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Strategies & Market Trends : Winter in the Great White North -- Ignore unavailable to you. Want to Upgrade?

To: TheSlowLane who wrote (4348)	3/21/2003 8:55:18 AM
From: E. Charters	Read Replies (1) \| Respond to of 8273

The thing that stood out at the PEEDACK was that the diamond explorers stood out as very active, but gold and base metal people were very 'reservedly' ebullient too. They all mentioned that money was tight, but they 'all' had programs and many were very well funded. One small gold group I parley with from time to time got 500K to do a recovery op in Arizona or Nevada in gold, I forget which state. All in all it seemed very upbeat. Some said that even if gold stayed at 335, they could still raise money and produce. The number of Canuckistan companies in east and west Africa has me wondering. I don't think things will change anytime soon in that continent. I only rate two countries as approachable in money matters. It's wait and see. I do not know how funny Canico is. Know zero. Have some material. Will look at it. One thing I noted is that some companies are very advanced with gold properties. One that stands out is Eastmain. I remember them from the mid 90's and their stuff looked hopeful but nothing screamed "mine". Today it looks very interesting. Wildcat looks closer to doing something and getting the money to do it. To be real we need one million. We need to explore to the tune of 500K and we need 500K corporate. That is the reality. Anything less and we cannot list. I would dearly love to do something in mining for less than one million. Cheapest mill/recovery plant I know is 375,00 complete and that will do 25 tons in one day. We can get one for perhaps 500K and fix it for 250K that will do 200 tons/day. Mining equipment ('bulk sample') and permitting will be perhaps 800K minimum, tailing pond or small vein. We see profitability in this, and more importantly, we see raising more money out of it. I don't see one or two man ops as practical or permittable. You have to mill and the smallest mill would cost a tailings pond to permit. There are perhaps 4 to 6 showings to develop ore on. Some could be partially or starter open pit. EC<:-}

To: TheSlowLane who wrote (4348)	3/21/2003 5:02:50 PM
From: E. Charters	Read Replies (1) \| Respond to of 8273

Canico, except for the fact that it is practically a subsidiary of Inco (18% ownerhsip and two board seats) is not that jokeiferous. They are in Brazil, which is not well known for being able to operate smoothly or get one's money out. Nationalization is still a problem there, as is corruption and a bad rate of exchange ratio. Repatriation of capital laws are not that favourable. If it were all smooth sailing Inco would be doing it themselves, as the resource itself is fairly good. The company is formed from the group that did the Bulyanhulu in Tanzania, a hand-off to Barrick. It looks like low-risk exploration development for Inco is the key here. Inco basically did the same thing with Fort Knox Gold Res., now FNX mining. i.e. Explore and develop with other people's dollars, and when the going looks good, take it over. Pay for the success, not the failure. For this they do not want too high a share price. This has already been hacked out with the Canico-Sutton people, who are cash rich and hence not too greedy. Here is what is known about the property. Remember that it is a laterite which is cheap mining, but low recovery and more expensive smelting. Inco has been pulling back from laterites for 2 decades, as sulphides once the pollution abatement is solved, is less expensive to deal with and better recovery. The whole offshore laterite thing in the 70's was entered to offset governments hostile to mining back home. Laterite recovery is not that much cheaper despite the lower mining cost. Basically the Canadian government under Trudeau chased Inco into Latin America and Asia. On the other hand, Inco was not too wise in the way they tackeled on of the bugbears, pollution. They chose the hard route instead of the easy. The final bugbear was taxation. It was all designed to sunset the mining industry faster than it would naturally. The government thinking was to clean Canadian industry gradually in order to take the production towards "clean" service, that was so much easier to tax, and in the government lawyers' eyes, so much more self sustaining. The method was to kill off the financing conduits, tax some of the mines out of business, take over the necessary ones that had huge resources, and try to poison people's minds who had a yen for this investment. The future, as the politicians saw it, was pure high technology. It was idealism and that was part of the way it was sold in front, on the QT, but was it honest? Or right thinking? Does high tech grow by itself in a vacuum? Is it necessary to form industrial policy to the detriment of what appears to be a natural advantage? Or was all the rhetoric just an excuse to rob Peter and pay Pierre? Inco in retaliation took much of their business offshore to lower the takeover/shutdown risk, and avoid taxation. Hence the lateritic operations in Guatemala etc. The effect this had was to increase the competition in these areas where they had not had competition before, as they could not get all the ground and others could imitate their success. So in the end it worked agains their virtual control of the nickel market. The deposits are near surface and located beneath shallow hilltops partly used for cattle grazing. Watts, Griffis, and McOuat, consulting engineers, reviewed earlier data and confirmed an inferred resource of approximately 42 million tonnes grading about 2.3% nickel and 0.09% cobalt using a 1.5% nickel cut-off grade. Approximately 31 million tonnes of this resource was deemed available outside of an indigeneous reserve and of this, approximately 10 million tonnes at 2.5% nickel was attributed to the Puma West deposit. In a January 20, 2003 news release, Canico reported the receipt of a new inferred nickel resource for Puma West of 33 million tonnes at 2.2% nickel using a 1.5% nickel cutoff. This new resource includes the information from 220 new diamond drill holes. Total inferred resources for the two projects has now grown to about 53 million tonnes at 2.2% nickel and 0.08% cobalt which total includes the old Onça estimate of about 22.6 million tonnes at 2.1% nickel. Drilling is now underway at Onça to test for additional nickel laterite resources for a new resource calculation. EC<:-}