Update on Current Holdings

Canadian Shield Resources (CSP.v)

Shares outstanding: 48,906,067
Shares fully diluted: 55,052,433
52 week high: $0.41
52 week low: $0.095
Purchase price: $0.18

Here's a company I have recently bought into after noticing that an insider purchased 100,000 shares in the open market. The company's main focus is silver mining in Peru, where the latest results dated November 23, 2007 showed grades of up to 99.1 g/t over 107 meters at the company's La Estralla property. These are phenomenal interceptions that initially sent the stock up 78% in one day. Since then, however, the stock price has returned to its starting point around $0.18 and presents us with another great buying opportunity.

The company hopes to expand these high grades during its Phase II drilling which is set to start in January 2008 and I believe that similar results could propel the stock even higher than before. Another encouraging factor to consider is that on December 18, 2007, the company closed a private placement at $0.30, which represents a significant premium to the market price.

Finally, the management team is experienced and has a proven track record of success. For example, Interim CEO Bernard Kraft is a long-time director of Agnico Eagle Mines, which is a multi-billion dollar company.

On the technical side, it would appear that the stock price has leveled off between $0.175 and $0.20 and currently has very limited downside.

Indicator Minerals Inc. (IME.v)

Shares outstanding: 59,941,702
Shares fully diluted: 77,685,963
52 week high: $0.90
52 week low: $0.165
Purchase price: $0.26

Indicator is the first diamond exploration company I have invested in, and I was mainly drawn to them because of the partnership agreements they have entered into over the last few years. For example, mining giant Teck Cominco has optioned the company's Darby project in Nunavut and can earn a 51% interest by spending $14 million over four years. Teck is therefore incurring the bulk of the exploration costs while Indicator is free to concentrate on its other projects. What a great situation to be in!

Here is an excerpt from the company's latest news release, dated November 23, 2007:

"We have firmly established that there is a field of diamond bearing kimberlites on the Darby Project," says Indicator President and CEO Bruce Counts. "Large kimberlites have been identified and the chemistry of the indicator minerals recovered from till samples suggest that there may be significantly diamondiferous bodies yet to be discovered on the property. To date, 9 kimberlites have been drill confirmed on the Darby Project and the work completed by Teck Cominco this year has placed the partners in an excellent position to continue the process of discovery in 2008."

Although I did not manage to enter at the very bottom of the trend, I am very satisfied with my average price of $0.26. Since mid-December, the stock has nearly doubled on higher than average volume, but it is still a long ways off its high of 2007. I am not expecting any substantial news in the near term and may decide to swing trade if the opportunity presents itself.

Kinbauri Gold Corp. (KNB.v)

Shares outstanding: 43,538,320
Shares fully diluted: 67,086,236
52 week high: $1.00
52 week low: $0.36
Purchase price: $0.45

Kinbauri never seems to let me down. I have been in and out of this stock numerous times over the years and have always made money. I have recently bought back in at $0.43 and $0.47 and the stock is already starting to climb. In the past week, M Partners (House 97) has been buying virtually everything available and it is my understanding that they have set a price target of $1.50.

The company is continuing to expand its resources and hopes to complete a 20,000m drilling program at El Valle/Carles between now and July. In addition, bids are being received to complete a scoping study by May 2008 and a feasibility study by November 2008. By the looks of things, Kinbauri is on schedule to re-open the El Valle mine in 2009 and reach full production of 145,000 ounces of gold by 2010.

To see the most recent corporate presentation, click here.

I'm Alive!

Yes, I'm still here. I haven't been paying much attention to my investments over the summer since I was extremely busy writing the Bar exams, but I now feel like I can get back into the thick of it.

For whatever reason, yesterday I decided to check up on my stocks and saw that Temex Resources (TME.v) had shot up over 34%. Today, the climb continued and the share price fluctuated between $0.55 and $0.69 before closing at $0.60 - a 9% gain. I managed to sell a little over half my position at $0.60. One thing is for sure: I did not want to miss out on yet another run-up like the one we had in June.

That's it for now.

