1. Executive Summary The Hunter Creek Mine investment proposal outlines an opportunity to invest in a gold mining operation near Rampart, Alaska, with substantial reserves and existing infrastructure. The project requires an initial investment of $2.5 million to expand operations and capitalize on approximately 2 million cubic yards of gold-rich material. With a strategic operational plan, investors can expect returns through gold production, repayment plans, and potential equity conversion.
2. Key Points → Investment Opportunity: $2.5 million required for infrastructure, equipment, and operational costs. → Gold Reserves: Estimated 2 million cubic yards with 57,872 ounces of gold at a 90% purity level. → Revenue Projections: Significant revenue and net profit increases projected over the first three years. → Repayment Plan: Investors receive repayment from the second year's production, with options for equity conversion. → Operational Strategy: Phased approach to ramp up production, improve efficiency, and expand mining locations.
3. Detailed Analysis → Location and Access: The mine is located near Rampart, Alaska, accessible by air and barge. → Historical Data: Past operations yielded 1 to 3 grams of gold per yard, with conservative estimates at 0.9 grams per yard for financial projections (p. 2). → Gold Composition: Testing indicates gold ranges from 1-ounce nuggets to fine gold, with 60% between 20 and 100 mesh sizes (p. 2). → Financial Projections: ↳ Year 2: $3.43M revenue, $2.2M net profit from 1,302 ounces of gold (p. 4). ↳ Year 3: $12M revenue, $8.87M net profit from 4,554 ounces of gold (p. 4). → Investment Returns: Repayment starts in the second year, with every fourth ounce produced contributing to repayment (p. 4). → Equity Options: Investors can acquire a 25% stake for $4 million, with an option to convert the initial investment into an additional 5% share, totaling 30% (p. 1).
4. Important Findings/Data → Total Reserves Value: The total reserves are valued at approximately $152.6 million (p. 3). → Wash Plant Capacity: Designed for 250 yards per hour, with a start-up rate of 125 yards per hour (p. 3). → Operational Season: Gravel washing is feasible for about 90 days each season (June 15th to September 15th) (p. 3).
5. Conclusions/Recommendations The Hunter Creek Mine presents a viable investment opportunity with significant potential for profitability, given its substantial gold reserves, strategic operational plan, and flexible repayment options. The proposal includes conservative financial estimates and considers potential risks such as weather conditions. Investors have the opportunity to recoup their investment through gold production and gain equity in the mining operation.
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