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Miners digging this Ghana gold rush

Thom Calandra Thom Calandra, www.thomcalandra.com
0 Comments| September 23, 2009

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ACCRA, Ghana – Let’s do the easy part first: Ghana and Burkina Faso – maybe Eritrea for tightrope artists.

These are the nations where miners and bankers in West Africa are placing their chips, or more specifically, diamond and reverse-circulation drills. We’re talking the juniors here.

“I think, speaking for myself, that if you are serious about gold, you have to be in West Africa right now,” Newmont Mining’s Dale Finn tells us on a crystal-clear Accra morning at exploration headquarters. Dale is speaking as an individual and not as a Newmont Mining executive who oversees all of the giant company’s gold exploration choices on the Africa continent.

“Yes, I would call what is happening right now a gold rush,” said Benjamin N.A. Aryeein response to a question.The Ghana Minerals Commission CEO forecast gold output for the small democratic nation will rise 10% this year to about three million ounces. That’s a 6% piece of GDP for the nation of 24 million people.

“For us, this is exciting and daunting,” Mr. Aryee tells me as we look at maps of famous Ghana gold belts and district, among them Ashanti, Esaase, Kibi and Tarkwa. (Please see map photo – Thom Calandra photo.) Mr. Aryee and his Minerals Commission colleagues are opening offices in areas where illegal miners are ravaging alluvial sources of gold. The reason: to convince the so-called galamsay (my spelling) they are better off registering for inexpensive and legal licenses.

So – West Africa. Can it compete with Nevada or Quebec or Mexico in terms of friendly and profitable gold mining? I cannot answer the question for the entire region of the continent, but having been to Ghana before, I can say this: Ghana is a slam-dunk.

Click to enlargeEven huffy BHP Billiton (NYSE: BHP, Stock Forum), the world’s largest overall miner, says West Africa (Ghana, Eritrea, Burkina Faso, Sierra Leone, Ivory Coast and so on) might be an exemption from a five-year cooling off period for Africa investments. When commercial chief Alberto Calderon at BHP came out of his London closet to make that Africa “chill” statement this month, he explained that a BHP with almost $20 billion cash can afford to lower its investment risks for fresh stakes in copper, aluminum, iron ore, gold and oil.

Not so for mid-sized to large gold miners. Newmont (NYSE: NEM, Stock Forum) and AngloGold Ashanti (NYSE: AU, Stock Forum) and Gold Fields of South Africa (NYSE: GFI, Stock Forum) and Barrick (NYSE: ABX, Stock Forum) and Harmony Gold (NYSE: HMY, Stock Forum) ad-infinitum are on the prowl for Africa gold. They all see the commodity’s price rising steadily into year 2015.

There are at least 200 gold miners and prospectors operating in Ghana and another 200 working the back-roads of Burkina Faso, Sierra Leone and politically dicey Eritrea.

“I think the folks who are working their ground for a resource, or extending one, just didn’t show up this year or last year and start pick-axing,” Dan McCoy, Keegan Resources (TSX: T.KGN, Stock Forum) president and CEO and a geologist, tells me as we are hiking up a steep hill in the Esaase District to tour the Keegan property, a potential five million-ounce resource.

Ahead of us are a team of five Ghanian drillers from Australia’s Geodrill, a company that is fast cornering the West Africa market for prompt and eco-smart technological drilling of gold resources – be it diamond, reverse circulation or combinations of the two.

Click to enlargeFor ticker hounds who cannot get to West Africa, here are some of the West Africa company symbols that came up in interviews, research and on-spot property trekking I did on behalf of Ticker Trax subscribers: RVS, VTR, EET, PMV and yes, in Eritrea – a company whose managers, among them John Clarke, I respect enormously: Nevsun Resources (TSX: T.NSU, Stock Forum). They all trade in Canada, one or two in the USA … and they all are drilling or producing gold.

In West Africa, Mr. Finn at Newmont, when I asked him what he looks for most in a property, the 20-plus year veteran of South America, North America and Africa prospecting, said: “We like to see gold. As much as possible.”

Funny … but simple … and true.

“It’s a gong show for sure,” says James Longshore, president of Ghana prospector Xtra Gold Resources (OTC:BB: XTGR, Stock Forum). “I mean, what are we trying to do – find a ton of earth that has two grams of gold in it – or more.” (Please see soil samples from Xtra drilling program at one of its Kibi Gold Belt concessions – photo Thom Calandra.)

