Name(XXX) XXX-XXXXemail @canaccord

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Name(XXX) XXX-XXXXemail @canaccord

SMALL-CAP OVERVIEW
AND 2009 WATCH LIST
18 December 2008
Wendell Zerb
[email protected]
1.604.643.7485
Eric Zaunscherb
[email protected]
1.604.699.0829
We provide an overview of the small cap mining sector and our year-end
list of exploration/development/mining companies that we believe could
provide above-average speculative potential in 2009.
Toni Wallis
[email protected]
1.604.643.7551
Nicholas Campbell
[email protected]
1.604.643.7027
Adam Melnyk (Research Associate)
[email protected]
1.604.643.1655
Companies on our 2009 watch list have been selected based on a wide
variety of criteria, including: capable company management, 2009 work
programs, project potential, possible leverage to metal price movement
(ideally, upward leverage). Although our list considers balance sheet strength
in these difficult times, our primary focus is to identify companies that
provide above-average opportunity should the junior sector find life in 2009.
Iris Varga (Research Assistant)
[email protected]
1.604.643.7412
Figure 1: Gold price versus average value US$/oz in situ
155
1000.0
Current value: US$26.17/oz ↑
950.0
135
900.0
800.0
95
750.0
75
700.0
650.0
55
Gold Price (London PMFix)
850.0
115
600.0
35
550.0
Average Value US$/oz in situ
11-Dec-08
20-Nov-08
9-Oct-08
6-Nov-08
23-Oct-08
28-Aug-08
25-Sep-08
14-Aug-08
11-Sep-08
3-Jul-08
31-Jul-08
18-Jul-08
5-Jun-08
19-Jun-08
24-Apr-08
8-May-08
22-May-08
10-Apr-08
28-Feb-08
27-Mar-08
14-Feb-08
13-Mar-08
3-Jan-08
31-Jan-08
6-Dec-07
17-Jan-08
20-Dec-07
8-Nov-07
25-Oct-07
22-Nov-07
11-Oct-07
30-Aug-07
28-Sep-07
16-Aug-07
13-Sep-07
5-Jul-07
2-Aug-07
19-Jul-07
7-Jun-07
26-Apr-07
12-Apr-07
21-Jun-07
500.0
24-May-07
15
10-May-07
2
4
6
8
9
10
11
12
16
38
40
42
43
50
51
29-Mar-07
Junior market and commodities snapshot
2009 overview
Key junior mining sector drivers
A “defensive” slant overview
Small-cap M&A
Our 2008 wish list
Cash rich, cash poor tables
2009 watch list
Company profiles
Gold in situ spreadsheet
Uranium in situ chart & spreadsheet
Research universe
Ink spots
Chocolate chip cookies – A festive recipe
Junior mining weekly index
Junior Mining Weekly will resume publication the week of 12 January 2009.
Average Value US$/oz in situ
In this issue
While 2009 could be another difficult year for the junior mining sector, we
believe the worst is likely behind us. At current market levels, segments of
the junior sector offer fundamentally good value and, with time,
revaluations should draw speculative capital back to the space. Is it time to
accumulate small cap mining/exploration stocks? We review important
factors that will influence the sector and provide our insights into the
direction the markets could trend. There is no simple conclusion.
Gold Price
C$:US$ 0.90
Ag:Au ratio 55:1
Source: Thomson ONE, Canaccord Adams
Canaccord Adams is the global capital markets group of Canaccord Capital Inc. (CCI : TSX|AIM)
The recommendations and opinions expressed in this Investment Research accurately reflect the Investment Analyst’s personal,
independent and objective views about any and all the Designated Investments and Relevant Issuers discussed herein. For important
information, please see the Important Disclosures section in the appendix of this document or visit or visit
http://www.canaccordadams.com/research/Disclosure.htm.
Junior Mining Weekly | 2
18 December 2008
Figure 2: Junior market and commodities snapshot
Value
Dec 12/08
719
8,515
276
230
75
81
252
S&P/TSX Venture Composite Index
Selected companies
Highly active by value (Dec 8-12/08)
San Gold Corp.
Capital flowing to gold equities.
Andina Minerals Inc.
Hathor Exploration Ltd.
Uranium Explorer.
Gold Wheaton Gold Corp.
CA commodity price and currency forecasts
Aluminum US$/lb
Copper US$/lb
Nickel US$/lb
Zinc US$/lb
Lead US$/lb
Uranium US$/lb
Molybdenum US$/lb
Cobalt US$/lb
Gold US$/oz
Silver US$/oz
Platinum US$/oz
Palladium US$/oz
C$/US$
A$/US$
US$/Euro
Rand/US$
% Change
YTD
-75.0%
-38.9%
-17.2%
-70.1%
-11.2%
-5.2%
-43.1%
WoW
17.1%
5.3%
-5.3%
WoW
10.3%
20.7%
5.7%
24.1%
WoW
-6.2%
-8.1%
6.1%
-6.9%
0.0%
0.6%
3.7%
Symbol
SGR
Price
Dec 12/08
$1.08
Av Day Val
C$ 000
1,510
ADM
$0.85
1,420
HAT
$2.88
1,040
GLW
$0.23
880
TSX Venture Daily Volume for the week
of Dec 8-12/08
Date
Monday
8-Dec-08
Tuesday
9-Dec-08
Wednesday
10-Dec-08
Thursday
11-Dec-08
Friday
12-Dec-08
Volume
171,261,748
153,907,514
198,375,898
238,300,947
191,927,864
Total
Average. Daily Volume
S&P/TSX Venture Composite Index Volume and Value
Jan/07-Dec 12/08
953,773,971
190,754,794
445
3,200
370
2,800
2,400
295
2,000
220
1,600
TSX Ve nture Vo lume (M )
Index
S&P/TSX Composite Index
S&P/TSX Global Gold Index
S&P/TSX Diversified Metals & Mining
(SPDR) Streettracks Gold Trust
IShares Comex Gold Trust
AMEX Gold Bugs
% Change
YTD
-75.0%
-45.7%
-85.3%
YTD
-88.2%
-88.5%
-83.3%
-89.0%
1,200
145
800
400
70
2-Jan-07
22-Jan-07
9-F eb-07
1-Mar-07
21-Mar-07
11-Apr-07
1-M ay-07
22-M ay-07
11-Jun-07
29-Jun-07
20-Jul-07
10-Aug-07
30-Aug-07
20-Sep-07
11-Oct-07
31-Oct-07
20-Nov-07
10-Dec-07
2-Jan-08
22-Jan-08
11-F eb-08
3-Mar-08
24-Mar-08
11-Apr-08
1-M ay-08
22-M ay-08
11-Jun-08
2-Jul-08
22-Jul-08
12-Aug-08
2-Sep-08
22-Sep-08
10-Oct-08
31-Oct-08
20-Nov-08
10-Dec-08
CA COPPER In Situ (cents Cdn/lb)
CA NICKEL In Situ (cents Cdn/lb)
CA ZINC In Situ (cents Cdn/lb)
CA MOLY In Situ (cents Cdn/lb)
Value
Dec 11/08
26.17
0.60
1.24
Dec 12/08
0.96
4.02
0.56
4.27
S&P/TSX Venture Inde x
In Situ
EV/attrib. lb eq. or Mkt. cap/oz or lb eq.
CA GOLD In Situ (US$/oz)
CA SILVER In Situ (US$/oz)
CA URANIUM In Situ (US$/lb)
TSX-Venture Daily Trading Volume
2008E
1.18
3.15
9.60
0.85
0.96
63.40
30.40
38.50
867.00
14.94
1,574
357
2009E
0.90
1.65
5.00
0.63
0.60
60.00
13.50
15.00
875.00
12.50
1,050
250
2010E
1.00
2.00
6.00
0.70
0.60
55.00
15.00
15.00
825.00
13.50
1,200
300
Long Term
1.00
2.00
7.75
0.80
0.50
50.00
12.50
12.50
750.00
14.00
1,200
300
Value
Dec 12/08
0.66
1.43
4.78
0.47
0.46
54.00
12.38
15.50
826.50
10.23
820.50
174.00
0.95
0.85
1.47
8.03
0.85
0.70
1.30
8.50
0.90
0.75
1.34
8.00
0.90
0.80
1.30
8.00
0.80
0.66
1.34
10.06
WoW (week over week) - Thursday to subsequent Thursday close.
In Situs: The basket of companies might vary quarterly. Silver In Situ first published on Sep 22/08.
CA - Canaccord Adams.
Source: Thomson One, Bloomberg, TSX Venture Exchange, Canaccord Adams.
S&P/TSX Venture Index
% Change
YTD
-38.9%
-53.1%
-60.8%
-57.3%
-61.0%
-35.7%
-61.6%
-63.5%
-3.6%
-32.9%
-46.8%
-53.4%
-19.8%
-24.2%
-8.5%
45.9%
WoW
0.0%
4.4%
18.0%
-2.1%
7.0%
-1.8%
0.0%
19.2%
10.3%
8.5%
2.2%
5.9%
1.4%
3.8%
5.1%
-2.2%
18 December 2008
Figure 3: Table of contents
Junior market and commodities snapshot
2009 overview
Key junior mining sector drivers – How are they shaping up for 2009?
A “defensive” slant in an offensive small-cap mining sector
Small-cap M&A
Our 2008 wish list
Cash-rich, cash-poor tables
2009 watch list
2
4
6
8
9
10
12
16
Company profiles – 2009 watch list
Banro Corp.
Brilliant Mining Corp.
Condor Resources Inc.
Diamonds North Resources Inc.
Extract Resources Ltd.
Fortress Minerals Corp.
Golden Arrow Resources Corp.
Guyana Goldfields Inc.
Helio Resource Corp.
Intl. Royalty Corp.
Intl. Tower Hill Mines Ltd.
Keegan Resources Inc.
Kivalliq Energy Corp.
Lumina Copper Corp.
Peregrine Diamonds Limited
Rubicon Minerals Corp.
Serengeti Resources Inc.
Underworld Resources Inc.
Uracan Resources Ltd.
West Timmins Mining Inc.
Investment risks & site visits
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
Gold in situ spreadsheet
Uranium in situ chart & spreadsheet
Research universe
Ink Spots
Chocolate chip cookies recipe – A festive recipe
Junior Mining Weekly Index – Previous 12 months
38
40
42
43
50
51
18 December 2008
2009 OVERVIEW
The small-cap mining sector has just been through its worst, most precipitous decline in
modern history. While 2009 could be another difficult year for the junior mining sector,
we believe the worst is likely behind us. Any sustainable recovery in the junior mining
space will depend upon the perception that an overall recovery in global demand for
metals is imminent. A turnaround in global demand for metals will likely depend on the
efficacy of the government stimulus packages being implemented around the globe.
Overall appetite for risk will be another key determinant of junior mining equity
valuations. The year 2008 has shattered investor confidence, and market valuations
reflect risk-averse investor sentiment. We believe that, to achieve a sustainable rally in
the junior mining sector in 2009, investors must regain confidence in broader equity
markets. Given the ongoing issues in the global equity and credit markets, we believe
that investors are likely to remain somewhat risk-averse in 2009. That said,
opportunities do exist in the junior sector even under more subdued investor interest.
Our general observation, based on past cycles, is movement in the overall broad junior
market, requires above-average investor participation. We typically track this by
measuring daily and weekly volumes on the TSX Venture Index. When the broad market
is less engaged in the junior space, however, we believe capital tends to flow to more
select, higher-profile, junior companies that capture investors’ attention.
In addition, as volumes decrease and market prices decline, bottoming capitulation
occurs, which plunges prices below reasonable valuations, and as such offers savvy
speculators entry-level opportunities. Under these conditions of capitulation and low
volumes, a change to positive sentiment can then result in share prices gapping up on
low volumes. The market lows of November 2008 may have been a basing level for the
TSX Venture Exchange.
It is important to note that, since the peak achieved in May 2007, the TSX Venture
Exchange has come off as much as 79%. As a comparison, starting in April 1987, the
market (VSE) declined about 75% over a 3.75-year period. Following the Bre-X crash of
1997, the junior mining fallout spanned about 3.5 years, and the total decline was about
73%. The TSX Venture has already declined more than it did during the downturns of
1987 and 1997 – but in only 1.7 years. Can it be argued that, with a faster decline in the
market relative to previous cycles, we should also see a faster rebound from market
lows? Possibly. A rebound could be stimulated by an upturn in metal prices, a decline in
the US dollar, a high-profile exploration discovery or a renewed wave of consolidation in
the junior mining sector.
We stress that, in the current environment, investors should focus on companies with
balance sheet strength, above-average project portfolios and strong management teams.
Junior companies with strong balance sheets are more likely to survive prolonged sector
weakness, which gives an investor an opportunity to benefit when the rebound in junior
mining equities occurs. For a more thorough review of selected companies that fit our
investment thesis, please refer to our equity research report titled A “defensive” slant in
an offensive small-cap mining sector, published on 27 October 2008.
18 December 2008
Figure 4: VSE, CDNX and TSX Venture Exchange (January 1983–December 11, 2008)
4000.00
-75%
-79%
3500.00
3000.00
-75%
-42%
-73%
2500.00
-40%
2000.00
-34%
1500.00
1000.00
500.00
VSE Index
CDNX Index
S&P/TSX Venture Exchange Index
Jan-83
Aug-83
Mar-84
Oct-84
May-85
Dec-85
Jul-86
Feb-87
Sep-87
Apr-88
Nov-88
Jun-89
Jan-90
Aug-90
Mar-91
Oct-91
May-92
Dec-92
Jul-93
Feb-94
Sep-94
Apr-95
Nov-95
Jun-96
Jan-97
Aug-97
Mar-98
Oct-98
May-99
Dec-99
Jul-00
Feb-01
Sep-01
Feb-02
Sep-02
Apr-03
Nov-03
Jun-04
Jan-05
Aug-05
Mar-06
Oct-06
May-07
Dec-07
Jul-08
Dec-08
0.00
VSE Index
CDNX Index
TSX Venture Index
VSE and CDNX values adjusted for S&P/TSX-Venture values.
