Archive for November, 2007
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Defining Investing
Principled investing is a misnomer these days. As facts say, most investors today wish that they want to learn more about investing. Therefore, common financial literacy is not so common after all. The need for people to be educated in a dynamic system should be taken into account. Thankfully more and more people are finding online education advantageous in improving their investing education.
Investing education is an abstract idea for most people. This is because that they value investment as a way to save money with the expectation that their finances should advance. Yet what they don’t see is that there are methods where investing can become an instinctive exercise to achieve financial freedom. This entails developing the perspective to find investing opportunities where most people find nothing. A quick refresher on investing education will teach students to change the way they look at different investment opportunities, risks, and rewards.
Investing education is also important in having a better read of today’s financial situation. As an analogy, anyone can enjoy a delicious cheese cake. But only informed people can dissect what is the real value of the cheesecake according to its taste and other characteristics that the uninformed eye cannot see. Therefore this education is a form of shaping and training that makes a student notice what he does not see in his first look.
Importance of Online Education
Online learning is in the center of the purposeful information marketplace today. Students of distance learning are seen to be highly motivated individuals who are able to adjust to the dynamics of different training materials and mediums that will allow them have a unique view of what education and training is all about. This dwells more on the practical and quantitative goals. This is evident in continuing internet based learning where the student is updated with the latest trends according to his field.
With the latest trends brought by the internet, online investing education is a practical side track to one’s personal development. Just imagine any full-time worker seeking to increase his finances to ultimate financial freedom. While he is severely tied to his career, he can scotch over some time to invest
Mindset Development through Investment Education
A positive impact that is not readily observable is the relationship of investing education and developing a millionaire’s mindset. Smart investors are able to find ways to generate income without much work. The thought that runs through a millionaire’s head invokes an encouraging level of attraction that will allow money to come to an individual. Investments should not be a methodical tool but a rational decision led by an instinctive millionaire’s mindset.
Everyone can become a smart investor through constant investing education. As you will learn smart investors completely do the opposite things and would rather be out leading. Leaders in the investment game are usually the risk takes that leave the average investor guessing. Planning ahead and thinking three steps ahead is one of the leading principles of investor education.
Investing education through online learning will teach you not only the methods of becoming a smart investor, but the mindset shift that will give you the instinct to be a smart investor and a wealth creator. The bottom of it all is that it should not be about the rules of the game. Instead, smart investors look at these rules smile at it and go the other direction; such a nugget of knowledge from 21st century educators.
Robert Taylor is a free-lance writer, journalist and educator. He is passionate about investing education to achieve success and financial freedom. He writes for Wealth Creation Education website.
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by PaulNHS
There are several different types of investments, and many factors in determining where you should invest
If you were going to purchase a new car, you would do quite a bit of research before making a final decision and a purchase. You would never consider purchasing a car that you had not fully looked over and taken for a test drive. Investing
You will of course learn as much about the investment as possible, and would want to see how past investors have done with that particular investment. Learning about the stock market
You can make pretend investments, and see how they do. Do a search with any search engine for ‘Stock Market Games’ or ‘Stock Market Simulations.’ This is a great way to start learning about investing in the stock market.
Other types of investments outside of the stock market, however they do not have simulators. You must learn about those types of investments the hard way — by reading.
As a potential investor, you should read anything you can get your hands on about investing, but start with the beginning investment books and websites first. Otherwise, you will quickly find that you are lost.
Finally, speak with a financial planner. Tell them your goals, and ask them for their suggestions. I mean this is what they do! A good financial planner can easily help you determine where to invest your funds, and help you set up a plan to reach all of your financial goals. Many will even teach you about investing along the way — make sure you pay attention to what they are telling you!
Search Phoenix AZ New Homes, Arizona Master Planned Communities and Arizona Real Estate today!
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by Anne Fletcher
With the ink barely dry on its latest African acquisition, PMI Gold Corp.
(TSX.V: PMV) is now looking for the big money that will get its gold properties into production.
PMI Gold president Douglas MacQuarrie says he’s currently trying to raise $53 million to see the new Kubi property, as well as the Obotan site, up and running within two years.
The properties, in the lucrative Golden Triangle in the West African nation of Ghana, have both been mined profitably in the past by industry giants from open pits.
PMI Gold finalized its deal for Kubi with a subsidiary of Canada’s Nevsun Resources Ltd. just last month, issuing 9,000,000 common shares to Nevsun to give that company an 11.6% stake in PMI Gold.
AngloGold Ashanti had worked the Kubi property on option from Nevsun from 1999 to 2005, taking out 500,000 tonnes of 3.65g/t Au for nearly 59,000 ounces of gold.
According to an NI 43-101 report completed in August, Kubi contains an indicated resource of 5.13 million tonnes, grading 3.66 g/t Au for 604,085 ounces of gold, and an inferred resource of 5.38 million tonnes, grading 1.88 g/t Au for 315,079 ounces of gold.
Kubi, covering 19.16 square kilometers in the Ashanti Gold Belt, is just 20 km south of AngloGold Ashanti’s Obuasi mine, in operation for 110 years.
Kubi is also 46 km southeast of PMI Gold’s Obotan property, lying in the Asankrangwa Gold Belt. PMI Gold picked up the property in Nov. 2006, after Resolute Mining of Perth, Australia shut its open-pit operation in 2003 when the price of gold fell below US$320 per ounce.
A total of 730,000 ounces of gold had been produced at Obotan, with 590,000 ounces of an approximate grade of 2.2g/t gold from the Nrkan pit, and a further cumulative 140,000 ounces from the Adubiaso and Abore pits.
“Kubi is closer to production than Obotan as it already has a mining lease,”
MacQuarrie wrote in an e-mail from Europe, where he is attending trade shows.
