Colombia: Scoping Gold & Copper (CGD)
- Previewing: Planetary Prospect No. 13 -- CANDENTE GOLD in Peru
- Actionable: Clifton Star, Antares
- Bonus: Mickey goes Baja … Bellhaven … more
PUNO, Peru – “This is the vuggy quartz I am telling you about. This is good. Very vuggy. Good for gold.”
Geologist Enrique Bernuy shouts this to fellow geologist and CEO Joanne Freeze. The two are combing Fredito, a property in the deep south of Peru. This is how we begin a Ticker Trax report coming later this week. Candente Gold’s first-time revelations about this Peru gold and silver prospect, one of two concessions we visited with Ms. Freeze and Mr. Bernuy, are very good. Very good for gold.
As of now, Candente Gold (TSX: T.CDG, Stock Forum) becomes our 13th Planetary Prospect. This means we intend to own the high-risk Canadian company’s shares for no less than one year. Hopefully, much longer. Our Ticker Trax audience will see why this gold prospector’s Peru (and Mexico) concessions hold the possibility of potent high-grade veins and low-grade epithermal gold-silver deposits. How potent? Peruvian drilling alone could unveil 10 million (Au-equivalent) ounces. (Please see some of the Fredito rocks we came across – in photo.)
We intend to exhibit the fine details of Candente’s Fredito and Tres Marias concessions. We owe it to our Ticker Trax audience, holders of sister company Candente Copper (TSX: T.DNT, Stock Forum). We owe the extra time and energy for this looming report to Ms. Freeze, a British Columbia geologist whose Peru copper and gold quests I have reported como un periodista y un inversionista since 2002.
Please stand by for the report. It will take another week or so. Candente Gold: Prospect No. 13.
At CMJ’s Cerro de Cobre: Copper In Colombia
In the meantime, we are this Monday after Easter in Colombia. We are on site with geologists Robert Carrington and Campos Elias Perilla. Mr. Carrington, president of Colombian Mines (TSX: V.CMJ, Stock Forum), and his lead in-country geologist, Mr. Perilla, are at Cerro de Cobre (Copper Hill), their company’s iron-oxide (limonite and hematite) ore deposit some 2 ½ hours north of the city of Bogota.
Cerro de Cobre is one of about 95 project areas Colombian Mines owns in Colombia. Our audience is about to learn why Cerro de Cobre’s carbonate limestone reef, along with a handful of other promising prospects, are best splayed out to joint venture partners.
“We are not a prospector generator,” says Nevada resident Mr. Carrington, who runs Colombian Mines with CEO Nate Tewalt of Washington State and Gloria Carrington, Bob Carrington’s Medellin-born wife. “We have several properties, no denying it, which have great scope and scale but just don’t fit our charter, our game plan. Copper here at Cerro de Cobre gave us 22 meters of 3.27 percent copper (two years ago) channel sampling. But it is not gold, and we are a gold 
company.”
Colombian Mines owns several other projects that Mr. Carrington, a Nevada-trained geologist who has been accumulating Colombia concessions since the mid-1990s, is willing to see joint-ventured to larger companies. “Part of the strategic value is bringing in a partner that is, say 20 times, or 50 times, our size. And part of it is realizing that Colombian properties are in demand right now.”
For instance, Mr. Carrington, as we slog our way through some of the thickest jungle I have been in since my last trip to Colombia two months ago, shouts that the company’s El Dovio copper property is coveted by a number of companies. “But we think there is a good chance it is a gold-rich VMS, with copper and zinc. So we’re not going to push the button on that.”
Ditto for Yarumalito, Benicia and other gold-centric properties in Antioquia.
What might be moving Colombian Mines’ shares, to the delight of our audience these past six months, might be one of its other 95 project areas luring potential joint venture partners. These partners, if ever named and transacted, would pay CMJ cash and then “carry” the drilling and other maintenance of the project as the new partner “earns in” its stake.
