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There was a significant development Friday as Victory Ventures (VVN, TSX-V) “decoupled” from Iskut River area leader Colorado Resources (CXO, TSX-V) and surged 25% on strong volume to close right at its 52-week high of 13 cents.  What that demonstrated is how the Iskut River play, still in its very early stages, is beginning to mature – as Colorado continues to work on an important discovery, astute investors realize this prolific area offers potential for other discoveries as well.  It’s going to be a very busy summer.  Right now, the one company other than Colorado with the best shot at immediate success is Victory.  Which is why it’s now coming into investor focus.

Technically, VVN finally appears ready to break out (see John’s fresh chart below) which coincides with the closing of 2 financings and the start of a drill program at the company’s Copau Property immediately east of Colorado’s North ROK discovery and north of Imperial Metals‘ (III, TSX) massive Red Chris deposit.

With a temporary pause in Colorado’s drilling at North ROK, and other companies not yet ready to commence drill programs around Iskut River, Victory will take centre stage, so to speak, in the coming days as a highly anticipated drill program begins at its 100% owned Copau Property after nearly 2 years of preparation.  Victory is blessed with a tight share structure (just 17 million outstanding prior to May’s financings at a nickel and 6 cents) and its management team has skillfully advanced the Copau project while wisely maintaining one of the lowest overhead costs in the industry since first listing on the Venture in August, 2011, through a 15-cent IPO.   A driving force behind Victory is director and entrepreneur Howard Milne whose most recent success was International Wex Technologies, a biotech deal he helped raise $100 million for.  In this kind of a market, you look for companies with individuals like that who are smart business people with a proven track record at raising money and making money for investors.  That’s what allowed Victory to get launched during a volatile market nearly 2 years ago.

The geological case for the Copau Property is compelling as we’ve been pointing out.  Below are some highlights:

• An IP chargeability anomaly increases in strength with depth, suggesting the presence of sulphides within a southwest dipping syenite body that underlies the central part of the property;
• The IP anomaly is open to the south and west and currently covers an area at least 600 metres north-south and up to 400 metres east-west;
• Several occurrences of sulphide mineralization have been noted at surface including pyrite, chalcopyrite, and magnetite hosted in a syente host rock;
• Property lies at the intersection of 2 major regional faults – this represents a zone of weakness which mineralization often likes;
• Fault setting is similar to that at North ROK

Major Regional Fault Zones (thick lines) Around Iskut River

There are never any guarantees, of course, in the risky exploration business but Victory appears to have much going for it at this early stage.  With a market cap that is still very modest, and investors showing an appetite for the Iskut River story based on Colorado’s success to date, the upside potential for VVN at 13 cents seems to significantly outweigh the short-term downside risk with drilling set to start at Copau.  As always, perform your own due diligence.  Victory will have a terrific summer if the first holes at Copau put the company’s geologists onto a trail of mineralization that can then be followed up with even more drilling and exploration.  Based on current geological evidence, we like the company’s chances.  Speculation should intensify, and in this business that’s a critical driver of share prices.

Updated VVN Chart- Major Breakout Appears Imminent

Note: Both John and Jon hold share positions in VVN.