2013 - Our Struggles Continue
Im struggling to find the words for recounting the events of last year yet reflecting my level of optimism since our progress and accomplishments are not readily recognized. My history records the importance of top corporate managements responsibility to inform owners facts, opinions and an analysis about their company. New shareholders unfamiliar with the significance of this reporting responsibility may read my annual reports since becoming president in 1983. The past thirty years are publically available at www.origsix.com under the topic, The Company. I encourage you to click on Annual President Messages. I did just that and reread a letter written twenty years ago (1993- Expansion and Development written on May 14, 1994).
The Sixteen to One mineral deposit (mine) has stayed the same since its discovery in 1896. Its operator or operations certainly have not. They ebb and flow, influenced by internal as well as external physical and sociological conditions. A most insistent thing in life is that you are ultimately judged by what you actually accomplish. We own a proven gold producing cash cow. We have produced gold over three decades. What was accomplished last year?
Our struggles continue. Last years stunted production is the result of our small operation, not low gold prices or excessive operating costs. My existential analysis is: we are undercapitalized to carry out the necessary exploration activities proven to be successful over 100 years of operation. Therefore, we have designed an exploration program in three areas deemed most important to succeed. My to do list also has the recruitment of additional high quality miners at the top.
Regulations are blamed for the hostile work environment in California as well as the mineral extraction industry. Farmers feel the same, as do too many other businesses. After years of working with the many governmental agencies, I reached a somewhat different conclusion to the regulations problem. The regulators are more the problem than the regulations they interpret and enforce. How has this happened? Government employees fear admitting that mistakes were made. In other words, they cover them up. Our most significant current regulatory issue is a lawsuit filed by the California Regional Water Control Board seeking over $2 million for not filing 13 reports. This reckless action will be settled in 2014, fear not.
Last year and continuing today people are challenging the credibility of Sixteen to One stock transactions. This is not new. When the Pacific Stock Exchange closed, we lost a reasonable market place where buyers and sellers meet to exchange values. Now the trade market is called the gray market, an honest description for an apparently dishonest venue. Buyers and sellers beware. So far no purchaser has obtained an actual stock certificate and our transfer agent has no requests for stock transfers emanating from this market. It might not be relevant but sellers must be ignorant that shares can be listed on our web site at any price they choose. Buyers likewise can offer to buy shares at any price they desire. The Company maintains its OAU X-Market on the web page under the topic, STOCK. Management does not maintain a stock promotion budget. We believe that our priorities are to find gold and eliminate all debt before crowing about how great this little old company is.
Unlike remarks made by numerous gold pundits or others with gold affiliations, I am most pleased with the current price of gold. In the future it will increase and decrease from todays spot of $1,306 an ounce. Why worry? Our rare, appealing, white and golden quartz is demanded for the high-end jewelry market and realizes a price well above spot.
What are we doing to find gold? We plan to access unexplored areas of our vast holdings. First, the water levels must be lowered to access known gold targets that were submerged years ago. We are going down the Tightner Shaft to the 3,000 level, a level that has not had a miners footprint on it in eighty years. No gold detectors have worked the Tightner Shaft below the 2200 level. This is a lip smacking adventure well worth undertaking. Second, another area of the mine has been blocked that also has never felt the zing of a gold detector. We are removing those blockades. Third, improvements have been made over the last year by the non-affiliated high-tec detection group. This outfit resembles that pink rabbit, beating a drum while skirting along an undefined path. They have taken a licken but keep on ticken. If the hardware and software improves at the same or better rate from the last year, gold production should increase.
I hope to see you at the annual shareholders meeting on June 14th in Alleghany.
Michael M. Miller, President
May 7, 2014