₪ David Pescod's Late Edition May 31, 2007
TOURNIGAN GOLD (V-TVC) $4.08 +0.46
FORSYS METALS (T-FSY) $6.85 +0.66
U308 CORP. (V-UWE) $3.10 +0.01
“Nothing has changed about the fundamentals of the uranium market” our research department tells us and the underlying fundamentals remain strong. “The complexion of the market might have changed” they suggest, “maybe people are just looking forward to summer or taking a little profit these days” and I guess we would point out that there’s also hundreds and hundreds more uranium stocks to try and follow these days, making the sector more than a little confusing.
But Toni Wallis today, writes up Tournigan Gold Corp., but it’s anything but a gold company. Based in Slovakia with some other assets in the United States, Tournigan has both gold and uranium and the Slovakian situation is interesting.
The small country of Slovakia is very much dependent on nuclear power which supplies almost 50% of the electricity in the country. Two large nuclear facilities are dependent upon Russia for their source of uranium and I suspect they wouldn’t mind finding a local source to secure supply.
In today’s write up on Tournigan, Toni mentions that “they have announced the receipt of a positive pre-feasibility study for the Kremnica Gold Project in Slovakia.” She points out that the study, “using a gold price of US$525 and silver price of US$9.25, gave an internal rate of return of 13% and an after-tax NPV of US$75.03 million.”
She does point out though that “if you use the gold price of US$675 for gold and US$12.00 for silver, the IRR increases to 28%.” But as we’ve mentioned, it’s their uranium assets that will probably attract your attention.
The company has now planned to divide itself into two, so the investing public can better follow its gold assets and uranium assets and that is expected to happen in October and could add to shareholder value. Wallis suggests it will take that long because of their time involved with regulatory authorities both in Canada and Slovakia.
Currently Tournigan has a target of $6.50, but another story high on Canaccord’s list is Forsys Metals (FSY) which she has followed since it was roughly a quarter of its current price and remains another pick with a target of $10.90. One stock that she’s also watching closely expecting drill results out sometime mid-June is U308 Corp. (UWE). Drilling the Aricheng Project in Guyana that was drilled when we had the last boom in uranium and those drilling results she suggests, could be important. To see the corporate presentation on Tournigan, just go to their website at www.tournigan.com.
INTL. FRONTIER RES. (V-IFR) $0.88 -0.03
“The problem with the North Sea,” Pat Boswell of Intl. Frontier Resources tell us, “is plain and simply the shortage of rigs.” “There are only 35 rigs available that can handle the local conditions” he suggests and yet if all the wells had to be drilled because of commitments made through the more recent licenses granted in the North Sea, “500 wells would have to be drilled.” Each well could take up to a month to drill and of course if you find something, time to test would be added as well. In other words, there is more than 10 years worth of commitments of having to be drilled in the North Sea and you’ve got nothing until you’ve got a rig to poke a hole to see if you actually have anything of value. And now with Oilexco’s discovery at Huntington being bigger than expected and some other recent British successes, the North Sea is once again, attracting attention.
As far as Intl. Frontier and Gulf Shores go, Pat Boswell tells us that the only thing they know about when they get to drill some of their prospects, is that Lundin Oil—the operator—tells us “they will take delivery of a rig sometime in the second half of the year.” And that’s as exact as it gets.
Which well to be drilled first depends on the location of the rig when they take delivery as they’ll obviously go to the closest location first. Intl. Frontier will have two projects drilled with the Lundin rig and Gulf Shores will have three.
LATIN AMERICAN MINERALS (V-LAT) $1.20 +0.15
Back on the 9th of May, Latin American Minerals announced they were going to raise $10 million in a bought-deal and yesterday they closed that financing, but they raised $12 million as people kept throwing money at them.
Some suggest that management of this company is very well respected and admire their portfolio of properties and obviously there is one big admirer — as it turns out, Pinetree Capital has bought 2 million shares to maintain 10.1% interest in the company.
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