Gold Bullion Development (GBB, TSX-V)
GBB appears to be stuck in a trading range at the moment between the mid-30’s and 40 cents, just below its still-declining 100-day moving average (SMA)…the stock closed at 37.5 cents Friday, off 2.5 cents for the week, though it enjoyed one of its best volume days in a few months on Thursday when it gained a penny-and-a-half on over 700,000 shares (all exchanges) after news came out on the Castle Silver Project…while the stock continues to face some stiff technical headwinds, the fundamentals look good, especially with Gold trading where it is…GBB has a very valuable asset – Gold in the ground and close to surface at Granada…just how much of it remains to be seen but we’re optimistic as a 43-101 resource estimate from GENIVAR draws closer…one important point is very certain in this current equity and Gold environment…many producers, big, medium and small, are sitting on large piles of cash and are looking to add ounces to their production profiles…any junior with an advanced property like GBB possesses, and a 43-101 resource to back it up, could be the target of a potential takeover…takeover activity in this sector is likely going to increase substantially in the months ahead…GBB has received approval from the TSX Venture Exchange to lower the exercise price of a total of nearly 8 million share purchase warrants to 58 cents (7.4 million from last October’s financing were priced at 75 cents)…these warrants expire October 27, 2011…having those warrants exercised would bring another $5 million or so into the GBB treasury, so a resource estimate by sometime in September would be timely…a move through the mid-50′s would also constitute a major technical breakout for the stock but that’s going to require a strong 43-101…GBB’s last drill results were released July 13…there was nothing spectacular in those numbers but hole #165, collared approximately 50 metres northeast of hole #108, offered encouragement with regard to the very promising northern portion of the Eastern Extension…#165 returned 141.5 metres grading 0.31 g/t Au (from 155 to 296.50 metres) with no high-grade spikes, showing an apparent consistency of mineralization…it included a 20.5-metre section grading 1.2 g/t Au…assays have yet to be reported on 8 more important holes drilled in this general area (168, 178, 183, 241, 243, 246, 254, 257) according to GBB’s most recent drill map…along with additional results, GBB’s 43-101 resource estimate is going to be critical along with the Castle spin-off and potential discoveries in LONG Bars Zone 2…infill drilling is GBB’s focus at the moment with drill hole spacing tightening (which could help to improve grade) in preparation for a resource calculation…the company’s current market cap of $62.5 million which puts a value of just $21 an ounce on Gold in the ground at Granada if one were to assume the 43-101 will outline approximately 3 million ounces in the measured, indicated and inferred categories…that’s just a hypothetical number on our part at the moment but whatever number GENIVAR comes up with, we believe it should exceed the 2.4 to 2.6 million ounce conceptual figure that Gold Bullion gave in April of last year…based on all the drill results to date, this appears to be shaping up as a half-gram deposit with a higher grade starter pit and massive volume…it’s all about volume at Granada which is why the drills have to keep turning and why we want to see more than just two rigs in the LONG Bars Zone…this property continues to offer incredible potential…the company provided an update on its Castle Silver Mine Project on Thursday…a total of 12 holes were completed in Phase 1 drilling…while GBB chose not to release all the assay results, they did report that the best Silver intersection was 189 ounces per tonne (6,476 g/t Ag) over 3.09 metres which included a half-metre super high-grade section of 1,194 ounces or 40,944 g/t Ag (hole CA11-08)…the company also stated that numerous strong calcite veins and vein systems were drilled, and many of these were independent of the existing mine workings…more exploration work of course is planned and much will be required in order to advance Castle…GBB plans to spin-off this asset into a separate publicly traded entity…GBB is up 4346% since we introduced it to BMR readers in late December, 2009…
Currie Rose Resources (CUI, TSX-V)
It was a good week for Currie Rose which enjoyed its best volume day in nearly a month on Wednesday following an exploration update on its Tanzanian properties…CUI posted its second consecutive weekly advance, gaining another penny to 18 cents…the stage appears to be set for a potential breakout through the low 20’s, particularly if sentiment turns bullish in the overall markets going into early September…Currie Rose reported that 20 RC holes have been completed at Mabale Hills (16 at Sisu River, 4 at Dhahabu) while drilling is now shifting to the Sekenke Project approximately 200 kilometres to the southeast…what we found especially encouraging about the news is the fact that disseminated sulphides were intersected in all 16 holes at Sisu River, unlike Phase 1 drilling there last winter…the initial stage of drilling at Sisu River gave the company some important geological clues and it’s quite possible that assay results will turn out