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9/17/11

"I feel like I'm dying from mining for gold"

The wonderful Ten Percent put up this video on his blog last night to pay tribute to the four dead coal miners from Swansea, Wales, who died in an underground accident this week.



Your humble scribe picks it up, runs with it and highlights the Peru MEM page with the 38 names of those who have died in mining accidents in Peru so far this year:


Add these people to the roll call of the 66 dead in 2010, the 56 dead in 2009, the 64 dead in 2008, the 62 dead in 2007, the 65 dead in 2006, the 69 dead in 2005...and we could continue.

There's no moral to this story, just a request for readership perspective, as anyone who can afford the machine they're using to read a blog like this isn't doing all that badly. And the song is just beautiful, too.

Ritholtz: There Are No Rogue Traders, Only Rogue Banks

Barry Ritholtz is smart enough to be able to explain his complex sector of business in a plain-speaking way that the layperson can easily grasp. That takes talent and here's a great example today: In the light of the UBS rogue trader (kept it under wraps for three years!!??!!??...that's a big WTF in itself), Ritholtz pens "There Are No Rogue Traders, Only Rogue Banks" and you'd do well to read.

9/16/11

The Friday OT: Velvet Revolver; Fall to pieces

Slash plays the guitar, we rock out.


Velvet Revolver's best track, as requested by reader and main man SG.

Fortuna Silver (FVI.to) (FSM), a link and an owl

Here's the link to yesterday's post on FVI, before the bell, that noted the positives that'll come from the US listing (starts Monday).

Here's the chart since then:


Here's an owl

But hey, maybe 7.7% up in a day and a half isn't your idea of a good trade. DYODD, dude.

UPDATE: I'm sorry, did I say 7.7% up....?

Iron Creek Capital (IRN.v): Interesting

By way of disclosure, I own a few of these in a long term timeframe and I'm not about to sell them on any short-term pop, either. The company is in Chile looking for elephants in elephant country and it's the kind of play you need to give its due time. Explorers shall explore, don't bug them while they're concentrating hard.

Anyway, here's the interesting thing:

Iron Creek Capital Corp. (IRN)

As of September 15th, 2011
Filing Date Transaction Date Insider Name Ownership Type Securities Nature of transaction # or value acquired or disposed of Unit Price
Sep 15/11 Sep 14/11 Beale, Timothy J. Direct Ownership Common Shares 10 - Acquisition in the public market 180,000 $0.480

I've spoken to this Beale dude too and he's smart.  Something cooking?


Update: Reader RL is smarter than your humble scribe and sends this in:
Hello Otto,
 
I think the stock received by Timothy Beal were bonus shares issued by the company rather than
outright purchases on the open market.
 

Iron Creek Capital 500,000 bonus shares

2011-09-14 13:56 PT - Miscellaneous

The TSX Venture Exchange has accepted for filing the company's proposal to issue 500,000 bonus shares to insider Timothy Beale in consideration of services rendered for the company. Shares will be released on the following schedule:
  • Upon exchange approval, 100,000;
  • July 1, 2011, 80,000;
  • Jan. 1, 2012, 80,000;
  • July 2, 2012, 80,000;
  • Jan. 1, 2013, 80,000;
  • July 1, 2013, 80,000.
Shares are subject to a four-month hold period. If Mr. Beale ceases to be employed by the company prior to the issuance of all the shares, the company will issue a pro rated number of shares based on the next instalment due to him, based on his date of cessation.

Chart of the day is....

...GLD versus SLV versus GDX versus GDXJ, 10 day chart:


A bit of a sinkage for sure, but it has to be said that the stocks have done ok compared to their metals.

9/15/11

Brent Cook on Market Call

Here's the link, go watch it yourself.

Continental Gold (CNL.to) comes out with its resource

1) Here's how we kicked off this post dated 25th July on Continental Gold

"With decently sourced jungledrum rumours and heresay and whispers and all that jazz saying the Continental Gold (CNL.to) is about to release a 43-101 resource count for its Buritica project in Colombia of three million ounces of contained gold...."

