Something to think about

(while we wait)

I wouldn’t be totally surprised if we are up to 7,000,000 ounces now, if we lower our cutoff grade / increase our gold price to around US$900 plus toss in a few historical ounces (non-43-101) from our minor properties.

In 2007, Century published (in a presentation) u/g ounces based on a cutoff of 2.5 g/t vs 3.5 g/t. The difference in the 2.5 vs 3.5 cutoff grade itself works out to 29%. That 1 g/t change in grade resulted in a 32% change in resource ounces (2,015,000 ounces vs 2,655,000 ounces). In that example the resource ounces (M&I and Inferred) changed similarly to the percentage change in cutoff grade.

Let’s apply that same logic to our current situation.

If you look on pages iii and iv of the most recent Lamaque technical rpt you will notice that the 960,094 (new) ounces added to Lamaque’s 43-101 resource total in 2009 was calculated using a cutoff grade of 2.1 g/t. This is likely due to the gold price being high for an extended period of time. You will also notice that the other 4,589,547 ounces (that make up the current Lamaque 43-101 total of 5,549,641 ounces) was based on a cutoff grade of 2.5 g/t. The 2.5 g/t was from the January 2008 calculation which used an US$800 gold price. The 2.1 g/t grade cutoff ounces likely uses a gold price around US$900 - more reflective of today’s gold price (but still conservative given our current US$1,085 price). All of this strongly indicates that the 4,589,547 ounces need to be recalculated using a lower cutoff grade / higher gold price. Century likely needs to bring the original person back in to perform the recalculation. Hopefully they will use some of the flow-through money to do this in the near future.

Until then, let’s see if we can come up with a wild ballpark estimate of what the new numbers might look like.


Lamaque:

Original cutoff grade of 2.5 g/t vs current cutoff grade of 2.1 g/t = 16% change

Lamaque ounces still stated at 2.5 cutoff of 4,589,547 * 1.16 = 5,323,875 ounces (after lowering cutoff to 2.1 g/t)

Wild ballpark estimate of Lamaque using 2.1 cutoff = 5,323,875 + 960,094 = 6,283,969 ounces


San Juan:

Let’s apply the same logic to San Juan (using the same percentage to keep it simple):

377,916 ounces * 1.16 = 438,383 ounces


Lamaque and San Juan (ballpark recalculation):

6,283,969 ounces + 438,383 ounces = 6,722,351 ounces

Of course, the actual recalculation would be much more complex that this. Although basic logic would suggest that our current 43-101 resource count should be around this ballpark number, we all know that there are no guarantees due to a lot of other factors to be considered during the actual calculation. Obviously, no one should make investment decisions based on such high level assumptions and calculations.

Also, just for fun, let’s see if we can come up with close to 7,000,000 combined recalculated and historical ounces for Century.


Northbelt property (Yellowknife, NWT) – historical, non-43-101 ounces:

Our property has a strike length of 15 kilometers, along a volcanic belt that has produced over 10 million ounces.

We have at least 2 gold deposits on the property that I am aware of.

Our current resource total = 175,000 ounces (historical, non-43-101)

130,000 ounces @ 4.00 g/t (Nebex calculation in the 90s)

45,000 ounces @ 10.30 g/t (Crestarum deposit)

Both gold deposits appear to be open.

There seems to be a large zinc deposit also (which appears to be open) and numerous other showings as well.

Of course, as we all know, Century has much more higher priorities right now. We probably wouldn’t be able to get to Northbelt for another couple of years. It seems to have really good potential though.

Fyi, the Yellowknife area is starting to get active in gold mining again, led by a company call Tyhee Development Corp. They did a really good job with exploring their deposit. I think the grade might be a tad on the lower end though, but they seem to want to develop it to production stage in about 3 years. They don’t seem to be having problems with permitting or any other local tasks. I think they are trying to raise the cash to move forward with development.

Our large Northbelt property appears to be prime real estate for the area (along the volcanic belt). If gold mining really heats up there then we are positioned well.


Aumaque property (near Lamaque) – historical, non-43-101 ounces:

Our current resource total = 68,000 ounces (historical, non-43-101)

51,000 ounces @ 8.57 g/t (original work)

17,000 ounces @ 6.03 g/t (Alotta work in the late 80s)


7,000,000 combined recalculated and historical ounces for Century:

6,722,351 + 175,000 + 48,000 = 6,965,351 ounces