“Obotan is a prospecting license which needs to be upgraded to a mining lease.”
“Also at Kubi,” he went on, “the mineralization is at a higher confidence level - in the NI 43-101-indicated category.”
PMI Gold doesn’t yet have in independent resource calculation for Obotan, MacQuarrie wrote, but in-house estimates look good. “Quite frankly, we are so positive that we have ore bodies at both Kubi and Obotan, we will commence the development work as soon as we have the funds.”
“We are now in the market to raise $3 million in equity and $50 million in convertible debt or project financing to put both of them in production over the next 2 years.”
PMI Gold is planning small-scale underground mining to get at the ore still left from the open-pit work. AngloGold Ashanti trucked its Kubi ore to Obuasi for processing, and PMI Gold is looking to do something similar.
“Given that the Obotan orebody is the larger - and part of a 70 km string of concessions we control where we hope to make many more discoveries - it makes sense to locate (the processing plant) there and truck the high grade Kubi ore to Obotan,” MacQuarrie wrote.
As well, the Supuma Shelter Belt Forest Reserve covers 45% of the Kubi concession, so off-site processing, along with underground mining outside the reserve, will let the company by-pass any reserve development controversy.
Highlights of the final assay results released in August from an eight-hole, 2,539-metre drill program completed on Obotan include 44.5 m. of 2.61 g/t gold in hole NK07-001, which tested the down dip extension of the Nkran pit ore body 330 meters below the base of the previously mined pit. Another intercept graded 8.91 g/t gold over 2.7 m, collared 170 m to the south of the southern end of the pit.
Ghana is Africa’s second largest gold producer, recently attracting US$1.5 billion in committed foreign investment. The bulk of the country’s 90 million ounces of gold production has come from the Ashanti and Bibiani Gold Belts.
Interest in the lesser-known Asankrangwa Gold Belt perked up about a dozen years ago after the first modern airborne magnetic survey over southwest Ghana picked out major deformation zones and cross structures that were spatially related both to Ashanti’s Obuasi mine and to the historical gold mines and showings that define the belt.
PMI Gold, working in the country since 2003, now controls a 70-kilometre length of the Asankrangwa Gold Belt in 12 concessions/options totaling 484 sq km, and a mining lease and two concessions/options totaling 214 sq km on the Ashanti Gold Belt.
“We have a lot on our plate at the moment,” MacQuarrie acknowledged. But that doesn’t mean he’d pass up another good buy.
“I have a saying — that when I am no longer interested in new acquisitions, then it’s time for me to retire. And I am not ready for that.”
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
Resourcex Investor is an internationally distributed newsletter about emerging junior resource companies. Sign up for a free 1-month trial to our newsletter and get instant access to news and investing
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by Brian O Hara
Samples taken as vertical chip channel samples at intervals along the walls in the historic workings returned high-grade assays with a weighted average of 2.57 per cent copper (Cu), 86.8 grams per tonne silver (Ag), 0.97 per cent zinc (Zn) and 0.19 g/t gold (Au) over an average vertical height of 1.89 m.
Recently, several members of the Toronto investment community toured the La Verde project, together with Ian Foreman, P.Geo, President and Julio Lopez, the company’s Exploration Manager. The La Verde project is located 45 km northwest of Hermosilo, Sonora State, Mexico. Yale acquired this project almost four months ago at a cost of US $1.6 million payable over 27 months plus a 2% Net Smelter Return. The property has an historic resource estimate dating from 1989 (which do not comply with NI 43-101* rules) of some 459,000 tonnes grading 2.59% copper, 98.54 grams per tonne silver and 0.38 grams per tonne of gold. Yale is now making considerable progress on updating and expanding that resource.
There are at least five known deposits with historic workings on the property but the company presently has it sights set on the La Verde Grande Mine itself. Walking inside the old mine workings, the blue-green hues make the copper oxide mineralization quite evident. Mining operations at the turn of the 20th century, when the area was last properly mined, utilized steam powered machinery. These limitations meant that only the highest-grade ores were mined. With modern technology and elevated metals prices, Foreman and his backers believe that a wealth of mineable ore remains, long forgotten or undiscovered.
Yale has moved quickly on La Verde. According to Ian Foreman, “La Verde Grande is much bigger than we originally thought.” Yale has reexamined many of the old workings, and has taken some 200 channel samples from throughout the underground workings. Most of these are exploration drifts about two meters high by two meters wide. La Verde Grande appears to be a classic skarn-altered limestone with high grades of copper and associated silver, gold and zinc. “But there may be more to this than just a classic skarn” says Ian Foreman. Within the La Verde Grande Mine, there are four different levels, trending northeast. In addition there is an old working trending due east/west.
The walls of the old workings are covered in soot and bat guano. Some bats still fly through the old mine and give a new challenge to mine samplers and geologists. Yale Resources will try to liberate La Verde Grande mine workings from the bats and persuade them to find a new home.
Yale Resources has come up with an interesting discovery at La Verde Grande with potential important geologic and economic significance. They have discovered a shaft of at least 80 meters in La Verde Grande. Historic documentation and old geological records describing this shaft add a new dimension to the old working. Of particular note is the reference to sulphide mineralization at the bottom of the shaft. All other mineralization in the La Verde Grande Mine is oxide so therefore this is potentially very significant. The other point is that given the challenges of drilling and mining using the steam-powered equipment of that era, it is doubly significant that so many resources would have been devoted to such a development. It would have been a large undertaking to make a vertical shaft with the depth being equivalent to a 26-storey building. There is a challenge of determining what mineralization does occur in the shaft area — being safety considerations and lacking the mythical Spiderman to go down there. One way to decode the sulphide mystery would be to put down a drill hole down parallel to the shaft. The results of this could change the geological concept of La Verde Grande and add a new geological dimension.
