man-band operations, 50 yard gravel might be it. The one man operation can economically work small stringers. If the deposit is several acres, small equipment makes more economic sense.

For every size class of equipment, there is an economic threshold. All your equipment is limited in through-put by the bottleneck. The more equipment/expenses, the more in the hole you start each day.

You will become a mechanic. Or broke. And you thought you were in the hole this morning?
-----------------
Ain't quite made the transition yet. But trying my hardest. Is there a draft under my hat?
eric

  
geowizard
17:47:05 Thu
Oct 18 2012

Offline
posts
Reply
Re: So you wanna placer mine

ote,

All valid points. And the shovel hasn't even hit the dirt.:smile:

Could just wait for the carnival to come to town and spend a couple hundred on merry-go-rounds for a real thrill!

But, then, the REAL thrill is nuggets. BIG nuggets!

Your estimate for a single-engine charter is close. The last time I used a charter out of McGrath a couple of months ago, it was $550 an hour, they get $330 for a 34 mile out and back. Yes, they charge for the return flight even if I stayed at the mine.:gonetoofar:

- Geowizard

  
Jim_Alaska
18:22:21 Thu
Oct 18 2012

Offline
4302 posts
Admin

Reply
Re: So you wanna placer mine

Scrub,

Having 37 years experience dredging in Alaska, as well as in the lower 48, I think I can help with some of your questions.

First of all, as has already been suggested, The name of the game in any gold mining venture is the more material you can move, the more gold you will recover.

In that vein I would suggest not even thinking about using a 2" dredge. You simply cannot move enough material to make it worth it. You will find that there is more material over 2" than under it. A 2" dredge is a toy. I consider the smallest dredge for any kind of "production" is a four inch, and even then, this is minimal.

I have gone the "raking the cobbles" route in my early days. I found that it does not accomplish much. Once you get a hole started, it all has to be raked uphill. Simply raking the surface before dredging only removes the very surface cobbles, the minute you get below this there are just more cobbles.

You didn't say just how shallow this new river is. If you are working with your back on the surface, a harness for weights might be ok, but remember that you will increase depth as you enlarge the hole. I would strongly advise against a harness for safety reasons.

Until you get in an emergency/panic situation you will never understand the idea of just being able to cut loose one buckle and drop your weights. Just imagine a situation where you are working hard and need to take a breath, but your regulator just popped out of your mouth and you don't have time to find it. At a time like this the difference between having to cut loose one buckle, or three buckles and also shrug out of the shoulder straps could mean the difference between you living or dying. Don't ask me how I know this, just take it from one who has been there.

It is very difficult to get your weight belt tight enough once you develope the gut that comes with age. One trick I learned is to just get it on any way I can and then once in the water get yourself in a "head down" position, laying flat on the bottom. In this position you will be able to really tighten it properly.

You will experience lots of problems and decreased productivity if not using Hookah and trying it with a snorkle.

Since the name of the game is moving material, please understand that in a two man dredging operation each man has his specific job. The nozzle man's only purpose in life is to keep material moving up the nozzle. The other guy should be the "rock man". A good rock man will have the initial dredge area cleaned of rock before you begin dredging. He will then take care of, not only the larger rocks and boulders, but also help you be more efficient with your nozzle work by extracting the rocks that need to be moved as you uncover them. If you as nozzle man are moving fast enough that you also need to pull some rocks from in front of the nozzle, you should not have to throw them, the nozzle man's hand should be right there to take what you pulled out.

My rock man will be right at my elbow, taking rocks as I give them to him, while also moving the ones he sees. Your rock man should be someone who not only has lots of strength, but one that can also think for himslef and anticipate what is needed before it is needed.

You will find it more productive to switch jobs between rock man and nozzle man, giving each a needed break, assuming that you both understand the concept of each job and are very proficient at both.

Being nozzle man takes a lot more understanding than many guys can handle to be productive. Any rock that plugs the mouth of the nozzle, or causes a hose plug-up results of a lot of lost time. The object is to be able to determine if a rock you are going to suck up will fit or become stuck. For production reasons it is way better to simply not suck up any rock that you even "think" might cause a problem. It takes a lot less time to simply throw it rather than have to clear a plug-up.

Sharp rocks, flat rocks, or long thin rocks are all potential plug-ups. Avoid putting them up the nozzle.

As far as the best size dredge, it will depend on what you can comfortably handle and the size of the material being worked. Remember the production factor, if the dredge is a real grunt to operate, you will tire faster and at that point all production will stop while you recover.

Don't try to rationalize your time. You can only handle a given amount of time underwater working. Fatigue, plus the effects of cold water will tire you faster than anything. I consider four hours actual underwater working time to be about all I can handle. And you will find that even that cannot be sustained day after day with no break.