much better this time around…each of the 4 holes at Dhahabu also intersected disseminated sulphides…drilling has yet to commence at Mwamazengo…geochemical analysis has outlined a continuous anomaly over a few hundred metres that runs parallel to the west of a previously reported discovery at Mwamazengo where drill results included notable high-grade intercepts such as 34 metres grading 3.60 grams per tonne gold, 12 metres grading 9.11 g/t Au, 63 metres grading 2.59 g/t Au and 31 metres grading 5.97 g/t Au…we’re most excited, however, about the Sekenke Project which has “blue sky” written all over it…Sekenke is why we decided to start following CUI when it was trading around a dime last fall…results from satellite imagery provide additional evidence that Sekenke is a highly intriguing geological target and part of the same northwest trending structure that hosts Canaco’s (CAN, TSX-V) Handeni Project…satellite imagery has also shown that the structures at Sekenke are coincident with a strong alteration envelope…what’s unique about this project is that it surrounds and runs in between two former high grade Gold mines including Tanzania’s original producer…this greatly increases the chances of a discovery as it’s unlikely the former mines were fully exploited or explored as techniques a century ago in this industry obviously weren’t what they are today…CUI has a terrific chance to hit it big at Sekenke and we also wouldn’t be surprised if the company also takes a shot at acquiring the former Sekenke Mine…that’s speculation on our part but it makes sense from a strategic point of view…while its Tanzanian properties are the market’s major focus, Currie Rose could also benefit over the summer from continued good exploration news out of Trueclaim Exploration (TRM, TSX-V) which has been conducting an 8,000 metre drill program at the Scadding Gold Property near Sudbury…Trueclaim, which continues to release decent assay results, has earned a 51% interest in Scadding and can acquire a full 100% interest by completing a feasibility study, paying $2 million to Currie Rose, and giving Currie Rose a 3% net smelter royalty…TRM announced July 26 that it has intersected a previously unknown area of Gold mineralization at Scadding with hole #48 assaying 5 metres grading 4.54 g/t Au (from 98 to 103 metres, assumed to be true width)…about 25 metres below that interval was a 10.25-metre section grading 1.37 g/t Au…TRM has drilled the North Zone, the South Zone and the Currie Rose Zone with promising results (the Central Zone, which could get really interesting, has yet to be drilled)…CUI announced a joint-venture deal January 25 with Australian-based Liontown Resources for Currie Rose’s Jubilee Reef Gold Project in Tanzania…CUI’s focus is on the Sekenke and Mabale Hills Projects, so finding a partner for Jubilee Reef made sense…it was announced last Wednesday that Liontown has now started drilling at Jubilee…while Currie Rose has had its market cap shaved by more than half, from a high of nearly $40 million late last year to the current $16 million, what hasn’t changed is the quality of this company’s project portfolio which remains as high as ever…Currie Rose‘s June 30th financials (6 months) were released Thursday and the company has all the cash it needs (nearly $2 million as of June 30) to complete an initial major round of drilling (10,000 metres) in Tanzania this summer…
Adventure Gold (AGE, TSX-V)
AGE remains one of our favorites with several exciting projects on the go…our theory is that there’s a very good chance at least one of those projects will “hit”…Pascalis-Colombiere is our pick…the stock has traded mostly in the 40’s over the last month and closed Friday at 46 cents, a loss of 1 penny for the week though volume was very light…we recently spoke with President and CEO Marco Gagnon and we’re continuing to perform some additional research on AGE in advance of some postings in the near future, particularly during our upcoming trip to Rouyn-Noranda…initial Phase 2 results from Pascalis-Colombiere should be out shortly…Gagnon is a sharp operator who knows how to maximize every dollar the company spends…he also has the strong backing of Montreal investment firm Windermere Capital which holds just under 20% of AGE as disclosed January 21…the company has five active key projects, two of which are in the hands of joint venture partners Lake Shore Gold (LSG, TSX) and Agnico-Eagle Mines (AEM, TSX)…AGE started a 5,000 metre Phase 2 program in late May at its very promising Pascalis-Colombiere Property near Val d’Or…on May 31 the company reported more highly encouraging Phase 1 drill results from this former producer including 4.8 g/t Au over 33.1 metres in hole #20 (plus lower grade halos over significant widths)…the Phase 2 program was designed to further define the Gold system, leading to a resource calculation which is already being worked on…Pascalis-Colombiere encompasses the past producing L.C. Beliveau Mine (Richmont’s Beaufor Mine is nearby)…we found a comment from Gagnon in AGE’s June 2 news release quite interesting…“Following positive drill results and the permitting process, an open-pit or an underground operation could be producing in the near future”…we believe Richmont Mines (RIC, TSX) could be very interested in this project as they are looking