Gold has traded between $1,093 and $1,107 so far today…as of 9:30 am Pacific, bullion is down $8 an ounce at $1,101…a close above $1,100 today would be very encouraging going into next week, but the breakout through $1,080 was an important first victory for the bulls…Silver is off 30 cents at $14.00…Copper has slipped a penny to $2.04…Crude Oil is up 17 cents to $33.44 while the U.S. Dollar Index has jumped nearly half a point to 98.70…
Global stock markets have endured a rough start to 2016, though Gold and Gold stocks have moved in the opposite direction…the S&P Global Broad Market Index, which tracks global stock performance, lost $2.2 trillion in market value through the first 4 trading sessions this year…that total trumps the estimated U.S. student loan debt of more than $1 trillion and would represent roughly 12% of U.S. government debt…
The U.S. economy closed out 2015 with a strong round of job creation…non-farm payrolls exceeded expectations in December as 292,000 positions (vs. the consensus estimate of 200,000) were added during the month, according to the Labor Department’s report this morning…the unemployment rate was 5%…a separate, more encompassing measure that accounts for those who did not look for work in the past month or were working part-time for economic reasons – the under-employed – held steady as well at 9.9%…
Top 50 Opportunities Update
Just over a month ago, on December 6, we released our “Top 50 Opportunities” List (not including the double-long HGU ETF)) which was heavily weighted (50%) in Gold producers, near-term Gold producers or companies with advanced Gold resources, and Gold explorers (some Silver exposure was mixed in among those categories)…of those 26 companies, 21 are up in value over the last month (21 trading sessions), 4 are down and 1 is unchanged for an overall return of 9.2%…the top 10 performers among those companies (through yesterday) have been:
Walker River Resources (up 40%, WRR, TSX-V)
Gold Standard Resources (up 30.1%, GSV, TSX-V)
Richmont Mines (up 22.9%, RIC, TSX)
OceanaGold (up 19.7%, OGC, TSX)
Cordoba Minerals (up 19.2%, CDB, TSX-V)
Claude Resources (up 18.8%, CRJ, TSX)
GoldQuest Mining (up 18.5%, GQC, TSX-V)
Kaminak Gold (up 15%, KAM, TSX-V)
Detour Gold (up 12.2%, DGC, TSX)
True Gold Mining (up 10.2%, TGM, TSX-V)
Meanwhile, the double-long HGU ETF has jumped 11% over the past month and 29% since our first recommendation in November…
Among the 50 companies, the Producer category (all Gold) is up 11.9%, Near-Term Producers/Advanced Resources category is up 10.8%, the Exploration category has gained 4.2% (led by 2 Lithium companies), while the Non-Resource category has been under-performing with a decline of 8.8%…overall, the gain is 4% vs. declines of 7.5% for the Dow, 6.8% for the TSX and one-half of a percent for the Venture (interestingly, the best of the 3)…again, those numbers are all through trading yesterday…
In today’s Morning Musings, we’ll review a few of the above situations and explain why we remain bullish on the Gold sector during this 1st quarter…on Monday, we’ll review and highlight some of the most exciting Gold exploration/discovery opportunities among Venture juniors, and why British Columbia’s #1 greenfield district is about to become more interesting than ever…
Increasing Global Conflict – Major Theme For 2016
Low commodity prices, with Crude Oil being the biggest concern, could exacerbate tensions and conflict in the Middle East, increase public protest in Latin America, and worsen industrial action in Africa’s resource-rich countries, according to global political risk consultancy Verisk Maplecroft in a 2016 outlook report published today…
“Verisk Maplecroft highlights low commodity prices as one of the primary drivers of political risk for investors in major producing countries across Africa and Latin America, while the increasing international threat posed by the Islamic State and rising tensions between Iran and Saudi Arabia, are flagged among the foremost geopolitical risk multipliers,” the consultancy said…
Verisk Maplecroft added that Iranian Supreme Leader Ali Khamenei might pursue a more confrontational foreign policy in 2016 in a bid to appease hardline elements in Iran’s theocratic regime…
Huge Oil Company IPO On The Way?