2) Here's the link to the CNL.to NR of today which states that the Buritica property has an all-categories (M+I+I) 43-101 compliant resource of 3.13m oz gold.

3) Funny dat, innit? So $250/oz in-situ it is, Ari. DYODD, dude.

Mercer Gold (MRGP.ob) and Rahim Jivraj

Check out the suit Mercer Gold (MRGP.ob) just slapped on Rahim Jivraj's tush right here. Two wrongs do not make a right, by the way.

Fulp talks U

right here

Something we know about Great Panther Silver (GPR.to) (GPL)...

...is that the top management there really don't like that this humble corner of cyberspace talk about their insider share shares (and people, we got the emails to prove that). But honestly, I don't understand why that should be. I mean, shouldn't they really be proud of those sales? Take for example Robert Archer and the way he's cashed in 298,800 shares this last week or so and banked himself one.....million....dollars. It's pretty clear that he's not paid enough at the company and is deserving of the cash that comes from dumping a shitload of shares on helpless retail saps, no? After all, he's only due to be paid $500,000 cash by GPR.to in 2011 and who can scrape by on that kind of pittance these days?

So c'mon GPR dudes, turn over a new leaf! Shout out those heavy insider share dumpages so that the world can hear them and be happy that you can take advantage of this wonderful thing called capitalism.You know it makes sense.

Quiztime

Here we go with a few questions for this esteemed audience to ponder:

1) Is the Pope Catholic?
2) Will the sun rise in the East or West tomorrow morning?
3) Will the listing of Fortuna Silver (FVI.to) (FSM) on the New York Stock Exchange be beneficial to the company's share price?
4) Do bears tend to defecate in areas of large tree coverage?

Answers on a postcard please to:

Otto Rock
Behind the bike sheds with a crafty ciggie
Al ber quer kay (right turn)

Chart of the day is...

...of Rio Alto Mining (RIO.v):


Interestingly, its 52 week low is September 14th 2010 and its 52 week high is 14th September 2011.

Update: Would you like to read Ian Parkinson of CIBC on RIO.v and the rationale behind his new $4.80 target? Ok, click here.

9/14/11

TV stars

Look who's hanging at BNN tomorrow, Thursday 15th September:

1) Mickey Fulp is appearing on Andrew Bell's show tomorrow morning,  where he's scheduled to talk uranium (betcha HAT.to gets a mention). Check listing for the exact time.

2) Brent Cook has a full hour to annoy some company CEO or other on BNN's excellent Market Call format later that day. If I were you I'd ring or mail in with in with your question for the bearded one immediately.

Do yourself a favour and watch both segments, because listening to people who actually know about rocks is far more profitable than listening to the market charlatans who can only pretend they know.

Chart of the day is...

..Silvercorp (SVM) (SVM.to) ten day chart.

Splat!

Subscribers: You'll get a Flash update that mentions the action in this stock in a few minutes. Enjoy the rest of your day, people.

Update: RayJames defends SVM, link here.

Update 2: We understand that SVM will issue "a full rebuttal" (source quote) later this morning. This heard from two places now.

Update 3: Two developments: Firstly, SVM came out with its rebuttal this morning and you've probably already rad that, but it's here. Secondly, this is the website of the original anonymous short sellers. Here's how they start their presentation:

September 14, 2011


Our Questions About Silvercorp. (NYSE: SVM, TSX: SVM CN)