for an acquisition, preferably in the general area of their Camflo Mill…earlier this year we met with AGE’s Jules Riopel, VP Exploration, regarding the company’s strong portfolio of properties…he was very keen at that time on Pascalis-Colombiere and given the drill results, his bullishness on this property appears to have been justified…the former L.C. Beliveau Mine was a very profitable operation between 1989 and 1993, producing nearly 170,000 ounces of Gold for Cambior…we believe a lot of Gold was overlooked in that area…in addition, the geometry of the deposit is such that mining costs should be relatively low…considerable infrastructure is also in place…meanwhile, Agnico-Eagle has completed its 4,000 metre drill program at AGE’s Dubuisson Property near Val d’or…Dubuisson is contiguous to the Goldex Mine Property and also straddles a 5-kilometre segment of the prolific Cadillac-Larder Lake Gold break…also of immediate interest is AGE’s partnership with Lake Shore Gold on the Meunier 144 Property where deep drilling is still testing the down-plunge extension of Gold zones located at the Timmins and Thunder Creek deposits…the current initial deep drill hole onto the Meunier JV property is continuing and had reached a core length of 2500 metres as of mid-June with another 500 metres to go…if a discovery is made, AGE will instantly explode higher…AGE has completed an 8-hole Phase 1 program at the Lapaska Property near Val D’Or…results released July 21 for the remaining 6 holes at Lapaska were very mediocre compared to the first 2 holes (MZO-TSX-V has an option to earn up to a 70% interest in the property) but Lapaska still holds good potential…the Granada Extension Property will be worked on later this year…AGE’s latest financials, released June 29, show the company with $3.3 million in working capital as of April 30, a $300,000 improvement in working capital over the quarter ending January 31…we first mentioned Adventure Gold to our readers in an article September 29 last year, just a couple of days following the company’s announcement that it had acquired land at Granada, when the stock was trading in the low 20′s…we officially added AGE to the BMR model portfolio at just 34 cents October 28…Adventure Gold has been around only since late 2007…AGE is clearly a keeper for the long haul and we wouldn’t be surprised to see a major breakout in this play next month as results begin to flow in…
GoldQuest Mining (GQX, TSX-V)
GoldQuest dropped as low as 13.5 cents last week which is really quite amazing…it closed Friday at 14.5 cents, a drop of 2.5 pennies for the week…technically, GQC has clearly become oversold as demonstrated by RSI(14) and the Slow Stochastics Oscillator…this is a company with strong management and a superb portfolio of properties in the Dominican Republic and Spain, so a $15 million market cap – down from about $50 million earlier this year – makes GQC look exceptionally attractive…the 200-day moving average (SMA), currently at 29 cents, is now in decline but the 300-day (SMA) at 25 cents continues to rise…support for the stock has been very strong in the upper teens, so a drop below that area last week brought out some additional sellers who made the classic mistake of panicking and dumping stock…there’s no question in our view that GQC presents a great opportunity for patient and long-term investors…Chairman Bill Fisher has been buying GQC stock on the open market, his latest purchase being 20,000 shares July 12…he has bought nearly 250,000 shares over the past couple of months between 18 and 20.5 cents according to insider trading reports…GQC’s prospects remain solid as the company has an outstanding portfolio of projects in the Dominican Republic and Spain…last week the company provided an update on its exploration activities, though no timeline was specified for the re-commencement of drilling in the DR…the substantial drop in the share price from a high of 48.5 cents in early February was due to general market weakness and selling from speculators whose expectations may have been too high regarding initial drill results from the company’s La Escandalosa Project in the Dominican Republic…in addition, the company stopped all drilling in the DR during the spring in order to complete extensive ground geophysical (IP) surveys over Escandalosa and magnetic surveys over other properties…overall assay results from Escandalosa were decent though far from spectacular…the final set of assays for 7 holes came out May 16…the best intersection from Escandalosa Sur, where an initial 43-101 inferred resource of 400,000 ounces was outlined last fall, was 20 meters grading 1.32 g/t Au…results from this area overall (21 holes) were somewhat disappointing though more drilling is required and will take place…however, the company drilled 3 holes at the Hondo Valle target 1.6 kilometres to the north (outside the resource area) and all 3 intersected significant mineralization including 29 metres grading 2.18 g/t Au in hole #65…that’s the thickest and highest grade mineralized section drilled to date at Hondo Valle…the theory is that mineralization trends north from Escandalosa Sur to Hondo Valle…GoldQuest also has other promising projects in the DR (in particular, Loma Oculta – formerly Las Animas – where an exploration program aimed at