Saudi Arabia is considering (for sometime this year) listing its state-owned Oil producer, Saudi Aramco, The Economist reports, citing the kingdom’s deputy crown prince Muhammad bin Salman…Aramco is the world’s largest Crude Oil producer and if the initial public offer goes through, Saudi Aramco would rank as one of the most highly valued listed companies in the entire world…the listing of the Oil giant, if it occurs, would also help bolster the Saudi government’s finances after the ongoing rout in Oil prices contributed to a record 367 billion Saudi riyals ($98 billion U.S.) budget deficit in 2015…
Photo of the Day
This curious snowy owl looks straight at Transport Quebec’s traffic camera along Highway 40 at Sources Boulevard (Transport Quebec)
In today’s Morning Musings…
1. TSX Gold Index approaches “decision” time – fascinating long-term chart…
2. Update on the HGU and two prolific Canadian Gold producers who are showing the “big boys” how to make money…
3. Another good week for Pure Energy Minerals (PE, TSX-V)
Plus more…to view the rest of today’s Morning Musings, login with your username and password, or click here to gain full access to this and other exclusive BMR content and features…
Sage advice from Brent Cook
What is your New Year’s investment resolution for 2016?
“One has to be very critical and brutal when evaluating exploration results and sell if your investment thesis begins to fall apart regardless of what your purchase price was,” he said.
“The key to making money in the junior mining sector is #1–Don’t lose money and #2 always fact check a company’s statements and data–sometimes they make things up,” he added.
Comment by Jeremy — January 8, 2016 @ 10:26 am
TMM.TO – does anyone have any insights or opinions on TMM??
they have 10 mil in the bank, owe 10 mil to Sprott which they gotten a month extention on it, have capex reductions for their AnaPaula mine due to a mill from Goldcorp and 6 mil from them.. if gold doesnt improve they will put SanFran Mine on C&M… in July…
Insiders have bought… SP below .20 which for a producer is nuts..
what am I missing here?? any thoughts?
Comment by Jeremy — January 8, 2016 @ 11:29 am
This may be of interest to shareholders where companies operate in this part of B.C.
marketwired.com/press-release/tahltan-central-government-welcomes-new-lands-director-build-tahltan-lands-department-2086623.htm
Comment by Andrew — January 8, 2016 @ 1:21 pm
TMM is it still another $100MM for production stuff I think and their plans are based on $1200 gold. Turmoil in the boardrm may have turned a few off. Not sure if Lundin group is still in, but given that its almost 90% off the merger high, maybe they are gone along with Sentry Investments , who were initially behind the deal
Comment by david — January 8, 2016 @ 1:47 pm
Dave – Any information from EQT that you can share with us?
Thanks!!
Comment by Jeff — January 8, 2016 @ 2:32 pm
Thx David…. the gold cost is definitely troubling… just wonder if they will be one of the first to go under….
Comment by Patricia — January 8, 2016 @ 2:34 pm
Thx David as well… indeed one wonders…
Comment by Jeremy — January 8, 2016 @ 3:53 pm
Jeff – getting conflicting stories from my men. Therefore, would rather not say. I will see who is right and who is wrong when it resumes. If it is a company going into EQT, it might be halted a while. Lets see what happens Monday.
Comment by dave — January 8, 2016 @ 6:58 pm
I hear that bought a minor gold producer.. nice for them with our money..!!!! more snake oil sales guys in my opinion!!!! I have lost all faith in anyone in the explorer and minor I need to raise funds arena..
so many times we the public have been duped… up to us to change that!!
Comment by Jeremy — January 8, 2016 @ 8:23 pm
Jeremy, it’s premature to draw any conclusions before anyone has even seen the news – whatever it is. If it’s a “minor” gold producer, why would that necessarily be a bad thing, especially if it has the right dynamics? Could be a great asset that may also be able to produce cash flow. And what would you suggest they do with our money at the moment?
Comment by Jon - BMR — January 8, 2016 @ 9:01 pm
EQT- If they were able to pick up
a good, but distressed gold asset, and
circumvent the high-risk exploration phase, then I
think the market would look at it favorably.
If gold has continued strength the timing may
also be in EQTs favor.
Comment by bob — January 9, 2016 @ 5:32 am
I would agree, Bob. There has been no better time to acquire high quality gold assets on the cheap. I’m sure they’ve looked at dozens of projects, and Hardy has put EQT in a position to do something significant here. That’s how u build a company. If there’s something negative about that, I don’t see it. The simple fact is that EQT needs more than 1 project – they knew that before drilling Garland.
