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Donner Metals Update

Posted by jojo at 8:23 AM on Monday, October 19th, 2009

The Mining Journal just covered the recent forum in London, including a bit they titled “Monopoly Rules; Winning is all about having the correct strategy.” Under the header “Passing ‘Go’,” Donner Metals Ltd.’s Dave Patterson refers to the opening speaker’s Monopoly analogy by applying it to the Matagami Project. : http://clients.westminster-digital.co.uk/minesite/microsite/events/62/video/index.aspx?companyid=62_5

In Monopoly, you need to have access to the railway, and utilities. Matagami has road, railway, airport, power, an onsite mill, and more infrastructure in place. It’s much easier to win when you can ride the railway without having to pay for building one from scratch.

don-10-17-09
This picture shows the proximity of infrastructure in the area currently under development in Matagami.

In Monopoly, when you Pass Go, you collect $200. In Québec, when you spend $1.00 on exploration, you get $0.40 back from the government. This is a huge incentive in a world-class mining district like Matagami.
Finally, in Monopoly it pays off both short- and long-term to own Park Place because you can collect on what you already have with the option of building more in the future. There have been 10 past producers in the camp, one current producer, and Donner/Xstrata’s new Bracemac-McLeod deposit is coming in as the third largest in the camp. Plus, there is potential for more new discoveries.

Pay close attention to the strategy in this game, and you should see that the Matagami Project is a quality property with low-cost, high-margin deposits in a camp that has proven economic in every metals cycle since opening in 1963.

In June 2010, Xstrata is expected to finish the accelerated feasibility study. If it’s positive which seems likely since Xstrata skipped the pre-feasibility study to fast-track it, they should be breaking ground in July.

Posted in A Grandich Company, All Posts, Base Metals, Copper, Donner Metals, Exploration Shares, Gold, Mining Shares, Nickel, Precious Metals, Silver, US Stocks, Zinc | 3 Comments »

Update – Donner Metals

Posted by Peter Grandich at 8:30 AM on Monday, September 7th, 2009

The Matagami Project is aggressively moving forward and on track to feed a hungry mill with high-grade zinc, copper, silver, and gold. Donner Metals (TSXV: DON) and partner Xstrata Zinc have accelerated their feasibility study in order to push forward into near-term production. Xstrata is spending up to $20 million on this feasibility study to progress the deposit along a timeline that is unusually fast.

Donner has the ingredients needed to succeed; Experienced management, an accessible location with infrastructure in place, and low-cost production for high-grade discoveries. Donner, along with mining giant Xstrata Zinc Canada, has all this – and what’s more, the Matagami Project has sped from deal to accelerated feasibility study in less than 3 years. Today, Donner is funding an on-going year-round drill program at Matagami looking for the next deposit to put through Xstrata’s hungry 2,600 tonnes/day mill.

The Donner/Xstrata team’s new discovery concept, the award-winning successful one that got them this far, is now being applied elsewhere on the camp. While past performance never guarantees future results, Donner appears to have all its gears going strongly forward so stay tuned.

Hear Donner’s presentation in New York City on September 9th

Posted in All Posts, Base Metals, Copper, Donner Metals, Exploration Shares, Gold, Mining Shares, Nickel, Precious Metals, Silver, US Stocks, Zinc | 3 Comments »

Article on Donner Metals

Posted by Peter Grandich at 2:23 PM on Tuesday, July 28th, 2009

Read

Posted in All Posts, Base Metals, Copper, Donner Metals, Exploration Shares, Gold, Mining Shares, Nickel, Precious Metals, Silver, US Stocks, Zinc | 4 Comments »

The Rodney Dangerfield of Juniors Takes a Big Step Forward.

Posted by Peter Grandich at 9:27 AM on Tuesday, July 14th, 2009

Its official – Xstrata Zinc is advancing the Bracemac-McLeod zinc-copper discovery to the feasibility stage, effective immediately.

A positive outcome of the recently completed scoping study means that Xstrata has now begun an accelerated feasibility study at Bracemac-McLeod in Matagami, Québec. The 50/50 joint venture with Donner Metals and Xstrata Zinc allows Xstrata to spend up to $20 million on a bankable feasibility study in order to earn an additional 15% (bringing it to 65% Xstrata, 35% Donner, just for that one area in the camp).

