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GoldQuest Mining (GQC, TSX-V)

GoldQuest continues to look very healthy technically and closed the week up half a penny at 37 cents…the stock has been strongly supported by its rising 50-day moving average (SMA), currently at 34.5 cents, since October…it fell just briefly below the 50-day this month before snapping back…that temporary slight weakness may have been caused by the company’s acceleration of the warrant expiry date from a private placement last April to January 24…a total of 9,465,400 warrants were still outstanding as of December 24 (each warrant is exercisable to purchase one common share at a price of 20 cents per share), meaning as much as $1.9 million could be added to the company’s treasury this month as these warrants expire tomorrow…GoldQuest last week elevated director Bill Fisher to executive chairman…he has an impressive 30-year track record of accomplishments in the resource sector…most recently, he was former chairman of Aurelian Resources Inc. (taken over by Kinross) and from 2000 to 2008 he was the chief executive officer of GlobeStar Mining Corp. which, during his tenure, developed, financed and built the Dominican Republic’s first copper mine at Cerro de Maimon (it was also taken over)…with impressive precious and base metal exposure, along with major new discovery potential, we’re very excited about GoldQuest’s prospects for this year which is why it’s one of our favorites for 2011…drilling has commenced at the company’s promising La Esandalosa Project in the Dominican Republic and results could build significantly on the recently released 43-101 inferred resource for that project…all of GoldQuest’s properties in the Dominican Republic and its zinc-lead-silver deposit in Spain have us very bullish on GQC going forward…the company, whose largest shareholder is Gold Fields Ltd., is well established in the DR and its property package there is a geologist’s (and an investor’s) dream…they have spent nearly a decade identifying many highly prospective precious and base metal targets, one of them being La Escandalosa (formerly Las Tres Palmas) where an inferred resource of 400,000 ounces of Gold has already been outlined (announced Nov. 16) based on just 25 drill holes at Escandalosa Sur from 2006 through 2010…it’s important to stress the 43-101 was completed on La Escandalosa  at a very early stage and the possibility of a discovery well in excess of a million ounces is possible as this is such an attractive geological target…the deposit is open at depth as well as to both the south and the north toward another discovery of Gold mineralization by the company at Hondo Valle, approximately 1.2 kilometres away…Gold at La Escandalosa occurs as a flat-lying stratiform zone at shallow depth with mineralization interpreted to be part of a larger intermediate sulphidation replacement-style system which has now been defined intermittently over a strike length of 2,100 metres…the source of the mineralizing fluids remains unknown at La Escandalosa, leaving open the possibility of the discovery of mineralization in structural feeder zones or perhaps in a porphyry copper-Gold type system…GoldQuest has many other targets of considerable merit throughout its large DR land package including Las Animas which has a 43-101 inferred resource of 129,000 ounces of Gold, 2.5 million ounces of silver, 106 million pounds of copper and 130 million pounds of zinc…GQC has more drilling to do there as well…in Spain, Goldquest holds the Toral zinc-lead-silver deposit which has an historical (non-43-101 compliant) resource of 5.4 million tonnes grading 9% zinc, 6% lead and 45 g/t Ag…a 43-101 on Toral is currently being prepared…GoldQuest has also acquired a second polymetallic project in the area (Lago, just a 20-minute drive from Toral), and more details are expected upon approval from the Spanish government of a mineral rights application for the property… GoldQuest is up 90% since we added it to our readers near the end of September…

Greencastle Resources (VGN, TSX-V)

Greencastle closed Friday at 28.5 cents, a loss of 2.5 cents for the week but volume over the trading period was was relatively very low at just under 350,000 shares…the market is waiting for news from Greencastle which made it clear in November that it’s in the process of getting more active in the Gold exploration space…President and CEO Tony Roodenburg is no doubt evaluating some advanced projects and when the right opportunity comes along, we’re sure he’ll pull the trigger…in the meantime he also has three Gold properties – two  in Nevada and one recent acquisition in British Columbia near Richfield’s Blackwater deposit – that are each worthy of major exploration programs…the company has at least $6 million in working capital and receives more than $100,000 each month in oil royalties…so the outlook for this company is extremely positive and it’s one of those stocks you can hold and not worry about as the assets are solid…the long-term chart is also very bullish with rising 100, 200 and 300-day moving averages (SMA) that are in no danger of reversing…it’s also interesting to note that Roodenburg, a large shareholder in VGN, has refrained from selling any of his holdings in recent months despite the fact the stock price more than tripled in value on high volume…this is different from past runs in the stock and adds further credence to our view that we haven’t seen the highs in this cycle yet from Greencastle – it’s poised for what we believe could be a massive breakout sometime during the first half of this year…Pinetree Capital has also accumulated more shares in Greencastle, so there’s every reason to be very optimistic regarding this company’s prospects in the days, weeks and months to come…Greencastle has doubled in value since we added it back in to the BMR model portfolio about three months ago…

Adventure Gold (AGE, TSX-V)