Source: TSX-Venture Exchange, Bloomberg, Canaccord Adams
Our year-end watch list comprises exploration/development/mining companies that we
believe could provide above-average speculative potential in 2009. Companies on our
2009 watch list have been selected based on a wide variety of criteria, including: capable
company management, 2009 work programs, project potential, and leverage to metal
price movement (ideally, upward leverage). While our list considers balance sheet
strength in these difficult times, our primary focus is to identify companies that provide
above-average opportunity should the junior sector find life in 2009.
We do not have formal research coverage of the companies named in our 2009 watch list;
their inclusion on the list does not constitute a recommendation nor should it be assumed
to be a recommendation to purchase at this time. Share appreciation from current levels is
dependant upon factors that may or may not materialize. We provide profiles of each of the
companies on the watch list and highlight some important assumptions.
18 December 2008
KEY JUNIOR MINING SECTOR DRIVERS –
HOW ARE THEY SHAPING UP FOR 2009?
•
Base metal prices: The global outlook for metals demand remains grim. Producers
are shutting down operations. Inventories continue to grow. We are watching copper
as a gauge of the overall trend in base metals. Data suggest capacity utilization starts
to curb copper production at about US$1.25/lb – at these levels could we be close to
levelling off?
•
Precious metal prices: Gold has recently rebounded above US$800/oz. Credit
concerns, a trend to further Fed easing (the bullion price typically outperforms
during periods when real rates are declining and thus liquidity is improving),
political tensions, diversification of central bank reserve holdings and the high US
current account deficit all suggest a strain on the US dollar, and therefore strength in
US-denominated bullion.
•
Uranium: Distressed selling relief, concerns over supply constraints and a strong
demand outlook as the nuclear renaissance continues have helped support uranium
prices. We expect uranium to fare well through 2009 and beyond as the current
global nuclear fleet of 439 plants is expanded by 39 plants under construction and as
plans and proposals for an additional 379 plants are advanced; the price may be
further enhanced as supply concerns arise.
•
Diamonds: This has been the least interesting sector in mining over the past five
years, in our view. With all metals having experienced robust gains in the last cycle,
combined with the long development timeframe for diamonds and a lack of
interesting diamond stories, investor interest towards diamonds was minimal at
best. With metal prices off, rumours suggest BHP and Rio Tinto are ramping up
diamond exploration activities. In addition, advanced plays by Peregrine and
Diamonds North could create renewed interest. It’s very contrarian, but would you
rather bet on low-grade zinc in northern Canada?
•
US dollar: Yes it has been a safe haven draw and been comparatively strong relative
to other currencies. However, the US has very high debt levels, a growing deficit
driven by huge fiscal spending, weak manufacturing and lower export revenues. As
capital diversifies, will the US dollar decline? If so it could be good for all metals.
•
The TSX and Dow Jones: Off 44% and 40%, respectively, from yearly highs.
Recessions have lasted between 6 and 44 months, typically averaging 13 months.
Markets historically begin to recover four to six months before the end of a
recessionary period. If the US has been in recession since December 2007, we may
have already seen the bottom of the market. If we are half way through the recession
we have good hope for the markets in H2/09.
•
The TSX Venture Index: It has been down as much as 80% over the last 18 months.
Many companies are trading at less then cash, and assets are being treated like
liabilities. Can it really drop further? Starting in April 1987, the market (VSE)
declined about 75%, but over a 3.75-year period. Following the Bre-X crash of 1997,
the junior mining fallout spanned about 3.5 years and the total decline was about
73%. We think the worst is over, but will the recovery be V-shaped or will prolonged
consolidation kick in before a sustainable recovery emerges?
18 December 2008
•
TSX Venture volume: Average daily volumes have variably increased since August
lows of about 100 million shares per day to current averages of about 190 million
shares per day. On several occasions over the last two weeks, daily averages have
spiked to over 235 million shares traded per day. Our interpretation is that speculative
capital remains constrained but is generally improving. It is important to note that,
given the large decline in the TSX Venture Index, the value associated with the same
volumes today versus one year ago is considerably less.
•
The availability of capital has been constrained on all levels. In the last several months,
however, we have witnessed successful equity underwritings of several small to midcap gold equities (Yamana, Minefinders, Agnico Eagle, Red Back). Underwritings of
non–cash flowing junior companies have been very limited. Until a shift in sentiment
towards explorecos improves, we expect capital to remain tight among the small caps.
In past cycles, windows of opportunities have opened and select, higher-profile
companies have successfully raised capital. We believe equity raised in 2009 for
explorers and developers will be limited to above-average opportunities.
•
M&A activity: We believe the circumstances currently prevailing within the small cap
mining space could open the potential for a series of mergers and acquisitions.
Compounding this is the lack of capital available to the juniors, which could also be a
motivating factor to build on the M&A environment. In our 11 November 2008 Junior
Mining Weekly we highlighted a number of companies we felt had an above-average
potential to merge or be acquired. Since we published, three of those companies – Gold
Reserve, MAG Silver and Orezone – have had takeover bids tabled.
•
New discoveries: While there have been numerous exploration successes in the last
several years, few have developed into high-profile discoveries that captured market
attention. With fewer explorecos actually conducting exploration work, the chances of
a discovery in 2009 are declining. That said, an attention-grabbing discovery could
have a greater impact given the smaller circle of active explorers for investors to
concentrate on. Who will be next? Will it be one of our 2009 watch list companies?
•
Industry challenges: Last year we were concerned about political issues, a shortfall
of drill rigs, constrained assay labs, onerous capital costs and limited labour talent.
For 2009, things look very different. Access to capital, declining metal prices and an
apathetic investment climate are serious concerns in 2009.
18 December 2008
A “DEFENSIVE” SLANT IN AN OFFENSIVE SMALL-CAP
MINING SECTOR
On 27 October 2008, we published an equity research reported titled A“defensive” slant
in an offensive small-cap mining sector.
This report highlights our main investment thesis given the difficult financial and
economic circumstances. We do not attempt to time the turnaround for the junior sector.
We believe that, at current levels, segments of the junior sector offer fundamentally good
value, while recognizing that aversion to the small cap sector can include prolonged
periods of value deterioration. We believe companies with low treasury levels, soft
management and weak upcoming exploration plans are at the greatest risk of further
share price erosion. Given the unknowns associated with the timing of a broad junior
mining market turnaround, we suggest that exposure to small caps be associated with
well-managed, cash-rich companies that will maintain active, but modest,
exploration/development programs on top quality targets over the next 6-18 months.
Within that period, we were hopeful that a good defence will be the best offence and that
an off-the-bottom rally will provide substantial returns for risk-tolerant investors.
In the report, we highlighted 12 small-cap mineral exploration/development companies
that have strong working capital positions, above-average project portfolios and strong
management teams. The price performance in percentage gain (loss) between 27 October
2008 and 11 December 2008 is presented in the table below.
Figure 5: Featured companies in A “ defensive slant” in an offensive small-cap mining sector, published 27 October 2008
1
2
3
4
5
6
7
8
9
10
11
12
Company name
B2Gold Corp.
Colossus Minerals Inc.
Exeter Resources Corp.
Fronteer Development Group Inc.
Hathor Exploration Limited
Lake Shore Gold Corp.
MAG Silver Corp.
Minera Andes Inc.
Northern Dynasty Minerals Ltd.
Rainy River Resources Ltd.
Silverstone Resources Corp.
Ur-Energy Inc.
Arithmetic Average
Ticker
BTO
CSI
XRC
FRG
HAT
LSG
MAG
MAI
NDM
RR
SST
URE
Exch.
TSX
TSX
TSX-V
TSX
TSX-V
TSX
TSX
TSX
TSX
TSX-V
TSX-V
TSX
Price (C$)
Oct 24/08
Dec 11/08
$0.35
$0.42
$0.74
$0.50
$1.15
$1.73
$2.17
$3.05
$1.23
$2.88
$0.77
$1.00
$4.75
$5.45
$0.54
$0.57
$2.40
$3.91
$0.74
$1.10
$0.47
$0.43
$0.38
$0.52
% Change
Price
20%
-32%
50%
41%
134%
30%
15%
6%
63%
49%
-9%
37%
33.7%
Rating
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
SPECULATIVE BUY
Target Price
(C$)
$1.00
$2.00
$2.30
$4.60
$2.75
$2.05
$7.50
$1.40
$4.50
$2.50
$1.50
$1.05
18 December 2008
SMALL-CAP MINING M&A
We believe circumstances currently prevailing within the small-cap mining space create
the potential for a series of mergers and acquisitions. Compounding this is the lack of
capital to available the juniors, which could also be a motivating factor to build on the
M&A environment. Mergers among the small caps could increase as management teams
become “humbled” by current market conditions and recognize that combined entities
could, in the long term, result in improved shareholder value. In other cases, the
combination of cash-rich companies with property-rich companies could synergistically
result in improved shareholder value. We expect additional M&A activity to drive some
renewed speculative appeal over the next several months. Figure 6 lists some small-cap
mining and mineral exploration/development companies that we believe could be
targeted for, or are targeting, a merger or acquisition. Since we first published this list
(Junior Mining Weekly dated 11 November 2008), three companies on the list have had
takeover bids tabled (MAG Silver, Orezone, Gold Reserve).
Figure 6: Selected juniors – possible M&A targets
Company name
Anatolia Minerals Dev.
Aquiline Resources
Aurora Energy Res. Inc.
Bear Creek Mining Cp.
Candente Resource Cp.
Canplats Resources
CGA Mining Limited
Comaplex Minerals Cp.
Corriente Resources
Detour Gold Corp.
Donner Metals Ltd.
GlobeStar Mining Corp.
Gold Reserve Inc.
Grayd Resource Corp.
Intl Tower Hill Mine Ltd.
MAG Silver Corp.
Minera Andes Inc.
Osisko Mining Corp.
Rainy River Res. Ltd.
Tournigan Energy Ltd.
Ur-Energy Inc.
VMS Ventures Inc.
Sym
ANO
ADM
AQI
AXU
BCM
DNT
CPQ
CGA
CSI
CMF
CTQ
DGC
DON
GMI
GRZ
GYD
HAT
ITH
MAG
MAI
OSK
RR
RMX
TVC
URE
VMS
Price (C$)
Exch 11/7/08 12/11/08
TSX
$1.01
$0.96
TSX-V
$0.81
$0.85
TSX
$1.12
$1.19
TSX
$1.32
$0.95
TSX-V
$0.95
$1.28
TSX
$0.28
$0.20
TSX-V
$1.20
$1.35
TSX
$1.00
$0.87
$0.85
$0.50
TSX
TSX
$2.00
$1.74
TSX
$2.94
$3.30
TSX
$5.20
$5.30
TSX-V
$0.13
$0.11
TSX
$0.53
$0.39
TSX
$0.63
$0.38
TSX-V
$0.34
$0.30
TSX-V
$1.88
$2.88
TSX-V
$1.46
$1.32
TSX
$5.00
$5.45
TSX
$0.81
$0.57
TSX
$2.00
$2.87
$0.85
$1.10
TSX-V
TSX
$1.18
$1.14
TSX-V
$0.23
$0.17
TSX
$0.69
$0.52
TSX-V
$0.32
$0.26
% Chg
Price
-5.0%
4.9%
6.2%
-28.0%
34.7%
-30.4%
12.5%
-13.0%
-41.2%
-13.0%
12.2%
1.9%
-19.2%
-26.4%
-39.7%
-11.8%
53.2%
-9.6%
9.0%
-29.6%
43.5%
29.4%
-3.4%
-26.1%
-24.6%
-18.8%
Sh o/s
M
83.14
79.38
62.64
73.3
55.46
80.94
56.75
233.88
42.67
52.71
75.3
44.86
46.26
105.26
57.54
56.19
82.05
43.83
49.16
190.16
166.03
57.84
156.15
122.7
93.24
107.91
Originally published on Junior Mining Weekly dated 11 November 2008
Source: Thomson ONE, Capital IQ, Canaccord Adams
Wkg Cap Mkt Cap
C$ M
$98.8
$22.6
-$0.9
$105.1
$5.4
$5.6
$5.8
$47.0
$16.6
$33.0
$86.8
$57.5
$5.4
-$2.1
$73.0
$3.1
$28.5
$9.9
$60.8
-$12.1
$126.0
$35.4
$17.0
$17.2
$65.0
$19.2
C$ M
$79.8
$67.5
$74.5
$69.6
$71.0
$15.8
$76.6
$203.5
$21.3
$91.7
$248.5
$237.8
$4.9
$41.1
$21.9
$16.9
$236.3
$57.9
$267.9
$108.4
$476.5
$63.6
$178.0
$20.9
$48.5
$28.1
M&A Thesis
Upcoming production 175k oz/yr; big project pipeline
Large multi-million Au oz resource
World-class Ag, Pb asset
Cash plus large U3O8 portfolio
Multi-asset Ag company; large resource base
Growing Peruvian Cu asset
Bulk mineable potential, Au
Emerging low-cost gold production in the Philippines
Extremely high-grade multi metal asset - Brazil
Northern synergies; Agnico interest
Large Cu assets, majors sniffing
Large multi-million Au oz resource
Strategic base metal assets in Matagami
Small Cu production; strategic Ni saprolite
Venezuela consolidating Recent bid by Rusoro
Mexican Au resource next to growing producer
Strategic location; high-grade U3O8
Growing Au asset in Alaska
High-grade Ag – recent Fresnillo bid
Large Cu asset – solid option agreement
Large multi-million Au oz resource operation
Location, growing resource, exploration upside
High-grade in Red Lake – say no more
Large undervalued U3O8 resource; Areva in country
Highly desirable US domestic ISR uranium production
High-grade Cu next to Hudbay’s Snow Lake
Rating
Not rated
SPEC. BUY
Not rated
Under Review
Under Review
Not rated
SPEC. BUY
Not rated
SPEC. BUY
Not rated
SPEC BUY
SPEC. BUY
Not rated
SPEC. BUY
Not rated
Not rated
SPEC. BUY
Not rated
SPEC. BUY
SPEC. BUY
SPEC. BUY
SPEC. BUY
Not rated
Under Review
SPEC. BUY
Not rated
18 December 2008
OUR 2008 WISH LIST
Where did that freight train come from? The year 2008 will not be remembered by the
mining or investment industry for its good fortune. In December 2007, we released our
2008 wish list based on criteria similar to those applied to our 2009 watch list. Last year,
we asked the question: “Is it time to accumulate junior mining stocks?” While we were
cautious in our outlook, in hindsight perhaps we should have simply answered our own
question with “no”.