As a long-time supporter of Donner I am really pleased to see this news. The scoping study was a long time coming from Xstrata, who conducted and funded the whole thing. Getting the go-ahead for feasibility is not a 100% guarantee that Bracemac-McLeod will go into production – but it is rare to see a major company spend money on feasibility without anticipating that there will be a mine. The Matagami Mining Camp is a world-class mining district with 10 past producers, as well as Xstrata’s own low-cost currently producing mine.

Since Xstrata has about another 4 years of mine life left and Bracemac-McLeod apparently will need to be in production well before the Perseverence Mine shuts down, this accelerated feasibility study draws a clear line from the end of the study to near-term production.

The overall objective of the Matagami Project is to supplement and replace production from Xstrata’s mine by finding more new discoveries. Two awards have been won by the Donner/Xstrata exploration team for their work on Matagami for their brand new geological understanding of the camp. Keeping in mind that there has been mining at Matagami for about 50 years, and where geologists before said there was nothing, Donner and Xstrata found over 4 million tonnes of high-grade zinc and copper. With their new understanding of the geology of the camp, the exploration team is currently doing more exploration with the hopes, and real potential, to find more new discoveries to feed that mill.

Left: David Patterson, Chairman, Donner Metals

Posted in A Grandich Company, All Posts, Base Metals, Copper, Donner Metals, Exploration Shares, Gold, Mining Shares, Nickel, Precious Metals, Silver, US Stocks, Zinc | 5 Comments »

Update 1100:AM DST

Posted by Peter Grandich at 11:00 AM on Thursday, June 11th, 2009

I’m almost caught up after just a week away from the office. It’s a tough job but somebody has to do it-lol

I want to say it was an absolute pleasure meeting so many blog followers at the Vancouver show. Your words of encouragement were very special to me. I always felt a sense of responsibility to my readers but after you meet so many personally, you come away with even more a desire not to screw up. Thanks again for all the kind words there and here on the blog.

There’s not much to update as yours truly has curled up into a fetal position-lol. I’m very content holding all metals related positions as I think we’re not even close to the explosive stage for precious metals and feel we’ve seen the lows for base metals.

I explained in Vancouver that after 25 years in this business and losing more money than I ever thought I would make as a youngster, I’ve learned to take profits, especially when they come much faster than expected. That’s why I advised taking profits in oil-related recommendations.

Since I’m basically a speculator/gambler, I’ve learned when you swing for the fences its best to have plenty of swings. Profits allow more swings.

I also feel quite comfortable holding my short treasuries and U.S. Dollar positions for the long term.

I’m extremely bearish on the belief that the U.S. economy can return to any real economic growth for years to come. Yes, a recovery is likely but what good will flat growth be anyway? It’s my belief that a multi-year trading range can develop between the lows around DJIA 6500 and 10,500 on the upside. I think the play is to await some a run to the top of the range before going short. If we simply go back towards the lows again I will once again consider the long side depending on the then current fundamental and technical outlooks.

In regards to the few open buy positions and Grandich Clients, here are my latest views:

Taseko Mines – Please see most recent comments

Continental Minerals – Buy up to $1.20. Stock appears to be consolidating recent gains.

Nevsun Resources – Would be a break out on a close above $1.60

All remaining positions in model portfolio are holds.

ATW Gold – The market seems to be realizing that they’re on the threshold of becoming a significant producer and still have excellent exploration potential.

Apella Resources – Still waiting on new developments.

Bravo Venture Group – Soon to be drilling again and the Homestake project is the homerun swing.

Crosshair Exploration – Has lifted off lows thanks to renewed interest in Uranium.

Donner Metals – The Rodney Dangerfield of juniors has finally received a little respect. Here’s to it continuing.

Farallon Mining – The name change says it all. It’s now a producer.

Hawthorne Gold – It too is set to drill and we wait in anticipation of good news.

Knight Resources – Another kick at the can this summer. Here’s to a big kick!

