Vanadian Energy Corp V.VEC.H

positives and negatives

[seanyboy]

Positives for URC:

1.  Financing complete, terms reasonable.  These flow through shares are a major tax deduction, and many juniors desperate for cash get raped on these things.  Often they are done below market plus the half warrant. This was above, and the difference was not all that far from the value of the warrants. 

2.  U price continues upwards, and continued talk of supply problems going forward.

3.  Russia makes it clear that further disarmament is not going to happen.

4.  M&A in uranium heating up.

Negatives:

1.  The drill results were terrible.  At best a couple of holes worth following up on, and then at best we're talking a minor satellite pit.

2.  Apparently there is no other strategy other than to continue to drill, regardless of the quality of the targets.  They could sit on the newly raised cash and mothball the properties - that would be my vote.  Otherwise they could at least do infill drilling to further prove up the resource they have.  Every indication is that Sedin will piddle away the new capital as an excuse to pay himself.

3.  Macro picture sees commodities pushing the envelope beyond which the global economy ceases to function.  Major defaults looming.  A dangerous time to be in commodities.


My advice remains the same - wait to buy into the next panic.  Research a basket of U juniors.  I already mentioned Bannerman, another that's on my radar now is Continental Precious Metals.  A billion pounds of U, moly and rare earth credits, trading at a market cap of less than double Uracan's 40 million pounds (less than 5% of Continental's resource.)