Comment by Jon - BMR — January 9, 2016 @ 8:02 am
EQT- Yes Kyler has been to many countries in the last 6 or more months looking for projects that meet his demanding criteria.
And I really like his criteria.
This is his baby.
Comment by murf — January 9, 2016 @ 8:29 am
Like I said in an earlier post. He was in South America (quietly) back in early December. One of my guys says generating revenue gold property. We shall see.
Comment by dave — January 9, 2016 @ 8:39 am
Hardy is eager, an extremely hard worker, and savvy – the Venture needs more like him. Whatever he has come up with, I suspect it will be good and not something “ordinary”.
Comment by Jon - BMR — January 9, 2016 @ 8:50 am
EQT- yes cash is king, Kyler Hardy builds companies.
Comment by murf — January 9, 2016 @ 9:08 am
Yes but if hardy missed with his first project then why should market be excited about his second property? For myself, eqt goland was a pump and dump. Sorry if I offend anyone but just calling it as I see it.
Comment by tony t — January 9, 2016 @ 10:07 am
Perhaps when Kyler was in South America perhaps he looked at Lupaka Golds (V.LPK) property in Peru, which is permitted and just waiting for a partner? (Probably not though as I believe they are trying to get a toll miller in the area to partner with them).
Comment by Andrew — January 9, 2016 @ 10:25 am
EQT rumour making the rounds in Vancouver is that EQT is taking over MTO Bachelor Mine.
Dave, Jon, your thoughts?
Comment by Jeff — January 9, 2016 @ 10:27 am
I’d rather comment after the facts are on the table, Jeff, but whatever EQT has come up with, I suspect it’s going to be significant and would not be just a normal property acquisition as mentioned earlier.
Comment by Jon - BMR — January 9, 2016 @ 11:27 am
Tony- no offence taken, one should not expect a discovery
and hence should not be disappointed when economic grades/
lengths are not encountered on initial drilling. They did
not miss but encountered indicators. Money is made on the
market’s expectations and disappointments, rarely on discovery.
I’ve had some 6 figure profits on exploration plays where never
an ore body was found. Who other than the CEO is going to promote
his co.,and all the discussion re pump and dump, is just putting a
negative spin on normal market activity. Lots of money can be made
with stocks like EQT, by being a contrarian. Buy into disappointment
and sell into the euphoria.
Comment by bob — January 9, 2016 @ 11:52 am
EQT- Excellent post Bob.
And if EQT is a pump and dump somebody forgot to tell management because they put their own money
into all private placements and are not dumping.
It’s almost like they think they know more than we do, curious behavior.
Comment by murf — January 9, 2016 @ 12:03 pm
Hardy has a lot invested in this, murf – from the get-go, he has taken the approach of building this company for the long haul. He fits into the rare (preferred) category of builder/communicator as far as Venture CEO’s are concerned.
Comment by Jon - BMR — January 9, 2016 @ 12:13 pm
MTO has been screaming to be taken over for a while. It has it’s problems but Sandstorm’s gold stream is up for renewal soon. However if that is the case, why has the stock not been halted? I thought Oban would be the ones to take MTO over.
What sort of deal could EQT offer to a takeover target? They don’t have much cash and their market cap is less than $7mil. Must be some sort of clever deal being worked on with new players?
Comment by Tom UK — January 9, 2016 @ 12:14 pm
Tonyt – EQT was never nor will it be a pump and dump. This new property is geared to pay dividends to their shareholders is what I am hearing.
Bob – excellent post, could not have said it better. Kyler wants to get EQT back to .20 in a hurry.
Comment by dave — January 9, 2016 @ 12:17 pm
Andrew, Good point on Peru. But this is generating revenue already, lots of it.
Comment by dave — January 9, 2016 @ 12:19 pm
Jon – EQT $$… have no idea… but maybe spend it on expanding the research into Garland… I just have the feeling that they are throwing crap at the wall and see what sticks like so many other Venture companies have done..
Dont know Hardy… but I trust with verification these days on most things.