The goal at the La Verde Project is to define more clearly mineralized zones, which contain copper mineralization grading 1 to 3 % copper. There is also a sweetener with the silver, gold and zinc content, which all add to increase the value of the mineralization. Once Yale Resources receives all the results of their channel-sampling program, they can establish a drilling program with priority targets. Their goal is to delineate a multi-million tonne resource that is amenable to open pit mining.
Yale has other targets nearby their La Verde Grande project. Julio Lopez, Exploration Manager, together with a project geologist, two junior geologists and two sampling crews have their work cut out for them. The El Picacho target is located 900 meters north east of the La Verde Grande project following the strike. The target is to explore a breccia with strong copper oxide showing over a 15-meter width that was discovered in the early 1900’s.
A second target, La Verdesita located 1300 meters south of La Verde Grande Mine has historic estimates (non-compliant with 43-101 rules) of 100,000 tonnes of 3 % copper.
These targets and other targets close by have never been explored as one package. More detailed knowledge of the geology will prove valuable There even exists a possibility that the same geological structure links up at depth, all three of the above targets.
On Nov. 6, Yale Resources released the first set of assays — 19 in all. The results confirm anomalous copper values with weighted average grading 1.21% copper, 26.6 grams per tonne of silver, 0.77 % Zn and 0.27 grams per tonne of gold. The highest grade gave a result of 1.97 meters grading 4.86% copper,131 grams per tonne of silver, 0.26% Zn, and 3.28 grams per tonne of gold.
Yale will prioritize drilling targets in all of the mineralized zones, once all the assay results are received over the coming months. The challenge now is to “sort out the smoke” to determine the best targets for drilling and potential economic mineralization.
With only 26 million shares outstanding (33.6 million shares fully diluted) and a price tag of aound $0.25 per share, Yale still represents a bargain for a near term producers that could well be paying its own way soon. The coming months could well see Yale’s share price head north for the winter.
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
Resourcex Investor is an internationally distributed newsletter about emerging junior resource companies. Sign up for a free 1-month trial to our newsletter and get instant access to news and investing
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by Andrew K. Burger
It stands to reason that governments around the world are looking to expand their use of nuclear energy in coming years given the potentially catastrophic effects of climate change and the current international focus on reducing carbon dioxide greenhouse gas emissions. More than 130 new nuclear power plants are under construction worldwide and the World Nuclear Association forecasts that demand for uranium will grow between 25% and 50% per annum over the next 13 years.
Uranium ore prices have begun rising again this past month, breaching US$90/lb., after having fallen back and settled around the US$80/lb. level after skyrocketing up to US$138/lb. in June this year from lows around US$7/lb. that lasted decades and prompted mine closings and the curtailment of exploration programs. Lately it’s been sharp run-ups and volatility in oil and gold prices that have attracted the focus of energy and mineral resources investors and the media.
Energy and uranium market fundamentals haven’t changed, however. The base case reference scenario for the US Energy Information Association’s International Energy Outlook 2007 is based on worldwide electricity demand increasing 2.4% per year, from 16,424 billion kilowatt-hours in 2004 to 303,364 in 2030, most of it non-OECD nations. Coupled with ever greater resources being devoted to mitigating climate change and significantly cutting back global greenhouse emissions, junior uranium explorers such as Vancouver’s Atomic Minerals Ltd. (TSX.V:ATL) are raising capital and gearing up to follow through on ambitious acquisition and development plans.
From Southwestern Colorado…
Listing on the Toronto Venture Exchange in June, Atomic Minerals owns 932 claims covering 19,250 acres and has signed a Letter of Intent to purchase an additional 1,585 acres on what it considers to be a prime, untapped area for uranium ore prospects: the Dolores Anticline, a large, asymmetrical northwest-trending fold in southwestern Colorado’s Dolores and San Miguel counties.
Located within the Paradox Basin and Uravan Mineral Belt some 30 miles from southeastern Utah’s Lisbon Valley, this area in the Four Corners region was the scene of a uranium boom in the 1950’s after an initial discovery by “Uranium King” Charles A. Steen led to the development of a number of mines. In total, these have produced more than 80% of the uranium mined in Utahin excess of 103 million pounds.
Atomic management considers Dolores to be the last saltwater anticline in the southwestern US with excellent uranium ore prospects. A recently completed NI 43-101 report confirmed that the claim area, which is approximately 30 miles away from Denison Corp.’s White Mesa Mill, has the potential to host a uranium deposit and Atomic has put together exploration plans for a US$2 million Phase Two drilling program to further explore and define the potential resource.
The Salt Wash Member of the Morrison Formation of Late Jurassic Age and the Moss Back Member of the Late Triassic Chinle Formation in and near the Uravan Mineral Belt in San Miguel, Montrose and Dolores Counties, Colorado have produced economically significant amounts of uranium ore. Drilling programs on the Dolores Anticline conducted by Hunt Oil and Newmont in the 1970s indicated that the uranium ore-bearing Moss Back Member of the Chinle Formation is present in the area.
Atomic on November 15 announced that it had begun drilling on a first transect of a planned 30,000 feet for the Summit Point and Box Canyon Exploration Projects in San Miguel County.
“Our initial drill hole at Summit Point will be looking for the mineralized zone of the Moss Back member of the Chinle Formation. Upon completion of this hole, we will be working along the flank of the Anticline with the next eight holes. Our rotary drill rig is running 24 hours a day, and this first hole of up to 2100 feet should be completed by Friday morning.”
Additionally, the Dolores Anticline was drilled by both Hunt Oil and Newmont in the 1970s. Drill logs from this wide spaced drilling indicate that the favorable Moss Back Member of the Chinle Formation is present in the area.
