Quarterly report pursuant to Section 13 or 15(d)

Asset retirement obligations

Asset retirement obligations
6 Months Ended
Apr. 30, 2014
Asset retirement obligations [Text Block]

Asset retirement obligations


Remediation, reclamation and mine closure costs are based principally on legal and regulatory requirements. Management estimates costs associated with reclamation of mining properties as well as remediation costs for inactive properties. The Company uses assumptions about future costs, capital costs and reclamation costs. Such assumptions are based on the Company’s current mining plan and the best available information for making such estimates. In calculating the present value of the asset retirement obligation the Company used a credit-adjusted risk free interest rate of 10% and a projected mine life of 12 years. On an ongoing basis, management revaluates its estimates and assumptions; however, actual amounts could differ from those based on such estimates and assumptions.

Changes to the Company’s asset retirement obligation on its Palmetto Point project are as follows:

      April 30,     October 31,  
      2014     2013  
  Asset retirement obligation – beginning balance $   59,245     -  
  Incurred   -     59,245  
  Asset retirement obligation – ending balance   59,245     59,245