One property in the CMJ portfolio, Anori, is 2,300 hectares surrounding another 100 hectares that a successful South America gold driller and miner, Yamana Gold (NYSE: AUY, Stock Forum), controls and considers a promising prospect. This is all public information and is also on CMJ’s Web site.
Yamana’s project is the Solferino Mine near Segovia in Antioquia. I recall, the last time CMJ’s Nate Tewalt and I were in Medellin a few months ago, he was telling me stories about working in exploration for Meridian Gold. Yamana bought Meridian in 2007.
Not that a pedigree – Nate is a geologist – means anything in terms of farming out a property for a cash stream. Mr. Tewalt also has worked in various capacities for US Borax, Tenneco Minerals, Cornucopia Resources and Great Basin Gold. Against that CV, and the connections that Mr. Carrington has after 31 years in the gold business, there is little reason to believe that CMJ is poised to let Yamana drill the beans out of Anori.
Besides, I am no believer in prospector generators. This is in most cases not the “model” I would buy at the gold hobby shop called speculative mining companies. Why give up the best gold prospects, especially when you have been staking these claims, digging these trenches and scraping this rock, even poring through old U.S. Geological Surveys of Colombia, since the mid 1990s?
Easy: When you own 300,000 hectares of Colombia, you got to move, move, move.
Mr. Carrington would only say, as we hacked our way 1,900 meters or so up to the outcroppings of Cerro de Cobre, that Anori’s quartz veins are in a shear zone. He also noted that channel samples CMJ conducted at Solferino Mine showed 17 meters of 6.6 grams gold (per metric tonne).
Could a promising CMJ gold property be packaged off in return for cash payments to a larger miner with deep pockets? Just as we reached the top of a two-hour climb in this part of the eastern cordillera of the Andes, Mr. Carrington turned to me, his pick axe already whacking at calco-pyritic rock, and said, “When you control a lot of properties in a very promising country, and I think we do, getting someone into the mix that has cash, talent and motivation is what they call a strategic decision.”
Remember: Mr. Carrington (please see photos of him today at Cerro de Cobre and of me and lead in-country geologist Campos Elias Perilla) is the homegrown geologist who says things, in a twang, such as this: “You know, my grandma used to say all the time, ‘I put Robert into the dirt to play when he was two years old, and look at him, he’s still in it. “
Or my personal favorite – on our one-day tour of the old Independence Mine in Nevada two weeks ago. As we were driving from the town of Battle Mountain to the site, which is controlled by tiny General Metals Corp. (OTC: GNMT, Stock Forum), Mr. Carrington’s consultant-geologist on the Nevada project, there in the back seat of the pick-up truck, felt his foot push a metal object. He looked down and, seeing a gun on the floor, said, “Say, Bob, is that thing loaded?” Mr. Carrington replied: “Well, why would I be hauling around a gun without bullets in it?”
The Colombian Mines portfolio has plenty of bullets. More than one of them will go to other companies. When that happens., CMJ will have more cash, time and corporate palanca than it already hasto make Yarumalito, possibly El Dovio, Benicia, Rionegro … or even that phosphate property with coking coal possibilities … a winner.
Congratulations: A swell report on Pediment Gold (TSX: T.PEZ, Stock Forum), which we viewed and reported on last autumn from Baja, Mexico. Mickey Fulp, Mercenary Geologist, gets credit for digging into his notes and pulling out a report that Educates, Entertains and Enhances his audience. Please see the report.
Lookout list: Extreme value melt-Up likely for Bellhaven Copper & Gold (TSX: V.BHV, Stock Forum), which is active here in Colombia and which I toured several months ago. I await more developments on Colombia properties from Julio Benedetti’s Belhaven. Please see our Ticker Trax and Stockhouse coverage of the Panama-based prospector. I own shares of Bellhaven at a price of about its current level of 22 cents Canadian. Bellhaven is not a Planetary Prospect and will not become one until I get to revisit its San Lucas properties or coveted concessions along Colombia’s Rio Magdalena and elsewhere. It is, as stated here several times, the cheapest thing I know of in Colombia with top-notch geologists and producing and prospective gold projects.
