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The Company's Eagle Gold Project in Yukon Canada hosts a National Instrument 43-101 compliant Reserve of 2.3 million ounces of gold.
Message: Summary of Conference Call Comments
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I have done the best I can in being accurate in summarizing the comments made
in today's news conference. I apologize in advance if I have made any errors
in my summary comments.
Key Positives Re: Eagle Pre-feasibility
1. The report demonstrates the positive economics for developing a producing mine.
2. Attractive production profile - averaging over 170,000 ounces of gold per year,
with cost of production well below the average cost of production for many gold
companies.
3. Significant potential for increasing its reserve base. This year VIT intends on spending
another $5,000,000 for drilling activity at the Eagle property which will more than likely
add additional gold resources. Outside of adding resources from additional drilling
activity, it was noted that reserve estimates for Eagle are highly leveraged to the price
of gold. In fact, reserve estimates will go up exponentially given a rise in gold prices. It
was mentioned that at $1,050 gold - Eagle's Reserves would go up from 1.75 million ounces
to 3.2 million ounces. Just imagine what that number would be if Jim Sinclair is half
right in his projection for gold to hit $1,650 by Jan 2011! This years drilling program at
Eagle will commence in May, so we should have plenty of drilling news through the
year.
4. Cost of putting the a mine into production will be relatively small for a gold mine:
$175 million in one year and another $106 million in the following year with a $38
million contingency. The real deal here is a quick pay back once production starts. I
believe it was stated that the pay back period was approximately three years, and
that pay back period could be even shorter giving a price for gold that exceeds
$ 1,050 per ounce.
Other Comments Made:
1. If you combine the expected production from our Eagle property with our Cove
property, we are looking at production of 250,000 ounces per year. There are
few mid sized gold companies that have that type of production.
2. There is no specific date mentioned that Newmont Mining has to make a decision
on their back in rights for our Cove property; however, it appears from comments
made that Newmont Mining and Victoria Gold are presently involved in discussions
regarding a potential back in rights decision. Chad said that it not that important
that we have an exact date or time for a decision to be made. The important thing
is that there are discussions go on which there will ultimately be decision made.
3. In addition to the $5 million in drilling activity at our Eagle property this year,
our company will be spending another $5 million drilling in Nevada. If the drilling
activity at Santa Fe continues to show robust drilling results, our company may
spend the entire sum on further drilling at Santa Fe, and defer drilling on their
other properties until next year.
I BELIEVE THE KEY MOVER IN OUR STOCK AT THIS POINT WILL BE THE
DIRECTION IN GOLD PRICES BECAUSE OF THE HIGH LEVERAGE THAT OUR
COMPANY HAS TO GOLD PRICES. SURE, DRILLING RESULTS WILL BE
A FACTOR, BUT IMO, THE PRICE OF GOLD WILL BE MORE IMPORTANT.
I PERSONALLY BELIEVE WE WILL SEE MUCH HIGHER GOLD PRICES
OVER THE NEXT 12 MONTHS, AND I ALSO SEE THE LARGEST PROFITS
WILL BE MADE THE BETTER JUNIOR GOLD EXPLORATION COMPANIES
LIKE VICTORIA GOLD.-
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