Gold has traded between support at $1,640 and $1,660 so far today and is currently ralling…as of 7:40 am Pacific, the yellow metal is up $11 an ounce at $1,658…Silver is up 30 cents at $30.22…Copper has gained 3 pennies to $3.55…Crude Oil is $1.54 lower at $88.59 while the U.S. Dollar Index, which found support at 79 yesterday as expected, is currently up over one-quarter of a point to 79.57…
Today’s Markets
One thing about U.S. politics – it’s always a little messy (it was designed to be that way), so in all likelihood the “fiscal cliff” negotiations between Democrats and Republicans (and Republicans and Republicans) will go right down to the wire December 31 (may not even be settled until early in the New Year) after House Speaker John Boehner couldn’t pull enough support together within his own party for a vote in the House on his “Plan B” last night (clearly an embarrassment and a setback for Boehner which explains his Serenity Prayer last night)…Republicans in the House are clearly divided between conservative anti-tax, deficit-cutting hawks and moderates who are more willing to strike a compromise with the President…Democrats have their own hawks who aren’t prepared to touch entitlement programs, or cut them enough…at the end of the day, the market is betting that some sort of compromise will ultimately emerge but one thing appears certain – it will do little to tackle the U.S. debt problem…that is ultimately bullish for Gold…the real “fiscal cliff” for the U.S. is what happens when interest rates start to rise at some point in the future…the federal government is currently paying out $225 billion a year to service the debt at record-low interest rates which won’t stay at these levels forever…long-range budget projections from the CBO (Congressional Budget Office) aren’t worth the paper they’re written on…
Due to the upcoming Christmas holidays, we’re now on an abbreviated schedule at BMR through December 31…we’ll have postings each market day as usual, but they’ll be shorter…there will be no Week In Review And A Look Ahead this weekend but this regular feature will return December 29…
Asian markets were weaker overnight with Japan’s Nikkei average closing below 10000 while China’s Shanghai Composite gave up 15 points to close the week at 2153…as of 7:40 am Pacific, the Dow has retreated 104 points while the TSX is up 19 points…
One has to be encouraged with how the Venture Exchange has performed this month…in the face of tax-loss selling pressures, “fiscal cliff” worries and a drop in Gold, amid overall negative sentiment toward the juniors, bears have not been able to take the Index to a new yearly low…the late June 1154 low has held, and all the bad news since then – especially over the last couple of months – has not been able to drive the Venture below critical support…what does this tell you???????…what this indicates in our view is that there’s an incredible buying opportunity at the moment for selective and patient investors with a bottom likely having been put in…below is John’s last Venture chart before Christmas…a terrific support base has been built over the last six months…technically, as we’ve mentioned before, what has to occur before a new uptrend can be sustained is a move through the down trendline in place since early 2011…that level is approximately 1275…as of 7:40 am Pacific, the Venture is down 3 points at 1177…
Amarc Resources (AHR, TSX-V) and Newstrike Capital (NES, TSX-V)
Amarc Resources (AHR, TSX-V) is considered a good bottom-fishing opportunity for patient investors with plenty of cash and quality projects to explore…below is a look at the technical side of the AHR equation with a 2.5-year weekly chart from John…RSI(14) has been trendling along a bottom around 30 and has recently formed a bullish “W”…AHR is up a penny at 12 cents in early trading…
Below is an updated chart for Newstrike Capital (NES, TSX-V) which continues to advance its 100% owned Ana Paula project in the Guerrero Gold belt of Mexico…an initial resource estimate is expected soon…current support is $1.80 while resistance is at $2.10…
Note: John holds a position in AHR.
GBB just released their PEA. Would like to know your comments!
Comment by pete — December 21, 2012 @ 8:04 am
It’s a start but the numbers (IRR, payback period) definitely need to improve considerably.
Comment by Jon - BMR — December 21, 2012 @ 8:08 am
I am a new investor , not much knowledge I have been told to buy GQC and that it is a can’t miss. Your opinion?