Figure 7: Canaccord Adams 2008 wish list
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Company Name
Blackstone Ventures Inc.
Canplats Resources Corp.
Crosshair Exploration & Mining Corp.
Copper Messa Mining Corp.*
Donner Metals Ltd.
Exeter Resource Corp.
Full Metal Minerals Ltd.
GoldQuest Mining Corp.
International Tower Hill Mines Ltd.
Merrex Gold Inc.
Pacific Rim Mining Corp.
Panoro Minerals Ltd.
Rochester Resources Ltd.
SilverCrest Mines Inc.
Tournigan Gold Corp.
Xemplar Energy Corp.
Arithmetic Average
* Formerly Ascendant Copper Corp. (ACX : TSX)
Ticker
BLV
CPQ
CN
CXX
CUX
DON
XRC
FST
FMM
GQC
GYD
ITH
LSG
MXI
PMU
PML
RR
RCT
SVL
TVC
XE
Exch.
V
V
V
V/A
V
V
V/A
V
V
V
V
V
T
V
T
V
V
V
V
V
V
Rating
Not rated
SPECULATIVE BUY
Not rated
UNDER REVIEW
Not rated
Not rated
SPECULATIVE BUY
Not rated
Not rated
Not rated
Not rated
Not rated
SPEC BUY
Not rated
Not rated
Not rated
SPECULATIVE BUY
Not rated
Not rated
UNDER REVIEW
Not rated
Price (C$)
Dec 17/07
Dec 11/08
$0.71
$0.04
$2.90
$1.35
$0.05
$1.04
$0.10
$1.40
$0.02
$0.20
$0.48
$0.11
$1.73
$4.75
$0.20
$1.35
$0.17
$2.22
$0.09
$0.68
$0.30
$0.55
$1.38
$1.32
$1.00
$1.55
$0.10
$0.55
$0.13
$1.02
$0.10
$0.49
$1.10
$3.78
$0.16
$2.03
$1.03
$0.35
$0.17
$1.12
$0.17
$5.80
2,608.00
713.44
% Change
Price
-94.4%
-53.4%
-95.2%
-93.2%
-90.0%
-78.1%
-63.6%
-85.2%
-92.3%
-87.5%
-45.5%
-4.3%
-35.5%
-82.7%
-87.7%
-79.6%
-70.9%
-92.1%
-66.0%
-84.8%
-97.2%
-75.2%
-72.6%
18 December 2008
Figure 8: TSX Venture Exchange (year over year, 2003 to present)
3,150
2007
2,650
2006
2,150
2005
1,650
2003
2004
1,150
2008
2003
2004
Source:S&P/TSX Venture Exchange, Canaccord Adams
2005
2006
2007
2008
December
November
October
September
August
July
June
May
April
March
February
January
650
18 December 2008
CASH-RICH, CASH-POOR TABLES
Figure 9: Selected companies with HIGH working capital
Company Name
Anvil Mining Limited
Africo Resources Ltd.
GobiMin Inc.
Raytec Metals Corp.
Consolidated Thompson Iron Min.
Baja Mining Corp.
Northland Resources Inc.
Nautilus Minerals Inc.
Labrador Iron Mines Holdings Ltd.
Phoscan Chemical Corp.
MagIndustries Corp.
Orvana Minerals Corp.
IMA Exploration Inc.
Urbana Corp.
Baffinland Iron Mines Corp.
General Moly, Inc.
WGI Heavy Minerals Inc.
Western Uranium Corporation
Erdene Resource Deve. Corp.
Aurora Energy Resources Inc.
Continental Precious Minerals, Inc.
Stingray Copper Inc.
HudBay Minerals, Inc.
Crescent Gold Ltd.
Geovic Mining Corp.
Atacama Minerals Corp.
UR-Energy Inc.
Kootenay Gold Inc.
NEMI Northern Energy & Mng. Inc.
U.S. Silver Corporation
Linear Gold Corp.
Mano River Resources Inc.
Breakwater Resources Ltd.
Canadian Zinc Corp.
Continental Nickel Limited
Sabina Silver Corp.
Commerce Resources Corp.
Grande Cache Coal Corporation
Evolving Gold Corporation
Olympus Pacific Minerals Inc.
Troy Resources NL
Antares Minerals Inc.
B2gold Corporation
Inspiration Mining Corp.
Athabasca Potash Inc.
Fortuna Silver Mines Inc.
Metallic Ventures Gold Inc.
Eastern Platinum Limited
Geologix Explorations Inc.
Quadra Mining Ltd.
La Mancha Resources, Inc.
Thompson Creek Metals Co Inc.
Altius Minerals Corp.
Western Copper Corp.
Uranerz Energy Corp.
Ivernia Inc.
Richmont Mines Inc.
Sprott Resource Corp.
Fusion Resources Limited
Ticker
AVM : TSX
ARL : TSX
GMN : TSX-V
RAY : TSX-V
CLM : TSX
BAJ : TSX
NAU : TSX
NUS : TSX
LIR : TSX
FOS : TSX-V
MAA : TSX-V
ORV : TSX
IMR : TSX-V
URB : TSX
BIM : TSX
GMO : TSX
WG : TSX
WUC : TSX-V
ERD : TSX
AXU : TSX
CZQ : TSX
SRY : TSX
HBM : TSX
CRA : TSX
GMC : TSX
AAM : TSX-V
URE : TSX
KTN : TSX-V
NNE.A : TSX
USA: TSX-V
LRR : TSX
MNO : TSX-V
BWR : TSX
CZN : TSX
CNI : TSX-V
SBB : TSX-V
CCE : TSX-V
GCE : TSX
EVG : TSX-V
OYM : TSX
TRY : TSX
ANM : TSX-V
BTO : TSX
ISM : TSX
API : TSX
TVC : TSX-V
FVI : TSX-V
MVG : TSX
ELR : TSX
GIX : TSX
QUA : TSX
LMA : TSX
TCM : TSX
ALS : TSX
WRN : TSX
URZ : TSX
IVW : TSX
RIC : TSX
SCP : TSX
FNS : TSX
XE : TSX-V
Price
(C$)*
0.91
0.60
0.66
0.18
0.97
0.23
0.55
1.00
0.60
0.25
0.30
0.50
0.28
1.80
0.16
1.13
1.00
0.54
0.15
0.92
0.37
0.21
3.38
0.05
0.56
0.25
0.50
0.37
0.30
0.08
0.70
0.03
0.08
0.16
0.42
0.43
0.17
0.77
0.22
0.05
0.79
0.51
0.45
0.54
1.05
0.16
0.71
0.30
0.32
0.24
3.01
0.18
4.37
5.21
0.27
0.64
0.12
2.00
2.10
0.37
0.22
Shares out
(M)
71
73
71
70
119
143
110
162
35
172
198
115
52
78
255
72
24
59
89
73
48
59
153
591
103
114
93
37
58
215
28
318
447
121
30
67
112
96
80
232
70
55
163
68
37
123
85
52
681
51
66
142
122
31
73
55
180
24
84
49
120
Market Cap
(C$M)
64.8
43.6
46.5
12.2
115.6
32.2
60.3
161.6
21.3
42.9
58.4
57.0
14.6
140.2
39.6
81.2
24.0
32.1
12.9
67.4
17.6
12.3
517.1
29.5
57.6
28.5
46.6
13.6
17.4
16.1
19.5
7.9
35.7
19.3
12.6
28.8
19.0
74.0
17.2
10.5
55.2
27.8
73.3
36.7
38.8
19.6
60.6
15.6
217.8
12.3
198.7
25.6
534.2
161.0
19.7
35.5
20.7
47.6
176.8
18.1
25.7
Working Cap
(C$M)
316.9
107.1
113.5
26.2
244.6
65.7
121.5
310.9
40.8
79.4
142.0
99.3
24.4
230.7
63.6
130.5
39.0
50.8
20.4
105.1
27.0
18.7
778.5
44.3
84.7
43.3
65.0
18.8
31.6
21.6
25.8
11.9
48.8
23.9
15.5
34.4
22.5
83.0
19.2
11.6
58.6
26.3
67.3
33.5
34.9
17.2
53.0
13.6
179.5
10.0
158.6
29.5
418.4
162.8
15.1
27.2
15.5
35.4
131.1
13.3
18.8
Long-Term
Debt (C$M)
0.5
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
37.3
3.1
0.0
0.0
0.0
0.3
0.8
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2.1
0.0
0.0
8.2
0.0
0.0
1.8
4.5
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
9.5
1.9
38.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
Working Cap - (Working Cap LT debt
LT debt)/
(C$M)
Mkt Cap (%) Reported
316.4
488% 9/30/2008
107.1
246% 9/30/2008
113.5
244% 9/30/2008
26.2
215% 7/31/2008
244.6
212% 9/30/2008
65.7
204% 9/30/2008
121.5
201% 7/31/2008
310.9
192% 9/30/2008
40.8
192% 9/30/2008
79.4
185% 7/31/2008
104.7
179% 9/30/2008
96.2
169% 9/30/2008
24.4
167% 9/30/2008
230.7
165% 6/30/2008
63.6
161% 9/30/2008
130.1
160% 9/30/2008
38.2
159% 9/30/2008
50.8
159% 6/30/2008
20.4
158% 9/30/2008
105.1
156% 9/30/2008
27.0
154% 8/31/2008
18.7
151% 10/31/2008
778.5
151% 9/30/2008
44.3
150% 6/30/2008
84.7
147% 9/30/2008
41.1
144% 9/30/2008
65.0
139% 9/30/2008
18.8
138% 9/30/2008
23.4
135% 6/30/2008
21.6
134% 9/30/2008
25.8
132% 9/30/2008
10.1
127% 9/30/2008
44.3
124% 9/30/2008
23.9
124% 9/30/2008
15.5
123% 9/30/2008
34.4
120% 9/30/2008
22.5
119% 7/31/2008
83.0
112% 9/30/2008
19.2
112% 9/30/2008
11.6
110% 9/30/2008
58.6
106% 6/30/2008
26.3
95% 7/31/2008
67.3
92% 9/30/2008
33.5
91% 6/30/2008
34.9
90% 9/30/2008
17.2
88% 6/30/2008
53.0
87% 9/30/2008
13.6
87% 9/30/2008
179.5
82% 9/30/2008
10.0
81% 9/30/2008
158.6
80% 9/30/2008
20.1
79% 9/30/2008
416.5
78% 9/30/2008
123.9
77% 10/31/2008
15.1
77% 9/30/2008
27.2
77% 9/30/2008
15.5
75% 9/30/2008
35.4
74% 9/30/2008
131.1
74% 9/30/2008
13.3
74% 6/30/2008
18.8
73% 9/30/2008
*Priced as at 16 December 2008
Selection criteria:
1) TSX and TSX-V listed mining/exploration companies with market cap between $10 million and $1,000 million
2) Working capital > $5 million and
3) Working cap-LT debt/market cap > 50%
Source: Capital IQ, Canaccord Adams
18 December 2008
Figure 10: Selected companies with HIGH working capital
Company Name
Dundee Precious Metals Inc.
FNX Mining Company, Inc.
Shore Gold Inc.
Chariot Resources Ltd.
Canadian Gold Hunter Corp.
Eurasian Minerals Inc.
Pediment Exploration Ltd.
VMS Ventures Inc.
Mega Uranium Ltd.
Mines Management Inc.
Entree Gold Inc.
ATNA Resources Ltd.
Greystar Resources Ltd.
European Goldfields Ltd.
Strathmore Minerals Corp.
Ventana Gold Corp.
Kodiak Exploration Ltd.
North American Palladium Ltd.
Aura Minerals Inc.
Sacre-Coeur Minerals Ltd.
Virginia Mines Inc.
Goldsource Mines Inc.
