Archive for the ‘Gold’ Category
Company Alert
In previous articles I have told you about the leverage that you will get from emerging producers. Gold hit an all time high today of $1089. Timmins Gold is so close to pouring gold you can taste it.
A story that I have written about before is Timmins Gold and its San Francisco mine in Mexico. Timmins Gold is ramping up in hopes of full production before the end of 2009. The company has begun the leach process and now has gold in the leach fluids. The next step will be to extract the gold using the gold plant on site. This is planned for the next few weeks. Next year Timmins Gold can be producing between 80,000 and 100,000 ounces of gold at a cash cost of approximately $400 per ounce. The company has been drilling around the current pit and should also have some exploration results before the end of this year.
Timmins’ expansion plan consists of expanding the current reserve and lifespan of the San Francisco Mine, advance its other exploration projects and to make strategic acquisitions all utilizing future cash flow and not by dilution. The recent deal with Sprott was a watershed event IMHO. I’m of course bias due to my working relationship but I feel with the fundamentals finally firing on all cylinders, gold’s big break-out, and the chart on TMM suggesting a close above $.88 could be a break out for the stock, most speculators need to consider the company ASAP.
If A Picture Is Worth A Thousand Words
In the face of a rising U.S. Dollar and a vast majority of either outright bearish or weak-knee bulls, gold has just vaulted up to a new, all-time nominal high.The fact that India has already bought half of the entire amount of gold the IMF is selling is definitely a major plus.
The bears are in big, big trouble.
Silver Quest Resources – Superb Management and Strong Projects Potential
I am pleased to have been engaged by Silver Quest Resources. Silver Quest and it’s predecessors have a long history in the mining industry as one of the first junior mining companies to list on the Venture Exchange. Silver Quest is an exploration company filling a niche in British Columbia, Yukon, and Ontario by advancing and developing silver and gold resources. I like this company for three main reasons. The company’s president, Randy Turner, is committed to the success of the company, as proven by his more than 15 years of involvement in various roles. Second and third, I like the two main assets, the Capoose –Silver Trend property and the Davidson Property, both silver and gold properties with vast upside potential located in central BC.
Great Leadership
Mr. Randy Turner, the new President and CEO of Silver Quest, is a skilled and qualified professional geologist with over thirty-eight years of mineral exploration, business and financing experience to draw from. Mr. Turner has spent the majority of his career working for Canadian mineral companies. As president of Winspear Diamonds Inc., Mr. Turner guided the company from the discovery of the Snap Lake diamond deposit in northern Canada through its sale to De Beers Mining for C$305 million.
Prior to his position at Winspear, Mr. Turner was president of Trimin Resources Ltd. where he was involved in the development and sale of the McIlvenna Bay copper/zinc deposit in Saskatchewan. Mr. Turner also spent many years working on property acquisitions and joint ventures for Esso Minerals in Canada and AGIP Mining in the US and Australia. Mr. Turner’s knowledge, contacts and experience in the exploration industry are an invaluable asset to Silver Quest, and one of the reasons, I believe, that this company is truly one to watch as they have great potential knocking at their door.
BC Properties
Silver Quest’s main area of exploration is Central British Columbia, approximately 120 kilometres southwest of Vanderhoof. The company’s three main assets, the Capoose-Silver Trend, the Davidson and the 3T’s properties are all located within this region. Although I won’t go into too much detail at this time on the 3T’s property, it is worth mentioning that the property already has NI 43-101 inferred resources of 2,356,937 ounces of silver and 148,100 ounces of gold. Management has also informed me that 3T’s should be the site of a winter drill program early in 2010 with the goal of expanding the known gold and silver resources.
BC Property location map
Capoose – Silver Trend
The Capoose-Silver Trend property is the Company’s flagship project. Silver Quest has put together a land package totalling over 14,000 ha surrounding a historical mineral resource of 32.66 million ounces of silver and 308,500 ounces of gold. To-date, 112 drill holes have defined three mineralized zones which remain open in all directions and at depth. Also of significant interest is a five kilometre long silver-gold-copper-lead-zinc soil geochemical anomaly with multiple high priority targets that are defined and drill ready, but currently untested. The five kilometre long mineralized trend encompasses the historical resource and trends in a north-easterly direction. At the south end of the Capoose-Silver Trend land holdings there are multiple mineralized showings that need to be further explored; these include the Fawn, Buck and Rut mineral occurrences.
Silver Quest’s recently completed drill program included 1,692 m spread across 13 diamond drill holes. The focus of the program was to test the extensions of the south end of zones one and two, as well as to test the area between the two zones. Silver Quest’s concept is that the current three zones are actually connected creating one large disseminated gold and silver deposit. Last year’s program included drill hole D-08-91 which successfully connected zones one and two at their north ends and yielded 240 m of 45.5 g/t silver and 0.76 g/t gold. Silver Quest has only received assay results from the first hole of this years program, D-09-100, which was drilled at the south end of zone one and appears to expand mineralization to the south. Two areas of significant mineralization were intersected in this hole; an upper zone of 16 m grading 67.9 g/t silver and 0.26 g/t gold, and a lower zone of 30 m grading 23.1 g/t silver and 1.99 g/t gold, with a 9 m higher grade zone within the interval of 61.8 g/t silver and 4.72 g/t gold. These results are extremely encouraging and I look forward to seeing further high-grade results from the remaining twelve drill holes completed this year. I also anticipate an NI 43-101 resource calculation on the Capoose-Silver Trend property by the second quarter of 2010.
