China Gold Stock Ground Level
I thought it would be interesting to submit following which is from Ron Struthers--Ron is one the best. This is ground floor.
Email resource@bmts.com Web "http://www.playstocks.net"
The China gold stories are still attracting a lot of attention, but it
is important to buy into the right ones with good people behind them
Many of the same group out of Toronto that is behind Pargas (PGA.H)
now Silk Road, SIL is also behind the China gold stock
Canadian Shield, CSP. (US symbol CSDIF)
stockhouse.com
The best time to buy into these junior exploration stocks, is before
everybody knows about them, and at this time, the story has hardly
begun to spread on Canadian Shield. Once the great connections this
company has in China are understood in the marketplace, this stock
will be a lot higher. You can currently buy now around the initial
financing level.
Canadian Shield Resources TSXV:CSP
Shares outstanding 12.9 million approx.
Management Insiders approx. 45%
Lynda Bloom, M.Sc. is President & CEO of Canadian Shield and is
currently President of Analytical Solutions Ltd., a geochemical
consulting group. Previously she was president of Citadel Gold Mines
Inc.
Bernard Kraft, C.A. is Chairman of the Board. He is a Senior Partner
of Kraft, Berger, Grill, Schwartz, Cohen & Marsh Chartered Accountants
LLP. He is also a Director of Agnico Eagle Mines Limited and World
Point Terminals Inc.
Terence Bottrill, P. Eng Senior Consultant held senior positions at
Inco Ltd., Rio Algom Ltd. and Battle Mountain Gold Company
Michael Kraft, B.A. - Director is President & CEO of Lingo Media Inc.
and a Director of EnglishLingo, Inc.
Properties
Western Laowan gold property, China.
Last week Canadian Shield entered into an agreement with Uphill
Resources Corporation to acquire 100% of Uphill's interests in the
Western Laowan gold property in Henan province, China. The Western
Laowan gold property is located approximately 105 kilometres northwest
of Xinyang city, encompasses 15.68 square kilometres in the east
Qinling gold belt, China's second largest gold producing area.
Uphill, a private Canadian corporation, entered into a joint
venture agreement effective April 17, 2003, with China Henan
Province Geological Team No. 3 (HPGT) and has the right to earn a
55-per-cent interest in the Western Laowan gold property.
Pursuant to the acquisition agreement, Canadian Shield will acquire
all of Uphill's interest in the Western Laowan gold property and the
joint venture with HPGT in consideration of 3.25 million common
shares of Canadian Shield. Canadian Shield will assume all of
Uphill's obligations and benefits under the terms of the JV
agreement and will retain Uphill's right to manage exploration
activities for the joint venture.
In order to earn a 55-per-cent interest in the Western Laowan
gold property, Canadian Shield must spend $1.5-million (U.S.) on
exploration expenditures over a period of three years. Expenditures in
the first year will be the amount recommended for the initial work
program in the National Instrument 43-101 report to be prepared
by an independent qualified geologist, expected to be
approximately $200,000 (U.S.). Upon earning its 55-per-cent interest,
Canadian Shield and HPGT will contribute pro rata to their respective
interests, subject to dilution on non-performance.
Canadian Shield plans geological mapping along with geochemical
and geophysical surveys to prioritize existing regional anomalies and
evaluate high-priority targets with trenching and drilling.
Previous regional geological and geochemical surveys conducted by
HPGT on the adjacent property to the east of the Western Laowan gold
property were successfully followed up leading to the discovery of two
significant gold deposits with combined gold resources of
approximately one million ounces. One of the deposits, the Laowan gold
deposit, is currently being mined at 500 tonnes of gold ore per day
with an average head grade of approximately five grams per tonne.
The gold mineralization is hosted by middle Proterozoic schists
and gneisses within a stratabound thrust zone of ductile-brittle
shearing. The same schist and gneiss units that host the Laowan
gold deposit underlie the Western Laowan gold property and numerous
copper-gold and gold occurrences have been identified using the
same methods that led to the successful delineation of the Laowan
gold deposit to the east.
Erichsen Lake Property, 50%, 202,432 hectares
The property is in Northwestern Ontario, located within the North
Caribou Lake Greenstone Belt, 150 km north of the town of Pickle Lake
and 30 km north of the gold-producing Musselwhite Mine (Placer Dome
Canada 68%, Kinross Gold Corporation 32%).
The property encompasses a belt of banded iron formations enveloped by
mafic volcanic rocks situated regionally along strike to the
Musselwhite Mine (1,243,783 ounces gold produced and 2.1 million
ounces reserves grading 4.8g/t remaining as of Dec. 31, 2002). A
detailed airborne geophysical survey conducted in 1994 outlined
favorable magnetic signatures and electromagnetic conductors
associated with the rock units. Most of these features have never been
followed-up on the surface.
The primary targets are a series of variable strength EM conductors
coincident with a belt of high magnetic susceptibility anomalies that
outline the location of the Hatch Lake Banded Iron Formation and
extend intermittently for at least ten kilometres along the length of
the property.
Financial
Canadian Shield just announced a $800,000 financing, a non-brokered
private placement offering of up to two million units at 40
cents per unit. Each unit comprises one common share and one-half
share purchase warrant. Each whole warrant entitles the holder to
purchase one common share at an exercise price of 60 cents per share
for a period of six months from the date of closing of the
private placement offering.
CSP has no long term debt and the announced financing will provide
more than adequate capital for initial exploration.
Summary
Everything looks good for this acquisition agreement to close as
it is a very good property deal and strategic alliance with the
China Henan Province Geological Team No. 3 (HPGT).
The geological evidence indicates a very good likelihood that the
formations that host the 1 million ounce or so mine adjacent to CSP's
Western Laowan property extends onto CSP's Western Laowan.
CSP should make further acquisitions in China through the HPGT
No. 3 and it would not surprise me to see the producing mine next to
the Western Laowan eventually vended into CSP. If CSP finds an
extension of the gold mineralization onto their property it would make
sense for both assets to come together. I would not under estimate
the potential of these properties just because there is only an
approximate 1 million ounce resource so far.
Typically, a North American company would spend money proving up a
large a gold reserve as possible so it would be attractive to raise
capital for a good size mine. However, the Chinese company would not
have easy access to capital so it is important that they put a mine
into production as soon as possible to provide cash flow that can
eventually be used to prove up more reserves. Canadian Shield should
have little problem raising capital to prove up a large gold reserve,
should one be found on the property.
This stock is not well known as a China gold play
yet, but that will change and I expect we will see a much higher
valuation on this stock very soon.
Contact Lynda B. Bloom, President
Tel: (416) 462-9124 Fax: (416) 462-1637
Website canadianshieldresources.com
As stated, gold stocks been hot, but those that pick up good gold properties in China are even hotter........
Southwestern Resources - SWG, has soared from $2.50 to over $40 on a large gold discovery in China.
SKN Resources - SRL, has soared from 0.50 to $5.50 just because they own the property next to Southwestern
Friedland's Ivanhoe Mines - IVN has soared from $3.00 to $15.00 on a copper/gold discovery, next to China in Mongolia
Pacific Minerals - PMZ joint ventured with Ivanhoe on some Chinese gold exploration properties and the stock has soared from 0.60 to $5.00
Both IVN and PMZ have come back down some, but SWG and SRL have gone to new recent highs
Canadian Shield is literally ground floor. Low Market Cap. Not many people aware of yet. |
