Tuesday 12th December 2017

Resource Clips


May, 2013

May 31st, 2013

Civil nuclear energy renaissance restart by GoldSeek
Flake graphite prices have bottomed: Simon Moores by the Gold Report
Why the TSX Venture is failing by Equedia
Pacific Potash and Sino-Canada Natural Resources Fund: Moving Brazil’s agricultural independence forward by VantageWire
Update: U.S. stocks/bonds/dollar, gold and silver, mining and exploration by the Grandich Report

Rick Rule discusses bears, bulls and Vancouver’s World Resource Investment Conference 2013

May 30th, 2013

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Chris Berry: Rumours of green energy’s demise might be exaggerated

May 29th, 2013

Some spectacular failures notwithstanding, green tech shows signs of hope. So said Chris Berry in his May 26 presentation at Vancouver’s World Resource Investment Conference 2013. Although his talk focused on uranium, the House Mountain Partners founder, Morning Notes co-editor and energy metals expert contrasted one green success story with some more widely publicized failures.

A U.S. Bankruptcy Court completed its post-mortem into lithium-ion battery disaster A123 Systems on May 20. Following a $256.6-million sale to China’s Wanxiang Group, creditors will get 65 cents on the dollar, the Wall Street Journal reported. Shareholders were wiped out. Nor will taxpayers see a dime of their $132-million subsidy. The sale had “more than two dozen lawmakers and retired military officials voicing concerns that A123’s military contracts and taxpayer-funded technology could wind up in the hands of a foreign buyer,” the WSJ stated. The paper added that the bankruptcy ruling “closes an embarrassing chapter in the Obama administration’s efforts to nurture the market for electric vehicles and develop a ready supply of advanced batteries. The U.S. government, in an effort to jump-start the electric-car battery industry, has provided more than $1.2 billion to battery makers in the past three years.”

Rumours of green energy’s demise might be exaggerated

Tesla’s Model S: As a profitable electric car,
is it an oxymoron or a bellwether?

Fisker Automotive spent $192 million of a $529-million U.S. government loan before shutting down operations and laying off its staff. The company’s expected to file for bankruptcy after selling only 2,000 cars. American taxpayers got just $21 million back last month.

Solar panel fiasco Solyndra declared bankruptcy in 2011 after wiping out another government loan. “That’s $535 million that the U.S. taxpayers are never going to see again,” Berry said.

Those examples show the “dark side of green tech,” he pointed out. Nevertheless Berry maintains there’s “a reasonably compelling case for green technology and clean energy and what you don’t hear about is what’s happening in universities like Simon Fraser or the University of Western Ontario or any research lab in the United States or Canada, or China for that matter. There’s hundreds of billions of dollars going into next-generation battery storage technology, clean technology, etc. In my opinion you can’t have so much money and so much intellectual capital and firepower going into figuring out these sustainable technologies without the dam eventually breaking and a scalable battery storage technology, for example, coming to the fore.”

While some other e-v ventures failed, Tesla Motors paid off the last of a 2010 loan on May 22, when it wired $451.8 million to the U.S. government. The company posted an $11.2-million Q1 profit and increased the year’s sales forecast by 5% to 21,000 cars.

The loan repayment came nine years early. “This is a profitable electric car company,” Berry said. “Obviously that has been an oxymoron thus far and we’ll see if it remains. But I’m actually watching Tesla as sort of a bellwether or benchmark for green technology and by extension energy metals…. despite the rough time we have now.”

Aspirations and energy

May 28th, 2013

Chris Berry discusses emerging economies, uranium and the Athabasca Basin at WRIC 2013

by Greg Klein

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It’s through his work with House Mountain Partners that Chris Berry came to his niche, energy metals. His presentations and Morning Notes articles show fascination with the interplay of macro-economic forces, geo-politics and the natural resource sector, “especially the junior mining natural resource sector because that’s where we see so much wealth-generation and wealth-creating opportunity, the current market notwithstanding.” On May 26 he focused on uranium, its growing demand and jurisdictional risk at Vancouver’s World Resource Investment Conference 2013.

Chris Berry: I think uranium is, across the entire commodity complex, one of the only true contrarian plays I see out there.

Chris Berry: “I think uranium is, across the entire commodity complex, one of the only true contrarian plays I see out there.”

Berry sees two opposing global forces putting the West at a disadvantage to the East, but not without potential for Western companies and their investors. He describes Western economies as “treading water” with sagging employment, industrial production, purchasing power, capital utilization and GDP growth. If the “largesse” of money-printing ended, “you would essentially pull the rug out from under these industrialized economies.”

Contrast that with the emerging economies, not just Brazil, Russia, India and China, but also countries like Indonesia and Colombia. Their middle classes keep growing. Even so, they’re increasingly aware that their standard of living doesn’t compare to that of the developed world. Essential to their aspirations is cheap, reliable energy, Berry maintains. That makes a “long-term case for commodity demand, in particular energy metals.”

