Gold Bullion Development (GBB, TSX-V)
Gold Bullion finished a rough month of February on a positive note Monday when the stock closed up a penny at 57 cents, building on some momentum that was generated the previous trading day (Friday) when there was a bullish intra-day reversal from a low of 51 cents to a close at the day’s high of 56 cents…weakness returned to GBB Tuesday, however, when the company issued a detailed news release on drilling at its Castle Silver Mine near Gowganda…we like the Castle project, and conducting a small exploration program there at the moment has merit, but the market wants to see that Gold Bullion is keeping its eyes squarely on the ball which is Granada…the “optics”, therefore, from Tuesday’s news regarding Castle weren’t positive which is why the stock weakened again and closed down 3 pennies for the day at 54 cents…strategically in our view it would be wise for Gold Bullion to say nothing regarding Castle until drill results are available and focus its entire news flow instead on Granada…the stock closed Friday at 53 cents for a weekly loss of 3 pennies…technically, GBB is resting in an area of strong support with the rising 300-day moving average (SMA) at exactly 50 cents…John is working on a chart update which we hope to post sometime tomorrow…we’re also in the process of completing an article on Granada which shows many positives from the latest results…this company has come an incredibly long way since it started drilling Granada 15 months ago and credit for that has to go to President and CEO Frank Basa who has shown vision and tenacity…the potential of the LONG Bars Zone continues to be immense…the challenge for Gold Bullion now is to build up its personnel and infrastructure on the ground at Granada, accelerate its exploration efforts and generate fresh momentum…
Cadillac Mining (CQX, TSX-V)
Cadillac traded in a range of 29 to 35 cents last week and closed Friday at 32.5 cents for a weekly loss of just half a penny…the stock seems to be building a strong base just above the 30-cent mark which is very positive from a technical standpoint…CQX is definitely one of our favorites for 2011…the current market cap of only $8.1 million allows for plenty of upside potential, so the risk-reward ratio here is extremely attractive…Richmont’s (RIC, TSX-V) success at its Wasamac Property is very bullish for Cadillac which is now preparing an exploration program including diamond drilling for its adjacent 100%-owned “Wasa” claims…Richmont has started a new 35,000 metre drill program of its own to upgrade and further expand resources at the growing Wasamac deposit where the principal structure hosting Gold mineralization plunges north at a dip between 50 and 55 degrees toward Cadillac’s claims…while there’s no guarantee, of course, there’s certainly the possibility that Cadillac’s Wasa claims could host a significant high-grade extension of Richmont’s deposit…this is what Cadillac will be exploring for…in addition they’ll be going after some highly prospective VMS targets on the property…the infamous Horne fault runs right through the Wasa claims and Cadillac discovered a zone last year (by deepening the only hole they’ve ever drilled on the property) that’s interpreted to be a feeder system typical of those seen under VMS systems in the Noranda camp…Cadillac’s Wasa clams have excellent potential and we’re pleased to see they’re going to “seize the moment” and drill for a possible discovery…other CQX ground along the Cadillac Trend is also about to be drilled…Visible Gold is starting a 9,000 metre drill program this month as part of the agreement they worked out with Cadillac in December on over 7,000 hectares of land in the Rouyn-Noranda region…the first four holes of that program will be drilled on ground adjacent to Vantex’s (VAX, TSX-V) Moriss Zone discovery at the Galloway Project west of Wasamac…besides northwestern Quebec, Cadillac has secured an entire former mining camp in Utah near the Nevada border (the “Goldstrike District”) which has Carlin-type potential…Goldstrike produced over 200,000 ounces of Gold and 200,000 ounces of Silver from numerous open pits in the late 1980′s and early 1990′s…the area has never been properly explored and Cadillac is planning a major exploration program for later this year in order to unlock the potential value of Goldstrike…we encourage readers to listen to our informative interview with Cadillac President and CEO Vic Erickson posted Friday night…
Abcourt Mines (ABI, TSX-V)
Abcourt continues to trade in a consolidation channel as John detailed in today’s updated ABI chart (previous post)…the stock was unchanged for the week at 19 cents, half a penny above its rising and supporting 50-day moving average (SMA)…the company released more positive assay results last week from its ongoing 10,000 metre drill program at its Elder-Tagami Gold Project near Rouyn-Noranda…mineralization continues to expand to the west of the former underground Elder Mine…the Tagami area to the north, meanwhile, has major potential so by later this year we’re expecting a substantial increase in resources at this project…the last 43-101 resource estimate of 216,000 ounces was released in the summer of 2009…the possibility of Abcourt expanding that resource beyond 500,000 ounces certainly exists given the encouraging results to date…the company’s goal is to put Elder back into production by the end of next year…considerable mining infrastructure is already on site…Abcourt released assay results February 15 from six more holes at its