You will not be able to work for very long without a wetsuit in Alaskan water temps. As a matter of fact a wet suit won't do much good unless you have it hooked up to a hot water system. I tried using a wet suit my first year and very quickly put out the money for a good dry suit. They are expensive, but the upside is more time in water to work.

I hope this helps some, I am sure others can add some to this thread that will be helpful.



---
Jim_Alaska
Administrator
jfoley@sisqtel.net
 
 
geowizard
23:33:53 Thu
Oct 18 2012

Offline
posts
Reply
Re: So you wanna placer mine

Jim,

You're a hard act to follow! :smile:

The only thing I could add is a ride in an Astar(in Alaska).

Fasten your seat belts, please.


http://www.youtube.com/watch?v=KsG6-R7HUJs

  
hoppingforpay
01:48:03 Fri
Oct 19 2012

Offline
164 posts
Reply
Re: So you wanna placer mine

My point was that one doesn't choose to to be recreational or commercial just that some guys become commercial.Everyone would rather get an ounce in a day as opposed to a pennyweight in a day.I have plenty of stories about guys wanting to be commercial and buying or having all the equipment ( Cats, Excavators ) but not the slightest clue about ground. It is very much possible that these types of guys can find and do find 5000 yds to the oz ground. That can be avoided if a person gets good at prospecting and can "see" what he is testing. Simple math is much more important to understand than geology when it comes to, is it mineable or not.

A small miner who has mined many paystreaks through many years carries a "log" in his head of his past finds that he applies to the ground he is looking at. The more of these finds the miner has the less likely that nature will trick him out of a good find.Especially if his finds are not all from just one stream.

Just like an indian following a trail a prospector through the development of his "visuals" will decide where to put in an excavation to see if there is gold.He doesn't want to waste work and time.He doesn't want to dig a 20 foot to bedrock hole when 2 hundred yds up stream there is bedrock within 4 feet.He is looking at everything, the width of the valley, the swiftness of the stream,the color of the rocks,the growth along the edges of the stream,stones or plantlife showing disturbance by man, anything that will reduce the chance of digging a worthless, time wasting hole.

After my first sale of Yukon gold to a car dealer/gold buyer in Whitehorse I went back to California. I side tracked along the highway along the Klamath River. I don't think I saw a single dredge. I wondered about it but not enough to check the BLM for claims...I could of had my pick because this was I believe before McCracken got them all, 1983 I think.

Commercial is about getting there first and making all followers recreational by default!

Lipca that is right 60 buckets equals a yd and a half but probably around 4 yds moved in order to get those buckets.

  
BobAK
04:12:06 Fri
Oct 19 2012

Offline
696 posts

Reply
Re: So you wanna placer mine

Tons of good info here, and yes like Jim said--a rake and 2" dredge gets you nowhere

  
geowizard
19:02:31 Fri
Oct 19 2012

Offline
posts
Reply
Re: So you wanna placer mine


There is an "intermediate level" of placer mining. This level provides a transition from buckets and back pain to using a machine with hydraulics.

Most of you are probably aware that I moved two Bobcat loaders to my operation at Ophir Creek. These machines get the wannabe placer miner past the physical limitations imposed by be human. The S185 has a quarter yard bucket. I have always considered 20 - five gallon buckets as a half yard. So, yes 60 buckets = 1.5 cu yards. Running dragline tailings, I can load my washplant once a minute. So with everything working properly, I can push 60 loads an hour = 15 cu yds. per hour. I used the 6 inch suction dredge as a model for a 50 cu yard per hour washplant. There are archives of the "Maxi-Banker" on this forum and else-where.

So, yes, I spent the past two winters fabricating three Maxi-Bankers. The Maxi-Banker is fabricated from unistrut and can be disassembled and re-assembled. That way it can be flown in on a Cessna 207 to remote areas and reassembled. The washplant has two or three 4" x 56" spray bars and a 650 gpm Keene 23 HP pump.

- Geowizard

  
geowizard
19:13:30 Fri
Oct 19 2012

Offline
posts
Reply
Re: So you wanna placer mine

Ophir Creek has 10 million cubic yards of dragline tailings that run .01 to .025 troy ounces per cubic yard.

See www.ophir-alaska.com

The math is what I call a straight-line calculation. I developed a business model, put together an MS Excel spreadsheet that demostrates the profit/loss calculations for various production scenarios.

The Bobcat was chosen because I have to fly equipment into McGrath on a Boeing 737 freighter (Northern Air Cargo). The freight charge from Anchorage to McGrath is a buck a pound plus tax plus fuel surcharge. The Bobcat will fit through the cargo door with 3 inches to spare. The 8 mile trip on a barge down-river for two bobcats and Hoses was extra. :smile:

- Geowizard
[2 edits; Last edit by geowizard at 19:17:36 Fri Oct 19 2012]

  
cubsqueal
03:44:02 Sat
Oct 20 2012

Offline
365 posts

Reply
Re: So you wanna placer mine


While reading this fascinating thread, I can't keep from thinking how comfortable and warm my recliner looks!