identifying new drill targets is now underway) in addition to its lead-zinc-silver deposit in Spain…GoldQuest’s potential has not diminished whatsoever yet the share price has dropped by 70% from its early February high…the company released a 43-101 resource estimate March 2 on its Toral zinc-lead-Silver deposit in Spain…it showed slightly lower grades but much higher overall tonnage than the previous historical non-compliant estimate…as a result, total resources came out 15% higher…resources in the indicated category are 4.04 million tonnes grading 11.8% lead and zinc (5.3% lead, 6.5% zinc) as well as 41 g/t Ag and 0.11% Cu… inferred resources are 4.67 million tonnes grading 9.8% lead and zinc (4.44% lead, 5.4% zinc), 32 g/t Ag and 0.14 Cu…Toral has significant exploration and development upside as a majority of the historical drilling (40,000+ metres) was conducted over one relatively small part of the property…the zone of sulphide mineralization is open along strike to the northwest toward a known lead deposit as well as along strike to the southeast and downdip…the project is also an ideal candidate for a fast-track to production…the deposit is close to a power line, highway and rail line…a large smelter is located just 300 kilometers away by rail…meanwhile, GQC has been granted the Lago exploration concession, as reported last July 19, which is only a 30-minute drive northeast of Toral…the Lago property is the first permit granted of three applications by GoldQuest…securing an exploration concession for Lago, where mineralization is similar to that of Toral, is another important step for GoldQuest in building its assets in that region…a comprehensive mapping, geochemical sampling and ground geophysical program will be initiated at Lago to define both infill drilling and new targets that may warrant drilling in the vicinity of the known hydrothermal lead and zinc mineralization that remains open along strike and at depth…GQC is down a nickel since we added it to the BMR model portfolio last fall…
Seafield Resources (SFF, TSX-V)
Seafield’s new President and CEO Carlos Lopez continues to put the building blocks together with this company…we’re impressed with his actions over the last few months as he has strengthened Seafield both on the ground and in the office by adding some key personnel…he has also put his money where his mouth is, buying significant amounts of stock in the open market…Seafield gained a penny-and-a-half last week to 25 cents…the stock has bounced up and down between the low 20′s and the low-to-mid-30′s the past few months…liquidity is certainly there for traders to play the rather predictable swings this stock has been experiencing…the company’s June 30th financials were released Friday, showing SFF with $18 million in cash…Seafield announced August 11 that Giovanny Ortiz, the former exploration manager of the Angostura Project, has been appointed General Manager of the company’s operations in Colombia…heavy selling came into the SFF market July 25 when the company announced drill results from Dos Quebradas which were disappointing, though we caution it’s still early in the game for that property…Seafield is currently drilling a promising area at Dos Quebradas approximately 250 metres wide (east to west) and more than 300 metres long (north to south)…the zone is open at depth and is interpreted to plunge to the north…meanwhile, Seafield has added a second drill rig at Miraflores in order to expedite a Phase 2 program there which is designed to better define the shape of the orebody, increase the resource confidence and extend mineralization…a total of 10 holes or 6,200 metres is expected to be completed by November (the rock is hard at Miraflores, so the drilling is slow which is why a second rig has been added)…the company announced July 5 that it has hired SRK Consulting for a preliminary economic assessment or scoping level study on Miraflores for completion by the first quarter of next year…SRK will evaluate the potential positive economics of developing an open-pit and underground operation at the property…it will also provide recommendations to advance the project to prefeasibility…Seafield released an updated 43-101 resource estimate for Miraflores May 26…the project has gone from an inferred resource of 776,000 ounces (at a cut-off grade of 0.5 g/t Au) to a measured and indicated resource of 1.2 million ounces and an inferred resource of 354,000 ounces (at a cut-off grade of 0.3 g/t Au)…Seafield exploded from the low 20′s to an all-time high of 77 cents in just one day last December but then proceeded to give up all of those gains…the company’s Quinchia land package in Colombia has a great deal of untapped potential and Seafield is also in a very strong cash position…patient investors have an opportunity to do extremely well with this play given the geological merits of Quinchia and the real potential for 5 million+ ounces from several potential deposits…we have confidence the new management group will unlock value by bringing fresh insight and new energy to this play along with a more aggressive exploration approach…Seafield has gained 317%% since we made it the first company in the BMR model portfolio two years ago…its current market cap is $42 million, just a little more than twice the company’s cash value…