The Bachelor Mine reference was also present on SH… yeh I check there every once in a while:)
Comment by Jeremy — January 9, 2016 @ 12:26 pm
My earlier posts is what I am hearing anyway, again lets see if it resumes next week.
Comment by dave — January 9, 2016 @ 12:26 pm
Jeremy, if a junior really wants to succeed in this market it has to have more than 1 project, especially if that initial project is grassroots exploration. We never would have highlighted EQT if we thought for a minute that there was not a company building/broader dynamic to it. That’s what Hardy brings to the table. He’s not one, as you say, that throws crap at the wall. He’s a strategic thinker, he understands the business, and he knows what he needs to do to build a company. So far he’s done all the right things with EQT and had a very successful 2015 when you look at the big picture.
Comment by Jon - BMR — January 9, 2016 @ 1:27 pm
always makes sense to have 2 projects, in different climates, so you can ideally have a constant news flow. EQT was humped, ya well, if anyone checked the background, that was par for the course and whats different is that they stick around for phase 2, to try the next thing as well as the first thing. There have been lotsa juniors that looked in the Voisey area for years, the reason to give these guys 2 cents was that they had a better pedigree and deeper reaching VTEM, fwiw. juniors are notorious for looking and not always finding. that’s the game we bot into. as long as they take minimal salaries and throw it into the ground, you cant ask for more.
Comment by david — January 9, 2016 @ 2:46 pm
Jon, before drilling started at the grizzly, we where some kind type of hoping for a cxo type of hole, now we are all staying quiet on what we could have with hole 3. Do you think GGI could go crazy i mean really crazy if we where to hit a GQC 27 August 2012 type of hole (put it in gold equiv. if you want). My non-geo DD lead me to think this would be a possibility.
Comment by Martin — January 9, 2016 @ 4:42 pm
Martin, it’ll be exciting and important to see confirmation of a 3rd discovery (new type) in the Sheslay district but your imagination is running a little wild tonight while you’re also tossing around some apples and oranges with the GQC and CXO examples…
Comment by Jon - BMR — January 9, 2016 @ 6:51 pm
I knows CXO was a porphyry hole an that is what we could have had expected in the first place given the district signature, I have mention the GQC hole as a example for grade purpose to how market could react if ggi hit the same or above. My english is really bad tonight 🙂 i guess.
Comment by Martin — January 9, 2016 @ 7:18 pm
I can’t wait for WRR to put out some news and update everybody! top pick by BMR up 40%! Nice! more to come in 2016!
Comment by STEVEN1 — January 9, 2016 @ 9:08 pm
GGI hole # 3 -Someone posted that IR told them something unexpected was hit in hole # 3. It is in the realm of possibility that the gold grade is off the charts (high) in hole 3 in the first round of fire assays – so extra testing required? Or another important mineral was encountered that required more analysis and testing. Either way, something significant was encountered in hole 3 and this same mafic unit was observed in hole 1 and 4. Remember, GGI geologist were extremely excited about hole 3 – XRF analyzer.
Comment by Dan1 — January 10, 2016 @ 6:35 am
It’s a nice thought Dan, but I thought fire assays were sufficient to identify very high levels of gold. Either way, GGI want to get the results of hole 3 back before they drill hole 6, so it must be something of some significance to hold them up. The cash is available, the camp is winterized and the drill and crew are ready and waiting.
I’m hoping that lab work continues on holes 4 and 5 whilst the extra testing is done on hole 3. Those results should come in soon after the first batch of 3.
Maybe the labs and GGI will have learnt from these initial holes what is likely needed to be done regarding testing on future samples i.e. multi fire assays and also further test on some samples.
Comment by Tom UK — January 10, 2016 @ 7:52 am
I eagerly await assays from ggi too but given the state of the markets I’d be hesitant to release anything good at least until the volatility settles some. This week was a sea of red for indicies and market leaders.
Comment by Treb — January 10, 2016 @ 8:59 am
Treb – I hear what you are saying but we could be waiting a long time for the volatility to settle. It wouldn’t be fair to sit on them for any length of time, not fair to the shareholders as certain people would know while the majority of us would not. We have been very patient waiting for results.
Comment by Danny — January 10, 2016 @ 9:39 am
@Dan1. Just remember that people were dancing in the streets of goose bay while eqt was doing its field work. I would lean towards being cautious here. Quite risky at this point and the market is pricing it that way.