As he explains, there’s “hundreds of millions, if not billions of people who live at say 10% to 20% of our quality of life and they want what we have. They want iPads, they want iPods, they want refrigerators… that implies infinite demand for finite resources. I’m not going to tell you that all trees grow to the sky and copper’s going to go to $9 a pound and lithium’s going to go to the roof. That’s not how markets work.”

But the world’s witnessing a phenomenon “that we call convergence. Emerging countries understand what we have and how we got there and they’re tailoring their economies to join us.”

That leads him to “four metals that I’m focusing on right now—scandium, cobalt, tungsten and uranium.” He emphasized the latter. “I think uranium is, across the entire commodity complex, one of the only true contrarian plays I see out there.”

Media coverage following Fukushima, however, has “clouded the longer-term issue.”

The very considerable nuclear infrastructure already in place provides very considerable incentive to maintain existing capacity. “Decommissioning any of these reactors comes at a very steep cost,” Berry explains. Citing info from the Nuclear Energy Institute, he said decommissioning can take years and could cost up to $1 billion per reactor. With about 436 reactors in operation, he asks whether governments and taxpayers would foot the bill to shut them down and build wind, solar or natural gas infrastructure instead.

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Skyharbour Resources’ Jordan Trimble on two earn-ins that will finance exploration on the company’s uranium properties in the Patterson Lake South region

May 28th, 2013

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May 28th, 2013

Flake graphite prices have bottomed: Simon Moores by the Gold Report
Why a uranium renaissance looks inevitable by GoldSeek
Why the TSX Venture is failing by Equedia
Pacific Potash and Sino-Canada Natural Resources Fund: Moving Brazil’s agricultural independence forward by VantageWire
Update: U.S. stocks/bonds/dollar, gold and silver, mining and exploration by the Grandich Report

May 27th, 2013

Why a uranium renaissance looks inevitable by GoldSeek
Why the TSX Venture is failing by Equedia
Pacific Potash and Sino-Canada Natural Resources Fund: Moving Brazil’s agricultural independence forward by VantageWire
Update: U.S. stocks/bonds/dollar, gold and silver, mining and exploration by the Grandich Report
Sprott is bullish on silver—and gold—equities by the Gold Report

What’s next for gold?

May 27th, 2013

Four panellists debate the state of yellow metal at the World Resource Investment Conference 2013

by Greg Klein

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Eric Coffin, Jay Taylor, Mickey Fulp, Mark Leibovit and Chris Berry discuss gold’s wayward ways.

Left to right: Eric Coffin, Jay Taylor, Mickey Fulp,
Mark Leibovit and Chris Berry discuss gold’s wayward ways.

 

Some six weeks after the fact, gold’s dramatic drop made for lively discussion at Vancouver’s World Resource Investment Conference 2013. On May 26 Chris Berry, founder of House Mountain Partners and co-editor of Morning Notes, posed some key questions to a four-person panel of prominent gold-watchers.

Mercenary Geologist editor Mickey Fulp suggested another price drop is looming, if only because gold usually hits a seasonal low in July or August. But he seemed unperturbed by the events of April. “For me as a guy who owns 10% of his net wealth in physical gold in my physical possession, I look at these things as buying opportunities,” he said. “I welcome the volatility in the market.”

I’m encouraged by the amount of buying you see in parts of the world that are always the main buyers and they’re not acting as if they expect significantly lower prices.—Eric Coffin, editor of
HRA Advisories

Nor was Eric Coffin particularly concerned. The HRA Advisories editor said, “I’m encouraged by the amount of buying you see in parts of the world that are always the main buyers and they’re not acting as if they expect significantly lower prices…. If you look in the press in the last month it’s bearish, bearish, bearish” with references to a 300-tonne sell-off. “They probably bought that much in China last month—at least.”

That remark prompted Berry to ask about the “granny effect,” in which Chinese grandmothers buy the stuff while institutions sell. Jay Taylor, editor of Gold, Energy & Tech Stocks, responded that “gold is increasingly a bipolar market” with a paper market much bigger than its physical counterpart. “This move out of gold was solely a paper phenomenon,” he said. “There was tremendous physical buying, which I think kept the price from going lower.”

He added, “I view gold as a hedge against financial calamity…. If you view gold as speculation and an investment, that’s a much different ball game and that’s a paper market.”

Coffin said his Chinese mother-in-law is “not a gold bug at all.” She’s lived through tough times, like the Japanese occupation of Hong Kong. “When people like her buy jewellery, it’s not the 14-carat crap. It’s the real deal…. She lived through periods where you had to grab what you could, put it in your pockets and run.”

Sounding rather blasé about the sell-off, he added, “Companies like Goldman Sachs do this three or four times a year. They just picked gold this time. I’m not reading too much into it.”