Ticker
DPM : TSX
FNX : TSX
SGF : TSX
CHD : TSX
CGH : TSX
EMX : TSX-V
PEZ : TSX-V
VMS : TSX-V
MGA : TSX
MGT : TSX
CSI : TSX
ETG : TSX
ATN : TSX
GSL : TSX
EGU : TSX
STM : TSX-V
VEN : TSX
KXL : TSX-V
PDL : TSX
RR : TSX-V
ORA : TSX
SCM : TSX-V
VGQ : TSX-V
GXS : TSX-V
Price
(C$)*
1.70
2.90
0.28
0.10
0.22
0.61
0.85
0.29
0.53
1.90
0.65
1.19
0.45
1.20
2.39
0.21
0.17
0.61
2.26
1.12
0.19
0.53
3.00
1.56
Shares out
(M)
133
85
217
328
58
28
41
108
187
23
43
95
83
46
179
72
69
89
85
58
593
36
29
19
Market Cap
(C$M)
226.3
246.1
59.6
31.2
12.8
17.3
34.7
31.3
99.3
43.2
27.7
112.5
37.5
55.3
428.7
14.9
11.7
54.3
192.5
65.0
109.7
19.2
87.6
30.1
Working Cap
(C$M)
171.6
165.1
39.2
19.9
8.0
10.8
21.4
19.1
60.1
25.9
16.6
67.6
22.9
31.9
245.4
8.4
6.6
29.9
105.5
34.9
58.3
10.0
44.4
15.1
Long-Term
Debt (C$M)
15.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.4
0.9
0.0
0.0
0.0
0.0
0.1
0.5
0.0
0.0
0.0
0.0
0.0
Working Cap LT debt
(C$M)
155.7
165.1
39.2
19.9
8.0
10.8
21.4
19.1
60.1
25.9
16.6
67.2
22.1
31.9
245.4
8.4
6.6
29.8
105.0
34.9
58.3
10.0
44.4
15.1
Selection criteria:
1) TSX and TSX-V listed mining/exploration companies with Market Cap between $10 million and $1,000 million
3) Working Cap-LT debt/Market Cap > 50%
(Working Cap LT debt)/
Mkt Cap (%)
69%
67%
66%
64%
63%
62%
62%
61%
61%
60%
60%
60%
59%
58%
57%
57%
56%
55%
55%
54%
53%
52%
51%
50%
Reported
9/30/2008
9/30/2008
9/30/2008
10/31/2008
9/30/2008
9/30/2008
6/30/2008
5/31/2008
6/30/2008
9/30/2008
7/31/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
6/30/2008
9/30/2008
7/31/2008
8/31/2008
9/30/2008
18 December 2008
Figure 11: Selected companies with LOW working capital
Company Name
OceanaGold Corporation
Crew Gold Corp.
Mercator Minerals Ltd.
Canadian Royalties Inc.
Moly Mines Ltd.
Mirabela Nickel Ltd.
High River Gold Mines Ltd.
Crystallex International Corp.
Sherritt International Corp.
Frontera Copper Corp.
Katanga Mining Ltd.
Globestar Mining Corp.
Orsu Metals Corporation
Cline Mining Corp.
Palladon Ventures Ltd.
Nord Resources Corp.
Coeur d’Alene Mines Corp.
Rusoro Mining Ltd.
Equinox Minerals Ltd.
Teal Exploration & Mining Inc.
Centenario Copper Corporation
Infinito Gold Ltd.
Archon Minerals Ltd.
Mineral Deposits Ltd.
International Royalty Corp.
Bear Creek Mining Corp.
Golden Star Resources, Ltd.
South American Gold and Cu Co.
Augusta Resource Corp.
Petaquilla Minerals Ltd.
US Gold Cdn Acquisition Corp.
San Anton Resource Corporation
Minefinders Corp. Ltd.
NovaGold Resources Inc.
Denison Mines Corp.
Lundin Mining Corp.
Western Areas NL
Minera Andes Inc.
Jaguar Mining Inc.
Northern Star Mining Corp.
Jinshan Gold Mines Inc.
Anooraq Resources Corporation
Taseko Mines Ltd.
Scorpio Mining Corp.
SEMAFO Inc.
Orezone Resources Inc.
Western Goldfields Inc.
Metanor Resources Inc.
Western Canadian Coal Corp.
CGA Mining Ltd.
Polymet Mining Corp.
St Andrew Goldfields Ltd.
Ecu Silver Mining Inc.
Uranium One Inc.
Harry Winston Diamond Corp.
Amerigo Resources Ltd.
Apollo Gold Corp.
Cantex Mine Development Corp.
Dioro Exploration NL
Castle Gold Corporation
Great Basin Gold Ltd.
Terrane Metals Corp.
ATW Gold Corp.
Uranium Participation Corp.
Ticker
OGC : TSX
CRU : TSX
ML : TSX
CZZ : TSX
MOL : TSX
MNB : TSX
HRG : TSX
KRY : TSX
S : TSX
FCC : TSX
KAT : TSX
GMI : TSX
OSU : TSX
CMK : TSX
PLL : TSX-V
NRD : TSX
CDM : TSX
RML : TSX-V
EQN : TSX
TL : TSX
CCT : TSX
IG : TSX-V
ACS : TSX-V
MDM : TSX
IRC : TSX
BCM : TSX-V
GSC : TSX
SAG : TSX
AZC : TSX
PTQ : TSX
UXE : TSX
SNN : TSX
MFL : TSX
NG : TSX
DML : TSX
LUN : TSX
WSA : TSX
MAI : TSX
JAG : TSX
NSM : TSX-V
JIN : TSX
ARQ : TSX-V
TKO : TSX
SPM : TSX
SMF : TSX
OZN : TSX
WGI : TSX
MTO : TSX-V
WTN : TSX
CGA : TSX
POM : TSX
SAS : TSX
ECU : TSX
UUU : TSX
HW : TSX
ARG : TSX
APG : TSX
CD : TSX-V
DIO : TSX
CSG : TSX-V
GBG : TSX
TRX : TSX
ATW : TSX-V
U : TSX
Price
(C$)*
0.15
0.10
0.47
0.27
0.22
0.70
0.12
0.16
3.23
0.55
0.28
0.42
0.09
0.14
0.17
0.40
0.93
0.28
1.39
2.85
0.85
0.27
0.85
0.47
1.68
1.25
1.38
0.03
0.82
0.43
0.90
0.34
5.54
2.09
0.91
1.22
3.28
0.52
4.05
0.63
0.66
0.38
0.83
0.23
1.33
0.55
1.78
0.44
0.61
1.00
0.88
0.20
1.01
1.57
5.88
0.35
0.27
0.10
0.25
0.20
1.63
0.11
0.38
7.30
Shares Out
(M)
162
855
75
102
86
130
590
295
292
65
206
105
462
85
169
69
551
391
597
54
51
121
53
485
78
55
236
767
89
96
45
105
73
108
197
487
168
190
64
103
164
186
144
112
230
358
137
73
210
234
137
319
243
470
61
93
220
317
92
75
215
363
60
72
Market Cap
(C$M)
24.2
85.5
34.8
27.6
19.0
90.9
67.9
47.2
943.3
35.5
57.8
44.2
39.3
11.4
27.9
27.6
512.7
109.4
829.7
153.7
43.5
32.8
45.3
227.8
131.8
69.3
325.6
19.2
72.8
40.8
40.7
35.8
403.4
224.7
179.5
594.7
551.8
98.9
259.1
64.9
108.2
70.5
119.6
25.2
306.2
197.0
243.4
32.3
127.9
233.9
120.8
63.7
245.0
737.1
360.9
32.7
58.3
30.1
22.9
15.1
350.7
38.1
23.0
528.0
Working Cap
(C$M)
-52.8
38.2
45.1
44.8
110.8
-99.3
-11.1
46.8
842.6
44.8
261.3
-2.1
-13.7
10.1
13.3
-3.7
172.3
6.5
-81.1
-93.7
90.9
-3.0
0.5
-58.4
-5.9
5.4
37.5
-1.9
12.2
27.4
2.6
0.4
40.8
7.4
83.0
157.2
80.2
-12.1
52.9
22.9
58.0
-0.7
14.6
15.4
16.3
-13.3
57.9
2.1
53.8
47.0
52.6
3.2
7.7
167.8
233.9
-1.3
-1.9
-0.8
0.3
7.3
71.6
6.3
6.3
-0.1
Long-Term
Debt (C$M)
149.0
381.9
139.7
93.8
141.2
42.0
83.5
101.0
1,897.1
83.9
320.8
43.3
26.3
19.1
34.5
17.3
555.7
82.9
494.1
0.0
111.5
11.0
19.2
15.3
36.2
26.5
133.2
3.8
32.3
37.2
11.8
8.0
125.9
53.6
119.2
275.5
187.5
4.6
94.5
32.8
73.0
8.7
30.3
18.2
50.5
7.9
83.8
5.5
66.0
68.7
62.4
8.1
21.1
206.7
249.4
0.0
0.1
0.0
0.7
7.3
73.0
6.4
6.4
0.0
Selection criteria:
3) Working Cap-LT debt/market cap > 5%
Working Cap LT debt (C$M)
-201.8
-343.6
-94.6
-49.0
-30.3
-141.3
-94.6
-54.2
-1,054.5
-39.1
-59.5
-45.4
-39.9
-9.0
-21.3
-21.0
-383.4
-76.4
-575.2
-93.7
-20.6
-14.0
-18.7
-73.7
-42.0
-21.1
-95.7
-5.6
-20.1
-9.7
-9.2
-7.6
-85.1
-46.2
-36.3
-118.3
-107.3
-16.7
-41.6
-9.9
-15.0
-9.5
-15.7
-2.9
-34.2
-21.2
-25.9
-3.4
-12.3
-21.7
-9.9
-4.9
-13.4
-38.9
-15.5
-1.3
-2.0
-0.8
-0.4
-0.1
-1.4
-0.1
-0.1
-0.1
(Working CapLT debt)/
Mkt Cap (%)
-832%
-402%
-272%
-178%
-160%
-155%
-139%
-115%
-112%
-110%
-103%
-103%
-102%
-79%
-76%
-76%
-75%
-70%
-69%
-61%
-47%
-43%
-41%
-32%
-32%
-30%
-29%
-29%
-28%
-24%
-23%
-21%
-21%
-21%
-20%
-20%
-19%
-17%
-16%
-15%
-14%
-13%
-13%
-11%
-11%
-11%
-11%
-10%
-10%
-9%
-8%
-8%
-5%
-5%
-4%
-4%
-3%
-3%
-2%
0%
0%
0%
0%
0%
Reported
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
6/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
8/31/2008
8/31/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
8/31/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
6/30/2008
9/30/2008
8/31/2008
12/31/2007
9/30/2008
9/30/2008
8/31/2008
9/30/2008
9/30/2008
6/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
9/30/2008
7/31/2008
9/30/2008
9/30/2008
9/30/2008
10/31/2008
9/30/2008
9/30/2008
7/31/2008
8/31/2008
9/30/2008
9/30/2008
9/30/2008
8/31/2008
8/31/2008
18 December 2008
Figure 12: Selected companies with LOW working capital
Company Name
Tanzanian Royalty Explor. Corp.
Quaterra Resources Inc.
Labrador Iron Ore Royalty Inc. Fund
Midway Gold Corp.
Wesdome Gold Mines Ltd.
Mountain Province Diamonds Inc.
Carat Exploration Inc.
Great Panther Resources Limited
Silver Standard Resources Inc.
Gammon Gold, Inc.
Norsemont Mining Inc.
Aurizon Mines Ltd.
Klondex Mines Ltd.
Ticker
TNX : TSX
QTA : TSX-V
LIF.UN : TSX
MDW : TSX-V
WDO : TSX
MPV : TSX
CRZ : TSX-V
GPR : TSX
SSO : TSX
GAM : TSX
NOM : TSX
ARZ : TSX
KDX : TSX
Price
(C$)*
5.06
0.60
19.70
0.36
0.89
1.10
1.08
0.31
17.30
5.05
1.70
4.00
0.51
Shares Out
(M)
89
87
32
77
101
60
37
95
63
120
54
148
25
Market Cap
(C$M)
449.3
52.5
630.4
27.8
90.0
65.9
40.3
29.5
1,084.8
605.3
91.6
592.0
12.9
Working Cap
(C$M)
1.3
1.5
4.1
1.2
10.0
0.8
0.6
5.0
130.2
14.6
2.0
22.4
0.4
Long-Term
Debt (C$M)
0.0
1.2
0.0
1.0
9.3
0.0
0.0
4.5
108.7
1.9
0.0
9.2
0.0
Selection criteria:
3) Working Cap-LT debt/market cap > 5%
Working Cap LT debt
(C$M)
1.3
0.3
4.1
0.2
0.7
0.8
0.6
0.5
21.6
12.7
2.0
13.2
0.4
(Working
CapLT debt)/
Reported
Mkt Cap (%)
0% 8/31/2008
1% 9/30/2008
1% 9/30/2008
1% 9/30/2008
1% 9/30/2008
1% 9/30/2008
2% 5/31/2008
2% 9/30/2008
2% 9/30/2008
2% 9/30/2008
2% 9/30/2008
2% 9/30/2008
3% 9/30/2008
18 December 2008
2009 WATCH LIST
Figure 13: Canaccord Adams 2009 watch list
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Company name
Banro Corp.
Diamonds North Resources Ltd.
Extract Resources Limited
Golden Arrow Resources Corporation
International Royalty Corporation
Kivalliq Energy Corporation
Lumina Copper Corp.