Kinbauri Making Progress

On April 2nd, Kinbauri Gold Corp. (KNB.v) announced that it had completed the purchase of the El Valle and Carles Mines, the El Valle mill and auxiliary facilities, and two new properties in Spain. As a result, the company is much closer to becoming a gold producer, with operations possibly starting in as little as 18 months. In order to pay for these assets, a major financing is underway with the company planning to raise a total of $13,500,000. To date, a total of $12,719,000 has been raised through the issuance of 25,438,000 receipts at a price of $0.50 per receipt (each receipt is comprised of one common share and one-half warrant exercisable at $0.70). Once the entire financing is complete, a total of 27,000,000 receipts will have been issued, meaning the company will have in the neighbourhood of 52,000,000 common shares fully diluted.

With regards to this financing, Buffalo Gold Ltd. (BUF.u, http://www.buffalogold.ca) announced on April 5th that it was expanding its gold assets through a strategic CAD$5,500,000 investment in Kinbauri, meaning they have subscribed to 11,000,000 of the receipts. Buffalo will hold approximately 28% of the company upon approval of the financing.

There is little doubt that a financing of this magnitude was necessary for the company to execute its plan of action, and the funds are most definitely being put to good use. Also, even with this major financing, the stock has not been unreasonably diluted, and the added liquidity will make the stock much easier to trade.

On the exploration front, a 13,000m drill program is scheduled to begin in April and is going to focus on Area 107 and Black Skarn North at El Valle. Inferred resources of 304,116 ounces of gold (835,834t, average grade 10.73 g/t) and 81,422 ounces of gold (506,668t, average grade 5 g/t) respectively have been previously reported at those sites.

At Corcoesto, a trenching and drilling program that was initiated to increase shallow open-pittable resources by 25% to 35% (less than 100,000 ounces of gold) and raise the cutoff grade to 1.75 g Au/t is supposed to be completed in early 2007. The company notes that so far "results from drilling on the Picotos vein systems show continuity and gold grades indicative of a significant increase in open-pittable resources."

(click image to enlarge)

The stock has been responding rather favourably to the progress being made, and volume has been well above average this past week. On April 5th, a new 52-week high was hit as the stock briefly touched $0.90 before closing at $0.85.

(click image to enlarge)

Someone trading out of house 046 (Blackmont Capital Inc.) has been doing the bulk of the buying, so I would expect the price to remain at this level until this person has finished establishing their position. Looking forward, solid results from drilling at Corcoesto and El Valle could drive the price up another level (to the $1.15 range) in the short to mid-term, but ultimately I would expect the stock to be suppressed once the newly issued shares become free trading in 4 months time. However, I would be very surprised if we saw the share price below $0.50 again. My sell target will be adjusted once results start coming out.

For a complete update on the company's projects, here is a link to a recent interview with CEO Dr. Vern Rampton:
http://easylink.playstream.com/stockhouse/kinbauri_022807.wax (open this URL in Windows Media Player).

Please do your own due diligence, these are not recommendations.

Bought TME.v and FUR.v

This week's correction has presented us with a good opportunity for bottom-fishing. My stink bid for Temex Resources (TME.v) was filled today, and my bid for Fury Explorations (FUR.v) was partially filled yesterday. Here is some information on both companies:

Temex Resources (TME.v)

Shares o/s: 57,061,462
Shares f/d: 70,453,263
52 week high/low: $0.80/$0.25
Purchase price: $0.38

Temex, a well-funded Canadian exploration company, is focused on advancing its gold, silver and diamond projects in northeastern Ontario. The company is well funded with $4.0 million in the treasury and has no debt.

The latest drilling results from the company's Gowganda property in Ontario were very impressive. Here are the highlights:

4,560 grams per tonne silver over 0.75 metres in hole TGS-06-03
6,066 grams per tonne silver over 0.70 metres in hole TGS-06-04
1,885 grams per tonne silver over 0.30 metres in hole TGS-06-02

Also, the CEO (Ian Campbell) has been accumulating shares at these levels for the past months:

02/19 - Ian Campbell - Acquisition in the public market - 2,500 - $0.49
02/14 - Ian Campbell - Acquisition in the public market - 2,000 - $0.48
02/09 - Ian Campbell - Acquisition in the public market - 4,000 - $0.45
02/09 - Ian Campbell - Acquisition in the public market - 3,000 - $0.44
01/12 - Ian Campbell - Acquisition in the public market - 3,500 - $0.38
01/10 - Ian Campbell - Acquisition in the public market - 2,000 - $0.39
01/08 - Ian Campbell - Acquisition in the public market - 2,000 - $0.405
01/05 - Ian Campbell - Acquisition in the public market - 10,000 - $0.40
01/04 - Ian Campbell - Acquisition in the public market - 11,500 - $0.43
01/04 - Ian Campbell - Acquisition in the public market - 3,000 - $0.41

From a technical standpoint, the chart seems to indicate that we will be bouncing off the existing upwards trendline and should be able to reach the $0.55-$0.60 level before the next short pullback:

(click image to enlarge)

Fury Explorations (FUR.v)

Shares o/s: 25,029,427
Shares f/d: 37,939,244
52 week high/low: $1.45/$0.42
Purchase price: $0.74

Fury Explorations is a mineral exploration and development company strategically positioned to achieve near-term cash flow, while assembling a portfolio of early stage projects with high economic potential.

The company is currently exploring for silver in Nevada and Mexico, and is much closer to production than Temex. In fact, in Nevada the company has recently purchased the Taylor Mill complex, a modern producing mill that can easily be recommissioned. The results from the latest drilling in Nevada were very promising, here are the highlights:

77.9 grams per tonne silver over 105 metres in hole FT-3-C
60.3 grams per tonne silver over 75 metres in hole FT-3-C
104.8 grams per tonne silver over 20 metres in hole FT-4-C
102.5 grams per tonne silver over 39 metres in hole FT-14-C
116 grams per tonne silver over 55 metres in hole FT-19
126.7 grams per tonne silver over 30 metres in hole FT-20

On the technical side, the stock is once again oversold and should bounce off the trendline around the $0.75 mark:

(click image to enlarge)

Aurogin Resources (AUQ.v)

Just a quick note to say that Aurogin is currently halted pending a news release. Rumours are circulating that it may be related to a merger or acquisition involving Morgain Minerals (MGM.v). I will keep you posted as things develop.

Please do your own due diligence, these are not recommendations.

Sold ELO.v

I have exited my position in Eloro Resources (ELO.v) for the following reasons: first of all, the share price has surged over 50% in the past two weeks and has caused the technical indicators to turn bearish, and second of all it is entirely possible that the share price has been purposely inflated in order to close the recent financing that was done at $0.80. That being said, insiders keep buying at these levels, and preliminary results from drilling at the Hurdman property will start to come out in the next few weeks. I am hoping the stock will rebound off its old trend line and present us with a new entry point between $0.65 and $0.70.

(click image to enlarge)

Please do your own due diligence, these are not recommendations.

Interesting Articles

I've been doing a lot of reading over the past few weeks and stumbled across some very interesting and informative articles. For the most part the articles relate to gold mining and exploration, but a few are of general interest. Here are the better ones:

How to Value a Mining Stock by Paul Van Eeden

This article elaborates on the difficulties of properly valuing a mining stock due to the fact that mines eventually deplete. The author does propose some valid methods for putting a price on a company, but concludes that for most people buying mining stocks comes down to blind speculation.

Valuing an Exploration Company by Paul Van Eeden

As a follow-up to the previous article, Van Eeden discusses his method for valuing a company that is still in the exploration phase. Notice the importance that is placed on choosing companies with experienced management.

Junior Mining Stocks: An Investment or Speculation (Gamble)? by Troy Schwensen

This author takes a different approach to investing in junior mining companies. He explains how a company does not need to be successful for you to make money - the important part is noticing the cycles and timing your entry.

The Federal War on Gold by Jacob G. Hornberger

Hornberger's article is a history lesson more than anything else, but it's quite an interesting read.

Cyanide Leaching of Gold on Mine-Engineer.com

It's quite difficult to find an article that explains the process of heap leaching, but this is the best I could find. For a less scientific explanation of the process, consult Wikipedia.

Updated Portfolio

For those who are unaware, my portfolio is regularly updated and can be accessed by clicking on the "My Portfolio" link located on the sidebar.