Thanks
Comment by dale glover — December 21, 2012 @ 8:26 am
Jon dig your head out if your ass. Hmmmmm let me think, here you have RBw that hasn’t found diddly sqwat or you have gbb moving towards production with 2.6m ounces and 80 percent of land unexplored. Do the math!!!!
Comment by Heath stockford — December 21, 2012 @ 8:40 am
Heath, nice to see you have your Christmas cheer. I’m as bullish as anyone on the potential of Granada. I’ve walked that ground, you haven’t. I’m just saying the initial numbers that have been put forward on the payback period and IRR need to improve, and they do. I’m sure Frank can figure things out. With regard to your comment regarding RBW, as an investor and understanding that particular area of Nevada and the historical work that has been done, I would argue RBW is sitting on a significant deposit at Jewel Ridge that is beyond what anyone here probably realizes. Just my opinion. A 43-101 will be the proof obviously. In addition, you have discovery potential in the Kootenays.
Comment by Jon - BMR — December 21, 2012 @ 8:50 am
Well I guess the market again was looking for something significantly better than GBB put forth. I see this as another positive step, but I have been out of step with the market on GBB for 2 years.
Comment by Mike — December 21, 2012 @ 9:43 am
The new drill map on Rainbow Resources website shows the drill locations on the nevada property. Interesting to see them drill in the Hamburg Pit and the surrounding area to perhaps unlock some untouched resources missed by previous owners. We know the mineralization is there its just a question of how much….
Comment by Ed — December 21, 2012 @ 12:00 pm
Would anybody happen to know how many ounces of gold were pulled out of the pits at Jewel Ridge years ago that RBW now own?
Comment by Rick — December 21, 2012 @ 3:52 pm
dale, i’ve held gqc since the 16 cent level,sold and bought back several times.i think now is a good entry level.ugd needs a look at, as well as rbw,vgd,abn,these are all drilling and going to be reporting results in january.hey listen,i’m not a pro at this ,but i’ve done a hell of alot of reading.need to read all reports of which ever company.but just remember you are the one investing and takeing the risk. (read,read,read and more reading).
Comment by tom — December 21, 2012 @ 4:49 pm
dale,you may also may want to look at dyg.correction,i should say results in early 2013.
Comment by tom — December 21, 2012 @ 5:02 pm
Rick, an area that runs for several kilometres along a north-south trend at Jewel Ridge includes literally dozens of past producing underground mines and open-pits. Historically, in an environment of much lower gold prices, miners were after high-grade that they could pull out of there economically. What was mined was significant but for some reason, American records are generally less complete than Canadian ones, and in some cases don’t even exist. So no one knows the exact figure from what I’ve been able to determine. I saw a picture on the Rainbow corporate presentation that was quite revealing and it’s the Eureka Mine (RBW holds a 100% interest after recently acquiring these patented claims that were in private hands), a tunnel including rail tracks, so obviously there was some sophisticated mining occurring there in the context of that historical period. The situation of course now is quite different. Gold is at much higher prices which makes an open-pit scenario possible, unlike even 10 years ago, and all the required infrastructure is nearby. Personally, I see a potential scenario where Rainbow could be looking at either one large pit or a series of smaller pits, and then they could also access possible high-grade material underground from the base of these pits. It makes a lot of sense. Given the jurisdiction and the presence of nearby power, mills and infrastructure, doing this at low-cost seems very plausible. Rainbow says it’s currently working on a geological model which tells you how advanced this project has quickly become. Next steps in my view are obviously more strategic drilling, a maiden 43-101 resource estimate, and a preliminary economic assessment. Location is everything in mining. RBW has it with this project. Gold Viking, where some interesting initial numbers came back a few weeks ago, is also in a good spot especially considering what DVN is looking at doing which is bringing the nearby Willa deposit intro production. RBW could piggy-back off of that in some way IF of course they’re able to outline a deposit at Gold Viking.