Atomic also owns 119 claims spanning 2,460 acres known as the Troublesome Creek property where a potential resource estimated as high as 6-7 million tons U308 grading between 0.08 to 1.14% holds out the possibility of in situ leach processing of uranium channels. Similar potential, as well as mining an unconformity type uranium deposit, exists at the Little Wolford property, where Atomic has filed for a state lease covering 640 acres. Rounding out Atomic’s Colorado holdings, the Beaver Creek property consists of 27 claims spanning 540 acres adjacent to a Newmont exploration project that has reported grades of 0.35-1.33% U308.
…to Southwestern Tanzania
Atomic has also cast its net farther afield. It has signed a Letter of Intent with Tanzania’s Geo Can Resources for an option to acquire up to a 100% interest in a land package totaling approximately 1.3 million acres located in the United Republic of Tanzania.
The LOI for the option covers ten licenses and seven parcels of land with known occurrences of uranium in southwestern Tanzania, as well as three “key” parcels in the Ruhuhu Basin, part of the Malawi Extension where 60 kilometers away in Malawi Perth-based Paladin Resources Ltd. (TSX:PDN) is developing its Kayelekera uranium ore project.
Atomic’s agreement with Geo Can Resources on the shores of Lake Nyasa, also known as Lake Malawi, extends into southern Africa’s Karoo Basin system, a deposition region known to contain significant sandstone-hosted roll front uranium deposits of the same type found on the Colorado Plateau and the world-class Mi Vida Mine near Moab, Utah that are mined by in situ leaching methods.
Current estimates for Paladin’s Kayelekera project in neighboring northern Malawi holds measured and indicated resources of 14,000 tonnes U308 and an additional 2,000 tonnes inferred. Paladin completed a Bankable Feasibility Study for Kayelekra early this year, has met environmental regulations and is investing
Australia’s Western Metals (ASX:WMT) on Oct. 22 reported that ongoing drilling and trenching at its Mtonya project continues to discover high-grade uranium mineralisation over a 7 kilometre trend including 1.2 meters at 7,723 ppm U308 and 0.8 m at 1,035 ppm at the Grandfather prospect. Western Metals plans to spend A$3.5 million on exploration in Tanzania over the next 15 months.
Uranium Mining, Business & the Environment
Tanzania has set a goal for the mining sector to grow from a current 2% to 10% of GDP by 2025, deputy minister of mining and minerals William Gereja has been reported as saying. Uranium ore may join gold and diamonds as one of the country’s top mineral exports if additional exploration and resource definition work pans out as well as is anticipated. Tanzania is Africa’s third-largest gold producer, ranking behind South Africa and Ghana.
“This is good news,” Gereja told a reporter from Voice of America’s Kenya bureau at the end of July. “Uranium is used for many industrial uses in the world and we expect that uranium in our country, Tanzania, would make us benefit a lot. We expect to raise revenues from this uranium mineral.”
Security and environmental health and safety are always issues when it comes to uranium.
“We have passed all environmental and Arc studies needed as per the BLM in Colorado. In Tanzania, we are in the midst of doing the equivalent for the same requirements. The main thing to look at in Tanzania is not only the land but also the many jobs this will create,” Atomic Minerals’ Chris Brown told Resourcex Investor.
Tanzania, as well as other African countries, has been a favored transit point for smugglers. In 2005 Tanzanian customs officials discovered a large shipment of uranium from Kinshasha bound for the Iranian port of Bandar Abbas. Four Tanzanians, including a government economist, were arrested in Tanzania in 2002 after 110 kilograms of uranium in plastic containers were found and seized.
The Tanzanian government is working to clamp down on both smuggling and corruption. The deputy minister of mining and minerals has said that laws and safeguards will be enacted if and when uranium is mined and produced to prevent it from falling into the wrong hands.
In terms of foreign miners doing business in Tanzania, “The Mining Act of 1998 legislated a clear exploration and mining regime that guarantees against nationalization and expropriation with a fair, predictable tax regime. A Chubb Group World Risk Survey in 2006 had Tanzania in the 10 lowest investment risk countries,” according to Western Metals.
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
Resourcex Investor is an internationally distributed newsletter about emerging junior resource companies. Sign up for a free 1-month trial to our newsletter and get instant access to news and investing tips that have helped many of our readers make more money. http://www.resourcex.com
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by Len McDowall
This article takes a look at the pros and cons of investing
What is Pre-IPO capital? Well it’s exactly that, capital that is raised prior to an IPO.
So to make things clear, an IPO, or initial public offering, refers to the time when a company is about to list on the stock exchange, and they have issued a prospectus in order to attract investors funds. The amounts sought vary greatly depending of the size of the company and the need for capital. So if you invest
You are usually limited by the maximum number of shares you can subscribe to. It may be $10,000 for example. There will also be a minimum subscription. This varies from float to float of course.
The other thing that is common with an IPO offering is that there is a defined time period in which you must respond. - usually about 3 weeks. This allows the company and their broker to coordinate the float with the exchange. It also creates urgency for the investor by giving you a deadline in which to make a decision by.
The basics on Pre-IPO…
Pre-IPO is much different to this, although it sounds similar. Pre-IPO is raised anywhere from 3 months to 18 months prior to the company listing onto the ASX. It is usually done without a prospectus and in most cases is done at a time when there is no stock-broker representing the company or underwriting the float.
At the pre-IPO level, there is no guarantee that the company will make it to the actual IPO, what the share price will be, or even which broker will do it. Also, because it may take up to 2 years before the company floats, your money is pretty much tied up until then.
As you can see, there is higher risk involved. To reflect this, pre-IPOs are usually offered at a considerable discount to the anticipated IPO price. For example, if company X believed that they will list for $1, they may offer shares in a pre-IPO capital raising at $0.25. Should they end up listing for $1, they you make 4 times on your money at the IPO.