Rubicon Minerals Corporation
Ticker
BAA
BMC
CN
DDN
EXT
FST
GRG
GUY
HRC
IRC
ITH
KGN
KIV
LCC
PGD
RMX
SIR
UW
URC
WTM
Exchange
TSX
TSX-V
TSX-V
TSX-V
TSX
TSX-V
TSX-V
TSX
TSX-V
TSX
TSX-V
TSX-V
TSX-V
TSX-V
TSX
TSX
TSX-V
TSX-V
TSX-V
TSX
Price
11 Dec 08
$1.05
$0.12
$0.05
$0.30
$1.10
$0.20
$0.16
$1.52
$0.19
$1.73
$1.33
$0.65
$0.10
$0.40
$0.38
$1.14
$0.15
$0.18
$0.14
$0.20
18 December 2008
BANRO CORP. (BAA : TSX : C$1.05 | BAA : AMEX : US$0.80 | NOT RATED)
Figure 14: BAA : TSX
Shares O/S (M):
Shares FD (M):
Working capital (M):
LT Debt (M):
Market Cap (M):
Website:
Source: Company reports
Figure 15: BAA : TSX
52.5
61.9
$12.1
Nil
C$70.4
www.banro.com
Source: StockCharts.com
Banro is focused on the advancement of four wholly owned gold projects on the 210-kilometre-long Twangiza–Namoya gold
belt in eastern Democratic Republic of Congo (DRC). The company has offices in Toronto, Kinshasa and Cape Town and is
guided by Chairman Simon Village and President and CEO Michael Prinsloo, former head of gold mining operations for
Gold Fields of South Africa.
•
Banro has been active in the DRC for 12 years, advancing its key projects. The company has a unique arrangement
with the Government of the DRC, arrived at through a legal settlement, that grants Banro 100% ownership with no
royalties and a 10-year tax holiday. This is positive from an ownership perspective but has also raised questions (from
outsiders, not the government), particularly in light of the ongoing land tenure review in the DRC. Completion of the
review should repudiate these concerns and the restoration of peace in the region should also reduce risk. It is
important to note that the current conflict between UN-backed government forces and rebels linked to neighbouring
Rwanda is simmering in North Kivu, well north of Banro’s projects.
•
Banro’s primary project at this time is a simple proposed open-pit heap-leach operation at Namoya. A prefeasibility
study is expected imminently and production is possible in H2/10 based on approximately 1.5 million ounces in all
resource categories. The company is also optimizing the Twangiza bankable feasibility study, expected in January
2009. Twangiza hosts 3.3 million ounces in reserves with what we believe is very good exploration upside remaining
in the Twangiza Main and Twangiza North areas as well as in new target areas to the west. The feasibility study will
likely include options for capturing a potential incremental 5 million ounces of mineable oxide and transitional (nonrefractory) reserve not included in the prefeasibility study. A scoping study is ongoing for the Lugushwa project, which
hosts an inferred resource of 2.7 million ounces gold. A further 10,000 metres of drilling is planned for 2009.
•
Among the three main projects, Banro has identified 9.55 million ounces of gold but is trading at US$3.68 enterprise
value per ounce, a significant discount to the average of US$22.35 per ounce for exploration and development peers.
Banro had US$12.1 million in working capital at September 30, 2008, but lacks sufficient funds to move forward with
its development plans; a strategic investor or development partner is being sought.
An analyst has visited Banro Corp.’s properties. No payment or reimbursement was received from the issuer for the related
travel costs.
Investment risks
The commercialization risks associated with mineral exploration and development are high. Exposure to the Democratic
Republic of Congo adds considerable sovereign risk, thus investment in the shares of Banro Corporation is for risk accounts only.
18 December 2008
BRILLIANT MINING CORP. (BMC : TSX-V : C$0.12 | NOT RATED)
Figure 16: BMC : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 17: BMC : TSX-V
73.0
80.1
$4.7
Nil
C$8.8
www.brilliantmining.com
Brilliant Mining is a Vancouver-based company focused on the production, development and exploration of nickel projects.
The company owns a 25% interest in the producing Lanfranchi nickel mine in Western Australia and wholly owns the
Michikamau Ni-Cu-Co-PGE exploration property in central Labrador. The company melds strong Canadian management in
the form of Chairman John Robins, President Mike Sieb and CEO John Williamson with exceptional Australian engineering
in the form of hands-on directors Leigh Junk and Ian Junk.
•
Brilliant’s primary asset is a 25% interest in the high-grade Lanfranchi nickel mine in Western Australia’s Kambalda
nickel district. The Kambalda district has yielded over 1 million tonnes of nickel metal from 25 mines since the 1960s.
Mineralization is hosted in paleochannels of nickel-bearing flows. The Lanfranchi mine hosts measured and indicated
resources of 3.7 million tonnes grading 2.57% Ni plus 1.6 million tonnes inferred grading 1.84% Ni for a global
resource of 276.3 million pounds of nickel. The mine is conducting a two-phase drill program designed to upgrade the
current Deacon channel inferred resource to a higher level of confidence and to test the channel’s down-plunge
potential. Management is guiding toward mine production in the range of 26.1-27.2 million pounds nickel for the year
ended 30 September 2009. At the end of the third quarter ended 30 June 2008, the company had C$4.7 million in
working capital and was on track for delivery of C$12 million in operating cash flow to year-end 2008.
•
Apart from cash flow from the producing high-grade nickel mine, Brilliant offers excellent exploration potential in
down-plunge extensions of the producing channels. In addition, an A$2.5 million, 12,000-metre, 24-hole drill program
has been budgeted for the Northern Tramways Dome area where evidence is building in support of the discovery of an
overturned portion of the critical ultramafic/basalt target contact on the northern margin of the area. Two high-priority
nickel channels in the projected overturned position of the Winner-Schmitz and Helmut-Deacon channels have been
identified. The wholly owned Michikamau exploration property in central Labrador targets Voisey’s Bay–style
mineralization.
An analyst has not visited the properties held by Brilliant Mining Corp.
Investment risks
The Lanfranchi Mine is located in Western Australia in an area of extensive historical production, thus sovereign-related
risks are minimal. The primary risks associated with investment in Brilliant Mining Corp. are those of metal prices and
exchange rates. The commercialization risks associated with new mineral exploration and development are high, thus
investment in the shares of Brilliant Mining Corp. is for risk accounts only.
18 December 2008
CONDOR RESOURCES INC. (CN : TSX-V : C$0.05 | NOT RATED)
Figure 18: CN : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 19: CN : TSX-V
23.8
28.5
$2.0
Nil
C$1.2
www.condorresources.com
Condor Resources is a small-cap mineral exploration company focused on copper-gold and gold targets in Peru and Chile.
The company is led by CEO and President, Pat Burns, who has over 25 years of exploration experience and has been
recognized as an important member of the original discovery team at Escondida.
•
Condor’s portfolio of 12 projects provides investors with numerous opportunities for preliminary and long-term
exploration success. In terms of short-term potential impact, Condor will conduct exploration in 2009 on its Condor de
Oro gold project in Peru. The company will likely require financing to fund exploration work in 2009.
•
Condor de Oro is a gold-copper target spanning about 85 square kilometres. It is located south of Kinross’s Fruta del
Norte (FDN) gold deposit in Ecuador, and mineralization is believed to be associated with a geological environment
similar to that at FDN. The company has outlined strong gold and base metal geochemical data coincident with the 2kilometre boundary of a magnetic high/low transition. Condor has the option to earn up to 65% of Condor de Oro. It
has also recently attained a right to earn 100% of a 49-square-kilometre project, Sol de Oro, adjacent (10 kilometres
northeast) to Condor de Oro.
•
Over the last year the company primarily focused on its Brahma copper porphyry target (located south of Santiago,
Chile and 200 kilometres south of the El Teniente mine). Surface mapping and sampling in association with
geophysical data (chargeability anomaly over the central portion of the target measuring approximately 900 metres in
width) and initial drilling aided in the identification of a large porphyry copper target (approximately 6 square
kilometres in diameter). In July 2008 Condor commenced drilling an eight-hole, 3,500-metre drilling program at
Brahma. Initial results were variable and Brahma’s potential to host economic copper mineralization has been brought
into question. We believe the large Brahma system requires additional work to fully assess its potential. In addition,
Condor’s untested Austral copper target is located 10 kilometres from Brahma.
An analyst has not visited the properties held by Condor Resources Inc.
Investment risks
The commercialization risks associated with mineral exploration and development are high, thus investment in the shares
of Condor Resources Inc. is for risk accounts only.
18 December 2008
DIAMONDS NORTH RESOURCES LTD. (DDN : TSX-V : C$0.30 | NOT RATED)
Figure 20: DDN : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
8
Figure 21: DDN : TSX-V
75.2
86.3
C$8.5
Nil
C$22.6
www.diamondsnorthresources.com
Diamonds North Resources is a mineral exploration company targeting diamonds in Canada’s far north. The company is led
by Mark Kolebaba (President and CEO), a former exploration head for the BHP and Dia Met joint venture at Ekati. Its principal
asset is its 100%-owned Amaruk diamond project (Tuktu target) in the Pelly Bay region of Nunavut. The main area of the
Amaruk project spans more than 80 kilometres east to west and is within approximately 30 kilometres of tidewater.
•
The company has identified over 500 airborne magnetic anomalies defined by abundant, high-quality indicator
minerals and kimberlite float at the Amaruk property. Sampling indicates a significant population of highchromium/low-calcium pyrope garnets (G-10s). In our opinion, the chemistry of these garnets is closely comparable to
some of the best garnet chemistry associated with the Ekati and Diavik diamond mines in NWT. In fact, several of the
sub-calcic garnets display as high as 13 wt% Cr2O3 and <2.5 wt% CaO. This chemistry is a strong indication that any
kimberlites that sourced these garnets have tapped the diamond stability field and have a high potential to contain a
significant population of diamonds. The company has indicated that the area hosts favourable chromite chemistry and
there is additional work outstanding on the chemistry of the population of eclogitic garnets. From this initial data the
company has identified 29 kimberlites.
•
On 13 March 2008, Diamonds North announced that it had recovered high diamond counts from the Tuktu kimberlite
cluster on the Amaruk project. Sample Tuktu 1 returned the highest diamond count of 550 diamonds from an 81.75
kilogram sample, or 6.7 diamonds/kg. In June the company reported that a follow-up sample of 412.15 kilograms of
kimberlite (Tuktu 1B) returned 2,850 diamonds, or 6.9 diamonds/kg. The majority of the stones recovered to date are
described by the company as clear and octahedral in form.
•
Diamonds North is in the process of completing the analysis of a mini-bulk sample at Amaruk. An estimated 21.63
tonnes of kimberlite was collected from the Tuktu-1, 2 and 3 kimberlite and an additional estimated 14.49 tonnes of
kimberlite was collected from Qavvik-4, 5 and 6 kimberlites last summer. This kimberlite sample has been processed
using Dense Media Separation (DMS), and final diamond-picking is expected to be completed by late January 2009.
The presence of a population of macro stones would add considerably to the economic potential at Amaruk.
An analyst has not visited the properties held by Diamonds North Resources Inc.
Investment risks
of Diamonds North Resources Inc. is for risk accounts only.
18 December 2008
EXTRACT RESOURCES LIMITED (EXT : TSX : C$1.10 |ASX : A$0.85 | NOT RATED)
Figure 22: EXT : TSX
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 23: EXT : TSX
212.7
214.9
$246.8
Nil
C$26.5
www.extractresources.com
Extract Resources is a Perth-based uranium exploration company focused on the advancement of the wholly owned Husab
uranium project in Namibia. Extract is ably guided by Chairman Bob Buchan, founder and CEO of Kinross Gold Corp., and
Managing Director Peter McIntyre.
•
Extract owns 100% of the Husab uranium project situated immediately south of the world-class Rössing mine in
Namibia. Rössing, indirectly owned by Rio Tinto, the Government of Iran (15%), the Industrial Development
Corporation of South Africa (10%), the Namibian government (3%), and a private party (3%), has been in production
for more than 30 years. An expansion is in progress to take the mine to 8.8 million pounds U3O8 per annum capacity.
Extract continues to build an impressive resource at the Rössing South prospect, intersecting significant widths of highgrade uranium mineralization. Four high-capacity reverse circulation (RC) rigs and two diamond drill core rigs are
presently testing Rössing South Zone 1. The recent intersections reported include 105 metres grading 1,198 ppm U3O8
and 58 metres grading 1,372 ppm U3O8, very high-grade in the Namibian context. Management intends to complete
drilling Rössing South Zone 1 on a 100 by 100 metre grid by the end of 2008, and an initial resource is expected by
January 2009. Rössing South will complement the Ida Dome site in the south of the Husab project where an initial
inferred resource of 52.7 million tonnes grading 213 ppm U3O8, or 24.8 million pounds using a 100 ppm cut-off grade,
was announced in August 2008. An eventual mine plan will likely incorporate a central plant at the Rössing South site
fed in part by satellite mine(s) at Ida Dome.
•
Zone 1 has been traced over a strike length exceeding 2.3 kilometres and remains open to the south and at depth to
the east on every section. Zone 2 provides an additional 2 kilometres of strike length. The deposit is shaping up well,
with multiple zones of moderately to steeply east-dipping uraniferous alaskite in a setting that we consider virtually
identical to the world-class Rössing mine. The project is also well-situated relative to existing infrastructure.
•
Namibian uranium resources are definitely “in play” given the recent C$7.00 cash offer by George Forrest International
for Forsys Metals and the machinations surrounding Extract. Rio Tinto has taken a 14.4% position in Extract, joining
Kalahari Minerals with a 39.1% interest. Kalahari and Extract had entered into a plan of arrangement earlier this year
whereby Kalahari was offering 1.6 shares for each share of Extract. Kalahari terminated the deal on 20 November
after Rio Tinto refused to agree to a “standstill” agreement.
An analyst has visited the properties of Extract Resources Ltd. No payment or reimbursement was received from the issuer
for the related travel costs.
Investment risks
of Extract Resources is for risk accounts only.
