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GoldQuest Mining (GQC, TSX-V)

GoldQuest had a solid week, climbing as high as 48.5 cents and finding support at 41 cents…the stock closed Friday at 44.5 cents, a loss of just half a penny for the week…very bullish technicals, which John outlined in a GQC chart update recently, are in sync with this company’s strong fundamentals…GoldQuest made an important announcement last Tuesday as the company named Julio Espaillat its new President and CEO…Espaillat is intimately familiar with the DR…for the past 11 years he was President and General Manager of GlobeStar’s DR subsidiary…he was co-responsible for building the only currently operating mine (Cerro de Maimon) in the DR which is about 100 kilometres from GoldQuest’s Las Animas Project…of course GlobeStar was taken over late last year by Perilya Ltd. for nearly $200 million…two key members of the former GlobeStar team – Espaillat and Bill Fisher – are now heading up GoldQuest with Fisher having been named Chairman just a few weeks ago…this is extremely bullish for GoldQuest as our view is that Fisher and Espaillat will pull off another GlobeStar or even better…we stated in December that GoldQuest is one of our top picks for 2011 and we’re even more certain of that after our recent interview with Fisher who is highly respected in the mining industry…Fisher is very excited about GoldQuest’s La Escandalosa Property where drilling continues in an effort to expand the 43-101 inferred resource of 400,000 ounces…this is a flat-lying ore body and “the economics could be really quite compelling,” Fisher told us…it’s important to stress the 43-101 was completed on La Escandalosa  at a very early stage and the possibility of a discovery of one million ounces or even more 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…the 400,000 inferred ounces outlined so far are over a 25-hole section 350 metres long…successfully linking this central mineralized zone to the north and the south is what could take this deposit to the million ounce plus category which would allow for production of 100,000 ounces per year…no major infrastructure or political hurdles…the regulatory framework in the DR is conducive to mining…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 will be drilling Las Animas immediately after Escandalosa…that will be followed by a drill program at Jengibre, a promising target about 30 kilometres southeast of Escandalosa…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 completed and is due very soon…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, which has nearly $4 million in the bank, is up 128% since we introduced it to our readers near the end of September…this is a stock that got as high as $1.80 ($100 million market cap) in mid-2007 on less than what it has now…initial drill results from La Escandalosa and the 43-101 on Toral could come by the end of this month, and Fisher has promised strong news flow throughout the year…GQC has all the ingredients to become a huge winner this year as the bull markets in Gold and the CDNX intensify…

Greencastle Resources (VGN, TSX-V)

Greencastle was quiet last week, closing down half a penny at 25 cents…the stock appeared to bottom recently at 22 cents as John pointed out in an updated VGN chart…after gaining a lot of momentum last November and December, a lack of news has been the main factor that has caused Greencastle to drift lower…however, with approximately $6 million in working capital, three Gold properties and monthly cash flow from an oil royalty, it doesn’t take a rocket scientist to figure out that VGN is a bargain at current levels…volume has been low on the move down which confirms there’s nothing to be concerned about here…Greencastle will have its day in the sun again soon enough…the long-term chart remains 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 President and CEO Tony 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 is up 79% since we added it back in to the BMR model portfolio three months ago…

Adventure Gold (AGE, TSX-V)

Adventure Gold has been a strong performer recently and is up 39% from its low of 36 cents January 20…we posted an updated AGE chart from John Friday which clearly shows this stock is on the verge of a potential breakout…an obvious first possible catalyst could be new drill results from Gold Bullion as Adventure Gold of course holds ground at Granada…AGE closed Friday at 50 cents, a gain of two more pennies for the week…the stock has climbed above its 50-day moving average (SMA) and the 20-day SMA has reversed nicely to the upside…AGE released significant news January 20…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 land (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 soon from Gold Bullion, we expect Adventure Gold could continue to firm up…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 in December 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 47%…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 passed the 2,000 metre mark in depth…if this deep hole succeeds, AGE could absolutely explode…

Sidon International (SD, TSX-V)

Sidon continues to trade in a narrow band between its 100 and 200-day moving averages (SMA’s), 14 cents and 12 cents, respectively…we saw a similar pattern prior to December’s breakout…Sidon closed Friday at 12.5 cents, a decline of half a penny for the week…this stock has shown clear trading patterns since the spring of last year and has been quite volatile…however, the primary trend remains up and Sidon has consistently found support at or just above the 200-day SMA…BMR will be interviewing President and CEO Kamal Alawas in the near future but a date for that has not yet been confirmed by Alawas who could be waiting for news prior to speaking with us…results are pending from drilling 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 over intervals of 30 to 70 metres throughout all six holes drilled…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…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 had a rough week, plunging as low as 37.5 cents Wednesday (the 100-day SMA) before rebounding to finish at 41.5 cents Friday…that was still a loss of a nickel for the week…lack of news since the close of the December financing has not helped the Seafield situation as the company had built up some nice momentum…on the bright side, however, the fundamentals are strong and the chance of Seafield outlining several million ounces at its Quinchia District properties in Colombia this year is very real…the company’s current market cap of approximately $60 million is cheap if it’s able to prove up what we believe it may have…on December 3, SFF announced a spectacular drill result from its Miraflores Property 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 now is taking place 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 had 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)…Seafield has in excess of $15 million in the bank to fund an aggressive program in Colombia…