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Discovery Ventures (V.DVN) up on option agreement: Canadian market movers

Elizabeth Walters Elizabeth Walters, Stockhouse
0 Comments| November 6, 2013

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Here are the most active stocks on Wednesday mid-morning on the TSX and TSX Venture Exchange.

On Wednesday, the top TSX mover was Encana Corp. (TSX: T.ECA, Stock Forum) The stock was gained 0.7% and was trading at $19.35 on volume of 3.6 million.

On November 5, the energy producer announced a bold strategy to put the company back on track. The key points of the strategy include focusing its capital investment on five oil and liquids-rich resource plays in North America and lowering the company's dividend, while maintaining financial discipline and a strong balance sheet. With this strategy, the company believes it can average a more than 10% compound annual growth rate in cash flow per share through 2017.

Bombardier Inc. (TSX: T.BBD.B, Stock Forum) was the second most active stock on the TSX. It gained 1.6% and was trading at $4.60 on volume of 3.2 million shares.

On November 4, the transportation equipment manufacturer announced the appointment of Éric Martel as President, Bombardier Business Aircraft. Martel succeeds Steve Ridolfi, who last week was appointed Senior Vice President, Strategy and Mergers and Acquisitions, Bombardier Inc. "Over the course of Éric's tenure at Bombardier, he has held numerous positions with increasing responsibilities, including President, Bombardier Customer Services & Specialized and Amphibious Aircraft since 2011,” said Guy C. Hachey, President and Chief Operating Officer, Bombardier Aerospace. “Éric comes to this new position with a proven and very successful track record."

Discovery Ventures Inc. (TSX: V.DVN, Stock Forum) was the volume leader on the TSX Venture Exchange. It rose 4.4% and was trading at $0.24 on volume of 6.5 million.

Today, the natural resources company jointly announced with Roca Mines Inc. (TSX: V.ROK, Stock Forum) they have entered into a binding letter agreement dated Nov. 4, 2013 with each other and FortyTwo Metals Inc., a subsidiary of Roca, whereby Roca granted an exclusive option to Discovery to acquire all of the issued and outstanding common shares of FortyTwo.

FortyTwo holds, among other assets, the Max mine which includes an underground molybdenum mine, crushing, milling and concentrating facilities, tailings storage facilities, mineral claims, mining leases, licenses and other holdings located near Trout Lake in the Revelstoke mining division of the Province of British Columbia. The Max mine is located approximately 135 kilometres from Discovery's Willa project and is a formerly producing molybdenum mine that operated from 2007 until November 2011 when depressed metal prices led to its closure.

Discovery may exercise the option and acquire all of the shares of FortyTwo for a total purchase price of $5.675 million, consisting of cash payments of $5.05 million and the issuance of 2.5 million shares of Discovery at a deemed price of $0.25 per share.

The second most active stock on the TSX Venture was WesternZagros Resources Ltd. (TSX: V.WZR, Stock Forum). It slipped 5.8% and was trading at $0.81 after 2.3 million shares changed hands.

Today, the oil and gas company announced the completion of testing operations in the Oligocene reservoir of the Kurdamir-3 appraisal well on the Kurdamir oil and gas discovery in the Kurdistan Region of Iraq. Although the testing operations took longer than anticipated due to mechanical difficulties, the results of the third and fourth drill stem tests confirm the presence of light oil, with an oil-water contact at a depth of at least -2,049 metres subsea, which is a minimum of 33 metres deeper than the lowest known oil at -2,016 metres from the Kurdamir-2 well. The results continue to confirm the scale of the Kurdamir oil discovery.

Following the testing of Kurdamir-2, the company's independent resource evaluators confirmed that the Kurdamir Oligocene reservoir holds a mean estimate of 390 million barrels of gross unrisked contingent resources of oil, and an additional 327 million barrels of oil equivalent of gross unrisked contingent resources of gas and condensate. Although the company has yet to present the latest findings to its independent resource evaluators, internal evaluations support that the most likely outcome will result in no material change to the current contingent resource estimates.


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