Back in 1980 when gold was about $800/oz., my father and I were invited to "mine" on a good-sized group of claims on Burwash Creek in the Yukon. Several family members (not ours) had gotten together hauling up cats and other equipment. One of the gentlemen was saying nobody realized how rich they now were. Using the valuation of a spot on their claims and projecting that value linearly for their full claims area, they were worth $14 million, or so they thought. The guy was like drunk with the thought of their enormous wealth. Anyway, most of them lost their farms and homes. Not a happy ending.

Below these claims a Canadian group had put in a really nice-looking operation--at least $1.5 to $3.5 million, can't remember now. They went broke too. (An old miner had previously mined the area and had apparently done a very good job of following the paystreak. Seems like he got killed when his cat ran over him?)

As a friend used to say when we tried to pan a little yellow stuff here in western Oregon, "Why does Mother Nature have to be such a stingy old bxxxx?"

[1 edits; Last edit by cubsqueal at 03:47:02 Sat Oct 20 2012]

  
Jim_Alaska
04:03:52 Sat
Oct 20 2012

Offline
4302 posts
Admin

Reply
Re: So you wanna placer mine

And then there is always the old adage: How can you make a small fortune mining? (Answer) Start with a large fortune. :devil:



---
Jim_Alaska
Administrator
jfoley@sisqtel.net
 
 
cubsqueal
04:24:01 Sat
Oct 20 2012

Offline
365 posts

Reply
Re: So you wanna placer mine


This might be a good place to tell about the young couple that came into a small shop here on the Central Oregon coast about 2 years ago. The owner described them as very rugged looking. They said they were down from Alaska after spending the summer mining on a relative's claims, and were in the process of returning. They had a brand-new F-350 and a new dredge in the back. They would not say what part of Alaska they had been in, but did say they found (as I recall) 150 oz. of nuggets and 175 oz. of fines. They paid for their purchases with gold.

So I guess we can all dream....

  
geowizard
15:45:27 Sat
Oct 20 2012

Offline
posts
Reply
Re: So you wanna placer mine

Entrepreneurs know there is risk in what they do. If a gold miner applies a reasonably strict business philosophy to what he or she is doing, the outcome has an equally reasonable chance of success.

Take sampling for example. How many samples are adequate?:confused:

Books have been written on the subject of sampling a placer gold deposit. Many investors will not invest money in a placer mining operation because of the risk involved. Sampling before-hand is one of the important steps required in the process of reducing financial risk.

I began sampling dragline tailing piles at Ophir two years ago (almost three). Sampling was done using a Cat D8N, Cat 235 Excavator, and a 150 cu yd. per hour wash plant... The equipment was used by a lessee and I was able to monitor the production. samples of the gold I received as royalty are viewable at www.stampede-gold.com .

In order to expand the process of sampling, I used a new Proline highbanker combo 3" suction dredge. Samples were measured using five gallon buckets. When you do the conversion, there are 40 - 5 gallon buckets to the cubic yard. I considered 20 buckets to be an adequate sample.

Sample location is important when sampling!

Dragline tailings are upside-down. The inside core of the tailings represent the muck and overburden. The next outer layers represent the material mined for gold. The outer most layer represents the end-point or barren bedrock material.

Know the source of the sample and take it into consideration.

Statistical variation:

While working at Honeywell, they offered a paid course in "Six-Sigma". The course was offered to "exempt" employees. Exempt employees are those employees on salary and that are exempt from over-time. Well, I was not an exempt employee, because I was hourly and received overtime. - Long story - short - I applied and was accepted into the Six-Sigma training program.I was the first in the door, sat in the front of the class and when the program was over, I was the last one out the door, turned out the lights and closed the door. It was probably the most important training that a person can take.

How many samples represent a statistical sample? :confused:

It turns out that you need 11 samples. The samples then represent the area sampled. I have taken hundreds of samples at Ophir and applied the rules of six-sigma to the sampling campaign.

How do you measure the weight of the gold? :confused:

The measurement system (scale) should have greater precision and accuracy than the specified result. Precision in a digital scale is represented by the number of digits. Accuracy depends on "calibration". I measure to one milligram on an Ohaus scale. I calibrate the scale using Ohaus certified calibration weights. I adjust the resulting measurement for the drift or difference in the calibration.

Bias:

Don't bias the measurement.

The scale should be covered, so you can't breathe on the scale!

- Geowizard
[2 edits; Last edit by geowizard at 15:55:59 Sat Oct 20 2012]

  
overtheedge
18:13:53 Sat
Oct 20 2012

Offline
600 posts
Reply
Re: So you wanna placer mine

Geowizard brought up a good point on sampling.