Abcourt-Barvue Silver-Zinc Property near Val d’Or, and results continue to be very encouraging…the holes were all drilled 150 to 200 metres from surface and five of them intersected two zones of high-grade silver and zinc…Hole #16 cut 152.26 g/t Ag over 12.7 metres…the heavy accumulation that began in Abcourt in December was no fluke in our view…this is a company with significant assets that could justify a substantially higher valuation…nearly 60 million shares of ABI changed hands on the CDNX in December and January – record volume for this stock, accompanied by a price jump from 14.5 cents…we’ve seen these type of volume surges before and they are always a very positive sign…Abcourt is being accumulated, and our best guess is that some savvy players like the assets in the ground…the 10,000 metre drill program at Abcourt-Barvue continues with the goal of upgrading and augmenting existing 43-101 reserves and resources…the company is also trying to justify an expansion of the proposed mill from 650,000 tonnes to one million tonnes…Abcourt-Barvue is a former producer and one of the best silver assets in the country with nearly 20 million ounces in all-category reserves and resources (plus nearly 300,000 tonnes of zinc)…Abcourt completed a $4 million financing at the end of December…with 110 million shares outstanding, its market cap currently sits at just $21 million…continued drilling success and even higher prices for Gold, silver and zinc would be exciting developments for this stock which has a history of major moves…from mid-2005 to early 2006, Abcourt rocketed from 15 cents to nearly $1.40…
Currie Rose Resources (CUI, TSX-V)
Currie Rose continues to build an impressive base after its January drop to a low of 15 cents…the key technical event we’ll be looking for in the coming few weeks with CUI is a reversal in the 50-day moving average (SMA) which has been in a sharp decline since January and currently sits at about 21 cents in a zone of technical resistance…the stock closed Friday at 17.5 cents, a loss of a penny for the week…significant accumulation has been taking place in Currie Rose given the CMF indicator which has shown increased buying pressure since early February…RSI and Stochastics indicators are looking positive as well…Currie Rose should benefit from the good exploration news coming from Trueclaim Exploration which is currently conducting an 8,000 metre drill program at the Scadding Gold Property near Ontario…Trueclaim, which released assay results Friday including 15.78 metres grading 5.36 g/t Au near-surface, is in the process of earning a 51% interest in Scadding by carrying out a $2 million work commitment…Trueclaim can acquire a full 100% interest by completing a mine production plan, paying $2 million to Currie Rose, and giving Currie Rose a 3% net smelter royalty…CUI announced a joint-venture deal January 25 with Australian-based Liontown Resources for Currie’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…the deal commits Liontown to at least 5,000 metres of drilling at the property this year which will give Currie Rose a minimum of 23,000 metres of drilling at all of its properties in 2011…while Currie Rose has had its market cap shaved considerably, from a high of nearly $40 million to the current $15 million, what hasn’t changed is the quality of this company’s project portfolio which remains as high as it ever was in our view…
Richfield Ventures (RVC, TSX-V)
Richfield broke out to a new all-time high last week ($6.15) as a 43-101 resource estimate was released for the Blackwater Project…using a 0.4 g/t Au cut-off grade, the estimated global indicated resource is 1.83 million ounces of Gold (53.46 million tonnes grading 1.06 g/t Au) with an additional 2.34 million ounces in the inferred category (75.45 million tonnes grading 0.96 g/t Au) for a total of 4.17 million ounces…some 20 million ounces of silver are also in the indicated and inferred categories…initial metallurgical testwork has indicated an average of 92-per-cent Gold recovery using conventional whole ore direct cyanidation…the company has also contracted a series of consultants to prepare a Preliminary Economic Assessment (PEA), planned for completion in the fourth quarter of 2011…the study will consider the potential for a large-scale, open-pit mine and ore processing facility…with cash on hand of $17 million, the company has ample reserves to complete a 30,000 metre drill program this year as well as the PEA…given the state of the Gold market and the likelihood of continued exploration success at Blackwater, Richfield’s current market cap of $260 million still gives it considerable upside potential for the balance of 2011… we were very pleased to see that Richfield got a well-deserved buy recommendation recently from GMP Securities which has initiated coverage on RVC with a 12-month target price of $11.10 per share…BMR introduced Richfield to its readers in December, 2009, when the stock was trading at only $1.20…GMP sees the potential for at least five million ounces of Gold at Blackwater which is located in central British Columbia…the primary trend remains up with Richfield and there’s every reason to expect more excellent drill results throughout 2011…we believe the company’s ultimate objective is to find a buyer who can put this deposit into production…if good drill results continue as we expect they will, we’re confident that objective will be met and the takeover price could be significantly higher than the current $5.95 per share…Richfield gained 65 cents last week…