Capoose-Silver Trend drill hole location map and estimated zones of mineralization
Davidson Property
Silver Quest holds 100% interest in the Davidson property, located 10 kilometres west of the Capoose-Silver Trend property. The Davidson Property has been optioned to Richfield Ventures, which included Davidson in a larger land package called the” Blackwater Project”. Richfield has completed 15 holes totalling more than 2,450 m this year. The majority of these holes have been collared on Silver Quest’s Davidson property and have confirmed and expanded historical mineralization in three mineral zones. Richfield believes the area may contain a bulk tonnage gold deposit. The best hole to date on the Davidson property was a Silver Quest hole drilled in 2005, DAV-05-02, that assayed 3.4 g/t silver and 1.43 g/t gold over 140.5 m. Richfield has recovered many intersections that have similar values of gold and silver over long intervals including BW 48 which returned 148 m of 5.0 g/t silver and 1.26 g/t gold. Richfield is lead by a group of experienced and knowledgeable individuals. The group is well financed and plans on completing the earn-in option on the Davidson property towards the middle of 2010. It is expected that Silver Quest will retain a 40% interest in this property; a significant amount for the upside potential, but a reasonable amount to be able to fund their portion of further exploration while also being able to advance their flagship project, the Capoose-Silver Trend Project. I look forward to the release of the results from the remaining four drill holes, and hope to see a resource calculation released prior to next summer.
Drill hole location map from Richfield. Davidson property is above the blue line
Additional Properties
In addition to the Company’s BC projects, Silver Quest has a package of early-stage projects located in the booming White Gold Area of the Yukon and the Thunder Bay Region of Ontario, creating an in-depth pipeline of projects for advancement. At the top of the list is the Boulevard project recently optioned from Kiska Metals and Northgate Minerals. A new gold discovery was made last year in the trenches on Boulevard. The discovery trench, TRV0801 returned 7.04 grams per tonne (g/t) gold over 6.0 metres. A second trench, TRBV0802 returned 6.43 g/t gold over 2.0 metres. The Boulevard project has been soil sampled, trenched and drilled over the past three years. Silver Quest completed an auger soil sampling program this year to better define the targets to be drill tested next season.
Bottom line
Silver Quest is a company in all the right geographical locations, building and defining resources with a pipeline of strong exploration properties to deliver upside potential. The quality of Silver Quest’s Projects, and the added value of an experienced management team and board, makes this worthy of consideration for most speculators portfolios.
Interesting Chart
Bill Murphy had this chart in his daily message today. It shows how the U.S. Dollar has been in a series of self-correcting oversold periods that have grown shorter each time. It’s interesting to note that the 50-Day M.A. has held almost the entire time. The dollar continues to be a key factor in most markets and nothing appears on the horizon that can change that.
P.S. By my non-scientific research, it’s Bill Murphy 100, Nadler 0 Who’s the crazy?
Model Portfolio Updated. Comments on Some Clients.
It appears the long suffering gold bears have once again failed in yet another attempt to shake the market lower. While the media remains focus on receiving advice about the future from a few chronic bad forecasters from the past, gold appears like it has all but completed its latest consolidation and ready to challenge $1,100 before years-end. As I said all along – the surprises in gold should mostly be to the upside.
With this in mind, I updated the model portfolio this morning.
In regards to some clients of Grandich Publications:
Formation Capital (FCO-TSX) is so close to finalizing their mine developing package one could taste it. Stay tuned.
Sunridge Gold (SGC-TSX-V) management tells me they’re quite please with their on-going exploration program. The $.60 area appears to be a level those not yet believers can become one at an undervalued entry point.
Timmins Gold (TMM-TSX-V) is perhaps one of the most undervalued companies on my entire list.
A Service You Should Consider
After once being a legend in my own mind, I’ve easily accepted the fact I will never be the smartest, second smartest, etc., guy in the world. Instead, I realized if I could find individuals and groups who have demonstrated to me a special skill, I could incorporate all of them into my thoughts and hopefully then have something good going for me. A case in point would be my belief that Mr. David Walker is a 21st century financial prophet and it paid handsomely incorporating that into my work.
Here’s two links to a super service I believe just about all readers can benefit from. You can begin receiving it free by just providing your email address. I fully support their comments on the gold and the U.S. stock market.
Update
Markets are quite interesting at the moment. The inevitable stock market correction appears to have finally taken hold. A 5%-10% decline would be the least one would look for as of right now. I wouldn’t yet bet against the “Don’t Worry, Be Happy” crowd so I’m quite content on watching this unfold from the sidelines.
Gee, gold options expired today and what do you know gold fell $30+ the last three days. What a coincidence. I suspect we’ll see a bounce in gold followed by some selling to see if the bears can finally do some real damage. Based on their track record up until now, I wouldn’t break into a sweat if you’re long term bullish like me.
The U.S. Dollar is once again trying to get some sort of a counter-trend rally going but needs to get a close above 78 on the U.S. Dollar Index to do so. Even if it does, any rally looks like it should be capped below 84.
I remain neutral on oil and screaming bearish on 10yr. and higher U.S. Treasuries.
I’m going to put a buy again on NSU as this sharp correction from $3.40 just last week seems to have been enough of a correction. I paid up to $2.60 today and will use that as a buy limit.
I’m adding a new recommendation to my model portfolio. Buy East Asia Minerals (EAS-TSX-V $1.78) up to $1.85
Keep a $1.55 buy limit on KMK until further notice. There’s a lot more to this situation than meets the eye so be careful of what you assume is real information from people who may be playing with one or two hands tied behind their backs.