When prospecting, if a place is good enough looking to sample pan, I run 3 pans. Long ways from 6 sigma. It might make 1.5 sigma at best. 3 pans also gives an idea of variability between pans.

1 sigma is 68.3 percent probability. 2 sigma is 95.4 percent probability. Statistics is just probability aka odds. Sampling tells you what you got in your pans and statistics might predict what probably remains in the deposit. The better the sampling efforts, the higher the probability one way or the other.

The problem with 1 pan is the nugget effect or anti-nugget effect. The next pan could be anything but the first. 3 sample pans increases the probability that the deposit is or is not economical at that location only. 20 feet away and it can be a whole different ballgame. Hence the need to sample pan to delineate the economic boundaries.

I would argue that sampling separates the successful commercial miner from the recreational. Success defined as income exceeds out-go.

It appears that the recreational miner tends to find a spot that has color and then goes to work using whatever tools they have available. The commercially-minded miner samples profusely and often. They make sure the odds are in their favor.

This becomes more critical with heavy equipment. Every hour of operation costs money; you are already in the hole expense-wise: Initial investment and start-up operational costs.. Either the overburden pays or it gets moved out of the way the fastest and cheapest way possible. Just keep in mind rehab costs.

A thorough sampling effort will help you gauge the size-class of the equipment that can be economically utilized. The placer deposit has to pay ALL expenses including equipment purchase price and transportation costs to and from. The recreational miner amortizes the equipment costs over the life-span of the tool. In a commercial operation, the amortization period has to be over the lifespan of the deposit.

An operation that is just paying its way is a money loser. You absolutely need profits. A sizable portion of these profits MUST set aside for maintenance, rehab and demob.

Ever wonder why claims are sold with the equipment? Too old? Health issues? How old is too old and maybe the health issue is just "sick and tired of being broke?" Then there is that accumulated rehab and demob costs that aren't off-set by any recovery.
----------
The hand-miner has an oft overlooked expense; food. We tend to forget that hand-mining is calorie intensive. The 2500-2800 calories that gets us by at a day job is just a snack. It is easy to eat 5000 calories a day and still lose weight. Not eating enough reduces efficiency of the human engine. If you are consistently running out of steam early in the afternoon, you aren't eating enough fuel.
-------------
Unfortunately, experience is an expensive school and there have been far too many times I've paid the tuition. And on occasion, I've been known to take a remedial course. Not so often anymore, but ... I still tend to shed 15-20 pounds a season and get overly optimistic. Ah, but next year!
eric

  
geowizard
20:13:13 Sat
Oct 20 2012

Offline
posts
Reply
Re: So you wanna placer mine


I burn 8,700,000 calories every 15 minutes!:welcome:

Sitting in the shade on my patootie.

I haven't touched a shovel since I discovered Bobcats. Ote is correct in the fact that the name of the game is calories. That concept works it's way back to what is "work" and how we measure work. Horsepower plays into the subject. Human beings at an early point in history gave notice to the potential of using horses! At a later point, i.e. WWI, before the internet, the diesel engine was developed. Years later, hydraulics improved mining by replacing the cables.

There's a moral to the story...

A human can only consume a limited amount of calories and do a limited amount of work. When it comes to feeding a human and feeding a machine and comparing the cost versus performance, the machine wins.

In the bush, I figure the cost of diesel at $10.00 per gallon. One liter contains 8,700,000 calories:

http://www.ehow.com/how_6195532_calculate-calorific-value-diesel-fuel.html

One liter = approx 1 quart = approx $2.50. That's the cost of a Big Mac. Yes... I had to buy the machine. But I own it and I can sell it. Yes... I have to transport the machine to the mine. But, the machine is worth more near a mine. (location = value added). Yes... I have to maintain the machine. But, it's parts are replaceable and mine arent!:smile:

- Geowizard

  
Scrub
02:06:36 Sun
Oct 21 2012

Offline
19 posts
Reply
Re: So you wanna placer mine

Thanks for the info & advice! I'll use it.

  
overtheedge
07:36:48 Sun
Oct 21 2012

Offline
600 posts
Reply
Re: So you wanna placer mine

Don't get me wrong, I'm a big fan of internal combustion engines attached to tools. I am a tool using specie. I think most of the time. There is only so much gold per yard, ergo to make more money, you MUST move more yardage. Under average conditions hereabouts, I can process about 4.5 yards a day shoveling in.

Even one of those tow-behind mini-backhoes will move more yardage in a day than I can move in a long week. Maybe two. On what, 3 gallons of gas? Around here, food calorie costs are about $2/1000 calories actually it is 1000 kilocalories. Gasoline is $4.84/gal for 26.5 million calories. Gasoline, diesel, cheap for the tools they can fuel and work accomplished. Plus, ta da, the tool is engineered to do one job very very well. I'm a generalist. My body can sorta, kinda do any job but isn't optimized to a specific purpose and still needs a tool designed to fit the average person.