Situation Background
On August 29, 2011, we anonymously sent a letter to a number of parties including Ernst & Young (Silvercorp’s auditor) and the Ontario Securities Commission. We indicated that we planned to post some of our research on Silvercorp on the Internet and we included a preliminary copy of our research with that letter. On September 2, 2011, before we had posted any research, Silvercorp announced publicly that it had received a copy of our letter from Ernst & Young. Silvercorp published a press release in which it stated its response to certain of the matters raised in our letter and made reference to certain documents. In the release Silvercorp stated that a special committee of its board of directors has been established. We reviewed Silvercorp’s response, updated our analysis further, and are now posting our revised analysis on the Internet. On September 9, 2011, the media reported that the British Columbia Securities Commission had been made aware of our research and was “examining both the nature of the complaint and the allegations contained in [our] letter.” We have sent a copy of this Internet posting to the British Columbia Securities Commission, the Ontario Securities Commission, Ernst & Young and Silvercorp’s independent directors.



Update 4: Here's the BMO take on today's developments, as per Andrew Kaip (who called the first downmove a buy last week and did well by it).

Disclosure: As subscribers already know I'm long a very small amount of SVM and will hold them for the time being.

9/13/11

What Scotia thinks of Hathor (HAT.to)

Right here below, and FWIW  Scotia is calling it right imho (disclosure: your humble scribe is long HAT, smallish trading position)

Preliminary Assessment of HAT’s Roughrider – High Grade + Low Capex = Very Attractive Economics even Before Including the Far East Zone:  This morning, Hathor Exploration (HAT-CN, not covered) released the much anticipated Preliminary Assessment for its Roughrider Uranium Project in the eastern Athabasca Basin of Saskatchewan.  Scotia Mining Sales is eager to see the full study (to be posted on SEDAR within 45 days) but the summary of the results is very encouraging in terms of both the forecasted capital costs (only $468mm pre-production, including $172mm for Processing Facilities and a 25% contingency).  Also, operating costs are very attractive at an estimated $14.44/lb U3O8 which compares very favourably to Cameco’s Athabasca operations and projects (i.e. $23.14/lb U3O8 at Cigar Lake and $19.69/lb at McArthur River ).  The low costs are due to a) the proximity to existing infrastructure, b) the high grade nature of the deposit, which minimizes the mining rate and mill throughput.  Both of these are features that contribute to making the Athabasca Basin the world’s most important uranium producing jurisdiction.  Looking at the reported project economics, Scotia Mining Sales thinks the $60/lb U3O8 case is the most appropriate, which produces a pre-tax NPV7% of $769mm discounted back to the start of construction (or 32% IRR and 1.6 year pay back).  It is important to note that this analysis does not include the Far East Zone which has yet to be included in the resource estimate (but which Scotia Mining Sales thinks adds 13-17mm lbs to the current ~58mm lbs resource).  Scotia Mining Sales assumes a roughly 4 year permitting process with production beginning in 2020 after a 4 year construction period.  Discounting all the way back to beginning of 2012, Scotia Mining Sales estimates a pre-tax NPV7% of ~$570mm, or roughly $4.50/HAT share, and suggesting significant upside beyond CCO’s current $3.75/sh bid for HAT.  Including the Far East Zone in the resource boost Scotia Mining Sales’ 2012 NPV7% to $731mm or $5.85/HAT share.  Conference call to discuss the PA is scheduled for 1pm EDT today: 1-877-353-9586.  http://www.hathor.ca/s/NewsReleases.asp?ReportID=478741

A Flash update...

...has just been sent to subscribers, right at the opening bell on this beautiful and sunny Tuesday morning*.

Please be having nice day yes thank you yes.

*well, round this way at least

Mining PRs and the Ottotrans™, Part 45


Today's foray into the wild world of the junior mining news release turns its attention to Exeter Resources (XRC.to) (XRA) and this finely worded missive emitted by the company this very morning.

