The Graystone Company Announces It Has Begun Mining Production
Nov 13, 2012 (Menafn - M2 PRESSWIRE via COMTEX) --LIMA, Peru, Nov 13, 2012 -- The Graystone Company (otcqb:GYST) announced that it has begun mining production in Peru.
The Company began mining production operations in November 2012 and expects to slowly develop and expand its operations over the next 6 months. The Company's expectations are that it will run one System (see below) during the 4th quarter prior to adding heavier equipment; thereby, allowing the Company the flexibility to locate the optimal locations to mine.
Company's Expected Production
The Company expects to mine 22 days per month and to generate between 15 - 20 grams per day. The Company expects to increase its number of Systems by approximately 1 per quarter beginning in 2nd Quarter 2013. The Company also expects to increase its gold recovery to 50 grams per day per System with the addition of heavier equipment such as an excavator and trammel and/or sluice box.
The Company expects to recover approximately 850 - 900 ounces of gold in 2013 for revenue of approximately 1,000,000. The Company expects to recover approximately 2,000 ounces of gold in 2014 for revenue of approximately 2,500,000.
Company's Mining Operations
The Company's mining operations in Peru consist of alluvial (or placer) mining. Alluvial mining refers to mining precious metal deposits (particularly gold and gemstones) found in alluvial deposits - which are deposits of sand and gravel in modern or ancient stream beds, or occasionally glacial deposits. The gold deposits are moved by stream flow from an original source such as a vein. Since heavy metals like gold are considerably more dense than sand, they tend to accumulate at the base of placer deposits.
The Company uses the term "System" to refer to its mining production operations. A "System" consists of the following:
-- Mining production foreman
-- Crew of 12 for mining (2 shifts of 8 hours each.)
-- Water Pumps to move water to where mining operations are occurring
-- Rock pumps to move the dirt, rocks and water
-- Sluice box
-- Shaker Tables
The Company expects the monthly expenses (monthly burn rate) associated to each system to be approximately 20,000 - 25,000. The Company expects the initial capital expenditures for each system to be approximately 100,000 and up to 250,000 with heavier equipment. These expenses include the costs of the employees, food, gasoline, diesel, oil, grease, soda ash, travel, security, repairs to equipment, machine parts, and miscellaneous supplies. The Company expects its breakeven point to be approximately 20 grams of gold per day depending on the purity levels, refining fees and easement costs.
The Company has determined that it qualifies for a 2-year exemption from the Ministry of Mining in Peru. The exemption allows the Company to conduct full mining operations on its mining property for 2-years while completing the environmental impact study. The Company has filed for the exemption and expects to receive the exemption by the end of 2012. The Company is allowed to conduct limited production operations until it receives the exemption from the Ministry of Mining.
About The Graystone Company. The Graystone Company, Inc. is a U.S.-based mining and exploration company focused on acquiring and developing gold and other mineral properties. The Company's strategy is to build value for shareholders by the identification, acquisition and exploration of early-stage properties that show significant potential for the discovery of gold. The Company sells gold and silver to retail buyers via www.graystonegold.com.
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