Sunday 20th May 2018

Resource Clips

June, 2012

Guest Columnist

June 25th, 2012

Market Bottom Only in Hindsight

By John Lee

Read here for a feature story on Prophecy Platinum and its Wellgreen copper-nickel-PGE project.

The last 18 months have been gut-wrenching for mining equity investors.

Image copyright

As the above chart demonstrates, the TSX Venture Composite Index, a fair representation of the junior mining sector, has come back down to levels seen in 2002, when gold first broke out of $300 an ounce.

While the TSX Venture Composite Index is still well above its 2008 low, the pain is just as pronounced now as it was then, as the TSX Composite Index, relative to the Dow, is now trading below 2009 levels. The following chart indicates a flight out of Canadian markets into the US markets.

Image copyright

With emerging markets, such as China, struggling and the Eurozone in outright crisis mode, global investors not only have been pouring money into US stocks but have also driven US bonds into an all-time high, ignoring the fact that the bonds are sporting negative real interest.

Image copyright

While this represents an extreme flight to perceived “safety,” the US dollar index has failed to break out of its 2009 high, indicating the fundamental weakness of the US dollar.

Image copyright

Focusing back on the gold sector, the severe correction is not just felt by the juniors but senior producers as well. Kinross, for example, is now back to its 2008 low, when gold was below $1,000 an ounce.

Image copyright

Overall, gold producers, relative to the price of gold, have indeed reverted back to the 2009 level as the following chart indicates.

Image copyright

Despite the financial crisis worldwide, gold has held up very well in the last 23 months, currently ($1,600 an ounce) trading comfortably above the 2008 crisis level ($900). This clearly shows that gold is gaining momentum as the safe haven and reserve currency in the time of crisis.

Image copyright

Also notice, post 2008 crisis, that gold doubled from the $800-an-ounce level to peak at more than $1,900 an ounce in less than three years. In 2008, the US Federal Reserve embarked on unprecedented quantitative easing, creating trillions of dollars to revive the banks and the equity and housing markets. Such inflationary measures had a direct positive impact on gold.

Image copyright

As we seemingly come out of the Euro crisis and with world governments eager to again embark on unlimited monetary easing, there are reasons to be again bullish on gold as it completes the current 18 months’ consolidation.

My conclusion is that the degree of flight to safety today and risk aversion is no less than the case in 2008. The dollar and US bonds were the main beneficiary during the 2008 crisis, and they are in the current crisis.

Post 2008 crisis, gold and gold equities were the big winner, registering triple digit gains. There are preliminary signs of gold and gold equity market bottoms, if one considers the bottoming ratios of TSX to Dow and gold equity to gold and the blowoff of US bonds.

I am reminded of two old famous adages: never catch the falling knife, and a market bottom is only known in hindsight. For me, successful investing means buying 20% from the bottom and selling 20% from the top. If we are not currently 20% from the bottom, I’d say we are darn near.

John Lee, CFA, is Chairman and Interim CEO of Prophecy Platinum Corp TSXV:NKL and Chairman and CEO of Prophecy Coal Corp TSX:PCY. He holds degrees in economics and engineering from Rice University in Houston, Texas. The views expressed above are those of the author and may not reflect those of Prophecy Platinum Corp or Prophecy Coal Corp. Read here for a feature story on Prophecy Platinum and its Wellgreen copper-nickel-PGE project. Prophecy Platinum is a client of OnPage Media.

