This picture (from the Utah Bureau of Land Management) shows the Basin Pit (right foreground) and the Hamburg Pit at the past producing Goldstrike Mine in Utah. Cadillac Mining has acquired essentially all of this former mining camp.
Gold is stronger this morning, advancing $7 an ounce to $1,369 as of 7:05 am Pacific…Silver has jumped 56 cents to $28.88 while the U.S. Dollar Index has weakened to 78.66…strong physical demand for Gold in Asia is underpinning prices…fresh concerns regarding the European sovereign debt issue are also helping Gold today…a report on U.S. housing starts for December is due tomorrow and economists are predicting a decline which is putting pressure on the greenback today…the CDNX is strong, 20 points higher at 2295…since introducing Cadillac Mining (CQX, TSX-V) to our readers about six weeks ago, we have stated repeatedly that this is a company led by a couple of very shrewd operators (Victor Erickson and Andre Audet) who also know their geology…Cadillac announced a very significant acquisition yesterday as it has tied up an entire former mining camp, assembling a large land position in the historic Goldstrike Mining District in southern Utah near the Nevada border…mark our words – this deal has MAJOR upside exploration potential and Cadillac was able to pull it off after many months of hard work (including negotiations with individual landholders) and at minimal cost and no share dilution…as stated in CQX’s news release yesterday, “The property will comprise approximately 3,800 acres, covering all the known hard-rock gold occurrences of the historic Goldstrike district“…what we interpret this to mean is that Cadillac has actually acquired the former Goldstrike Mine area (patented claims in addition to the staking of additional federal claims contiguous with the patented claims – the “surrounding area”) which produced over 200,000 ounces of Gold and 200,000 ounces of silver between 1988 and 1986 from approximately seven million short tons of ore mined from 12 near-surface deposits extending over a roughly four-mile trend…Cadillac will be looking for near-surface extensions to these mined deposits and will also be drilling for higher grade mineralization at depth…there are parallels here to Nevada where some huge deposits have been discovered underneath old heap leach operations….the best place to find Gold is near an old mine, and Cadillac has put itself in an excellent position at Goldstrike…we doubt the area has been properly or fully explored – we have seen that in so many instances including of course in Quebec with Canadian Malartic and Granada among others – so we expect Cadillac to employ some sophisticated techniques to help unlock what could be the immense hidden potential of Goldstrike…besides all of that, we of course love the name “Goldstrike”…Cadillac also has much going for it in Quebec with strategic claims next to Richmont’s (RIC, TSX-V) Wasamac Property and Vantex’s (VAX, TSX-V) Galloway Project…we’ll have more on both of those exciting situations in the coming days…they are developing rapidly as we discovered during our visit to Rouyn-Noranda…Cadillac Mining has unwound its overbought condition from December and at 36.5 cents is in a zone of solid technical support…Abcourt Mines (ABI, TSX-V), which we introduced to readers just over a week ago, reported very good results yesterday (after the market close) from its Elder-Tagami Project just northwest of Rouyn-Noranda, a property we recently visited…the Elder Mine produced 350,000 ounces of Gold between 1944 and 1964…Abcourt, in its exploration there, has discovered significant extensions to the west, the east and the north…a 43-101 report in July, 2009, gave measured, indicated and inferred resources of just over 200,000 ounces at Elder using a 3.8 g/t Au cut-off…the drilling that Abcourt has done since then, plus the new 10,000 metre program that is just starting, could easily double those resources in our view and also upgrade some of the current resources…Abcourt is focused on bringing this property back into production as an underground operation by as early as sometime next year…a lot of infrastructure is already in place…one of the holes reported yesterday on the western side of Elder was E10-41 which intersected 6.07 g/t Au over 10.9 metres (approximate true width)…Abcourt also has one of the best undeveloped silver assets in the country near Val d’Or (Abcourt-Barvue) and drilling continues there…Abcourt is currently up 2.5 cents at 22 cents…the Vancouver Resource Show is coming up on Sunday and Monday (Jan. 23 and 24) and as a result we expect some companies will be aiming to put out news prior to then, so we suggest our readers be on the lookout for that…Gold Bullion Development (GBB, TSX-V) of course, could be one of them…we have tremendous faith in the Granada Property…the news has consistently been good for over a year now and there’s no reason to believe that’s not going to continue throughout 2011…GBB continues to consolidate in the 70’s and is currently unchanged at 75 cents…Adventure Gold (AGE, TSX-V) is down 1.5 cents at 41.5 cents…technically, AGE is strongly supported by a rising 100-day moving average (SMA) at 37.5 cents…this is a company with a quality portfolio of advanced projects and we suggest readers who have not taken a look yet at AGE do some immediate due diligence…GoldQuest Mining (GQC, TSX-V), another quality opportunity, is off a penny at 37 cents…it’s a very bullish sign in our view that this stock has held up so incredibly well over the last few weeks since the company announced it was accelerating the warrant expiry date from last April’s financing to January 24…GoldQuest is currently drilling its very promising La Escandalosa Project in the Dominican Republic, a mineralization-rich country which is why we also like Everton Resources (EVR, TSX-V)…Everton is drilling aggressively in the DR and we believe their ground (like GoldQuest’s) holds excellent potential for a major discovery…EVR is off half a penny at 32.5 cents, very close to its supporting 100-day moving average (SMA)…
Talk about Sidon for Once
Comment by John Fahim — January 18, 2011 @ 8:45 am
Dear Jon.
I have followed some of your recommendations before. I havent bought any of the CQX yet but am wondering if it is to late to do so now when it have gone från 15 cents to 49 cent at its maximum. (now 38 cents) Do you still think it´s a great upside on this one?