18 December 2008
FORTRESS MINERALS CORP. (FST : TSX-V : C$0.20 | NOT RATED)
Figure 24: FST : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 25: FST : TSX-V
150.1
169.0
C$9.0
Nil
C$30.0
www.fortressminerals.com
Fortress Minerals is a junior gold exploration company under the stewardship of Lukas Lundin, President and CEO.
Fortress holds interests in gold exploration projects in Russia, Mongolia and Nicaragua; however, its focus has been on the
exploration and development of the company’s Svetloye gold exploration project in Russia. While Fortress currently holds a
100% interest in the Svetloye project, Gazprombank has an option to acquire a 51% interest in the project.
•
Svetloye project: The Svetloye project is located east Russia, roughly 80 kilometres from the Pacific Ocean, close to the
port of Okhotsk. Fortress is targeting high-sulphidation epithermal gold deposits, similar to Barrick Gold’s Veladero
mine (Chile). Currently, nine targets have been identified on the Svetloye land package: Elena, Larissa, Tamara, Gorki,
Ludmilla, Amy, Bill, Sandy and Katie.
•
Svetloye resource estimate: A resource estimate was released for the Svetloye project in June 2008. The project
currently hosts inferred resources of 16.2 million tonnes grading 2.11 g/t gold for total contained gold resources of 1.1
million ounces. The resource is primarily hosted within the Elena deposit, which the majority of drilling has been
focused at Svetloye.
•
Expansion potential: The company’s drill program at Svetloye has returned significant mineralized intervals from the
Elena, Tamara, Amy and Ludmilla. The most compelling drill results released in 2008 were produced from the Amy
prospect. In December 2008, Fortress reported the assay results from five diamond drill holes completed at the Amy
prospect. Hole PDSC-236 returned a 111.2-metre intercept grading 19.39 g/t Au with mineralization starting from
surface. This is a compelling drill intercept. In addition to hole PDSC-236, the company reported a 62.5-metre intercept
grading 1.32 g/t from surface (Hole PDSC-233) and a 117.5-metre intercept grading 1.99 g/t Au from surface (Hole
PDSC-234). Based on the drilling results reported to date, the Amy prospect has the potential to significantly add to the
resource base at the Svetloye project with significant upside associated with the seven remaining regional targets.
•
Gazprombank’s option: Gazprombank’s option is exercisable up to 31 December 2008. To exercise the option,
Gazprombank must: (a) pay US$47.75 million to Fortress; (b) reimburse Fortress 51% of costs incurred at Svetloye
between 8 April 2008 and the date of the exercise; and (c) pay a bonus to Fortress at prefeasibility, contingent on the
measured and indicated resources included in a prefeasibility study report.
•
Balance sheet: At the end of September 2008, Fortress had C$1.9 million in working capital and no long-term debt. In
November, Fortress converted C$4.0 million note due to a related party into 27.1 million shares of the company and
announced a 16.25 million unit private placement for C$3.25 million (gross). Factoring in these developments, the
company should have roughly C$9.0 million in working capital and roughly 150 million shares outstanding.
An analyst has not visited the properties held by Fortress Minerals Corp.
Investment risks
of Fortress Minerals Corp. is for risk accounts only.
18 December 2008
GOLDEN ARROW RESOURCES CORPORATION (GRG : TSX-V : C$0.16 | NOT RATED)
Figure 26: GRG : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 27: GRG : TSX-V
19.6
29.0
$2.7
Nil
C$3.1
www.goldenarrowresources.com
Golden Arrow Resources is a Vancouver-based precious metal exploration company with a focus on Argentina and Peru.
The company is under the stewardship of Joseph Grosso, President and CEO. Mr. Grosso is the founder of Grosso Group
Management Ltd., which includes Amera Resources Corporation, Blue Sky Uranium Corp., IMA Exploration Inc. and
Golden Arrow Resources Corp.
•
Gualcamayo royalty: Golden Arrow has a 1% NSR royalty on Yamana Gold’s Gualcamayo project in Argentina. The
Gualcamayo project is expected to start commercial production in April 2009 with guidance for production in excess of
200,000 ounces of gold per year. At a production rate of 200,000 ounces of gold and a gold price of US$825/oz, Golden
Arrow’s 1% NSR royalty should generate roughly US$1.9 million.
•
Exploration in Peru and Argentina: Golden Arrow inherited a portfolio of exploration properties in Peru and Argentina,
when the company was spun out from IMA Exploration. Its portfolio includes: the Rio Tabaconas project in northern
Peru, 50 kilometres south of Aurelian Resources (now Kinross Gold’s) Condor gold project; the Rio De Las Taguas
Property in Argentina, adjacent to Barrick Gold’s Pascua Lama gold project; and the Potrerillos Property, adjacent to
Barrick Gold’s Veladero gold mine.
•
Balance sheet: At the end of September 2008, Golden Arrow had C$1.9 million in cash and short-term investments,
working capital of C$2.1 million in working capital and no long-term debt. In November 2008, the company announced
a private placement of 4.1 million units at a price of C$0.15 per unit, which, if fully executed, could raise gross
proceeds of C$0.6 million.
•
What to watch for in 2009: The royalty in place on Yamana Gold’s Gualcamayo project has piqued our interest in this
micro-cap explorer. Gualcamayo is expected to begin commercial production in Q2/09, which suggests that Golden
Arrow could begin to generate cash flows in 2009. Golden Arrow would then be in a position to use the proceeds from
the royalty to finance exploration in Peru and Argentina, or it could potentially look at the outright sale of the royalty.
Gold royalty streams can fetch a significant premium in the market. The royalty on Gualcamayo should help support a
healthy balance sheet for Golden Arrow and/or it could attract attention as a potential acquisition target for larger cap
royalty company.
An analyst has visited the properties held by Golden Arrow Resources Corp. Partial payment or reimbursement was
received from the issuer for the related travel costs.
Investment risks
of Golden Arrow Resources Corp. is for risk accounts only.
18 December 2008
GUYANA GOLDFIELDS INC. (GUY : TSX : C$1.52 | NOT RATED)
Figure 28: GUY : TSX
Shares o/s (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 29: GUY : TSX
52.1
57.4
$25.9
Nil
C$79.2
www.guygold.com
Guyana Goldfields is a junior gold exploration company under the stewardship of J. Patrick Sheridan Jr., President and
CEO. Guyana is focused on exploration and development of its flagship Aurora gold project in northern Guyana.
•
Aurora gold project: Exploration at the Aurora gold project began to pique investor interest in 2004, when Guyana
Goldfields released the first set of drill holes from the project, which returned 45-211m intercepts grading from 1.3 to
5.9 g/t Au. Subsequent drilling programs in 2005 and 2006 built on these initial results, driving speculative interest in
the shares of Guyana Goldfields. The best intercepts returned to date include:
–
Hole RKD-27: 106m grading 5.62 g/t Au (432m down the drill stem)
–
–
–
–
–
Hole RKD-60DV2: 222m grading 4.72 g/t Au (731m down the drill stem)
While the highest-grade zone of mineralization tends to be intercepted at depth, Guyana Goldfields’ exploration
program has also returned a significant number of low- to high-grade mineralized intercepts from surface.
•
Aurora gold resource: The company released an initial resource estimate in October 2007, which was updated in
December 2008. Currently, the project hosts measured and indicated resources of 29.1 million tonnes grading 3.92 g/t
Au (3.7 million ounces of contained gold) and inferred resources of 20.0 million tonnes grading 2.77 g/t Au (1.7 million
ounces of contained Au). The total gold resource base is now estimated at 5.4 million ounces of gold.
•
Preliminary economic assessment: A preliminary economic assessment of the Aurora project was completed in August
2008, considering a combined open pit/underground operation scenario exploiting the Aleck Hill, Rory Knoll and East
Walcott resources of the Aurora project. The base-case scenario outlined a 2-million-tonne-per-year operation
producing an average of roughly 190,000 ounces of gold per year at a total cash cost of US$388/oz of gold produced.
Using a US$600/oz gold price, Snowden estimated a 10% discounted NPV of US$108.3 million (US$298.3 million using
a US$800/oz gold price). Total pre-production capital used in the study was estimated at US$65 million.
•
Balance sheet: At the end of July 2008, the company had working capital of C$25.9 million and no long-term debt. The
company’s balance sheet should be sufficient to support continued exploration, engineering and metallurgical work in
2009 without the need to come back to the market.
An analyst has visited the properties held by Guyana Goldfields Inc. Partial payment or reimbursement was received from
the issuer for the related travel costs.
Investment risks
of Guyana Goldfields Inc. is for risk accounts only.
18 December 2008
HELIO RESOURCE CORP. (HRC : TSX-V : C$0.19 | NOT RATED)
Figure 30: HRC : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 31: HRC : TSX-V
50.2
61.0
$3.0
Nil
C$9.5
www.helioresource.com
Helio is a gold exploration company focused on developing the SMP Gold Project in Tanzania. The company is under the
stewardship of Richard Williams, President and CEO. Helio controls a 20-kilometre section of the Saza Shear Zone, the
main gold-bearing structure in the Lupa Goldfields located in southwestern Tanzania.
•
Since June 2006, the company has drill-tested a series of mineralized gold zones associated the east-northeast trending
Saza Shear Zone. Mineralization is commonly associated with congregate structural intersections with the Saza shear
and in contact zones related to a lower Proterozoic granitic batholith. Helio has completed about 49,000 metres of
diamond and RC drilling since 2006. A single composite metallurgical sample, tested for a series of conventional
processes returned recoveries ranging from 92 to 96%. The most advanced zones are the Kenge and Porcupine targets.
•
The Kenge target has been outlined over a strike length of about 2,000 metres. Mineralization is associated with a
congegate northwest structure zone from the main trending east-northeast Saza shear. Over 100 holes have tested the
target and about 70 holes have subsequently been completed but assays remain outstanding. The company is targeting
an initial gold resource of about 500,000 ounces.
•
The Porcupine target is interpreted to be associated with a structurally complex dilatational zone adjacent to the Saza shear.
Mineralization is largely related to quartz sericite with gold, pyrite and weak molybdenum. The zone has been traced over
1,000 metres with widths approximately 30-50 metres. Grades are variable but often within a range of 1-4 g/t Au.
•
Numerous targets remain untested within Helio’s large concession. While the style of mineralization at SMP can
require considerable exploration work to delineate, the overall system appears to us to be robust and prospective.
Longer term we believe SMP controls an asset that could host numerous zones of potentially economic mineralization.
To aggressively advance the project, the company will likely require additional capital in 2009. Helio expects pending
drill results to be available in early March 2009
An analyst has not visited the properties held by Helio Resource Corp.
Investment risks
of Helio Resource Corp. is for risk accounts only
18 December 2008
INTERNATIONAL ROYALTY CORPORATION (IRC : TSX : C$1.73 | NOT RATED)
Figure 32: IRC : TSX
Shares O/S (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 33: IRC : TSX
78.5
($2.2)
$25.7
C$135.8
www.internationalroyalty.com
International Royalty is a mineral royalty company with more than 85 royalty interests. The company is under the
stewardship of Douglas Silver, Chairman and CEO, and Paul Zink, President. IRC has a diversified portfolio of royalties
from producing, near-producing and earlier-stage exploration and development assets. Through its portfolio of royalty
streams, IRC has exposure to the prices of nickel, copper, gold, cobalt, coal, oil, natural gas, zinc, silver, molybdenum,
uranium, lead, diamonds, specialty metals, industrial minerals and PGMs.
•
Six operating royalties: IRC generates the substantial majority of its royalty revenues (90+% of revenues in 2008) from
its 2.7% NSR on Vale’s Voisey’s Bay nickel-copper-cobalt mine in Labrador, Canada. The company also has royalty
interests in three gold mines, a thermal coal mine and another nickel mine.
•
Potential new royalty revenues in 2009 – Gwalia Deeps, Las Cruces and Inata: St. Barbara’s Gwalia Deeps gold project
(Australia), Inmet Mining’s Las Cruces Copper project (Spain) and Wega Mining’s (Inata gold project – Burkina Faso) all
have the potential to start contributing to IRC’s bottom line in 2009. Both Gwalia Deeps and Inata are on schedule to
begin production in H1/09. The potential for the Las Cruces copper project to begin production in 2009 is dependent
upon a resolution to the current suspension of authorization related to the dewatering and re-injection at Las Cruces.
•
Longer-term royalty revenue growth – Pascua: After the Voisey’s Bay royalty, the company’s royalty on Barrick Gold’s
Pascua Lama project in Argentina/Chile is arguably the company’s next-most-significant royalty asset. Payouts from
the royalty are based on a sliding scale of 0.47% to 3.15%, depending on the price of gold. Resolving the issue of crossborder taxation continues to be the primary obstacle impeding the development of this project, which makes the timing
of a potential production start difficult to determine. In addition to the Pascua Lama royalty, IRC has 17 royalty
interests on feasibility stage projects with an additional 45 royalty interests on exploration stage projects, giving the
company a pipeline of potential revenue growth opportunities without coinciding capital commitments.
•
A nickel-weighted royalty company that is growing more diversified: Given that its largest revenue stream is primarily
generated from Voisey’s Bay, the company’s revenue breakdown is substantially weighted towards nickel. However,
new royalty revenue streams from operations coming on stream are primarily associated with gold and copper
production. Therefore, over the next 12-24 months, IRC’s revenue breakdown should diversify significantly.
•
Balance sheet: IRC ended the third quarter with a negative working capital position of US$2.2 million and US$25.7 million
in long-term debt. While this balance sheet leaves something to be desired, it largely reflects the acquisition of the Pinson
royalties in September 2008. With the free cash flows being generated from the company’s current producing royalties
and with new royalties coming on stream, the company’s balance sheet should improve throughout 2009.