More: We are reviewing our notes from the Antioquia Gold (TSX: V.AGD, Stock Forum) tours I did in January and February of this year. I do not own the shares and am doing more research on Cisneros in Antioquia.
Pitching and swelling’ along Las Bambas
Antares Minerals’ Haquira Copper Project is preparing an updated mineralogy review of its ore deposits in Peru. As you recall, Antares, in our view, appears within one year of elevating its copper-values to a transaction level that could see the company (ANM)’s shares triple from their current price. Were that to happen, anyone who has taken the rough five-hour drive from mellow Cusco to Haquira’s 14-billion-pound copper (with molybdenum and gold) prospect, and spent time at the camp some 4,200 meters high, would enjoy a tankful of fruition.
In the meantime, we can point out two areas of our recent report that merit further review.
In our Part-One review of Antares’ Haquira copper project in Peru, we misspelled a geology term. Antares Minerals’ neighbor 10 kilometers away is Xstrata Copper’s sprawling Ferrobamba copper project. Xstrata spaces many of its drill holes some 15 to 25 meters apart. (We saw it from the air; please see photo.) The tight spacings are because of the type of rock beneath Xstrata’s 400,000 meters of drilling. A skarn is a Swedish mining term for course-grained, calc-silicate rock (garnet and pyroxenes, typically formed from replacement of limestone by hydrothermal fluids).
“The reason why one has to drill closely spaced holes in skarn is that the geometry of skarns are notoriously difficult to predict,” Paul Zweng says. “They can pinch and swell. Because of their irregular shape, one must drill them on a closely-spaced pattern so that the irregular pattern can be constrained. The copper at Ferrobamba is hosted in skarn, so the geologists need to know where it occurs and where it doesn't.”
Antares Minerals was an Internet shell before Paul Zweng, John Black and their partners started probing copper-moly-gold porphyry deposits in Las Bambas district. Mr. Black, Mr. Zweng and another founder, Dave Anderson, share links in their educations (geology – Queen’s University, Ontario; Stanford University in California) and/or their work experience, largely in Mongolia from 2002 to 2004 or so. In addition, Antares CFO Mark Wayne was a founding shareholder of Mr. Zweng’s Mongolia-centric QGX Ltd. Kevin Heather, on site at Haquira with us this past week, is Antares VP of geology and also studied with Paul Zweng at Queen’s U. John Black met Paul Zweng at Stanford University, where Paul earned his doctorate. (Which means, if I were practicing strict journalism style rules, the reference would be Dr. Zweng.)
John Black spent time in Chile and in Mongolia with Western Metals before that company’s China activities hastened the sale of the company. John worked for Western Metals for about nine or 10 years and has written at length about the geology of epithermal gold-silver and porphyry copper-gold deposits.
We’ll have revelations about Antares’ Haquira copper-moly-gold deposit in coming issues.
More congratulations: Medoro Resources (TSX: V.MRS, Stock Forum) appears to have locked in Frontino Mine, the pension-troubled yet lush and historic mine below the town of Segovia in Antioquia. Congratulations to consultant Serafino Iacono, who helped engineer the $200 million pending purchase – pursuant to due diligence, Medoro CEO John Hick tells me. We here have been following Medoro as a gateway into the world of Colombia mining since its predecessor at El Marmato, Colombia Goldfields. I own the shares via my ill-timed purchase of Colombia Goldfields shares several years ago at insanely high prices. Mr. Hick, when I asked him why Medoro is reporting grades at Frontino but not widths, replied, “At this point, we only have limited historical information re Frontino. That is why we negotiated for a due diligence period.”
Finally: Clifton Star Resources (TSX: V/CFO, Stock Forum) near the Canadian Malartic Gold Project in Quebec appears to be gaining favor again with investors. Please review our Ticker Trax and Stockhouse coverage. Drill results from its Osisko Mining (TSX: T.OSK, Stock Forum) joint venture, if potent, will triple this company’s shares almost overnight. I do not own any of them.
