That Was The Week That Was ... In Canada
April 09, 2007
By Our Canadian Correspondent
Minews. Now over to Canada where commodity prices continue to help the speculative resource market.
CC. Yes indeed. Despite the holiday shortened trading week, a good showing for gold combined with yet another take over announcement prompted some buying ahead of the Easter long weekend. When all was said and done, the TSX Ventures Exchange, home to the most junior exploration stocks, surged some 2.2 per cent.
Last week it was Xstrata’s bid for LionOre International and this past week we saw Lundin Mining offering to buy Rio Narcea Gold Mines. The price tag is C$821 million, which equates to C$5 per share and C$1.04 per share warrant. The cash deal is being supported by the Board of Directors of Rio Narcea. Rio Narcea has assets in Spain, Portugal and Mauritania, as well as a 20 per cent equity interest in Chariot Resources, which owns a 70 per cent stake in the Maracona copper project in Peru. The main asset however is the Aguablanca nickel-copper mine in southern Spain, one that would give Lundin exposure to the red hot nickel market. Lundin Mining ended the week up C$2.34 at C$15.19, while Rio Narcea added C$0.59 to close at C$5.11.
Sticking to the European flavour, investors took a fancy to Gold-Ore Resources after the junior announced that it plans to have a feasibility study in hand by year ends on its proposed underground mine at the Bjorkdal Project, Sweden. Gold-Ore, which ended the week up C$0.16 at C$1.07, has the option to purchase 100 per cent of the project from Minmet plc of Dublin, Ireland.
On the really speculative front, shares in GGL Diamond soared following news that the company has found nickel mineralization while looking for diamonds in the Winter Lake area of Canada’s Northwest Territories. The extremely long and somewhat overplayed press release only gives one assay value and that being 0.41% nickel with anomalous copper and cobalt. The low grade did not deter investors as GGL Diamond hit an intraday high of C$1.50, marking a 1000% return on a sample yielding 0.41% nickel. In other words the run seems a bit much. By the end of the week, GGL shares had settled down to C$0.72, up an impressive C$0.59 on an even more impressive 89 million shares traded.
Aussie lead miner Ivernia had a bad week as production at its Magellan mine has been put on hold for the next three to four months until the company finds a new way to ship lead. You see a lead poisoning investigation has resulted in the suspension of lead exports from the Esperance port after autopsies of two birds showed they died of lead poisoning. Blood tests on more than 400 people so far have show that at least seven people had lead levels higher than recommended but have not required medical treatment. About 75% of Ivernia’s workforce has been laid off, while the rest will manage the wind-down of production and care and maintenance activities until the mine goes back into production. The company issued force majeure notices to its suppliers, customers and contractors. Ivernia ended the week down C$0.25 to C$1.16.
Shares in New Guinea Gold rallied after the junior tabled more drill results from its 92% held Sinivit project in Papua New Guinea. Results included 22.6 grams gold per tonne over 18 metres and 19 metres running 19.02 grams gold per tonne. New Guinea ended the week up C$0.13 at C$0.56.
Moly continued to catch the eye of investors and this week it was Largo Resources to surge higher following news that its Northern Dancer deposit in the Yukon holds an inferred resource of 508 million lbs. tungsten and 151 million lbs. molybdenum. The overall deposit is estimated at 242 million tonnes grading 0.1% WO3 and 0.046% MoS2 using a cut-off grade of 0.05% WO3.Largo ended the week up C$0.135 at C$0.60 on over 8 million shares traded.
Shareholders of Crowflight Minerals continued to smile as the price of nickel remains at lofty levels. Crowflight is looking to put its Bucko Lake deposit in Manitoba into production. Crowflight ended the week up C$0.08 at C$1.02.
The world’s largest uranium miner moved to new highs as shares in Cameco ended the week at C$53.11, up C$5.81. Worries about the delays and cost over runs at the Cigar Lake project in Saskatchewan are currently being overshadowed by a surging uranium price.
It was generally a quiet week as traders headed home early on Thursday with an eye on spending a long weekend away from their desks. Meanwhile, shares in the major gold miners have lagged behind a robust bullion price suggesting some catch up is due over the next few weeks. But only time will tell, so stay tuned.
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