From the FP Jan. 24 -
Some observers are not impressed by the diamonds recovered from Alberta so far.
"The quality is still questionable,'' said Robert Bishop, an independent analyst based in California.
However, exploration is still at an early stage and these stocks will likely get a lot of attention if only because of the lack of opportunities in other former exploration hot spots like Indonesia and Labrador.
"This sector is really one of the only ones where you could see a rising tide effect,'' said John Kaiser, publisher of the California mining newsletter Kaiser Bottom Fishing Report.
"If one goes up, the others will too,'' he said. This implies that the reverse would be true if results do not meet expectations.
To spread the risk, Hainey is advising investors to buy a basket of stocks, rather than focusing on individual companies.
Investors are also being advised to look at juniors with large land packages in and around the discovery area.
"There is no reason to think that Ashton has the richest cluster [of kimberlites] or the only cluster,'' said Brian Fagan, author of the Vancouver-based Fagan Report.
These are the companies being mentioned by analysts and newsletter writers eyeing the Alberta diamond rush:
Pure Gold Minerals (PUG/TSE), which was unchanged Friday at $1.13, has staked 52.6 million acres in Alberta.
Its holdings include a 15% stake in Ashton's Buffalo Hills claims as well as 49% of 22 million acres surrounding the Ashton ground.
It also has interests ranging from 50% to 100% in about 20 million acres in other parts of Alberta and southern Saskatchewan.
Lucero Resource (LCR/VSE), which was unchanged Friday at 67›, has interests in 500,000 acres. Lucero is part of a stable of companies headed by Vancouver geologist Jim Dawson.
Other companies in the group are Meteor Minerals and Primero Industries.
New Claymore Resources (NCS/VSE), which rose 1› Friday to $2.46, picked up 13.5 million acres ahead of other juniors.
It has since struck joint venture deals with a number of other juniors, including the Lucero group.
However, as there are only about 4.2 million issued shares in New Claymore, the stock is considered hard to acquire.
Troymin Resources Ltd. (TYR/ASE), which rose 7› to 76› Friday, has staked four strategic blocks covering 1.1 million acres in the Buffalo head area. Geophysical surveys are under way with results expected in early 1998.
Birch Mountain Resources (BMD/ASE), which was unchanged at 70› Friday, has granted New Indigo Resources and Lytton Minerals Ltd. rights to earn a 75% stake in its 1.9 million acre land package.
To exercise that option, New Indigo and Lytton must spend $5 million on exploration over four years and complete a bankable feasibility study on any future diamond find. Lytton and New Indigo are planning to merge.
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