I tend towards the frugal side. Better to run smaller equipment than to over-extend yourself going to the largest practical for the grade/acreage. Just as long as you meet your minimum on average. Lot easier to upgrade with gold in hand than attempt a quick downgrade when you are broke.

If I had the ground, I would budget for the upgrade to mini-sized equipment as fast as possible. Shoveling-in is just the means to that upgrade. Or in my case, I snipe point bars where the total yardage rarely goes more than 25-30 yards. Then days, weeks of just colors until I find another bar that pays.

One other point, a mining claim runs into that prudency issue. The intent of the claim laws is to put the claim into mining production. I would ask, if the claim consistently turns a profit shoveling-in, why not make that initial upgrade to mini-sized equipment? The additional profit will grossly exceed the costs in the same ground.

As an example, let's say that I am content with 2dwt/day shoveling-in 4.5 bank cubic yards well shovel the smaller stuff and just move the big rocks aside. Let's assume that a mini-backhoe has a 1.5 cubic foot bucket and it has a dig, lift, swing, dump and return cycle time of 15 seconds. That is 6 cubic feet per minute or 13.3 yards an hour. we'll operate or shovel-in for 6.5 hours a day. Shovel-in: 4.5 yards. Mini-hoe: just over 86 yards. 86/4.5= about 19X the 2dwt=38dwt or just under 2ozt a day. But I am physically limited to 6.5 hours before I'm done in. Not so with powered equipment. Wanna work some 16's? 16hrs x 13.3yards=212ypd/4.5(my yardage shovel-in) = 47 times that 2dwt minimum= 4.7ozt/16 hr day*

eric

* Your results may vary. Offer void where prohibited by law. Make sure your seats and tray tables are in the full upright and locked position.

Just how short is that pay-back period again?

  
geowizard
14:21:48 Sun
Oct 21 2012

Offline
posts
Reply
Re: So you wanna placer mine

Sometimes, we spend our time re-inventing the wheel!

History can serve us well. I often read about members of the Alaska Mining Hall of Fame. One such miner was Peter Miscovich, an Iditarod miner:

http://alaskamininghalloffame.org/inductees/miscovich.php

He came to America through Ellis Island with no education, and no understanding of the english language.

Can we learn about placer mining from the experience of other placer miners that precede us?

- Geowizard
[1 edits; Last edit by geowizard at 14:24:03 Sun Oct 21 2012]

  
geowizard
16:50:49 Sun
Oct 21 2012

Offline
posts
Reply
Re: So you wanna placer mine

What's the margin? :confused:

Margin is (generally) defined as the difference between cost and revenue.

Let's say we have placer gold that runs 0.01 troy ounces per cubic yard. We are employing two equipment operators to operate a Bobcat and washplant.

Revenue:

If: We operate 10 hours per day. We process 10 cubic yards per hour x 10 hours = 100 cubic yards. The washplant is 80 percent efficient = .8 ounces of raw gold. Raw gold when sent to a refiner pays .70 of the spot gold price. So, given spot gold at $1750 an ounce x .8 ounces x .70 = $980.00 on the revenue side.

Cost:

One Bobcat burns 10 gallons of diesel x $10.00 = $100.00

One Bobcat burns 10 gallons of diesel x $10.00 = $100.00

(The second Bobcat clears tailings)

23HP Pump burns 10 gallons of unleaded x $10.00 = $100.00

Two employees @ $20 x 10 hours = $400.00

Pump replacement $2500 a 1000 hours = $25.00/10hrs oper.

Bobcat (x2) replacement at 5000 hours = $100.00/10 hrs oper

Food, gas for genset, wifi, etc. $125.00

Total cost = $950.00

Margin = $980. - $950. = $30.00

Less taxes = $20. :welcome:


added content:

Who does the cleanup?

You do!

Added cost = $400 (one day) cleanup...

Net = ($380):gonetoofar:

Note some operators do cleanups at 5 day intervals to avoid this problem. They don't go broke as fast!

Oops... Forgot Caveat Emptor: Your results may vary. There can be additional losses that translate into "cost". This model assumes no sick days, no injuries, no equipment down-time, everything works perfect!

Corrected grammar, spelling errors and calculations. No liability is assumed for any use or misuse of the aforementioned business model...

- Geowizard


[7 edits; Last edit by geowizard at 17:28:38 Sun Oct 21 2012]

  
geowizard
17:52:42 Sun
Oct 21 2012

Offline
posts
Reply
Re: So you wanna placer mine


IF You still wannabe a placer miner, YOU have to fix the problem!