Mr. Longshore is the subject of a Ticker Trax profile this week – based on a tour of Ghana these past 10 days. Dr. McCoy of Keegan Resources is also included in that profile.

“It is hard to find a small patch of the world (Ghana is the size of Oregon) that has so many super-extended and producing gold belts,” the 43-year old Owen Wilson look-alike says. “I can’t count how many geologists believe we’ll see continuous mineral structures of five million and 10 million-ounces enter the Ghana books in the next few years.”

That is all for now. I own none of the companies mentioned in this article but I am on record with our swelling band of Ticker Trax subscribers as intending to purchase one of the company’s shares later this week in the open market. I do not participate in private placements these days, and I always give Ticker Traxsters at least three or four days to purchase shares when naming one of our (now nine) Planetary Prospects.

(Please see:Thom Calandra’s Stockhouse articles.)

Toronto’s Cambridge House: Joe Martin and Howard Fitch’s investment conference for junior miners is this coming weekend. I’ll be there with my contribution: “My Own District 9: H1N1, Silver and Moly.” Please visit www.cambridgehouse.com. It’s free if you enlist today. (Or visit the banners above and below.) I’ll also be at the Stockhouse booth with a pleasant surprise and an idea. A workshop too: any question taken. I also look forward to meeting six or seven miners and their respective geo-teams at the conference – including ECU Silver (TSX: T.ECU, Stock Forum), Avalon Rare Metals (TSX: T.AVL, Stock Forum) and a large owner of the promising gold property I saw on the Kibi Gold Belt in Ghana. Plus: I will have face time with James Turk, Doug Casey, Danielle Park, David Skarica and Lawrence Roulston.

The New Orleans Investment Conference: Not to attend is unthinkable – if you can spare the time and the fees. Click on here for a discount: The New Orleans Investment Conference. I’ll be presenting a down-and-dirty workshop, participating in a panel with Rick Rule and doing a keynote on the aforementioned “My Own District 9: H1N1, Silver and Moly” at this year’s gathering. Brien Lundin of The Gold Newsletter produces the conference, whichruns Oct. 8-11. This year will bring an excellent crop of counter-clockwise and contrary thinkers in the areas of mining, emerging markets, commodities and life sciences, including Great Panther’s (TSX: T.GPR, Stock Forum) Robert Archer, Avalon’s Don Bubar and X-Tra Gold’s James Longshore. Mr. Lundin just told me they added Ron Paul – now who is he again? If you are interested in a discounted rate, please visit this link for registration.

Ticker Trax™
Please see tickertrax.comto learn more about this wealth service and its 8, no, 9 Planetary Prospects. Subscribers, please click here for password-secure Ticker Trax.

HOLDINGS: Thom’s holdings are listed for all Stockhouse members on www.Stockhouse.com under the “portfolio setting” for user TCALANDRA. It is public and free to view. He and his family own recently minted gold and silver coins and shares of a number of public and two private companies.

THOM CALANDRA of Ticker Traxhelps his audience find value in a quagmire of investment choices. Thom co-founded CBS MarketWatch andMarketWatch.com. As the voice of Thom Calandra's StockWatch and The Calandra Report, Thom pegged $300-ounce gold as a long-term hold.

Ticker Trax is published by Stockgroup Media Inc. Ticker Trax is an information service for subscribers and neither Stockhouse nor Thom Calandra is a broker or an investment advisor. None of the information contained therein constitutes a recommendation by Mr. Calandra or Stockhouse/Stockgroup Media that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. Ticker Trax does not purport to tell or suggest the investment securities subscribers or readers should buy or sell for themselves. Subscribers and readers of Ticker Trax should conduct their own research and due diligence and obtain professional advice before making any investment decisions. Ticker Trax will not be liable for any loss or damage caused by a reader’s reliance on information obtained in the reports. Subscribers and readers are solely responsible for their own investment decisions. Opinions expressed in Ticker Trax are based on sources believed to be reliable and are written in good faith, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. All information contained in Ticker Trax should be independently verified. The editor and publisher are not responsible for errors or omissions or responsible for keeping information up to date or for correcting any past information. Ticker Trax does not receive compensation of any kind from any companies that may be mentioned in the report. Any opinions expressed are subject to change without notice. Owners, employees and writers may hold positions in the securities that are discussed in Ticker Trax. PLEASE DO NOT EMAIL THOM SEEKING PERSONALIZED INVESTMENT ADVICE, WHICH HE CANNOT PROVIDE. Copyright 2009 all rights reserved.



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