Rainy River CEO Ray Threlkeld on TPK and RRGP

June 22nd, 2012

…Read More

Confederation, Redstar report Ontario Gold Assays up to 5.51 g/t over 13m

June 22nd, 2012

Resource Clips - essential news on junior gold mining and junior silver miningConfederation Minerals Ltd TSXV:CFM and Redstar Gold Corp TSXV:RGC announced assays from the Newman Todd property in the Red Lake Gold District, Ontario. Highlights include

2.2 grams per tonne gold over 1 metre
1.1 g/t gold over 10 metres
2.23 g/t gold over 5 metres
1.21 g/t gold over 45 metres
(including 4.72 g/t over 4 metres)
5.71 g/t gold over 13 metres
(including 17.9 g/t over 3 metre)

Confederation President/CEO Lawrence Dick commented, “Drilling on section 1700, which is one of our more detailed sections, clearly shows continuity of the gold mineralization between drill holes. It is our belief that with additional drilling this continuity of gold mineralization exists on every cross-section throughout the Newman Todd Structure. The zone has been traced to a vertical depth of 600 metres, and there is regional geological evidence that suggests it may be several kilometres deep. It is management’s belief that this Red Lake-type system will extend to significant depth. Deeper drilling is planned.”

Confederation can earn a 50% interest in the project by spending $5 million in exploration by November 2013, and an additional 20% by producing a preliminary economic assessment by November 2016. To date Confederation has spent in excess of $5.0 million dollars on exploration, paid Redstar $100,000 and issued 200,000 shares. During the earn-in period, Confederation is the operator of the project.

View Company Profile

Confederation Minerals Ltd
Lawrence Dick

Redstar Gold Corp
Tim Mikula
Business Development

Read a feature story about Confederation Minerals

by Jay Currie

Gold Canyon reports Ontario Gold Assays up to 1.5 g/t over 343m, 0.97 g/t over 323.5m

June 22nd, 2012

Resource Clips - essential news on junior gold mining and junior silver miningGold Canyon Resources Inc TSXV:GCU announced the first assay results from its barge drilling program at its 100%-controlled Springpole Gold Project located 110 kilometers northeast of the Red Lake Mining Camp in Ontario. Highlights include:

1.5 grams per tonne gold over 343 metres
(including 3.44 g/t gold over 108 metres)
(including 5.27 g/t gold over 30 metres)
0.63 g/t gold over 210 meters
(including 1.24 g/t gold over 32 metres)
0.8 g/t over 116.9 metres
0.97 g/t gold over 323.5 metres
(including 2.41 g/t gold over 36 metres)
0.53 g/t gold over 213 metres
9.88 g/t gold over 8 metres

Director and technical advisor Quinton Hennigh commented, “Our first results from stepout barge drilling are very encouraging. Recent results clearly indicate the Portage Zone extends to the 0 to 250 meter section. In addition, hole SP12-146 is the first hole to demonstrate higher grades persist into this area. Over the remainder of this year, we plan to pursue stepout and infill drilling to expand the southeastern extension of the Portage Zone.”

View Company Profile

Leo Karabelas
Investor Relations

by Jay Currie

Gran Colombia reports Resource Estimate: 11.8M oz Gold, 80.3M oz Silver M&I

June 22nd, 2012

Resource Clips - essential news on junior gold mining and junior silver miningGran Colombia Gold Corp TSX:GCM reports a new mineral resource estimate for its Marmato project in Colombia. The project hosts 11.8 million ounces gold and 80.3 million ounces silver measured and indicated and 2.6 million ounces gold and 9.4 million ounces silver inferred.

CEO Maria Consuelo Araujo commented, “Our exploration activities continue to show upside to this flagship project at Marmato, which currently ranks in the top 2% of projects by gold resources globally. We expect further upside from our recently reported deep-zone mineralization, as this current estimate shows the potential increase in resource and grades at depth, but further drilling will be required to further define the deep-zone mineral resource.”

View Company Profile

Investor Relations

Read an interview with COO Donald East

by Jay Currie

Spanish Mountain reports BC Gold Assays up to 4.12 g/t over 37.3m, 2.88 g/t over 51m

June 20th, 2012

Resource Clips - essential news on junior gold mining and junior silver miningSpanish Mountain Gold Ltd TSXV:SPA announced the remaining results from its in-fill drilling program recently completed within the Main Zone of its Spanish Mountain Gold Project located in central British Columbia, Canada. Highlights include:

1.31 grams per tonne gold over 130.43 metres
(including 2.4 g/t gold over 59.93 metres)
1.09 g/t gold over 31 metres
1.44 g/t gold over 25.95 metres
(including 3.27 g/t gold over 10.5 metres)
2.88 g/t gold over 51 metres
(including 11.76 g/t gold over 11.08 metres)
(including 36.6 g/t gold over 3.48 metres)
4.12 g/t gold over 37.25 metres
(including 6.95 g/t over 19.75 metres)
0.64 g/t gold over 131.95 metres
(including 1.22 g/t gold over 40.5 metres)
0.64 g/t gold over 121 metres
(including 1.01 g/t gold over 40.29 metres)
0.64 g/t gold over 67.5 metres
(including 1.67 g/t gold over 17 metres)
0.71 g/t gold over 100.5 metres
(including 1.03 g/t gold over 61 metres)
0.92 g/t gold over 131.36 metres
(including 1.17 g/t gold over 91.36 metres)

According to a November 2011 resource estimate, Spanish Mountain hosts measured and indicated resources of 138 million tonnes grading 0.49 g/t gold and 0.64 g/t silver (at a 0.2 g/t gold cutoff) and inferred resources of 339.6 million tonnes grading 0.37 g/t gold and 0.65 g/t silver. This translates to 2.17 million ounces gold and 2.84 million ounces silver measured and indicated and 4.04 million ounces gold and 7.1 million ounces silver inferred. Compared to the November 2010 preliminary economic assessment, these figures constitute a 59% increase in gold measured and indicated and a 561% increase in inferred.

View Company Profile

Colin Clancy
Investor Relations

Read a feature story about Spanish Mountain

by Jay Currie

Temex President Ian Campbell on Juby Gold Project, new Directors

June 19th, 2012

…Read More

Seafield reports Colombia Gold Assays up to 1.89 g/t over 114.7m

June 19th, 2012

Resource Clips - essential news on junior gold mining and junior silver miningSeafield Resources Ltd TSXV:SFF reported infill gold assays from its Miraflores Deposit in Quinchía District, Colombia. Highlights include

1.89 grams per tonne gold over 114.7 metres
(including 11.97 g/t gold over 10.6 metres)
0.64 g/t gold over 73.6 metres
0.74 g/t gold over 23 metres
1.4 g/t gold over 31.6 metres
0.56 g/t gold over 18.1 metres
0.38 g/t gold over 7.4 metres

President/CEO Cesar Lopez commented, “We are pleased that our ongoing infill drilling program continues to confirm the continuity of high-grade vein structures within Miraflores. Seafield will be completing its current phase of drilling over the next quarter and begin our preparation to commence our underground drill program at the deposit.”

View Company Profile

David MacMillan
Investor Relations
416.361.3434 x 202

by Jay Currie

Alexander Nubia reports Egypt Assays up to 6.58 g/t Gold, 53.7 g/t Silver over 66m

June 19th, 2012

Resource Clips - essential news on junior gold mining and junior silver miningAlexander Nubia International Inc TSXV:AAN reported initial results from its deep-trenching program at its Hamama gold-zinc-copper-silver volcanogenic massive sulphide (VMS) project in Egypt. Highlights include

1.33 grams per tonne gold, 53.7 g/t silver, 0.11% copper over 66 metres
(including 2.23 g/t gold, 93.9 g/t silver over 34 metres)
0.6 g/t gold, 9.8 g/t silver over 104 metres
(including 1.25 g/t gold, 15.4 g/t silver over 44 metres)
0.26% copper, 0.11% zinc over 12 metres
0.09% copper, 0.23% zinc over 24 metres

VP Exploration John Payne commented, “The gold and silver assay results from the deep trenches in the Western VMS Zone (DT-85 and DT-87) confirm the results of the nearby shallow surface trenches. The widespread, zinc and copper values from the footwall stringer zone and in the Valley VMS Zone are potential indicators that below the zone of leaching, the Main VMS Horizon, and possibly some of the VMS lenses deeper in the system, contain zones with abundant base metals.”