Comment by Jon - BMR — December 22, 2012 @ 10:00 am
GBB numbers look awful. IRR of 10% seems an appaling return for the money spent and dilution caused. One of the worst fs i’ve seen in a while.
There even using a high gold price of nearly $1500. High recovery of 94% but still not commercial. Maybe at $3000 gold it may attract someone.
They will need to improve these numbers massively if producton is ever to happen imo, and with 200m shares already out, as a potential investment its near the bottom of a long list.
Comment by Mark — December 23, 2012 @ 6:54 am
@mike. You know you can go through a long list and I think people like you in my books are at the very top of the filth scale!!! Slithering around stock boards selling your soul to spew lies and garbage to try to scare innocent honest men and woman out of their shares and money!! It doesn’t get any worse in my books. Lower than a snakes belly, and a coward to top it off binding behind anon and aliases. Sick disturbed and disgusting aspect of society now days. Looking in the mirror must be quite a task
Comment by Heath stockford — December 23, 2012 @ 9:56 am
MARK. Sorry
Comment by Heath stockford — December 23, 2012 @ 9:56 am
Great PEA…d’accord: the numbers (IRR, payback period) definitely need to improve considerably.
Think about it: 2.6m ounces and 80 percent of land unexplored.
It appears there are funds available as a convertible debenture payable in gold. No further dilution is necessary.
Comment by Tim — December 23, 2012 @ 11:22 am
GOLD BULLION RECEIVES POSITIVE PRELIMINARY ECONOMIC ASSESSMENT
FOR GRANADA, PROCEEDING TO PRELIMINARY FEASIBILITY STUDY
goldbulliondevelopmentcorp.com/Files/2012-12-21-Press-Release-final.pdf
GOLD BULLION RECEIVES POSITIVE PRELIMINARY ECONOMIC ASSESSMENT
FOR GRANADA, PROCEEDING TO PRELIMINARY FEASIBILITY STUDY
December 21, 2012 – Gold Bullion Development Corp. (TSX.V: GBB) (OTCPINK: GBBFF)
(the “Company” or “Gold Bullion”) is pleased to announce the first economic estimates for its
Granada gold property located on the prolific Cadillac trend in northwestern Quebec, 5 km south
of the city of Rouyn-Noranda. The proposed combination of an open pit and underground
operation has the potential to move Gold Bullion into gold production at the approximate rate of
102,000 ounces of gold per year.
The Preliminary Economic Assessment (PEA) was prepared by SGS Canada Inc. – SGS Geostat
business unit. The PEA is based on the measured, indicated and inferred gold resource estimation
provided by SGS Geostat that was press released on November 15
th
2012 in accordance with
National Instrument 43-101 Standards of Disclosure for Mineral Projects as defined by “NI 43-
101” regulations. PEA highlights are summarized below:
Assumptions
Gold Price (US$/oz) – 3 years trailing average 1,470
Canadian $ to US$ rate 1.0:1.0
Mineral Resources (recovered ounces)
Underground Resources (1) 387,000
Open pit Resources (2) 739,000
Mine Parameters
Mill feed coming from underground mine (tonnes per day) 1,000
Mill feed coming from open-pit mine (tonnes per day) 6,500
Combined mill feed (tonnes per day) 7,500
Mine plan tonnage (tonnes) 26,400,000
Underground Mine plan mill feed grade (grams/tonne) 3.51
Open-pit Mine plan mill feed grade (grams/tonne) 1.07
Open-pit waste-to-ore ratio 5.91
Estimated gold recovery (%) 94.10
Total gold recovered (ounces) 1,126,000
Pre-production period (years) 2.00
Mine life (years) 11.00 Average annual gold production (ounces) 102,000
Costs
Pre-production capital ($) 259,000,000
Average Underground cash cost per ounce (US$/oz) 1,205
Average Open-pit cash cost per ounce (US$/oz) 985
Financial Return
Payback from start of production (years) 6.80
Internal Rate of Return (before tax) 10.4%
Net present value, pre tax, 5.5% discount ($ disc.) 74,300,000
(All dollar figures expressed in Canadian dollars, except where indicated)
Resource category Tonnes Grade (g/t)
U/G
(1)
Measured 18,000 2.79
Indicated 1,018,000 3.74
Inferred 2,635,000 3.42
Open-pit
(2)
Measured 20,485,000 1.05
Indicated 2,178,000 1.27
Inferred 112,000 0.78
Note: The above chart is presenting the resource as diluted material, mineral resources that
are not mineral reserves and do not have demonstrated economic viability.