Most investors have not even heard of pre-IPO investment opportunities. This is because they are only usually marketed to wholesale investors, high net worth individuals, professional investors and investment funds. So to gain exposure to one, you sort of need to know the right people. Even high net worth individuals do not often get exposed to pre-IPO opportunities simply because they are not connected to the company or the broker/advisor managing the offer.
Most opportunities are restricted to “wholesale” investors however limited opportunities are sometimes available to some “retail” investors.
Key strategies for reducing investor risk in Pre-IPO opportunities…
There is no safe way to invest into pre-IPO opportunities. Simply because there are many factors that may prevent the company from reaching the stock market
Estimated listing timetable stated in Information Memorandum document (ideally within 12 months)
Board of directors in place
CEO in place
Key management and staff in place
Lead broker in place (or at least short listed)
Legal team in place (for IPO)
Accountant in place (for IPO)
Advisor in place (for IPO)
Financial projections completed
Profitable
Market opportunity clearly defined
Share capital structure in place
Value entry level established
It’s not necessary to have all the above criteria ticked, but the more the better as each criteria lessens the risk for you, the investor.
How do you know the company is going to list? The short answer is you don’t. Even some IPO’s have been pulled at the last minute. The bottom line is investing into Pre-IPO is risky, so be sure to only invest what you can afford to lose. And only invest a maximum of say 10% of your investment portfolio.
However when they work, the returns can be quite staggering. I know of a recent float where the pre-IPO investors bought in at $0.10 per share, less than 4 months before the IPO. The company floated at $0.20 and within 6 months, the shares rose to over $0.60. That’s 6 times your money within a year. However bear in mind that this was relatively speculative, and the pre-IPO investors could just have easily been left holding the stock for a couple of years.
In terms of Due Diligence, it’s wise to spend about 20 minutes on the phone to the CEO or better still, meet with them. Get them to answer any questions you have about the company and its ability to deliver on its promises. If you are investing $100,000 or more, it’s time well spent. If you were to spend a similar amount on a car, I’m sure you would take it around the block a couple of times, so make sure you do some homework when looking at a pre-IPO investment.
So how do you gain access to pre-IPO opportunities? Speak to your broker or get to know an advisory firm who specialises in pre-IPO capital raisings. From time to time, you will also see them advertised in the Financial Review. It’s free to enquire and even if you don’t invest, it’s good to get a feel for this type of investment prior to writing a cheque.
© Len McDowall, Integral Capital Group
Len McDowall founded Integral Capital Group (www.integralcapital.com.au)in 1990. Specialising in the Australian capital markets, Integral Capital Group serve sophisticated investors, private and public companies delivering a broad range of services including Stock Exchange listings; Mergers, acquisitions and divestments; Capital and debt raising; and pre-IPO offerings. Len McDowall has extensive experience in all facets of financial management with a particular emphasis on capital raising.
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by Christina de Wit
Voltaire, the great French Rationalist philosopher, described business as “the salt of life”. Perhaps he may have got it backwards — as far as KFG Resources’ (TSX.V:KFG) management is concerned, “salt is the life of business”. It intends to test this theory as the company prepares to launch a 3-D seismic survey in its quest for oil on its Fayette Field property in the Mississippi Interior Salt Basin.
The Fayette Field is located in Jefferson County, just north of Natchez, Mississippi, and is presently producing 20 barrels of oil and 250 MCF (thousand cubic feet) of gas per day. There are currently ten producing horizons in the field, and management believes that there are between five and ten more viable horizons. It’s worth noting that the company’s property, which consists of a 49.2% (42% net) interest in three leases covering 3200 acres on the largest salt feature left to be redeveloped in the region.
Permitting for the survey has already started and the 3D seismic survey will be conducted in February 2008. A 10,000 ft test well will likely follow in the second quarter of 2008. Drilling in this relatively under-explored area has two major possibilities: one, the highly productive Eocene Wilcox Formation, and the much deeper Lower Cretaceous Lower Tuscaloosa — also a famous oil reservoir. Within the Wilcox Formation, recovery rates are as high as 40% in this water drive reservoir. Secondary recovery using CO2 in the deeper Lower Tuscaloosa have yield an additional 80% of primary production.
The advantage of 3D seismic surveying is that it’s a two-pronged strategy
Salt domes are often the site of salt mines and oil wells. They can range from 1 to 10 km across and have been known to reach depths of up to 6.5 km. They are formed when large plugs of salt from deep in the earth are forced up, pushing up layers as they rise. As the density of salt is generally less than that of its surrounding material, it has a tendency to move upward toward the surface, forming large mushroom-shaped domes. As the salt moves up, it can penetrate and/or bend strata of existing rock with it, causing them to bend slightly upwards at the point of contact with the dome. This process often forms pockets where petroleum and natural gas can collect between impermeable strata of rock and salt. These formations are a major source of the petroleum produced along the coast of the Gulf of Mexico.
The economic potential of salt domes has been known about for some time, however, recent drilling (encouraged by both high oil prices and technological advances) of salt dome flanks in the Mississippi salt basin has resulted in important new discoveries.
37 deep wells of 10,000 feet or less have been drilled in the field– 29 of them on the east side of the dome. The east side of the dome has produced 2.2 million barrels of oil so far. This certainly gives cause for some optimism– since salt domes are usually symmetrical in nature, oil and gas deposits on one side tend to be mirrored on the other. The company’s 3D survey will focus on the west side of the dome. “I’m hoping to develop new production on the west side [of the dome], and to enhance the overall value of the project,” said the company’s CEO, Robert Kadane.