I fixed the problem!:smile:

Please tell me, what would you do?:confused:

- Geowizard

  
Diamond_digger
19:31:03 Sun
Oct 21 2012

Offline
posts
Reply
Re: So you wanna placer mine

Mining gold and diamonds is in the gene pool or in the blood as my Old Teacher Harry Sullivan used to say.
You either have it or you don't
Them that don't never make it as miners.
Andy

  
geowizard
20:22:33 Sun
Oct 21 2012

Offline
posts
Reply
Re: So you wanna placer mine

Andy,

Welcome to the forum! :welcome:

- Geowizard

  
overtheedge
20:25:44 Sun
Oct 21 2012

Offline
600 posts
Reply
Re: So you wanna placer mine

From an earlier post, you stated that the Bobcat could feed 15 yards an hour. You process 10 yards. This would imply that the feed cycle time is too long. Better placement of the washplant might get you a couple, three yards more per hour average. We'll use 12yph.
+20% gross income

The tailings Bobcat might be able to accomplish its job in 75-80% of the time provided tailings management practices were optimized.
+$20 net savings per day on expenses

The washplant efficiency is at 80%. An optimized plant should get you close to 90% recovery with 92% possible. But we'll figure 90%. Sluice bedding perhaps?
+12% gross income (0.90/0.80=1.125 aka 12.5%) on top of +20% from first paragraph. For a total gross increase of 34%.

Then you ran 10 hours a day. This is where the hourly operational costs limit increased profits as the daily fixed are already low. But recall that 34% increase in recovery for a 10 hour day? 12 hour days increases recovery period by 20% but more probably 15% due to inefficiencies at the end of the day. This would realize a increased recovery of about +25% for 2 hours rather than the 34% for the first 10 hour.

Former fixed cost @10 hours = $950
With optimization outlined @10 hours = $930
With optimization @12 hours = $1085

Former recovery @10 hours = $980
Optimized @ 10 hours = $1313
Optimized @ 12 hours = $1588

Daily net
former @10 hours = $30
opt @10 = $383
opt @12 = $503

I think the figures are right. I didn't bother writing it all out and might have screwed it up, but it looks close. So if increasing the day to 12 hours, why not 14? The longer the day, the less efficient and higher the probability is of operator failure resulting in injury or repair shut-down for damage inflicted. Some folks can do 14 or maybe 16 for awhile, but they get ground down to the nub sooner or later.

Just me, but I would operate 6 days a week. Clean-out once a day and concentrates clean-up on the seventh day.

As the owner, I would be on the tailing's Bobcat (remember that rehab thingy and who is responsible?). The 20-25% of time not on the loader would be spent sluice tending, moving one of the maxi-bankers to a closer spot and managing. Its my money on the line. I (and mining operation) should clear more per day than the employee.

Could the operation be optimized some more? Yes, but the margin drops off faster as the operational costs increase. It is all about margin. But that point of diminishing returns is real.

However with the material to be worked known (quantity and grade), I would be faced with the decision to be happy with what I make a day or scale up to the next production level. Yep, buy bigger equipment, washplant, etc. 120 day season with added profit of $500/day is only $60K. Maybe a small excavator first. Not the mini. Build a couple of the maxi-banker El Grande models (appropriately sized to the excavator) over the winter between working the -80mesh fraction that I didn't clean-up on the day off last season. The -80 mesh fraction flew out with back-haul.

As you can probably tell, I'm a fan of mobile washplants. Cut that stinkin loader cycle time as much as is practical.

But you knew a caveat was coming. I have NOT made the jump to full-fledged placer miner. These are just my off-the-cuff thoughts. Everyone who wants to be a placer miner MUST go through this exercise. Don't earn $1 million by spending $5 million. Do a spreadsheet on costs/income. Gain a full understanding of process flow and your operation. There is always a bottle-neck. Deal with it. Fix it. But don't bust a hump to get marginal returns that last percent or two isn't worth the effort. Let it go.

Just my opinion. I haven't made the transition. For a limited time only!!! I, overtheedge, do certify that the above is guaranteed to be worth no less than what you paid for it. The thought process used to put together the above has served me well, but your results might vastly differ. Do your own due diligence. "The captain has turned off the no smoking sign."
eric
BTW I like where this thread is going. It makes me think. It keeps me grounded in reality, uh er potential reality. Next year perhaps.

  
geowizard
03:10:28 Mon
Oct 22 2012

Offline
posts
Reply
Re: So you wanna placer mine

ote,

Good Job!

This type of situation happens first. "After" you begin operation, you see the real numbers!

Everybody wants to be the boss but when it comes to solving the problems, the boss has no-one else to turn to. He or she must turn to his or her inner self!

The revenue side is controlled by variables the operator has some (limited) control over.

Grade:

The operator may elect to do additional sampling in order to find higher grade gold. It doesn't sound like much but increasing grade from .01 to .015 is a 50 percent increase in revenue!