An analyst has not visited the properties held by International Royalty Corp.
Investment risks
of International Royalty Corp. is for risk accounts only.
18 December 2008
INTERNATIONAL TOWER HILL MINES LTD. (ITH : TSX-V : C$1.32 | NOT RATED)
Figure 34: ITH : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 35: ITH : TSX-V
43.5
55.3
C$6.5
Nil
C$57.4
www.ithmines.com
International Tower Hill (ITH) is a mineral exploration and development company whose principal project, Livengood (100%),
is located in Alaska, 110 road kilometres from Fairbanks. ITH is led by Jeff Pontius, CEO and President. AngloGold Ashanti
owns 6.4 million ITH shares (15% of issued) and has the right to acquire, via private placement at market value, up to a 19.9%
interest in ITH. This right will terminate if AngloGold’s interest falls below 10% at any time after 1 January 2009.
•
In November 2008, ITH released an updated mineral resource estimate for the Money Knob deposit at Livengood.
Using a 0.5 g/t Au cut-off, the resource estimate is 69.53 million tonnes indicated at 0.083 g/t Au and 87.88 million
tonnes inferred at 0.77 g/t Au, for a total of 4.03 million ounces of contained gold (overall average grade 0.80 g/t Au).
ITH estimates that approximately 65% of this resource estimate consists of oxide ore. This new resource indicates a
sizeable increase in grade and tonnes compared with the previous (2007) inferred mineral resource estimate at
Livengood of 87.81 million tonnes grading 0.71 g/t Au for 2.01 million ounces of gold (using a 0.5 g/t Au cut-off).
•
A winter drilling program at Livengood, budgeted at 7,000 metres, is planned to commence in February 2009, with an
additional 10,000 metres of drilling planned for summer 2009, both using one RC drill rig. The company indicates that
the winter drill program will focus on under-estimated blocks within the current resource area, while one-third of the
summer program will be dedicated to more regional exploration at the property, with the remainder as infill and
expansion drilling. The company plans to complete an updated resource estimate for Livengood in Q1/09, based on an
additional 60 drill holes from 2008, which will be used in a preliminary economic assessment, currently planned for
mid-2009. ITH plans to update the Livengood resource estimate after both the winter and summer drill programs in
2009, which have a total budget of approximately $6 million.
•
ITH is targeting Livengood as a large-scale open-pit operation. Given the modest overall grades encountered to date, we
would expect metallurgy to be an important factor in the overall economic viability of the project. Preliminary simple
bottle roll tests suggest oxidized and partially oxidized mineralization could return recoveries of 80-90%. Sulphide
mineralization, starting at variable depths of 50-200 metres below surface returned average recoveries of 50-60%.
•
Mineralization at Livengood is associated with an east-west trending structurally complex sequence of Paleozoic
sediments, volcanics and ultramafic rocks. Within the 1,000-metre main target area at Livengood, the company has
identified a structural zone spanning about 225 metres, where mineralization cuts into all rock units including footwall
sediments, Devonian volcanics, hanging wall sediments and hanging wall ultramafics. Wide zones of elevated gold
mineralization in this area could conceptually translate into a starter pit area.
An analyst has visited the properties held by International Tower Hill Mines. Partial payment or reimbursement was
received from the issuer for the related travel costs.
Investment risks
The commercialization risks associated with mineral exploration and development are high, thus, investment in the shares
of International Tower Hill Mines is for risk accounts only.
18 December 2008
KEEGAN RESOURCES INC. (KGN : TSX-V : C$0.65 | NOT RATED)
Figure 36: KGN: TSX-V
Figure 37: KGN: TSX-V
4
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
28.4
36.7
$9.3
Nil
C$18.5
www.keeganresources.com
Keegan Resources is a Vancouver-based junior gold exploration company under the stewardship of Dan McCoy, PhD,
President and CEO. Keegan is focused on exploration at its Esaase and Asumura gold projects in Ghana. Keegan has been
actively exploring in Ghana since 2005 and released an initial NI 43-101 compliant mineral resource estimate at its Esaase
project in October 2007.
•
Esaase project: The Esaase project is located 13 kilometres northeast of Resolute Mining’s Obotan deposit.
Mineralization is hosted in highly deformed Birimian metasedimentary rocks containing sheeted and quartz stockwork
veins. In October 2007, Keegan released an initial resource estimate for the Esaase project with indicated resources of
5.4 million tonnes grading 1.4 g/t Au and inferred resources of 31.9 million tonnes grading 1.4 g/t Au. Total gold
resources are estimated at 1.67 million ounces. The company has completed 115,000 metres of drilling to date at
Esaase and expanded the zone of mineralization to the south and the north and identified two new zones. In 2009,
Keegan should release an updated resource estimate for the Esaase project along with an initial scoping study for an
open pit operation at the project.
•
Asumura project: The Asumura project is located 65 kilometres to the south of Newmont Mining’s Ahafo gold mine.
Mineralization at Asumura is spatially associated with granitoid stocks, dikes and sills. The company has been
exploring at Asumura since 2005. In 2008, the company made a high-grade discovery in the northwest zone of the
Asumura project, returning 14 metres intercept grading 4.48 g/t Au (including 1 metre of 52.2 g/t Au). The majority of
Keegan’s exploration and development program in 2009 is budgeted on drilling and engineering work at the Esaase
project; however, some additional follow-up drilling at Asumura is also planned.
•
Balance sheet: At the end of September 2008, the company had working capital of C$9.3 million and no long-term
debt. With a reduced exploration and development program in 2009, the company’s current balance sheet should be
sufficient; however, should the company continue to aggressively advance the Esaase project, the company could
require additional capital and return to the market in mid-2009 or earlier.
Keegan stands out as one of the recent exploration success stories in Ghana. With a significant and growing resource at the
Esaase project in a known trend that has hosted substantial gold deposits, we believe Keegan could attract interest as a
potential M&A target in 2009.
An analyst has not visited the properties held by Keegan Resources Inc.
Investment risks
of Keegan Resources Inc. is for risk accounts only.
18 December 2008
KIVALLIQ ENERGY CORPORATION (KIV : TSX-V : C$0.10 | NOT RATED)
Figure 38: KIV : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 39: KIV : TSX-V
29.48
41.46
$1.10
$2.23
C$2.9
www.kivalliqenergy.com
Kivalliq Energy is a uranium exploration and development company that was listed on the TSX Venture Exchange on 7 July
2008. The company is under the stewardship of Rob Carpenter, Chairman, and John Robins, President and CEO. Kivalliq
was formed as a spinout from Kaminak Gold Corp. in order to have a separate energy company to control the uranium
property interests previously held by Kaminak, including the Angilak project in Nunavut and the Baker Lake joint venture
partnership with Pacific Ridge Exploration Ltd. in the Baker Lake Basin.
Kivalliq Energy (as Kaminak Gold) was the first company in Canada to sign a definitive agreement with Nunavut Tunngavik
Inc. (NTI) (Nunavut Inuit First Nation) to explore on its privately held lands in Nunavut for uranium. The landmark
partnership agreement between Kivalliq and NTI, was subsequently formally completed on 8 May 2008.
•
Angilak property: The NTI agreement provides Kivalliq with the right to explore the 250,000 acre Angilak property,
which hosts numerous high-grade uranium +/- copper, silver and gold occurrences, including the Lac Cinquante
uranium occurrence. This deposit has an historical resource of 11.6 million pounds uranium (not NI 43-101 compliant)
with grades averaging 1.03% U3O8. The deposit is a high-grade, near-surface vein-type uranium-silver-molybdenum
occurrence. Other showings on the Angilak property include the Bog, Yat and Rev showings. During H2/08 an airborne
geophysical survey outlined numerous radiometric anomalies, as well as discrete circular magnetic anomalies
representing possible kimberlite targets. Ground follow-up of mapping, sampling and ground geophysics outlined the
Lac Cinquante zone as well as a possible extension to the southeast. An up-to date geological model is being developed
in order to plan for a focused exploration/drill program in 2009.
•
Baker Lake uranium project: The Baker Lake uranium joint venture project is located in the Baker Lake Proterozoic
Basin, approximately 40 kilometres south of Baker Lake, Nunavut. This basin is host to uranium mineralization, and
Pacific Ridge Exploration Ltd. and Kivalliq in September 2008 amended the Baker Lake uranium project agreement to
include Aurora Energy Resources Inc. whereby Aurora can earn a 51% interest by incurring expenditures totalling $15
million over three years. Pacific Ridge has acquired 100% interest and delivered 2.0 million shares of Pacific Ridge to
Kivalliq. Kivalliq retains a back-in right to acquire a 20% project interest upon delivery of a prefeasibility study by
Aurora and Pacific Ridge.
Kivalliq Energy has demonstrated excellent initiative for obtaining the first agreement in Canada for exploration for
uranium on Inuit Lands in Nunavut. This area had previously been explored for uranium in the 1970s and 1980s by Pan
Ocean, Urangesellschaft and Noranda, and was known to contain areas of uranium mineralization. The initial work by
Kivalliq has outlined the known uranium areas and provided exploration targets for 2009.
An analyst has not visited the properties held by Kivalliq Energy Corporation.
Investment risks
of Kivalliq Energy is for risk accounts only.
18 December 2008
LUMINA COPPER CORP. (LCC : TSX-V : C$0.40 | NOT RATED)
Figure 40: LCC : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 41: LCC : TSX-V
34.6
34.6
C$7.5
Nil
C$
www.luminacopper.com
Lumina Copper was formed as a spinout from assets of Global Copper during Teck’s acquisition of Global Copper,
announced in April 2008. Lumina is under the stewardship of the same management team, led by Ross Beaty and David
Strang, who have successfully divested four companies (valued in excess at US$1 billion) with base metal assets over the
last 2.5 years.
•
As per the terms of Teck’s acquisition of Global, Lumina holds all assets of Global, other than the Relincho project,
including 100% of the Taca Taca and San Jorge properties in Argentina, $10 million in cash, equity interests in Coro
Mining (1 million shares) and Los Andes Copper (6.28 million shares and 3.90 million warrants at $1.00 expiring in
2010), a 1-2% NSR on Los Andes’ Vizcachitas copper/moly project in Chile and a 1.5% net smelter return royalty in
respect of the Relincho project (payable commencing in the fifth year after the start of commercial production).
•
In January 2008, Global Copper optioned its Taca Taca Cu-Au porphyry project, located near the Chilean border in
northwestern Argentina, 90 kilometres east of the Escondida copper mine, to Rio Tinto. In August 2008, after
completing a 5,000-metre drilling program, Rio Tinto dropped this option, claiming that Taca Taca did not meet with
its corporate objectives. Using a 0.4% Cu Eq cut off, the project has an NI 43-101 compliant resource of 841 million
tonnes grading 0.64% Cu Eq, containing 8.71 billion pounds of copper, 2.97 million ounces of gold and 333.7 million
pounds of molybdenum. Lumina intends to recommence drilling at Taca Taca in Q1/09 to investigate the deeper zone
of higher-grade copper mineralization and central area of enriched copper mineralization that the company indicates
is open to the north and at depth. At Taca Taca a source of water for mining operations exists on the property and
there is nearby electrical power.
•
The San Jorge copper-gold property is located in Argentina, 110 kilometres northwest of Mendoza. Global Copper
optioned San Jorge to Coro Mining Corp. in May 2006. Global Copper received a payment of US$1 million cash and 1
million Coro shares. Global Copper will also receive a total payment from Coro of US$16 million upon completion of a
full bankable feasibility study for San Jorge (US$8 million due 31 December 2009; US$8 million due 31 December
2010), and 2.0 cents US for every pound of sulphide copper the project is deemed to contain (P&P reserves), less the
US$16 million previously paid. The deal also stipulates terms should mine production exceed levels specified in the
feasibility study (1.5 cents US/lb sulphide Cu in excess). At a 0.3% cu cut-off, San Jorge hosts a NI 43-101 compliant
resource (M,I&I) of 268 million tonnes grading 0.45% Cu and 0.19 g/t Au, containing 2.7 billion pounds of copper and
1.6 million ounces of gold. Given recent policy changes affecting the use of sulphuric acid in Mendoza we believe Coro
feasibility work will trend towards a conventional milling operation. Should Coro choose to process the oxide material,
it will pay to Lumina 2.5 cents US/lb Cu within the oxide reserves on commencement of commercial production. For
any additional oxide material mined, Coro will pay Lumina 2.0 cents US/lb Cu that is processed.
An analyst has not visited Lumina Copper Corp.’s properties.
Investment risks
of Lumina Copper Corp. is for risk accounts only.
18 December 2008
PEREGRINE DIAMONDS LTD. (PGD : TSX : C$0.38 | NOT RATED)
Figure 42: PGD : TSX
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 43: PGD : TSX
70.0
81.0
C$1.6
Nil
C$26.6
www.pdiam.com
Peregrine Diamonds is a junior diamond exploration company under the stewardship of Eric Friedland (B.Sc. geology) and,
including senior management, Brook Clements (President) (Ph.D. geology), Peter Holmes (VP Exploration) and Jennifer Pell
(Chief Geoscientist). Peregrine holds an interest in diamond exploration claims in the Northwest Territories, Nunavut and
Manitoba. Peregrine has focused on the exploration and development of its 71.74%-owned WO diamond project (NWT),
which contains the DO-27 and DO-18 diamondiferous kimberlite pipes. More recently, Peregrine exploration work has
uncovered diamondiferous Kimberlites (three pipes to date) at its Chidliak project (150 kilometres northeast of Iqaluit,
Nunavut). Chidliak has become the primary focus for the company.