Investors would be hard-pressed to find a total package like this one, especially given recent record oil prices. Several factors highlight KFG’s potential for major appreciation: management is well prepared– all titles have been cleared, and the company is completely debt-free. Mississippi is an excellent place to work in– as costs and taxes are very low. Fayette Field, being inland, is sheltered from the notorious hurricanes that affect the Gulf Coat. Required infrastructure, such as salt water waste removal equipment and gas pipelines, is in place to support increased production. On the finance side, the company has recently closed the second tranche of its brokered private placement through Union Securities. The company is building on its existing success within the Fayette Field and within it other properties in Louisiana, Mississippi, and Kansas.
An oil play of this size offers investors maximum flexibility, mitigated risk, and the potential for handsome returns in a very short turnaround period– serious production and cash flow could take as little as ten months.
Mr. Kadane is a third-generation Texas oilman with over 40 years’ experience in the business. When asked why he has spent much of his life exploring in the Mississippi-Louisiana Salt Basin, his words of wisdom to investors were short — and sweet: “I’ve been here because it’s been successful for me in the past.”
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
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by Christina de Wit
The phrase “money talks,” has been around for ages, but the ancients had a more artful way of saying it — aureo hamo piscariis — which translates from the Latin as “To fish with a golden hook.” ValGold Resources’ (TSX.V:VAL) shareholders will probably appreciate the classical interpretation; the company’s latest news suggests that management has hooked a big one with its newest acquisition in Guyana. As per VAL’s November 7th press release, the company has expanded its holdings in the Guiana Shield through an agreement with a private Guyanese company. ValGold stands to earn a 100% interest in the Fish Creek Prospecting Licence, comprising approximately 5,180 hectares (12,800 acres) in Mining District #5 in northwest Guyana. This brings the company’s total holdings in the Guiana shield to 5,484 km2, with 4,592 km2 of ground in Guyana, and 892 km2 in Venezuela’s Bolivar State. This makes the company one of the larger single landholders in the Guiana Shield.
The Guiana Shield is South America’s counterpart to the volcanic-sedimentary Birimian Supergroup in West Africa, which hosts several large gold deposits, the most famous of which is AngloGold Ashanti’s Obuasi Mine in Ghana. Obuasi produces approximately 400,000 ounces of gold annually. What is perhaps most striking about the Guiana Shield is that it’s one of the last seriously underexplored major geological systems left in the world.
Major gold deposits within the Guiana Shield include the Rosebel mine in Suriname, the Omai mine in Guyana and the Las Cristinas and Brisas deposits in Venezuela. Before closing in 2005, Omai (owned by Cambior, which was bought out by Iamgold) was the largest open-pit gold mine in South America, and produced more than 3.7 million troy ounces (115,081 kg) of gold during its lifetime.
Besides being known as one of the world’s largest exporters of bauxite, Guyana is also known for its gold, diamond and uranium potential. Free market-oriented political reforms in the 1990s and the current breakout gold market have done much to highlight Guyana’s appeal to mining investors.
Although this acquisition stands on the merits of its exploration potential alone, ValGold’s corporate culture is to seek opportunities to “join with good men”. A key component of this deal is leveraging the expertise of Hilbert N. Shields, ValGold’s Guyana country manager, and past vice-president and general manager of Golden Star Resources. He was responsible for that company’s project generation, acquisition, and exploration to feasibility study for gold and diamonds in Guyana, Suriname, French Guiana, Venezuela, Sierra Leone, and the Ivory Coast. He was responsible for a US $100 million budget over 13 years with the company and had a technical staff of 45 geo-scientists and 350 local employees. Mr. Shields supervised the exploration of the Omai gold deposit to completion, which currently produces 300,000 of gold annually.
Perhaps more importantly, Hilbert’s team initiated the original exploration by Golden Star on Fish Creek in the 1990s. Now he is eager to return to the Fish Creek site to follow up on the mineralized anomalies he began to work on prior to the downturn of gold prices.
The Fish Creek licence is at the northeast boundary of and adjacent to the company’s Five Star property. This area has a history of artisanal gold mining and is dotted with workings. It is also thought to be potentially rich in diamonds, uranium and copper-nickel and/or platinum group metals (PGM).
The company’s website describes the Five Star properties as being “highly prospective for gold and, potentially, diamonds, uranium and copper-nickel and/or platinum group metals (PGM). Several gold occurrences have already been discovered on the properties including the Makapa occurrence where rock samples have returned gold values as high as 136.0 g/t. Limited drilling at the same occurrence has intersected up to 18.3 g/t gold over 2.0 meters in silicified volcaniclastic conglomerate. Large areas have also seen no work or have good gold stream silt anomalies that have not been investigated. Alluvial diamonds have been found at a number of locations yet very little exploration has been conducted for this commodity. Radiometric surveys have identified several uranium anomalies and layered, intrusive, mafic to ultramafic rocks could potentially host copper-nickel and/or PGM mineralization.”
Golden Star Resources, who worked on Fish Creek from 1994 to 1997, conducted stream sediment and regional soil geochemical surveys, airborne and ground geophysical surveys, detailed soil, rock and trench sampling, as well as 2,780 m of diamond drilling over 20 holes. This preliminary work allowed Golden Star to delineate several anomalous areas of gold enrichment. These appear to be associated with a major regional east-west fault, whose structure crosses the central part of the licence and extends about 40 km west.
Trench sampling is reported as having returned (historic, non-43-101-compliant) values of up to 3.6 g/t gold over 7m and 9.7 g/t gold over 3m. The best drill intersection was reported as 10.34 g/t over a core interval of 7m.
Despite some impressive results, low metals prices in the 1990s undoubtedly influenced Golden Star’s decision to halt its work program and to allow the licence to lapse. The license was not picked up until April 2007 by the current optionor. Prior to acquiring the licence, ValGold reviewed Golden Star’s collected data and visited the site to collect samples from past and current alluvial and saprolite artisanal workings. Grab and chip samples from rock exposures returned high-grade gold values of up to 34.0 g/t in quartz vein material.
