The BMR Portfolio
Gold Bullion Development (GBB, TSX-V)
Gold Bullion has been a market leader over the past 2 months and can therefore be expected to reach new highs soon with June expected to be a much better month for the CDNX…despite the 10% drop in the Index during the month of May, with one more trading session remaining this month, Gold Bullion is actually up 2 cents over where it was at the end of April…GBB closed at 42 cents Friday, a 3-cent increase over the previous week…technically, GBB is showing all the signs of a stock that wants to go much higher…it encountered tremendous support in the mid-30’s during the May meltdown and has been forming a nice base in the upper 30’s and low 40’s…all of GBB’s moving averages are in bullish alignment…from a technical perspective, this is a perfect textbook example of a situation to be invested in…fundamentally, of course, Gold Bullion is aggressively drilling its Granada Gold Property which has become one of the most exciting exploration plays in the country with the potential of rivaling Osisko in terms of total ounces in the ground…for these reasons BMR is heading back to Rouyn-Noranda this coming week to report in more detail on Gold Bullion directly from the LONG Bars Zone…our first visit to Granada was in mid-March…
Richfield Ventures (RVC, TSX-V)
Richfield has had a difficult month of May but a rebound in its share price appears imminent…from an all-time high of $2.25 last month, Richfield dropped as low as $1.22 May 21 when the CDNX bottomed out at 1393…technically, the stock is clearly in an attractive buy zone right now as it hugs its rising 200-day moving average…Richfield closed Friday at $1.32, a 2-cent drop for the week…the company is developing a potentially world class bulk tonnage deposit at its Blackwater Gold Project in central British Columbia and there’s every reason to believe Richfield will continue to produce impressive results…
Seafield Resources (SFF, TSX-V)
We suspected something was “up” with Seafield when it traded 10 million shares in a single day May 13…we got confirmation of that Friday when the company announced a proposed private placement to raise as much as $2.5 million at 17.5 cents…Seafield didn’t really have to do a financing so what’s going on here?…the evidence suggests that some powerful new “players” have gotten involved with Seafield which has to be viewed as a positive development…we’re not pleased with further dilution at 17.5 cents which will give the company 92 million outstanding shares and a lot more warrants as well…however, President and CEO Tony Roodenburg is a strategic thinker and he would not be doing this private placement simply to add more money to Seafield’s treasury…this has to be a strategic deal, positioning some “movers and shakers”…the quick closing of this PP (June 4) is encouraging and supports our thesis…Seafield closed Friday at 18 cents, unchanged on the week and with a huge bid at 17.5…this is a time to be accumulating Seafield, not dumping it out of frustration…
Kent Exploration (KEX, TSX-V)
Kent was halted on Wednesday as it came out with an impressive drill result from the Bunarra Zone at its Gnaweeda Gold Project in Western Australia…one of three holes drilled at Bunarra earlier this spring returned 18 metres grading 11.09 g/t Au…the shallowness of the hole (115 to 133 metres) was also significant…the stock gapped up to 21 cents Thursday morning but pulled back and closed the week at 17.5 cents, a 1-cent increase from the previous Friday…at BMR, we have very strong faith in Kent’s projects – they have what amounts to three “flagship” properties – but unfortunately the company is inadequately financed and must address this issue immediately…President and CEO Graeme O’Neill did an excellent job preventing dilution with Kent at a nickel or 10 cents but continually funding this company through the exercise of warrants and stock options is no longer the answer…investors are understandably frustrated when they see O’Neill selling large chunks of stock into the market as he did Thursday in order to exercise warrants and put some needed dollars into the company’s bank account…the inability of Kent so far to close the Archean Star spin-off is also a serious concern…this company has the goods to attract a significant financing and that’s what it requires in our view in order to ultimately increase shareholder value…
North Arrow Minerals (NAR, TSX)
BMR had a very interesting discussion with Dr. Chris Jennings this week and we posted that interview Saturday…Jennings is one of the world’s foremost authorities on diamond exploration and of course co-founded the Diavik deposit with North Arrow President and CEO Gren Thomas in the early 1990’s…NAR has worked out a joint venture agreement with Jennings on its 100,000 acres at Lac de Gras where Jennings has identified 70 high priority kimberlite targets through proprietary technology that uses airborne data…Jennings ranks the discovery chances at Lac de Gras as very high…North Arrow will commence drilling there by August…in the meantime, drilling continues at the company’s highly prospective Beaverdam Lithium Project in North Carolina…North Arrow closed the week at its rising 100-day moving average of 19 cents…the company is well funded and the risk-reward ratio at current levels is extremely attractive for investors with a minimum 3-month time horizon on this stock…
Sidon International (SD, TSX-V)
The waiting game continues with Sidon as its recently announced $750,000 private placement has yet to officially close with the Exchange…Sidon has a letter of intent to acquire an option to purchase an 80% interest in the Morogoro East Gold Property in eastern Tanzania, a highly prospective area for gold exploration…we continue to expect big things out of Sidon and we anticipate they’ll have everything cleared with the Exchange sometime in June…the stock closed the week at a nickel where it’s strongly supported by rising 100 and 200-day moving averages…
Colombian Mines (CMJ, TSX-V)
Volume has really dried up in CMJ recently which can be viewed positively as investors aren’t too eager to sell at current levels…the stock was down 4 cents on the week to 97 cents…an exploration update on Yarumalito is probably not far off…Colombian Mines has a strong treasury and a highly attractive portfolio of exploration projects in Colombia, so we’re content to stick with CMJ for the long haul…we first highlighted this stock at 60 cents last fall…
Greencastle Resources (VGN, TSX-V)
Greencastle has found a “comfort” zone between 11.5 and 13.5 cents, a range it has traded in since May 4…the stock is clearly a terrific buy at current levels as the company is sitting on approximately $5 million in cash and has gold assets in Nevada that the market isn’t putting any value on at the moment…however, there is a potential “opportunity cost” with Greencastle as it’s impossible to say when the company will announce something that will allow this stock to wake up…Greencastle should be acquired right now only by those investors who are prepared to sit on this stock through the balance of the year…