Northern Dynasty Minerals – Is consolidating recent run and is a buy if it gets below $7 again.

Oromin Explorations – Management continues to drill for gold and not investors. This may hurt now but pay off in the future.

Silvermex Resources – Is under review and I hope to have an update out soon.

Sunridge Gold- Just had an update today.

Timmins Gold – Onward and upward towards production now with financings all in place.

Posted in All Posts, Apella Resources, Base Metals, Bravo Venture Group, Copper, Crosshair Exploration, Donner Metals, Exploration Shares, Farallon Resources, Gold, Hawthorne Gold, Mining Shares, Nickel, Northern Dynasty, Oil, Precious Metals, Silver, Sunridge Gold, Taseko Mines, Timmins Gold, U.S. Economy, US Dollar, US Stocks, Uranium, Vanadium, Zinc, world economy | 8 Comments »

The Rodney Dangerfield of Juniors Hits Again!

Posted by Peter Grandich at 7:42 PM on Thursday, March 12th, 2009

Rodney Dangerfield’s famous line was “I get no respect”. Rodney was known in comical circles as one of the hardest working comics of all-time. Well no one I ever met works harder and longer hours then Donner’s Chairman and Director, Dave Patterson. I’m extremely prejudice here because not only do I work for Donner but I consider Dave one of my best friends in the whole world (poor guy).

In over two decades of being involved with junior resource companies, I never have seen a company that continues to have success over and over again, yet it doesn’t remotely get reflected in its share price. I’ve given up scratching my head over Donner since I can’t afford to lose any more hair. I know management feels the same way. Here’s to further great success and a share price that finally respects that success.

We may be closer to that success after the news released after the close today. Donner Metals (TSX.V: DON) has made another new discovery at Matagami, with 2.20% copper, 8.8 g/t silver, 0.25 g/t gold over 3.95 metres in the newly-targeted Daniel-1 area. This discovery was the result of follow-up drilling of previously encountered geophysical responses that, due to the great successes with the Bracemac-McLeod discovery areas, had to wait until now for exploration drilling. I think this intersection really demonstrates both the potential for many more high-grade zinc copper discoveries in the prolific Matagami mining camp, but also that the exploration approach taken by the Donner Metals / Xstrata Zinc Canada team is delivering results.

Because of the established infrastructure in the Matagami camp, including roads, railway, airport, and Xstrata’s 2,600 tonne/day mill, the economic threshold for viable deposits is much lower. Up next on the exploration front is drilling on the South Flank, known for having some of the most profitable producers in the camp. The numerous newly generated, high priority targets, have excellent potential for additional discoveries.

Simultaneous to this exploration work, Xstrata is conducting a scoping study at the Bracemac-McLeod discovery area to figure out the most cost-effective way to mine these deposits. Recent thinking has focused on the potential for a ramp from the open pit at former producer Bell Allard South. If this mine model results in a positive feasibility study, the ramp would bring the trucking distance to the mill to less than 2 kilometres.

Donner Metals and Xstrata Zinc Canada have had enormous success with the Matagami Project; they’ve won Prospector of the Year in Quebec for 2007, the Mining Journal’s Outstanding Exploration Award in 2008, and are already making new discoveries in 2009.

The Xstrata / Donner Metals team are exploring in the prolific Matagami, Quebec mining camp, where traditionally low-cost production has been underway since 1963. Even with 10 former producers in the camp in addition to Xstrata’s currently producing Perseverance mine, there’s been a lot of talk about blue sky potential and more new discoveries to come. It looks like they were right; the Xstrata / Donner team are applying what they learned at Bracemac-McLeod to other areas of the 800 sq. km property in the hopes of finding more high-grade zinc, copper, silver, and gold in order to continue feeding Xstrata’s mill.

Posted in All Posts, Base Metals, Copper, Donner Metals, Exploration Shares, Mining Shares, Nickel, Precious Metals, Silver, US Stocks | 3 Comments »

Donner Metals Update

Posted by Peter Grandich at 9:52 AM on Thursday, February 26th, 2009

It’s very frustrating to watch a junior do all the right things, have a strong chance to become a significant producer and see the share price at pennies a share. Dave Patterson and Harvey keats are among the hardest working people I know in the junior resource business. IMHO, if not for the junior market crashing, this type of news would have the share price trading at multiples from where it is now.