At the prevailing gold price on December 19th, 2012 of US$1,650 per ounce and a Canadian to
U.S. dollar exchange rate of 1.00, Gold Bullion has determined that the pre-tax NPV increases to
$217.8 million at a 5.50% discount rate while pre-tax IRR increases to 18.8% with payback time
reduced to 4.8 years (using the same mine plan).
The study was prepared as a stand-alone project, relating solely to the mineral resources deposit
at Granada, and accordingly does not take into account the previously outlined potential at depth
disclosed on November 26
th
, 2012 since it is not mineral resources. Additional work is therefore
required to convert the portion of potential into mineral resources.
The Scoping Study mentioned herein is a preliminary evaluation inclusive of inferred mineral
resources that are too geologically speculative to infer economical considerations that would
classify them into mineral reserves. It is therefore uncertain that this preliminary evaluation
results in the expected outcome.
The complete technical report will be filed on the Company’s website
(GoldBullionDevelopmentCorp.com) and on SEDAR (sedar.com) in the next 45
days.“We are very pleased to release the Preliminary Economic Assessment study on the Granada gold
deposit” stated Frank J. Basa, P. Eng., President and Chief Executive Officer. “Due to the
dedication and diligence of Gold Bullion’s technical team and consultants, we have been able to
deliver this study within just four years of developing the property and are proud to see Gold
Bullion progress as a potential emerging producer of gold in the near term, creating shareholder
value through successful exploration and development while continuing to seek out other
worthwhile opportunities for growth.”
The delivery of the Scoping (PEA) Study completes the first stage of Gold Bullion’s Continuous
Development Program at Granada, aimed at advancing the Granada Project to commercial
production, by demonstrating an economic, environmental and social gain, while simultaneously
mitigating the technical, financial, and environmental risks of the Project.
As mineral resources could be affected by permitting and social acceptance issues, Gold Bullion
plans to hold meetings with various stakeholder groups prior to the completion of the PreFeasibility Study and will either be incorporating those views and recommendations into the
study or retaining as recommendations to be addressed in the possible final Feasibility Study.
Claude Duplessis, Eng., Gaston Gagnon, Eng. and Jonathan Gagné, Eng. are acting as the
qualified persons (QP) for Gold Bullion Development Corp. in compliance with National
Instrument 43-101 and have reviewed the technical contents of this press release.
About Gold Bullion Development Corp.
Gold Bullion Development Corp. is a TSX Venture-listed junior natural resource company
focusing on the exploration and development of its Granada Property near Rouyn-Noranda,
Québec. Additional information on the Company’s Granada gold property is available by visiting
the website at GoldBullionDevelopmentCorp.com and on SEDAR.com.
“Frank J. Basa”
Frank J. Basa, P.Eng.
President and Chief Executive Officer
For further information contact:
Frank J. Basa, P.Eng., President and CEO at 1-514-397-4000
Comment by Arjan — December 24, 2012 @ 12:51 am
Heath, Im just giving my opinion. I have posted on here half a dozen times in a year, I do not post on any other boards.
Your welcome to your opinion but please try not to foul mouth me when you dont even know anything about me.
I’ll wish you and everyone on BMR a very merry christmas
Comment by Mark — December 24, 2012 @ 11:28 am
Thanks for taking the time to reply Tom
Happey holidays
Comment by dale — December 26, 2012 @ 9:21 pm