Capacity:

Ote hit that variable immediately. I considered adding another Bobcat. Another Bobcat will double the capacity. Also any waiting for the screen to clear on the washplant costs time and time is money. Capacity of the washplant is 50 yph. It's possible to up the capacity to three Bobcats feeding the plant.

Recovery:

Yes, Ote is spot on again. Tuning the washplant to improve recovery keeps gold in the sluice where you want it. Testing the sluice for gold blowing out the end should be done regularly. It's easy to be lulled into thinking everything is fine. Then working a week before cleanup and finding that the gold has been blowing out the end of the box.

Cleanup:

Doing a partial cleanup of the top 30 percent of the riffles saves time and generates revenue with minimum impact on production.

Next, I would focus on the camp and camp management!

Ideas?

- Geowizard

  
overtheedge
05:10:20 Mon
Oct 22 2012

Offline
600 posts
Reply
Re: So you wanna placer mine

Ah. Adding another Bobcat was a possibility. So can we assume that there are 3 personnel; working owner +2?

That changes some of the dynamics and makes optimization even more important.

$125 a day for camp costs @ 3 personnel. Making big cuts here is gonna be tough. The weight of the food alone costs a bunch to fly in. Perhaps a buyer/consolidator/river boat delivery person in McGrath. Provided you have transportation to get to the river. Scheduled deliveries.

Why WiFi? The mine needs commo, but ... ? Hey, why not? How about during a 4 hour period on the day off? You're probably paying for bandwidth/hours.

How many hours a day on the genset and for what?

Are facilities included in the $125? Tents, plywood shacks, cookhouse, etc?

Still, $125/day and say, 120 day season = $15K and this is for 3 people. Then a good figure might be $5K of that is freight costs. So we are left with roughly $835/person/month. Gonna be tough. Anymore data to give us a better picture?
eric

  
Diamond_digger
09:51:03 Mon
Oct 22 2012

Offline
posts
Reply
Re: So you wanna placer mine

Geowizard,
Thanks had a bit of a search to find the right forum.
I see the same [people hang out here as well.
Gmf they should be moving yards man hahahaha
Andy :devil:

  
geowizard
15:04:06 Mon
Oct 22 2012

Offline
posts
Reply
Re: So you wanna placer mine

ote,

You bring up another very important point. A common mistake that is often made is to allow yourself to become an employee.

The mine manager has to have the freedom to move around and not be tied to a piece of equipment for 10 hours. Who will order the fuel? Who will order supplies and schedule the delivery? Who will interface with the visitors that show up? Who will refill the fuel tank on the water pump? All of these things add up to a days work that takes away from production if not handled by a "third party".

Yes, adding a third machine i.e. Bobcat adds to the cost of operation and requires one more operator. It adds about $400 per day to the cost side of the operation. The doubling of production will add an ounce of gold to the revenue side.

Our dependency on the conviences afforded by electric power requires a genset. A small, 5 KW - 10 KW genset will blow through 5 gallons per day operating part-time. It starts with breakfast in the morning. The genset allows the cook to use electric skillets. The cook can work with light in the kitchen. A small refrigerator keeps perishable foods i.e. meats and eggs and cheeze from spoiling. How about the coffee pot or tea pot? Today's generation needs to get on the internet and check emails or communicate with the outside world including checking Facebook!

A day in the life of a mine:

I get up early and head out on the 4-wheeler to inspect the mine.

I usually set up a schedule. The genset gets started at 7 AM. I make a fire in the wood stove for heat. I start coffee and wait for the sleepy eyed campers to wake up. While waiting, I start the bacon and eggs and blueberry pancakes. Everybody eats breakfast while I provide time for discussion of the strategy for the day. I try to shut down the genset by 8 AM and head out the door so we can begin mining by 9 AM. During the day, power tools are needed to trim, cut, fablicate and modify the washplant, or do small repair jobs. Lunches are "bucket lunches". A 5 gallon bucket with sandwiches and soft drinks. The camp boss or cook has the job of making lunch and delivering it to the work site.

Someone has to check the genset from time to time and refill the fuel and check the status of the oil. The camp boss has that resposibility.

The camp requires fresh water for cooking, drinking and washing. We have two sources of water. Roof water runs off into a rain gutter and into clean 5 gallon buckets. The buckets are continually filled by rainwater and moved inside for cooking and drinking. The second source of water is creek water. The creek water is acceptable for washing dishes and clothes washing. We have an indoor shower for showers. It is a dipper and 5 gallon bucket in the rear mudroom exit. The mudroom is fitted with a shower curtain for privacy. A 2 gallon galvanized bucket is set in a steel frame on the heat stove for hot water.

So, anyway, by the end of the day, after cooking dinner and everyone checking emails, I shut down the genset at 9 PM. I have bear bars on the doors and windows to provide security at night.