View Company Profile

Nisha Hasan
Investor Relations
416.815.0700 x 258

by Jay Currie

Graphite Digest — June 8, 2012

June 8th, 2012

June 8, 2012

Big North completes SE Ontario EM Survey, ends IR Agreement

Big North Graphite Corp TSXV:NRT announced June 8 completion of an airborne electromagnetic survey of 1,187 line-kilometres with 100-metre spacing over its Griffith and Brougham properties in southeast Ontario. Preliminary data suggests both properties show conductors, including coincident features to the known graphite showings. Final data is expected next week and will be used to direct ground geophysics, mapping and sampling.

The company also announced it has terminated an investor relations agreement with Trident Financial announced on April 19. The Griffith-Brougham land package covers 6,500 hectares in a region that includes Ontario Graphite’s Kearney Mine and Northern Graphite’s TSXV:NGC Bissett Creek Project.

Read an interview with Big North Graphite President/CEO Spiro Kletas.

Galaxy completes Airborne Surveys of Quebec Graphite Project, approves Name Change

Galaxy Capital Corp TSXV:GXY announced June 7 completion of helicopter-borne electromagnetic and magnetometer surveys on its Buckingham Property in west Quebec. Preliminary results from the 162-line-kilometre survey are expected within three weeks and will be used to direct a program of ground geophysics, prospecting, mapping and sampling.

On June 6, the company announced shareholder approval of a change of name to Galaxy Graphite Corp. Contingent on TSXV approval, the stock symbol will remain the same. The 1,324-hectare Buckingham Property consists of two former mines 40 kilometres east of Ottawa. The host rocks for both deposits are graphitic crystalline marbles, similar to the host stratigraphy at Timcal Graphite & Carbon’s Lac-des-Îles Graphite Mine, the company has stated.

Rare Earth Metals begins Ground EM Survey on NW Ontario Graphite Property

Rare Earth Metals Inc TSXV:RA announced June 7 it has begun line-cutting and a ground electromagnetic survey on its Manitouwadge Graphite Property in northwest Ontario. The company intends to determine the strike length and continuity of graphite zones outlined by an EM survey flown in 1989. Three graphite horizons have been identified so far through historic work and recent trenching. The zones range from four to 12 metres thick with chip samples showing 2.04% to 4.18% carbon. Screen tests on the higher-grade composite sample confirmed the presence of +65 mesh and +35 mesh flake graphite. Additional metallurgical results are pending.

The company has two advanced projects in Ontario and Labrador, with rare earth elements, niobium, beryllium, zirconium and iron ore. The company has also acquired the Coldwell Complex and the Lavergne-Springer REE Prospect, both in north Ontario.

Standard Graphite reports EM Conductors on Quebec Graphite Property

Standard Graphite Corp TSXV:SGH announced June 5 airborne geophysical results from its Kiamika Property in west Quebec. Initial results confirm that surface occurrences are associated with a conductor crossing the entire property over a 3.5-kilometre strike length. A second conductor 750 metres east replicates the first and expands the project’s potential, the company stated.

The 888-line-kilometre TDEM survey included three other properties: Preston, 31 Milles and Notre Dame. Results are pending for those properties and will help determine follow-up work scheduled for later this month. All four properties lie within 90 kilometres of Standard’s flagship Mousseau East Project in the Central Metasedimentary Belt of the Grenville Geological Subprovince. Mousseau East has a 1992 non-43-101 resource estimate showing 598,480 tonnes grading 8.29% carbon proven, 219,450 tonnes grading 8.13% probable and 288,760 tonnes grading 7.85% possible.

Read a feature story about Standard Graphite.

Focus to acquire Brazil Graphite Project from Lara Exploration

Focus Graphite Inc TSXV:FMS and Lara Exploration Ltd TSXV:LRA announced June 4 a letter of intent in which Focus will acquire up to a 60% interest in the Canindé Graphite Project in Ceará State, northeast Brazil. Under the agreement’s first option, Focus may earn a 51% interest by issuing Lara a total of 500,000 shares and spending $2.5 million within three years. Exploration must include an EM survey and 2,000 metres of drilling.