Posted in A Grandich Company, All Posts, Donner Metals | 4 Comments »

Donner Metals in Mining Journal

Posted by Peter Grandich at 6:27 PM on Friday, February 6th, 2009

The Mining Journal on Xstrata Zinc & Donner Metals

The Mining Journal is the global mining industry’s leading weekly newspaper that really understands the industry and the noteworthy projects that deserve our attention. Today they published a piece about the Matagami Project’s Bracemac-McLeod resource estimate, along with new information about the scoping study.

Xstrata’s scoping study focuses on the development of the deposit and plans to use it as a supplement and eventual replacement for Xstrata’s Perseverance mine, which has about four years of mine life left. The scoping study team will put the existing infrastructure in the Matagami camp to good use with a proposed decline portal entering from Bell Allard South, a former producer, located about 2 kilometres from Xstrata’s mill.

http://donnermetals.com/uploadedFiles/images/MiningJournalFeb.pdf

Posted in All Posts, Base Metals, Copper, Donner Metals, Exploration Shares, Mining Shares, Nickel, Precious Metals, US Stocks | No Comments »

The Juniors Have Taken a Licking But Donner Keeps on Ticking

Posted by Peter Grandich at 11:23 PM on Friday, January 23rd, 2009

In a junior market full of disappointment, distress and companies disappearing regularly, the latest news from Donner Metals is truly a refreshing breeze. From almost the first days of the project, Donner has had one great success after another. I truly believe if this was past junior markets of the 90s and the first five years of this decade, these results would generate tremendous interest and share appreciation. Yes, that was then and this is now but the metals don’t know what year it is.

The impressive NI 43-101 Resource Calculation was just announced by Donner for their Matagami Project in Quebec. The Bracemac-McLeod indicated resources are currently calculated at 3,648,000 tonnes grading 11.09% zinc, 1.55% copper, 31.34 g/t silver and 0.48 g/t gold. In addition, inferred resources of 528,000 tonnes grading 1.39% zinc and 1.73% copper, x g/t silver, and X g/t gold has been calculated separately for the less well-defined McLeod West Zone and Copper Zone. It’s also quite interesting that several drill holes on the horizon, that had excellent results, were not included in this calculation.

What do all these numbers mean? To put this resource in context, a year or so ago their joint venture partner Xstrata Zinc invested in the refurbishment of their 2,600 tonne/day Matagami Lake Mill, and the development of their Perseverence deposit. Because of this, the hurdle for success of the Bracemac-McLeod deposits is even lower than Xstrata’s Perseverence deposit since the capital has already been spent upgrading the mill. It’s already in place. Before Perseverence is mined out, Xstrata should be looking for mill feed, and where better to start than the discoveries made 6 kilometres from the mill? The Matagami Mining Camp has consistently been a low-cost producer of zinc, copper, silver and gold since the first production began in the 60’s, and a low capital cost with a short time frame to production is more important now than ever.
So what’s next? Xstrata’s engineering and mine team should continue the scoping study and should advance the Matagami Project through prefeasibility, feasibility, and the development stages. Of course they can be expected to keep extending the exploration around the Bracemac-McLeod areas, and recalculate the resource base with any additional discoveries. Keep in mind that this area had decades of production before these discoveries were made, and the Donner-Xstrata team have a list of high priority drill/exploration targets for 2009 elsewhere on the Matagami property. If they apply their new exploration techniques and concepts to other areas on the property, it looks like they could discover more of the same zinc-copper deposits.

From the Prospector of the Year Award for Quebec in November 2007, to the Mining Journal’s Outstanding Exploration Award in December 2008, it is clear that industry leaders recognize this team’s high rate of success. I hope they will keep it up, and I’m eager to see what they can accomplish in 2009.

Posted in A Grandich Company, All Posts, Base Metals, Copper, Donner Metals, Exploration Shares, Mining Shares, Nickel, Precious Metals, Zinc | 2 Comments »