Please see the Ticker Trax archives for our entire coverage of this political issue – bankrupt pensions, unhappy miners and a company that hopefully can now fund the pension and get Frontino’s historic gold output revved up again. Our take six months ago and reaffirmed three months ago was this: Frontino would need to be resolved by administrators before the May 30 presidential election in this country. It appears that has happened.
The Planetary Prospects
- Premium Exploration (TSX: V.PEM, Stock Forum) – Gold in Idaho and Montana. Extremely high grades. Wilf Struck is the geologist and CEO.
- Inter-Citic Minerals (TSX: T.ICI, Stock Forum) –Gold prospector and mine developer in eastern China. China gold companies, banks and metals processors seek to boost gold output from their own country. That is the premise for owning a piece of the company’s Dachang Gold Project. I think we’ll see a transaction for Jim Moore’s Inter-Citic in coming weeks. It is common knowledge that China entities, including local and provincial governments, almost always will choose to own or ally with physical producers of metals vs. prospectors.
- Central Fund of Canada (AMEX: CEF, Stock Forum) and (TSX: T.CEF.A, Stock Forum) – Gold and silver repository. Its premiums, being a closed end fund, are rising. Own this one as a money market proxy for real gold and silver.
- BioCryst Pharmaceuticals (NASDAQ: BCRX, Stock Forum) –Influenza and leukemia drugs. Gout, too. Biomedical appears to be back in vogue this month as an investment. The shares are performing poorly this month of March and we here at home now fully own 70,000 of them – as in shares.
- Endeavour Silver (AMEX: EXK, Stock Forum) and (TSX: T.EDR, Stock Forum) Silver in Mexico. On a property purchase tear. Brad Cooke is the CEO. It is cheap by any metric – even after the shares’ tripling in value these past 14 months. I expect Endeavour Silver to purchase a publicly-traded silver company this year.
- Endeavour Financial (TSX: T.EDV, Stock Forum) –No relation to Endeavour Silver. This is the Canada merchant bank that is making a big bet on West Africa. The firm just increased its stake in Burkina Faso prospector and producer Crew Gold (TSX: T.CRU, Stock Forum) to 43 percent. Endeavour appears prepared to battle for control or ownership of Crew amid a Russia steelmaker’s accelerated bids for a greater stake and a new board.
- Xtra-Gold Resources (OTO: XTGR, Stock Forum) – This is the West Africa gold prospector that might follow in the footsteps of successful Keegan Resources (TSX: T.KGN, Stock Forum). But first, it needs to show us a lot more in the way of drilling results from the Kibi Gold Belt in Ghana. I am expected on site in late April – for a second visit.
- Great Basin Gold (TSX: T.GBG, Stock Forum): This is Ferdi Dippenaar’sSouth Africa and Nevada company. Please see archives for coverage of Burnstone and Hollister mines.
- Candente Copper (TSX: DNT, Stock Forum) –Joanne Freeze’s Candente has copper in Peru -- Cañariaco. The seven billion-pound copper project is starting to get the attention of manufacturers and bankers. Yet Candente Copper’s shares sell for a value of only a penny a pound for its in-situ copper. Candente Copper is among the cheapest things (based on ore in the ground) on this list, along with Avanti Mining. The Candente companies’ properties in Peru also include poly-metallic prospects that might some day package into a third separately-traded company
- Candente Gold (TSX: T.CDG, Stock Forum): This separate company’s shares were distributed to predecessor Candente Resources’ shareholders four months ago. CDG is our No. 13 Planetary Prospect as of today. We shall have a full report on Candente Gold’s Peru prospects later this week. I hope to visit CDG’s El Oro in Mexico in early May.
- Great Panther Silver (TSX: T.GPR, Stock Forum) –Silver in Mexico. Robert Archer is the CEO. The Panther is on the prowl for assets. GPR’s rising silver grades and low stock valuation compared with other Mexico silver producers make the company a value here.
