Reference has been made a few times to the 0.7 g/t grade at Milestone as being marginal, at best, in terms of the economics of mining. I am neither a geologist nor an economist, but I do invest in a number of mining companies and, it seems to me, there are enough examples out there of good economics for grades that are relatively low.

One that comes to mind is the Hammond Reef deposit owned by Brett Resources. In their mining plan, they show an average reserve grade of 0.8 g/t and an average feed grade over the life of the mine of 0.7 g/t. Over a 14 year mine life, it will produce gold at a cost/ounce of $593.00 and, at a POG of $990.00/ounce, will have a payback of 3.5 years.

On their last presentation, they list the reserve grades of the following large deposits as follows:

Paracatu (Kinross) .42 g/t; Pierina (Barrick) .50 g/t; Fort Knox (Kinross) .58 g/t; and Round Mountain (Kinross/Barrick) .48 g/t.

I realize the economics of any mine depends on a large variety of factors, and that Milestone has had only very limited drilling to date. That being said, are the aforementioned deposits fair possible comparisons for Milestone, or is the host rock/type of deposit/aligning of the planets or whatever, such that the comparisons are out to lunch?

Comments from geologists or anyone else with more knowledge than I?