Regards
Johan
Comment by Johan — January 18, 2011 @ 9:04 am
I’m hearing reports, Jon, that GBB (or specifically GENIVAR) has returned for further analysis the assay results they finally received from the lab last week. Can you comment on what is actually happening? Thank you. The delays are already epic. Now more? Frustrating.
Comment by Roger — January 18, 2011 @ 9:43 am
I’ve looked at every angle on Cadillac and this is a situation I have immense confidence in. First, you have a terrific share structure. 25 million outstanding. Management holds a strong position and Erickson and Audet didn’t sell a single share in the move from under a dime to 50 cents the last two months or so. There has been good liquidity for only 25 O/S. Three main fundamental drivers: The Goldstrike Mine acquisition (announced yesterday) with the potential for more acquisitions in the Great Basin; the Wasa Property (100% controlled by CQX) 15 km west of Rouyn-Noranda; and (3) Cadillac’s partnership with Visible Gold on over 7,000 hectares of Cadillac Trend ground. I met with Martin Dallaire from VGD. As they have publicly stated they are going to be extremely aggressive in exploring those properties. Of particular interest are the claims immediately to the south and west of Vantex’s Galloway Project (25 K west of Rouyn-Noranda) which is garnering growing interest as a potentially very significant deposit. From my research and going over VAX’s drill results, mineralization trends west and south onto Cadillac’s properties. McEwen just came on board as a major VAX shareholder. With McEwen entering the picture, you know something very big could be up. This is a major story for Cadillac (and VGD) that I believe will be unfolding in the weeks ahead. Technically, CQX has unwound its overbought condition from December. Strong support at current levels and a market cap of only $9.25 million. Not hard to do the math on this one and figure out where it could potentially go to. I hold a personal position as I’ve disclosed and I’m holding on very tight.
Comment by Jon - BMR — January 18, 2011 @ 9:54 am
Roger, where exactly did these “reports” come from?
Comment by Forb — January 18, 2011 @ 1:17 pm
I haven’t heard anything myself. There are always rumors that swirl around with these companies. In general, and I’m not referring specifically to GBB at the moment because I just don’t know, check assays (metallics) are run on high-grade intercepts and that of course can cause delays. There is nothing “epic” about delays on GBB’s drill results in the context of the overall market, Roger. Nothing epic at all. All labs are backlogged. The news will come when it comes. And I have complete faith that results from this property are going to continue to be good. Sleep well and worry about more important things. Granada will come through as it consistently has over the past year – the geology says so.
Comment by Jon - BMR — January 18, 2011 @ 2:02 pm
Hi Jon,
I just want to thank you guys for a great job. It’s sad to read all the negative comments from ungrateful people with bad attitude. For example CUI contributed to -40% in my portfolio because they did not find a glory hole the first time they drilled but I’m not sad, I still believe they are going to succeed in the long term as well CQX, GBB, SD and all other undervalued mining company that you guys have brought to us with your hard work and engagement. Please keep up the good work and don’t pay attention to people who don’t appreciate your expertsise and valuable contribution to all of us.
Sincerely
Peyman
Comment by Peyman from Sweden — January 18, 2011 @ 2:52 pm
Hey BMR,
Any new word on VGN? It’s been a while since their last news release. I was wondering what their next move is; I heard mention of starting up an advanced gold project, did that ever start up? What type of NR should we expect from them next? Drill results?
Thanks!
Comment by Trevor — January 18, 2011 @ 3:53 pm
I think VGN’s next move is an advanced project acquisition. That’s my guess, based on the signals from Roodenburg in recent releases. I expect things will heat up again in the near future. Lots of value with VGN and the chart is looking very positive. Good chance of a drill program at their Blackwater area project as well.
Comment by Jon - BMR — January 18, 2011 @ 4:04 pm
Hi BMR,
I second every word said by Peyman. You guys are doing a terrific job in sharing your expertise and your generosity in sharing your wisdom is truly appreciated.
I feel blessed to have come across your site with all the generous, helpful guidance it provides on investing.
Please ignore those negative people that make unruly demanding remarks.
A loyal follower,
Raj
Comment by Raj — January 18, 2011 @ 5:40 pm
Hi Raj (and others), we all thank you for your positive and encouraging words!
Comment by Jon - BMR — January 18, 2011 @ 7:09 pm
Realize both GoldQuest and Everton Resources are not in the portfolio, Just curious as to which you believe hold the most promise? All of Everton’s properties in the D.R. are distant from GoldQuest claims. Are you waiting on technical or fundamental factors like exploration success to make a decision to add to the portfolio? Thanks for all the information you provide. I can see why word of mouth makes this site popular.
“GoldQuest Mining (GQC, TSX-V), another quality opportunity, is off a penny at 37 cents…it’s a very bullish sign in our view that this stock has held up so incredibly well over the last few weeks since the company announced it was accelerating the warrant expiry date from last April’s financing to January 24…GoldQuest is currently drilling its very promising La Escandalosa Project in the Dominican Republic, a mineralization-rich country which is why we also like Everton Resources (EVR, TSX-V)…Everton is drilling aggressively in the DR and we believe their ground (like GoldQuest’s) holds excellent potential for a major discovery…EVR is off half a penny at 32.5 cents, very close to its supporting 100-day moving average (SMA)…”
Comment by george wohanka — January 18, 2011 @ 8:35 pm
We did add GoldQuest to our “model” portfolio late last September when it was just under 20 cents. Everton has not YET been added but we are extremely interested in this company and we believe they will do extremely well. Personally, I like GQC’s overall assets in the DR a bit more than Everton’s, but Everton is also right beside Pueblo Viejo….it’s probably a toss-up between the two……the GQC share structure is a little tighter……given how prolific the DR is, I think holding both these companies make a lot of sense……personally I hold both, a little more of GQC…
Comment by Jon - BMR — January 18, 2011 @ 9:07 pm