Under the second option, Focus may earn an additional 9% interest by spending a total of $4.5 million within five years, including completion of an additional 5,000 metres of drilling and a positive PEA.

If Focus declines or fails to exercise the second option, the two companies will create a 51/49 joint venture. If Focus exercises the second option, the companies will create a 60/40 JV. Both companies will fund exploration proportionately and the party holding majority interest will be deemed the project operator. If a party’s interest falls to less than 10%, its interest in the JV will be converted to a 2% production royalty.

Canindé is subject to a 1% royalty payable to a third party on gross revenue up to R$750,000 (750,000 Brazilian reais, approximately $369,000) as well as a one-time payment of R$200,000 (approximately $99,000) payable to the third party on completion of a non-NI 43-101-compliant Economic Graphite Reserve Estimate as defined by Brazil’s Departamento Nacional de Produção Mineral.

The 15,615-hectare project hosts 22 surface graphite occurrences discovered by Lara in mid-2011. The occurrences define a 16-kilometre-long graphitic corridor in high-grade metamorphic rocks. Individual graphite occurrences range from less than one metre to 10 metres wide and host grades ranging from 1% or 2% disseminated graphite in paragneiss and schist (mostly flakes), to over 50% graphite in narrow lenses in gneiss, schist, pegmatitic migmatites and brecciated horizons in gneiss. Surface grab samples from 15 of the occurrences show grades ranging from less than 1% up to 42%. The project is accessible by road.

The company’s flagship Lac Knife Graphite Project in northeast Quebec is scheduled for a PEA this month. The company states that it hopes to have offtake agreements and financing to begin mine construction following the PEA.

Read an interview with Focus President/CEO Gary Economo.

Read an interview about Focus’ Kwyjibo REE-Copper Project.

Read a feature story about Focus Graphite.

Energizer, Malagasy report Madagascar Graphite Intersections up to 434m

Energizer Resources Inc TSXV:EGZ and Malagasy Minerals Ltd announced June 4 five graphite intersections on the Molo Deposit of their Joint Venture Property in Madagascar. Intersections came to 434 metres, 295 metres, 220 metres, 150 metres and 51 metres. Core from the five holes has been sent for assaying, with the first results expected within six weeks. Metallurgical analysis of previous Molo samples showed jumbo-flake, +50 mesh graphite at an average purity of 93% carbon which can be liberated through simple crushing. The deposit begins at surface and extends to a vertical depth of over 300 metres, Energizer stated. The company plans an initial resource estimate for the Molo Deposit, which Energizer and engineering partner DRA Mineral Projects are targeting for open-pit production in early 2015.

Energizer holds a 75% interest and acts as operator on the JV Property, which surrounds Energizer‘s wholly owned Green Giant Graphite-Vanadium Property on three sides.

Read an interview with Energizer Resources VP of Business Development Brent Nykoliation.

Read feature stories about Energizer Resources’ vanadium deposit and its graphite deposits.

Canadian Platinum finds Saskatchewan Graphitic Argillite

Canadian Platinum Corp TSXV:CPC announced June 4 the presence of a thick sequence of graphitic argillite on its Peter Lake Copper-Nickel-PGE Project in northeast Saskatchewan. Examination of a 2009 airborne ZTEM survey and historic drillholes found conductors caused by graphitic argillite, the company stated. A sample assay of historic core showed 10.2% carbon and six grab samples from another historic hole averaged 4.5% carbon. Canadian Platinum drilled one of the ZTEM conductors in 2009, which intersected 142 metres of graphitic argillite and terminated in graphitic argillite. This drillhole and historic holes are currently being sampled to determine grades.

The project is North America’s largest mafic/ultramafic complex. The company’s mining claims in the area cover approximately 202,340 hectares.

By Greg Klein

Read previous Graphite Digests here

Disclaimer: Standard Graphite Corp and Focus Graphite Inc are clients of OnPage Media and the principals of OnPage Media may hold shares in those companies.