Adventure Gold fell 2 cents last week, closing Friday at 42 cents, but there’s lots happening with this company and our outlook is as bullish as ever…in a case of bad timing, AGE released significant news Thursday morning in the midst of the CDNX’s 65-point plunge…the company got some free drilling on its Granada Eastern Extension Property as it reported that one of Gold Bullion’s holes (#85) was drilled entirely on Adventure Gold property (just inside the boundary) while three other holes (#78, #83 and #98) were collared north of AGE’s property but finished within it…this didn’t surprise us and it’s not an unusual event in the industry…it worked out well for both parties in this case, however – all the core from those holes has been given to AGE who will share results with GBB…this represents at least $100,000 of drilling and all AGE has to do is pick up the assaying costs…given GBB’s “hit ratio” on holes, it’s reasonable to assume that at least one of the holes (or partial holes) on AGE’s property could be of the “stellar” variety…with more results coming from Gold Bullion, we expect Adventure Gold will start to heat up again…they do hold small but strategic parcels of land around Granada (immediately to the south and the west in addition to the east) that could become part of a large open-pit…their claims hold significant potential value and they have drill assay results coming in without even doing their own drilling which they plan to start upon completion of their program at Pascalis-Colombiere…that property in the eastern part of the Val d’Or mining camp is heavily underrated in our view…a 2,500 metre drill program started at Pascalis-Colombiere last month and is testing the former L.C. Beliveau Mine at depth (below 300 metres) as well as near-surface parallel Gold structures to the west…Pascalis-Colombiere is just 1.5 kilometres east of Richmont’s (RIC, TSX) operating Beaufor Gold Mine which has produced over one million ounces in its lifetime…it’s safe to assume Richmont will be watching developments at Pascalis-Colombiere with interest…Adventure Gold’s property has significant upside exploration potential…the geological setting is favorable for the identification of new high-grade Gold bearing veins and structures or bulk-style ore shoots…there are many untested areas and excellent potential at depth…L.C. Beliveau was a very profitable former producer…if AGE can prove up something significant through extensions to this deposit, we see a potential deal with Richmont which would be the natural choice to bring the mine back into production…we first mentioned Adventure Gold to our readers in an article September 29, 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 34 cents October 28, so the gain since then is 24%…Adventure Gold has been around only since late 2007 and we are impressed by the company’s solid portfolio of properties (19 in six strategic areas in Quebec and Ontario)…also of immediate interest is AGE’s partnership with Lake Shore Gold (LSG, TSX) on the Meunier 144 Property where deep drilling is currently 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…when completed it’s estimated the hole will provide a deep cut on the projected target area at about a vertical depth of 2,600 metres…this will enable shallower wedge cuts to be considered if significant mineralization is found to be present in this area…the initial deep hole was collared on LSG’s Timmins mine property last August and has now likely passed the 2,000 metre mark in depth…if this deep hole succeeds, AGE could absolutely explode…

Sidon International (SD, TSX-V)

Sidon had a relatively quiet week, trading less than four million shares on the CDNX and closing down 1.5 cents at 17.5 cents…the stock is finding strong technical support at its still-rising 50-day moving average (SMA) of 16.5 cents…we’ll be conducting an interview with President and CEO Kamal Alawas in the near future…we know he’s optimistic about the company’s fortunes…the first six holes have been completed over a strike length of 900 metres at Sidon’s Morogoro East Gold Property…the company reported zones of disseminated sulphides of pyrite and pyrrhotite as well as some chalcopyrite and arsenopyrite throughout all six holes over intervals of 30 to 70 metres…we caution that visuals are not always reliable but there’s reason to be optimistic that Sidon could be on to something…the company is also trying to develop a placer operation at Morogoro and has also acquired ground near Canaco’s discovery…Sidon remains locked in a very strong long-term uptrend as evidenced by the rising 100 and 200-day SMA’s…this company has come a long way since last March when we first introduced it to BMR readers at a nickel, and its new web site is just one more indication of how impressively Sidon has developed and matured…we see exciting possibilities for 2011…the company raised over $1 million through the exercise of options and warrants in November and December…

Seafield Resources (SFF, TSX-V)

Seafield continues to form a nice base in the low-to-mid-50’s in advance of what we believe will be a very strong 2011 for this company as it builds a substantial Gold resource at its Quinchia District properties in Colombia…the stock was off 3 pennies for the week, closing at 53 cents – 6 pennies above its rising 50-day moving average (50)…Seafield has simply refused to close below December’s 50-cent financing price…the trading action since early December has been impressive and the technicals suggest Seafield is at the bottom of a new trading range…on December 3 the company announced a spectacular drill result from its Miraflores Property in Colombia and the stock rocketed to 77 cents…results are pending on nine more holes at Miraflores…given historical results, at least some of these holes should be very good…drilling is also underway at Dos Quebradas, a property we believe gives Seafield its real “blue sky” potential at Quinchia… SFF reported December 8 that the first three holes have been completed at Dos Quebradas which is rich in porphyry targets over a wide area…DQ is just a few kilometres northwest of Miraflores…visual reports indicate that these three holes have similar styles of mineralization to an historical hole drilled by AngloGold that returned an interval of 39.5 metres grading 1.67 g/t Au…the potential of Dos Quebradas is evident from limited historical drilling and was confirmed by Seafield last year through soil geochemical surveys and magnetic surveys which are crucial to discovering hidden porphyries in areas of very little outcrop…Seafield also released results recently from trenching in one location from the southern end of the gold-in-soil anomaly that defines the northern extension of the Dos Quebradas porphyry…1.75 g/t Au was returned over 94 metres…Seafield has an excellent opportunity to develop a multi-million ounce Gold resource at its three major properties at Quinchia (Chuscal is the third property)…with a current market cap of $78 million and approximately $20 in the bank to fund an aggressive program in Colombia, Seafield still has considerable upside potential…