As it prepares for an immediate drill program that will test several of the anomalous targets outlined by Golden Star, ValGold has been infilling the historical soil sampling grids and sampling many of the accessible artisanal mine workings. Preliminary exploration has identified several additional, excellent gold occurrences that merit further trenching and subsequent drill testing. Investors can look forward to the soon-to-be-released NI 43-101-compliant report on Fish Creek.
This newest acquisition enhances a property portfolio that is already well-diversified within the Americas. In addition to its Mochila property in Venezuela, where it is actively drilling, ValGold also has a 100%-interest in two properties in the gold belts of northwestern Ontario.
Several factors suggest that VAL could soon see a significant appreciation in value: it has large holdings in an underexplored region known to contain hugely valuable mineral wealth, it has projects at drilling stage, and its timing is supported by record-high commodities prices. Perhaps most importantly, the company is led by seasoned management with a brilliant track record of exploration and relationship-building in the Americas. Valgold’s president and CEO, Stephen J. Wilkinson, is building on his success with Northern Orion (Argentina). Andrew F.B. Milligan, the company’s chairman, is a former president of Glamis Gold. Tom Pollock, ValGold’s vice-president of exploration, has 25 years’ international exploration and management experience– 20 of it with BHP.
Mr. Wilkinson, in his recent interview for Smartstox Online’s TV Talk Show — click here (http://www.smartstox.com/interview/val/) to watch — discusses the company’s plans for success as it goes ahead with its ambitious drilling programs in the Guiana Shield.
These are certainly exciting times for ValGold, and investors would do well to ensure that this opportunity doesn’t end up being “the one that got away”.
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
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by Hsiao Lin
Linux Gold Corp. (OTCBB:LNXGF) has stepped up to the plate as it further expands its presence in Alaska’s historic gold camps. The company has recently acquired an option to purchase a 100% interest in 26 mining claims close to the historic Ester Dome mining camp near Fairbanks, Alaska for US$10.3 million in cash and shares over a two-year period. As per its October 18th press release, “on September 9, 2007, a major gold/silver discovery was located on the claims, with a potential strike length of 6,500’, width of 100’ and minimum depth of 100’ of high grade gold and silver values based on the sampling and trenching program completed this year. The area has been re-sampled and results are pending.” Placer gold has been mined around Ester Creek and its drainage for decades.
This latest acquisition adds considerable lustre to Linux’s position in Alaska, as it also owns the Granite Mountain gold-polymetallic-platinum Project– located approximately 80 miles east of Nome, on the eastern part of Alaska’s Seward Peninsula. The company staked a 37 square mile area at the ‘epicentre’ of some of the world’s greatest deposits– surrounded by Teck Cominco’s Red Dog, (the world’s largest zinc deposit) located 180 miles north, Nova Gold’s Rock Creek and Big Hurrah gold mines 75 miles west, their Khotol Silver project 60 miles east, and finally, Northern Dynasty’s massive gold-copper-molybdenum porphyry deposit (the Pebble Project) to the southeast. Red Dog is has over US$20 billion worth of zinc reserves and is producing 500,000 tons of ore annually. Indicated deposits for Rock Creek and Big Hurrah total 670,000 ounces of gold with an estimated Inferred Resource of 100,000 ounces of gold. Northern Dynasty has an inferred mineral resource of approximately 28 million ounces gold and 16.4 billion pounds of copper — certainly one of the world’s finest mineral deposits.
In early 2005, Linux acquired a 100% interest in the property by staking 148 State of Alaska 160-acre mining claims at several locations near Granite Mountain. Work done in the 1960s suggests that the property deserves additional exploration. To date, mapping and geochemical sampling has enabled the company to outline a two-mile mineralized zone with favorable discovery potential. The company’s consulting geologist for the project, Robert B. Murray, is currently completing a NI 43-101 report on the property. In September 2006, a drilling program on the property was completed, testing four separate mineralized zones. Further exploration work to confirm gold and silver values on the property is planned pending additional financing.
The USGS’ fact sheet entitled Regional Geologic, Geochemical, Geophysical, and Mineral Deposit Data for Economic Development in Alaska in the 21st Century confirms the immense base-metal resources of the Seward Peninsula: “Since the gold rush of the late 19th century, it has been recognized that the mineral endowment of the Seward Peninsula, Alaska, is considerable. The well-known placer gold operations have had significant historic production and continue operating to this day. Lode gold production has also occurred. The potential for base-metal deposits (Pb, Zn, Cu) has attracted exploration to the peninsula for decades, but the extent of that resource is unknown. Scattered across the Seward Peninsula, in an area 150 x 200 km, are numerous prospects and occurrences of stratiform massive sulfides.”
Linux also owns a 50% interest in 30 mineral claims known as the Fish Creek Prospect, located in the Fairbanks Mining Division in Alaska. The claims are located only six miles from Kinross’ Fort Knox mill. Linux has a 50/50 joint-venture with Teryl Resources Corp. (TSX.V:TRC) in the Fish Creek claims, in which Linux will spend US$500,000 on the project over three years. Linux Gold Corp. retains a 5% net smelter return or may convert into a 25% working interest. The Fish Creek claims are part of Teryl’s Alaskan holdings, which also include the Gil Project, the Stepovich claims, and the West Ridge property — all in the Fairbanks Mining District. Teryl is one of the main landowners in the district, with holdings contiguous to Kinross’ Fort Knox Project. According to Kinross’ Fort Knox Mine technical report, “the Fairbanks mining district is a celebrated placer gold camp with production in excess of 8.0 million ounces of gold since 1902. Although a significant mining district in terms of total production, it had only limited lode production until the discovery and development of the Fort Knox deposit in the late 1990s.” Fort Knox is the largest producing gold mine in Alaska, with a 4,000,000 oz Au ore reserve.