This is what they wrote:
Press Release Source: Exeter Resource Corporation On Tuesday September 13, 2011, 6:30 am EDT
VANCOUVER, BRITISH COLUMBIA--(Marketwire -09/13/11)- Exeter Resource Corporation (TSX: XRC.TO - News) (AMEX: XRA - News) (Frankfurt: EXB.F - News) ("Exeter" or the "Company") is pleased to report that the Chilean government has granted the Company a 10,726 hectare water exploration concession. The concession provides a second potential water source for the Caspiche gold-copper project. The concession is located approximately 100 kilometres (60 miles) north of Caspiche, at an elevation of 4,700 metres above sea level.
The aquifer is within the same high altitude region of the Andes where other mining companies hold granted water rights. The source of the water is seasonal snowmelt trapped by volcanic barriers and which is considered unlikely to make its way to the coastal plains. Water harvesting from such a basin would not be considered to have a negative impact on present and future supplies relied upon by coastal communities.
The Company expects to initiate a water exploration program comprising field mapping, geophysics, drilling and pump testing during Q4 2011, weather permitting.
Applications for two additional water exploration concessions in the area are still being processed by the relevant government authorities. Following approval, exploration programs will be extended to cover these concessions.
A mine at Caspiche is estimated to require less than 100 litres/second for the initial heap leach gold phase of the mine, rising to as much as 1,000 litres/second for a full scale sulfide mining operation.
In addition to the water exploration rights reported in this release, on February 8, 2011 (http://exeterresource.com/pdf/2011_news/Exeter_news_110208.pdf) Exeter reported an option over water rights of 300 litres/second from local owners. The seasonal thaw in October will allow us to continue with the baseline water flow program covering these water rights started earlier this year.
Exeter has retained specialist consultants to develop a water balance in the area with the objective of demonstrating that the use of these water rights for a mine at Caspiche will be sustainable over the project life. This will provide a technical basis for an application to the relevant authorities for permission to proceed with the installation of the necessary pumping and delivery infrastructure.
Exeter is continuing to study the availability of water in the region and to negotiate with other parties for the purchase or rental of water rights. The Company and its consultants are taking a constructive approach to Caspiche's water needs and the overall sustainability of the water resources needed by the mining industry.
In addition, the Company is pleased to report that the Pre-feasibility Study for the Caspiche Project, including in-pit crushing and conveying of waste rock remains on schedule for completion before the end of 2011.
About Exeter 
 And this is what it means:

We got no water

Chart of the day is...

...The Euro, dailies.

When you say "the dollar is strengthening", all you're saying is that the dollar is performing relatively better than the lump of crap that comprises a full 57.6% of the index you use to measure it.

Telling me "the dollar is strong these days" is like telling me a six year old kid is fast cos he beat a four year old kid over 50 metres.

9/12/11

Mexico industrial activity

This chart, taken from this new Sep 12th dataset out of Mexico's INEGI stats people, shows the development of five key industrial sectors to Mexico's economy since 2009. The lines show the year-over-year percentage change in electricity (generation/transmission etc), hydrocarbons production (oil + gas), mining (metallic and non-metallic, plus ancillary industries around mining),  Construction (both residential type and civil engineering type) and manufacturing:


In a nutshell, mining and oil are lagging, meanwhile Mexico is building itself up nicely above ground. It also shows that the record prices being fetched at market for metals is the real reason for the flashy growth numbers we see in dollar terms, not any extra mining work being done.

Worried about the markets?

Concerned about the Eurozone?
Fretting over the dollar?
Having kittens about the price of silver?
Gnashing fingernails because of that out-the-money call you bought last week?

If so, Chopper has some advice for you. Listen carefully and comply.


Thanks due to reader M for the original headsup on this.

Chart of the day is...

...copper, dailies.

So in the last two trading days, copper has moved from $4.13 to 3.93/lb. Not so good, longs.

UPDATE (after breakfast): Oops, make that 3.91

9/11/11

The IKN Weekly, out now


IKN123 has just been sent to subscribers. The usual load of rotten tosh and blathering about stocks going to da moon, Alice.

On a day like today...

...it's worth reflecting on things like this, a link kindly sent into your humble scribe by reader 'B':


I really don't have the words for this, not today.

10 years

click to enlarge