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Athabasca Basin and beyond

May 25th, 2013

Uranium news from Saskatchewan and elsewhere for May 18 to 24, 2013

by Greg Klein

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Alpha/Fission plan $6.95-million campaign for Patterson Lake South

A review of uranium activity from Saskatchewan and beyond

With three rigs, three barges and $6.95 million, Fission Uranium TSXV:FCU and Alpha Minerals TSXV:AMW have a busy summer planned for Patterson Lake South. The 44-hole, 11,000-metre campaign announced May 21 will focus on delineating and expanding three zones of high-grade, near-surface uranium mineralization. Additional targets southwest and northeast of the 850-metre trend come courtesy of a radon survey. Ground geophysics will follow up on two “highly prospective” areas spotted by an airborne survey over the property’s southwest and southeast areas. The agenda also includes environmental baseline studies and sampling for metallurgical tests.

The 50/50 joint venture partners patted each other on the back for finding mineralization in 82% of their targets during a winter campaign that attracted widespread attention in and around the Athabasca Basin’s southwestern rim. Their discoveries sit 3.8 kilometres to 4.6 kilometres from one of the Basin’s largest known high-grade boulder fields.

Companies collaborate on PLS-region flyover

Six companies are pooling their money to fund a joint airborne geophysical survey in the PLS area. A May 24 announcement from Yellowjacket Resources TSXV:YJK said Lakeland Resources TSXV:LK, Skyharbour Resources TSXV:SYH, Aldrin Resources TSXV:ALN, Forum Uranium TSXV:FDC and Canadian International Minerals TSXV:CIN will join Yellowjacket on the study that begins May 26.

Yellowjacket will focus a 2,000-line-kilometre VTEM-Plus time domain system and 2,000-line-kilometre radiometric survey on parts of its 83,600-hectare Preston Lake project 26 kilometres southeast of the PLS discovery area. VTEM-Plus will search for basement conductors similar to the structures hosting the PLS discoveries while radiometrics will hunt down uranium boulder trains and in-situ mineralization. Although reports will come in daily, full results along with interpretation are scheduled for late July.

Historic Preston Lake work found anomalous uranium in lake sediment, as well as graphitic faults associated with sulphides and anomalous radioactivity. Rock samples of up to 5.4 parts per million uranium might indicate “either the down-ice glacial transport of uranium boulders from source or an in-situ source of uranium,” Yellowjacket stated.

The company’s Preston Lake and Patterson East properties total over 158,200 hectares, making Yellowjacket the PLS area’s largest claim holder. YJK also holds six other Basin properties. On the agenda for its May 29 AGM is a proposed name change to Athabasca Nuclear Corp. (Update: On June 6, 2013, Yellowjacket Resources began trading as Athabasca Nuclear Corp TSXV:ASC.)

We have a plan in place to attack this as a team. With the three companies combined we have a number of highly qualified geologists who have collectively been up in this part of Canada for a long time, so we have many, many years of exploration expertise behind us.—Jordan Trimble, Skyharbour Resources manager of corporate development and communications

Survey participant Skyharbour benefits from the money and expertise of two additional companies, SYH manager of corporate development and communications Jordan Trimble points out. The earn-ins announced last week allow Lucky Strike Resources TSXV:LKY and Noka Resources TSXV:NX each a 25% interest in Skyharbour’s portfolio of seven Basin properties, six in the PLS region. In return Lucky Strike and Noka each pay Skyharbour $100,000 and fund $500,000 of exploration a year for two years.

“In this market especially, the financial capital they’re providing is hugely beneficial,” Trimble says. “We have a plan in place to attack this as a team. With the three companies combined we have a number of highly qualified geologists who have collectively been up in this part of Canada for a long time, so we have many, many years of exploration expertise behind us. This is just the start of the program. There’ll be lots more news to come.”

UEX offers $3.175-million private placement

Already holding about $10.6 million in cash, UEX Corp TSX:UEX announced on May 24 a private placement of 6.35 million flow-through shares at $0.50 for proceeds of $3.175 million. An additional 1.85 million flow-through shares may be issued under the same terms should Cameco Corp TSX:CCO exercise its right to maintain an approximately 22.58% interest in UEX. The company hopes to close the placement by June.

UEX holds 17 Basin projects totalling 264,363 hectares including its 49.9% interest in Shea Creek, the Basin’s third-largest uranium resource. The UEX portfolio includes nine other JVs with AREVA and one with both AREVA and Japan-Canada Uranium (JCU). UEX holds a 100% interest in the other six.

NexGen hires ex-Hathor/Rio geos, plans Radio drill campaign

NexGen Energy TSXV:NXE snagged more expertise with two new hires announced May 22. Senior geologist James Sykes moved from Denison Mines TSX:DML to Hathor Exploration and from Hathor to Rio Tinto when the latter bought Hathor and its Roughrider deposit in 2011 for $654 million. Sykes is credited with building the 3D geological model of the Roughrider system that led to the discovery of the Roughrider East and Far East deposits.

Exploration geologist Matthew Schwab has a similar background. A member of the Hathor team that explored Roughrider and defined its mineralized zones, he also comes to NexGen via Rio.

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Western Potash VP of corporate development John Costigan

May 24th, 2013

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