- Geowizard

  
overtheedge
18:35:00 Mon
Oct 22 2012

Offline
600 posts
Reply
Re: So you wanna placer mine

I was trying to get an idea of total number of personnel that the camp keeps fed, sheltered, entertained, etc.

@ $125/day total.

I'm a big fan of working management, just not full-time working. Full-time manager, part-time fill in doing what needs to be done. If you need full time fill-in, you need another employee. Can you afford another employee?

Uh, remote means remote. Having to provide daily email and Facebook? Nonsense. Either run with the big dogs or stay under the porch and lick yourself. Employee access to commo link on day off only. This camp of yours is NOT Diavik or Prudhoe Bay. Hmm, maybe download a couple movies from Netflix or U-tube too. Who's up for pizza and beer? Room service? Restock the mini-bar, hooker sent up?

Remote means remote. Everyone pitches in on camp chores. Playing cards, mini chess set or a couple board games for entertainment. I like books. Perhaps provide a place to plug in a battery charger for an e-reader. I ain't your mama. No sense calling mama to complain.


Quote: geowizard

I make a fire ... . I start coffee and wait for the sleepy eyed campers to wake up. While waiting, I start the bacon and eggs and blueberry pancakes. ...


Sounds like I is mommy. But admittedly 15 years in military, 7 more as wildland firefighter in Ak and decades of going walkabout has left me happy to just get resupplied somewhat regularly.

Of course, friends and acquaintances are quick to comment that I am an anachronism. Today's employees have certain expectations well in excess to the most basic necessities.

Hmmm. $200/day/employee in wages + support costs = 20-25% of gross/employee? Looks like the management plan needs to be re-approached like a good old fashion rat-killing. Watching the margin means analyzing everything from the cost/benefit ratio aspect.

You (employee) either make me at least half again what it costs to keep you around or you better make your flight outa here.

Don't forget insurance money (workman's comp, medivac, equipment breakdown, cook-shack burned down, etc). I didn't see any of that in your impromptu spreadsheet analysis.

Just thinking out loud. Finding gold is easy. Making it pay is something else. Nothing will destroy a business venture faster than a "less than optimal" employee except a manager wearing blinders.

Now you might understand the reason for my nom-de-plume.
eric


  
geowizard
19:04:01 Mon
Oct 22 2012

Offline
posts
Reply
Re: So you wanna placer mine

ote,

Excellent! Bravo! I'm going to post that on the inside of the door on the privy! Excellent post!

Two new points to consider...

1. Employees are contractors. I have had to come to terms with the issue of employee liability - years ago.

"I Ain't Joe Momma!" :confused:

and...

"I Ain't Joe Long Term Disability Program!" :confused:

So, my "contract miners" operate under the terms of a contract. I remind them that I maintain a list of replacements.

There are 30 million people in the U.S. RIGHT NOW that are unemployed. I'm one of them! I am not an employment agency, although, sometimes I feel like one. Lots of "helpers" out there want to be a helper on a gold mine. Too many helpers unfortunately become a liability. There are those that enter into the scene with the intention and fore-thought of becoming a liability and the others that are accidents waiting for a place to happen! That makes being an employer a problem and makes being a prospective employee a problem. State and Federal employment laws make it a jungle out there!

Mining companies must operate under the umbrella of an LLC. Miners must operate the same way. A miner becomes a "service provider". He or she is a "vendor" that provides certain "contractual services".

I forgot the second thing...:smile:

- Geowizard

  
geowizard
20:23:16 Mon
Oct 22 2012

Offline
posts
Reply
Re: So you wanna placer mine


The second thing...

Rewarding performance:

I offer a "Performance Bonus. A performance bonus is additional payment for performing above a "benchmark".

If, for example, I have determined that on a normal day, the mine should produce one ounce of gold, AND when Wild Willy is at the controls, he produces 50 percent more gold, well, Wild Willy gets a 50 percent increase in pay.

Putting the "producers on the payroll" and providing an incentive for additional performance, keeps everyone working for the same objective!:smile:

- Geowizard

  

Pages: [ 1 2 3 4 5 ]

[ Notify of replies made to this post ][ Print ][ Send To Friend ] [ Watch ] [ < ] [ Add Reply ] [ > ]

 Total Members: 11956

  • Can start a new thread. (Everyone)
  • Can't start a new poll. (Mods & Admins)
  • Can add a reply. (Everyone)
  • Can't edit your posts.(Everyone Registered)
  • Register :: Log In :: Administrators

    The time is now 19:18:50 Mon Jan 17 2022

    Powered By BbBoard V1.4.2
    © 2001-2007 BbBoy.net
    :: :: So you wanna placer mine

    [Most Recent Quotes from www.kitco.com]

    [Most Recent Quotes from www.kitco.com]