From: rolfer@leonardo.src.honeywell.com (Tom Rolfer)
Subject: Re: The end of media generated recession i
Reply-To: rolfer@leonardo.src.honeywell.com
Organization: Honeywell Systems and Research Center
Date: Fri, 9 Oct 1992 16:19:51 GMT

In article 8190129@hpfcso.FC.HP.COM, rauchfuss@hpfcso.FC.HP.COM (Brian Rauchfuss) writes:
> In misc.invest, nfs@hart (Norbert Schlenker) writes:
> 
> > You must be reinvesting your huge profits from your gold investments
> > earlier this year. ;-)
> 
> American Gold Mines did quite well this year, and mutual funds investing in 
> them were among the top performers.  South African gold did very poorly though.
> 
> > Norbert
> > nfs@cs.princeton.edu


Speaking of gold mining companies, has anyone heard of Brush Creek Mining and Development (BCMD).  

This is a company based out of Grass Valley California.  Earlier this Summer they signed an exclusive rare metals, gem deposits, and industrial minerals agreement with the Research Institute of Geology of Foreign countries ("VZG") of Russia.  Over the summer they have been also working on a joint venture agreement with Morrison Knudsen, one of the largest construction and engineering companies in the world.

On August 24, 1992 Morrison Knudsen and Brush Creek signed a letter of intent to form an international mining company.  The first project that they are scheduled to work on is the mining of five gold mineralized properties with proven and probable reserves in excess of 20 million ounces.  Several additional properties are also under review.  The new company will split the profits 50-50 between themselves and are rumored to split 60-40 with Russia, with Russia getting 40%.  Apparently Russia doesn't have th



e resources to mine the gold themselves that is why they have been receptive to western world help, and they could really use the money (40% of something is better that 100% of nothing).

Also Brush Creek owns 11 former lode gold (hard rock) producing mines in the California Alleghany-Downieville discrict.  The have started production on some of the mines in California earlier this spring.  Estimates of reserves in California are in excess of 10 million ounces.

What does all this mean?  Well a gold company is typically valued on the amount of "reserves" it has.  After Brush Creek and Morrison Knudsen sign their joint venture agreement and sign all the agreements with Russia and can turn the estimated reserves in California into Proven or probable the company will have in excess of  16 million ounces of gold in reserves. It has also been estimated that it will cost somewhere around $170/oz to get the gold out of the ground and that includes administration costs et



c.  That leaves about $180 dollars profit per oz. Brush Creek has about 50 million shares outstanding.  Just use the Russian gold to put a value on the company,
(6 million oz. X $180/oz.)/ 50 million shares = $21/share.  Not bad for a company thats trading around  $0.75/share.  

Keep in mind that the above calculations don't include the California gold or any of the rare metals or industrial minerals that are in abundance in Russia.

This is not a solicitation to buy Brush Creek stock or any thing of the sorts,
I'm just passing along some information to people that may have an interest.

Also if your interested, the people involved in the Brush Creek and Morrison Knudsen deal are all in Russia and are due back in the States towards the end of the month.

If nothing else keep an eye on this stock.


These opinions are mine and do not reflect those of my employer.