I’ve been digging through the ‘FDN Resource Technical Report Nov 2007’ that ARU posted on their website today.   It’s a long and detailed read but has lots of interesting tidbits and history in it including the fact that FDN is located on one of the few properties that they didn’t acquire by staking (was owned by Amlatminas) and carries a 1% NSR.

A couple of key points:

First is that the resource is based on drilling completed prior to the end of June 2007.  Hole CP-06-139 is the last one included in the database.  So the a lot has gone on since then and the resource numbers should be cranking up ounces.

Second, they estimate mining costs at $37/tonne (mining, processing and G&A) or about $157/eOZ.   Their cut-off grade is based on a very conservative $550 AU and $10 Ag.    With high commodity prices (currently $777 and $14) bulk tonnage will go up as more of the deposit can be mined.  The cut off at today's prices would be about 1.6g/t

Third, the use of Cap grades in the FDN 1 zone is estimated to have reduced the metal content in that zone by 15%.  Cap grades are used to dampen the effect of statistical outliers in the assays.  It a ‘better safe the sorry’ approach of being conservative in preliminary estimates.   Increased drilling density and bulk sampling in those zones that are capped increases the confidence in the modeling of the mineralization and in the long run the grade of those zones are likely to go up.   Ever notice no one ever claims that the blank spot between mineralized zones is a statistical anomaly?

Fourth, conventional processing is likely to yield about 90% AU recovery.   The follow on composite sample and metallurgy work will show if this can be improved.

Lots more in the report including some great pictures.   Take a look when you have some time.