Comment by seamus — January 10, 2016 @ 9:45 am
seamus – agreed, most of the time drill results are disappointing. I certainly hope GGI is the exception.
Comment by Danny — January 10, 2016 @ 10:16 am
I do to. Expectations seem to be quite high based on visuals and an excited ceo. I’m also cautious due to the fact that there has been numerous holes punched in the area that has been met with a somewhat muted response. People can say dbv ran from 5 to 40 cents but where is it now?
Comment by seamus — January 10, 2016 @ 10:41 am
Even if results are available, it wouldn’t surprise me if GGI and DBV held back results and released closer to Roundup at the end of the month.
Comment by Northerner — January 10, 2016 @ 11:27 am
Northerner – in my opinion holding back results like that would be a total disservice to the shareholders who have been patiently waiting for results. That would really tick me off.
Comment by Danny — January 10, 2016 @ 12:12 pm
Danny, I agree that it may not be ‘right’ but if doing that resulted in a bigger share price bump, is that not a good thing in the end for shareholders.
Comment by Northerner — January 10, 2016 @ 12:36 pm
Northerner – how could they possibly know that by waiting it would result in a share price bump. Maybe the markets will be even worse by then. The longer they wait the more people think the results are poor. I can see waiting until Monday to release good results instead of doing it on Friday afternoon but trying to time the market with your results is really difficult.
Comment by Danny — January 10, 2016 @ 1:15 pm
Danny – agree with your last post. Shareholders will just get impatient and it’s not guaranteed it will help the share price. Just release results(better on Monday than Friday? Maybe) and let’s move on.
Comment by George — January 10, 2016 @ 2:00 pm
GGI will want to keep the momentum going, that is why they winterized the camp. They will release results when they get them and then start drilling again.
Jon, have you heard anything from Regoci regarding ”extra testing” on some samples?
Comment by Tom UK — January 10, 2016 @ 2:10 pm
Just saying that in the past there seems to be an increase in PRs during, and in the week before, Cambridge House and Roundup. I’m guessing that the juniors like the idea of people at the shows saying ‘did you see the new release from xxx’. Whether there is any tacticala advantage in doing that in today’s markets I’m not sure.
Comment by Northerner — January 10, 2016 @ 2:52 pm
Northerner – I get the logic, nice to release good results just before or during Cambridge House so you can show them off to the people attending. I think in this case the shareholders have waited long enough. I want to see what they have so I can move forward one way or the other. Not sure if it makes a big difference in these markets either. It seems the longer you wait, the worse the markets get right now. I was optimistic before about 2016 being a better year but I’ll admit to being a little spooked right now. The 1st week in 2016 was a bad one.
Comment by Danny — January 10, 2016 @ 3:43 pm
History has a funny way of repeating itself sometimes. On October 17, 2013, Doubleview announced the start of drilling at the Hat (2nd phase). On Friday, January 17, 2014, immediately prior to the start of the Vancouver Cambridge Show, DBV was halted. On Monday morning, Jan. 20, on the final day of the Cambridge Show, DBV reported its grassroots discovery which sparked a district staking rush and led to a 4-fold jump in DBV’s share price. There was a buzz at the show regarding the halt, and with the news on the Monday morning.
On Oct. 9, 2015, Garibaldi announced it was commencing drilling the following week at Grizzly Central. Wouldn’t it be interesting and ironic if there were a GGI halt Friday, Jan. 22, immediately ahead of this year’s Cambridge Show, with discovery news from GGI on the Monday morning????
How would that be for some drama? Seems possible the stars could line up that way.
Comment by Jon - BMR — January 10, 2016 @ 4:21 pm
Seamus, GGI is a bit different than EQT. EQT looking for nickel, a much more difficult target than what GGI is after. EQT did not report any drill core descriptions or photos before results. Look at what GGI has done. Not just excitement from the Geologist.
Comment by Dan1 — January 10, 2016 @ 4:51 pm
Seamus Re:DBV if you remember right before Chad Day illegally stopped the drilling DBV was starting to move up
I remember well because I bought some at that time and was kicking myself for not getting some sooner and then the illegal blockade happened no telling what price DBV would be at today?
Comment by Greg — January 10, 2016 @ 6:13 pm