Linux and Teryl share something else — their president, CEO and chairman of the board, John Robertson, who brings an extensive business, mining and marketing background to both companies.
Management has diligently set about acquiring strategic properties near some of the world’s major producers in an area known for its world-class reserves and its mining-friendly political environment. This approach has yielded some great results so far, given the fact that it has been able to forge close ties with Kinross at Fish Creek.
The company is remarkably well-diversified in terms of its property portfolio, with projects near major former and current producers in Alaska, Arizona, China and Canada. Its accessible price point and Bulletin Board status make it especially attractive to American investors who wish to position themselves early on in the drilling stage in order to maximize their chances of seeing major-league near- and mid-term appreciation. With some good drill results we could well see Linux hit a grand slam.
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
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by Katherine Young
The world’s most powerful currency just received a slap in the face by the world’s top earning supermodel. Gisele Bundchen, has insisted on being paid in Euros rather than US dollars. When even supermodels are making news by protecting their wealth from the plummeting US dollar, gold becomes foremost on investors’ minds. Of course, gold is widely considered a hedge against the dollar and so far, following the decline of the greenback, the gold price has responded as expected. Gold has increased relative to not just the American dollar, but to the other major currencies across the world. And many predict an unprecedented further acceleration in the price of gold. Goldcliff Resource Corp’s President, George Sanders, points out the enormous opportunity for investors to leverage their exposure to the rising gold price by investing
Although Goldcliff has thus far focused on reporting drilling results from a few high-grade zones on the property, according to Sanders, Panorama Ridge in fact has substantial bulk tonnage, open pit potential. In addition to the high-grade gold that Goldcliff is drilling, Sanders explains that in today’s gold market the low-grade material at Panorama is becoming economic, and in turn substantially increasing the potential size of the Panorama resource.
“We’ve been focused on the material right around a gram per tonne and in excess of a gram and we’re finding lots of potential tonnage of that material, but that material occurs within an even bigger envelope of low grade material. As these gold prices move higher, that lower grade material starts to become of serious economic interest. It moves into a resource category as you’re able to lower your cut-off grades.”
Focused in British Columbia adjacent to the historic and prolific Mascot Mine, Goldcliff is in the midst of a 10,000m drill program that is slated to wrap up in the spring of 2008 with resource estimates to follow soon after. Results from the Panorama Ridge property, concentrating on the high grade York/Viking and Nordic zones, will arrive over the next weeks and months as Goldcliff’s drilling results make their way through queues at the assay labs.
Highlights published thus far have included 1.56 g/t gold over 40.84m including 3.05 g/t gold over 19.23m and 5.24 g/t gold over 8.56m and 31.2 g/t gold over 0.25m at the Nordic zones. Highlights from the York/Viking zone include 58.27m of 1.01 g/t gold, 38.01m of 1.19 g/t gold, and 27.88m of 1.05 g/t gold.
The Panorama Ridge story began one afternoon in 2000 when geologists Leonard Saleken and Grant Crooker drove up the Nickel Plate Road only four kilometers from the Nickel Plate Mascot Mine near Hedley, BC. There they discovered new logging roads that extended into terrain with favourable outcrop and similar geology to the Mascot Mine area. Saleken and Crooker knew the potential of what they had. Immediately, they checked the records for previous claims. They found none and excitedly began the process of staking ground. Today Goldcliff has over 4,000 hectares in claims at Panorama Ridge and a growing body of significant exploration results.
Geographic proximity to the Mascot Mine is one advantage that Goldcliff has exploited. However, it doesn’t end there. Three members of the Goldcliff team, Leonard Saleken, Chairman and chief geologist, Paul Saxton, director and mining engineer, and Edwin Rockel, geophysicist, worked at the Mascot open pit in the 1980s and 90s when it produced over 1.0 million ounces of gold. Sanders points out that Mascot and Panorama have the same geological setting and same style of mineralization, “so in a sense our guys have already ‘been there and done that’. The whole team has been involved in more than one successful junior where deposits have been developed into ore bodies or companies have been sold to bigger companies. So we do have a lot of experience under our belts.”
Another important strategy
The carefully selected 2,735 hectare Plug Project is located at the Merrit-Logan Lake epithermal gold-silver belt, and the 56,997 hectare Ainsworth Silver Project is in the Kootenays. Although both are early stage projects, optimism for the Plug project is punctuated by two showings, the Plug showing of 4.35 g/t gold and 52.2 g/t silver over 11.98m including 20.78 g/t gold and 113.0 g/t silver; and the Meadow showing of 2.24 g/t gold and 400.6 g/t silver over 4.44m including 6.14 g/t gold and 1715.0 g/t silver.
A news release dated Feb. 15, 2007 detailed the value of the Ainsworth project: “The claim holdings contain old silver producers and a number of strongly anomalous silver, copper, molybdenum, lead, zinc and gold values. Goldcliff’s interpretation of the region’s geological, geochemical and geophysical data established an exploration model for mega-silver-deposit discoveries in the region. The region has historical silver production of 85 million ounces silver.”
With these three properties, the experienced Goldcliff team has strategically situated the company both next to a past-producing mine, and on the crest of a possible gold tsunami.
This article is intended for information purposes only, and is not a recommendation to buy or sell the equities of any company mentioned herein. It is based on sources believed to be reliable, but no warranty as to accuracy is expressed or implied. The opinions expressed in the article are those of the author except where statements are attributed to individuals other than the author, in which case the opinions are those of the individual to whom they are attributed.
Resourcex Investor is an internationally distributed newsletter about emerging junior resource companies. Sign up for a free 1-month trial to our newsletter and get instant access to news and investing tips that have helped many of our readers make more money. http://www.resourcex.com
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