- Avanti Mining (TSX: V.AVT, Stock Forum) - Cheap and aspiring molybdenum mine at Kitsault in British Columbia. Avanti’s Craig Nelsen and AJ Ali raised $17 million Canadian for the company. It is the cheapest proposition on this list. Few in the world of specialty metals will give this company respect until Avanti shows it can line up financing and possibly off-take agreements for the mine’s easily reached moly. (Someone told me the other day in Peru how moly is an important additive in armored tanks – the kind that are used in wars. I don’t want war. I do want Avanti to become the $300 million company its metrics merit.).
- Colombian Mines Corp. (TSX: V.CMJ, Stock Forum) –CMJ has one of the widest property holdings in Colombia for such a tiny company: some 300,000 hectares. Bob and Gloria Carrington and Nate Tewalt’s company is on fire right now in terms of stock price performance. I am seeing the company’s Cerro de Cobre copper project some three hours’ drive north of Bogota today (Monday). CMJ’s drilling of Yarumalito in the department of Antioquia is on schedule. Holes number six, seven and eight are completed and await assays from an SGS laboratory in Peru, Mr. Carrington tells me. Current drilling at the intermediate sulphidation gold-porphyry system: holes nine and 10. (Please see photo of Bob Carrington above at Cerro de Cobre.).
A week off: Nos vemos
Please note: We are taking a week off after our visit to copper prospect Cerro de Cobre in Colombia. I will be sniffing around Colombia with the family – for empanadas. I expect Ticker Trax to return at or around April 16. On the schedule: the full Candente Gold report.
Bonus reports are possible. Which means, if I find time to detail the Antioquia Gold thesis, I will – before April 16. I also hope on this trip to learn more about CMJ’s strategy for optioning out some of its properties in Colombia. And I will be meeting with several Colombia gold operators.
InvestFest 2010
InvestFest in Las Vegas – Join Stockhouse for a drink on the house June 4 at InvestFest.The gathering will feature investment masters who are making headway in today's marketplace. I’ll be there. It’s called InvestFest 2010. Please visit:: www.stockhouse.com/products/investfest2010.
WHEN: June 3 to June 6.
WHERE: Green Valley Ranch Resort, Las Vegas, Nevada. That’s a five-star resort minutes from the Vegas strip.
Special Offer to Ticker Trax subscribers: $197. Please book your resort rate as well by calling 1-866-782-9487. Quote: InvestFest.
(Photos by Thom Calandra. Thom owns shares of each of the 12 Planetary Prospects. Thom’s personal holdings are available for all to see on Stockhouse, the Canada publishing company. He has no intention of selling any of the 12 Planetary Prospects at present … and if he were to, subscribers would be informed well in advance of any shift in research regarding those Planetary Prospects.)
For Ticker Trax, please see Stockhouse Password-Secure Archives.
Ticker Trax™
Please see tickertrax.com to learn more about this wealth service and its 12 Planetary Prospects. For an index of free Thom Calandra, please click here.
HOLDINGS: Thom’s holdings are listed for all Stockhouse members at 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. As with each of the Planetary Prospects, Thom Calandra owns Colombian Mines and the other P.P.s indicated in this report. His ownership of Candente Gold came in the spinoff of its mother company, Candente Resource Corp., now called Candente Copper. Thom tours are in some cases supported by airfare or hotel costs paid by the companies. Please see Thom’s disclosure policies in this article.
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.
For Ticker Trax, please see Stockhouse Password-Secure Archives.
NOTICE: If I may for those who might not be paying Ticker Trax subscribers:
Si vous n'êtes pas le destinataire prévu ou un agent responsable de la
livraison de ce courriel, tout copie, impression, reproduction ou autre utilisation d'une partie de ce courriel est strictement interdit. (We also produce a free report each week on Stockhouse.)
Ticker Trax™ is published by Stockhouse Publishing Ltd. 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 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 2010 all rights reserved.