Douglas Lake Minerals Inc DLKM

A few thoughts for today.

[tobinator01]

I was pleased to see the 0.019 g/ton conversation  go away with this release.  Dcrain leveled the accusation that management cherry picked the samples, which can be valid for any company who releases results.  I reviewed the results on their website and for me I find it highly unlikely that the results presented today were cherry picked. 

Douglas basically took the concentrate and scooped out a portion to be assayed.  They did this so they could get a preliminary look at some of the other metal concentrations such as platinum, thorium and uranium.  My understanding is that to ship and assay the total amount of concentrate would be very expensive, hence a smaller portion was taken.  The remainder of the concentrate is to be fire assayed by Tanzminex to prove up a resource.

The results on the website show a dozen or more dry holes with no gold mineralization.  There are some big samples in the 12 - 18 g per cu meter with many others in between.  We can think of the average for all the holes of 1.6 per cu meter as being 1 g/ton or 1 part per million (ppm) gold.  Most of the weight in concentrate was on the order of 1 - 5 milli-grams gold.  This type of mineralization, IMO, requires magnification or a microscope to see the flakes.  If we are to assume they cherry picked samples, then they would have had to take each sample concentrate, go through the entire lot to find a few gold flakes, then scooping out that portion to get assayed.  For all the vast quantity of research I have done on this company and numerous conversations with the players, the results presented are consistent with my view of the property.  Therefore, cherry picked samples do not even come to my mind today and if done, would have taken considerable time and energy to perform.

Now we have these rumors that Barrick is to come knocking on our door for $5 per share.  Folks, let's not get worked up about this.  For one, majors simply hate alluvial deposits.  They do extensive research on the properties they buy and almost exclusively require 43-101 estimates with multi-million ounce measured and indicated gold resources.  I for one place the probability of a major or even intermediate gold producer making an offer over the next year at maybe one in ten thousand.  IMO, such talk of a take over this early on is actually damaging to the stock as serious investors become turned off as another exploration pump and dump scam.  You will not hearing me add my voice to any such speculation other than I think it is just plain silly.

I received a call today from Harp.  He is in Tanzania with a large Chinese contingent and says he will be there for another week.  Harp said he hoped I liked the results (which I did).  As board members will recall, I asked him to have a CC upon the Round #2 results.  Harp reaffirmed that he will have a CC and intends on having it the week of February 23rd.  Implied with this is we should be seeing Round #2 results sometime next week.

Today's stock price action was a welcome sight.  I think this is the first time since June that the stock actually went higher after a news release.  There was strong volume going into the close; a positive technical development.  We will continue to see over-head selling resistance from stale longs all the way up to $0.70.  I don't think we will see a sudden 20 cent burst in a day from today's press release but hopefully solid, quiet accumulation.  One would think that most quick buck investors and those with weak constitutions are long gone.  Now we need new longs to take this thing up.  IMO, we need a strong stock price in the coming months so that Douglas can raise the capital it needs to get Mkuvia into production.

There's been some discussion of take over versus organic mine growth.  As I stated earlier, at the moment there is essentially zero chance of a take over.  One postive thing going for us is that the TIGMR consortium has roughly 25% of the shares and insiders probably comprise of better than 20% (including options).  It will be very difficult to get those players to sell out on the cheap, knowing what kind of blue sky potential the property has.  What would be best, IMO, is for the company to organically grow slowly using cash flow from mining operations to increase the size of production.  Producers fetch much higher valuations than explorers on a market cap to resource per ounce basis.  What remains to be seen is proving up the resource ounces into hard, quantifiable scientific numbers to convince a buyer that the company is worthy to be bought.

[w256mgr]

another incredible post Toby but I am still hearing the rumors and barrick is not far away they know the area

[baconmaker]

Hey TobinatorI understand that they are working on a 43-101 for the April / May timeframe. OK, so maybe June/July since everything takes longer in Africa. That should provide a more definitive understanding of the scope and potential of the property.Just makin the baconBaconmaker

[w256mgr]

Right around the time they should get their mineral license all makes sense to me