•
Over the course of the summer, Peregrine announced that it had discovered three new diamondiferous kimberlites
(CH-1, CH-2, CH-3) at its 100%-owned Chidliak project in Nunavut. The CH-1 kimberlite was discovered associated
with a circular magnetic anomaly with an estimated surface expression of 6 hectares. The CH-2 kimberlite was
discovered 1.5 kilometres from CH-1 on the edge of a 3-hectare geophysical anomaly. CH-3 kimberlite was discovered
associated with a 2-hectare geophysical anomaly. Initial caustic fusion results from each kimberlite yielded promising
diamond results including a population of stones greater than 0.60 mm.
•
Subsequent to receiving caustic fusion results, Peregrine collected a 2.28 tonne mini bulk sample from surface material
on the CH-1 kimberlite. Processing of this material returned a significant 2.01 carat clear colourless octahedron gemquality diamond. The sample returned a total of 3.55 carats including 34 commercial-size diamonds larger than the
0.85 millimetres. A total of 16 diamonds were over 1.18 mm. While this initial mini bulk sample may not be fully
representative of the grade of entire CH-1 kimberlite, in combination with positive caustic fusion results, property
geochemistry and geophysics, we judge the potential for the Chidliak to be considerably above average.
•
The company has completed 11,700 line kilometres of heli-borne magnetic/electromagnetic survey with 100 metre line
spacing over priority areas of the property. According to Peregrine, thus far more than 170 kimberlite-type anomalies
have been identified from the preliminary survey data. The company is targeting a trend that spans about 50 kilometres.
•
Peregrine is currently planning for a 2009 exploration program that would include: drilling of new kimberlite targets,
collecting a larger mini bulk sample from CH-1, definition drilling of the known kimberlites, ground geophysics, heavy
mineral sampling, metals exploration and an environmental baseline study.
•
Following the release of the mini bulk sample results, BHP Billiton elected to exercise its earn-in rights for the Chidliak
property. BHP Billiton can earn an initial 51% interest in Chidliak by financing five times the exploration expenditures
($22.3 million) that have been incurred by Peregrine, over a period of five years, with minimum annual expenditures of
$5 million ($8.9-million commitment). Once BHP Billiton has earned its initial 51%, it will then have a one-time option
to earn an additional 7% interest in the property by sole financing the complete costs of a bankable feasibility study.
An analyst has not visited the properties held by Peregrine Diamonds Ltd.
Investment risks
of Peregrine Diamonds Ltd. is for risk accounts only.
18 December 2008
RUBICON MINERALS CORP. (RMX : TSX : C$1.14 | NOT RATED)
Figure 44: RMX : TSX
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 45: RMX : TSX
156.2
171.6
$24.1
Nil
C$178.1
www.rubiconminerals.com
Rubicon Minerals is a Vancouver-based mineral exploration company led by David Adamson, President and CEO.
Rubicon’s flagship asset is the 100%-owned Phoenix property, located approximately 5 kilometres north of Goldcorp’s Red
Lake and Campbell mines. McEwen Capital owns approximately 29% of Rubicon.
•
The F2 zone was discovered in March 2008. The discovery hole intersected 6.8 g/t gold over 11 metres. Subsequent
results include: 891.1 g/t Au over 2.0 metres, 24.4 g/t Au over 17.0 metres, 42.4 g/t Au over 11.0 metres, 28.7 g/ t Au
over 15.5 metres and 361.7 g/t Au over 1.8 metres. Rubicon indicates that intercepts from 35 holes released to date
average 16.25 g/t gold over 5.7 metres. Based on drill results to date, Rubicon is suggesting that the F2 zone has been
defined to over a vertical distance of 1,100 metres (starting at a depth of approximately 150 metres below surface),
along a strike length of 360 metres. Rubicon suggests that the zone is open along strike and to depth.
•
The company’s interpretation is that the F2 zone is within a structural corridor that strikes northeast-southwest and
dips steeply to the northwest. Mineralization at F2 zone occurs as free gold within quartz veins and breccias hosted in
mafic volcanics, with lower-grade disseminated sulphide-hosted ore between quartz bearing structures. Due to the
complex structural nature of F2, the true width of the zone is unknown; however, the company indicates that the
majority of the structures observed to date intersect the core at moderate to high angles.
•
The F2 zone is located only 450 metres from the 142-metre deep McFinley shaft. Rubicon has indicated that it plans to
use this shaft for access to explore the F2 zone at depth. The company is currently in the process of applying for permits
to dewater the shaft, which could commence as early as Q4/08. Following this, Rubicon intends to extend the shaft to a
depth of 350 metres and drift 250 metres southeast to facilitate drilling of the F2 zone from underground. The company
indicates that this shaft development and drifting will take four to six months and is expected to be completed in early
H2/09. In 2009, Rubicon has a total exploration budget of $14 million, which includes shaft sinking and drifting, as well
as a 40,000-metre drill program, of which 36,000 metres will be dedicated at F2 (20,000 metres underground), with
4,000 metres directed at regional exploration following up on Titan-24 geophysical anomalies identified at depth.
•
The southwest strike extension of the F2 zone intersects a corner of a claim block held by Goldcorp. In September
2008, Goldcorp acquired Gold Eagle Mines, whose principal asset was the Bruce Channel gold deposit in the Red Lake
camp, for a purchase price of US$1.3 billion. Although an acquisition of Rubicon is at this stage highly speculative, it is
worthwhile to note that Rubicon’s Phoenix project shares many geological similarities with Bruce Channel, as well as
the Red Lake and Campbell Mines. Investors should be aware that Goldcorp, in an effort to conserve capital given
current market conditions, recently suspended exploration activities in the Red Lake area, including work at the Gold
Eagle acquisition, making it unlikely that the company has any immanent acquisitions planned in the Red Lake area.
An analyst has visited Rubicon Minerals Corp.’s properties. Partial payment or reimbursement was received from the
issuer for the related travel costs.
Investment risks
of Rubicon Minerals Corp. is for risk accounts only.
18 December 2008
SERENGETI RESOURCES INC. (SIR : TSX-V : C$0.15 | NOT RATED)
Figure 46: SIR : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 47: SIR : TSX-V
44.8
52.9
$9.0
Nil
C$6.72
www.serengetiresources.com
Serengeti is a mineral exploration company in control of a portfolio of assets in the Quesnel Trough of north-central BC.
Serengeti is led by David Moore, President and CEO.
•
The most advanced asset to date in Serengeti’s portfolio is the 100%-owned Kwanika property, located approximately
150 kilometres northwest of Fort St. James. The Central zone of mineralization intersected at Kwanika is within an
approximately 2.5-kilometre-long IP geophysical anomaly. To date, mineralization has been traced over a surface
footprint of approximately 500 by 200 metres, dipping to the west beneath an unconformity that is overlain by postmineralization sediments. At the western edge of mineralization, truncated by a fault, this unconformity which marks
the upper level of mineralization is at a depth of approximately 400 metres. Although variable, the core of
mineralization intersected to date has a cross-sectional thickness of approximately 200 to 300 metres. The longest
mineralized intercept drilled to date was 0.74% Cu and 0.78 g/t Au, drilled down the plunge of the mineralization (does
not represent true thickness).
•
At Kwanika, the 2008 drill program was completed in August and the company has reduced costs associated with the
asset in an attempt to minimize the company’s cash burn rate. Metallurgical work and an NI 43-101 compliant
resource calculation, based on 80 drill holes, are underway at the Central zone with results expected in January 2009.
A scoping study is expected in Q2/09. Serengeti estimates it will spend approximately C$5 million on exploration at its
properties in each of 2009 and 2010 which, when combined with an anticipated tax credit to be received as early as
Q4/09, could see the company through to the end of 2010 with no need for additional financing.
•
As part of its Quest JV project Serengeti has a 50% interest in the Mil property, a 50/50 JV with Fjordland Exploration,
located approximately 75 kilometres north of Fort St. James. An attractive geophysical target appears to be
immediately up-ice from a gold anomaly observed in surface sampling. Serengeti indicates that the morphology of the
gold grains observed in sampling indicates a proximal source. A four-hole, 1,000-metre drilling program is scheduled
for 2009. The terms of the JV agreement call for the operator of the property to switch annually; in 2009, Serengeti is
the operator. Fjordland currently has limited cash reserves and may be subject to a dilution of its project interest in
Serengeti’s favour should the company be unable to raise capital.
An analyst has visited the properties held by Serengeti Resources Inc. Partial payment or reimbursement was received
from the issuer for the related travel costs.
Investment risks
of Serengeti Resources Inc. is for risk accounts only.
18 December 2008
UNDERWORLD RESOURCES INC. (UW : TSX-V : C$0.18 | NOT RATED)
Figure 48: UW : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 49: UW : TSX-V
23.3
25.3
$3.3
Nil
C$4.19
www.underworldresources.com
Underworld is a mineral exploration company whose primary focus is gold exploration in the Yukon. Underworld is led by
President Adrian Fleming, formerly of Placer Dome. Other key team members are Michael Williams, Chairman, and Rob
McLeod, who serves as a company director. Kinross owns 9.9% of Underworld’s outstanding shares.
•
The White Gold and Black Fox properties (both 100% Underworld) are located in the Tintina gold belt, approximately
90 kilometres south of Dawson City. The White property consists of five zones demonstrating anomalous gold in soil
geochemical anomalies over a 7.5-kilometre trend. Currently, Underworld is focusing on two areas of mineralization at
White Gold: the Golden Saddle and Arc zones, located approximately 1 kilometre apart. In 2008, a total of 3,431
metres of drilling in 27 holes was conducted at the project. Drilling is scheduled to recommence in spring 2009.
According to the company, mineralization intersected at both zones to date is near surface and potentially openpittable. The White Gold, situated at the confluence of the White and Yukon rivers, is within 30 kilometres of road
access and about 100 kilometres by gravel road south of Dawson City.
•
To date, the Golden Saddle zone has received more extensive drill testing with results including 5.70 g/t Au over 21.6
metres and 3.10 g/t Au over 50.7 metres. The company estimates that true widths are 65-70% of the drilled lengths.
Underworld reports that drilling to date has traced continuous gold mineralization at Golden Saddle for 450 metres
along strike, and to 170 metres down dip and that the zone is open for expansion in all directions. At the Arc target,
located approximately 1 kilometre to the southeast of Golden Saddle, two holes drilled 600 metres apart intersected 1.5
and 1.2 g/t Au, both over 29 metres.
•
A planned two-phase drilling program in 2009 is budgeted at C$2.5 million and is scheduled to recommence in midApril. Phase one is planned to be 1,500 metres of drilling and will focus on the Golden Saddle and Arc targets.
Underworld intends to take a six-week break from drilling after the completion of phase one, to assess the results
before commencing its phase two program, also budgeted at 1,500 metres. Phase two is expected to include drilling on
the Donahue and Teachers targets (both untested) on the White property.
•
At the Black Fox target, outlined by a 700 metre long by 150 metre wide gold in soil anomaly, subcropping quartz-float
samples have returned assays ranging from 0.41 g/t Au to 28.8 g/t Au. To date, no drilling has been conducted at Black
Fox. Exploration plans in 2009 include surface sampling and trenching, to follow up on a series of narrow gold-bearing
veins observed in surface work.
An analyst has not visited the properties held by Underworld Resources Inc.
Investment risks
of Underworld Resources Inc. is for risk accounts only.
18 December 2008
URACAN RESOURCES LTD. (URC : TSX-V : C$0.14 | NOT RATED)
Figure 50: URC : TSX-V
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 51: URC : TSX-V
90.67
109.36
$6.0
Nil
C$12.7
www.uracanresources.com
Uracan Resources is a Canadian uranium exploration company that has been exploring in Quebec and Saskatchewan since
mid-2006. Uracan is under the management of Gregg Sedun, President and CEO, with Marc Simpson as Exploration
Manager. Uracan is exploring for near-surface, large-tonnage, low-grade, uranium mineralization hosted within pegmatite
intrusive bodies, with the two main target areas being the North Shore project in the Johan Beetz area of southern Quebec,
and the Pipewrench Lake property located in the basement rocks of the Wollaston Domain southeast of the Athabasca
Basin. In November 2008, Uracan completed a private placement led by Canaccord Capital for $5.7 million.
•
North Shore project: This 900-square-kilometre property is located in southern Quebec, near the historical Baie JohanBeetz uranium zones that were explored in 1960s. Exploration in 2006 and 2007 by Uracan over the Turgeon Lake
Intrusive Complex outlined four high-priority uranium targets at Lac Petit-Double S, Lac Turgeon, Lac Tanguay and
Baie Johan-Beetz, and over 20,000 metres of drilling was completed, defining the Double S Zone. In July 2008, an
initial inferred resource estimate at Double S Zone had 74.2 million tonnes grading 0.012% U3O8 for contained 19.66
M lbs U3O8, and was based on 13,556 metres of drilling (51 holes). In 2008, an additional 14,525 metres of drilling
was completed in 71 holes, which were not included in the initial resource estimate. Drilling has continued to intersect
wide zones of uranium mineralization along the Double S Trend over a strike length of 3.9 kilometres and includes the
Middle Zone (MZ), TJ Zone and the recently discovered AJ Zone.
•
In late November 2008, URC announced a new uranium discovery on the Costabelle claims located on the North Shore
property at approximately 65 kilometres northeast of the Double S resource area. Channel samples returned up to 22.0
metres grading 0.036% U3O8. An airborne radiometric survey in 2007 over the Costabelle claims outlined numerous
anomalies, and follow-up work in Q3/08 has identified at least three broad zones of uranium mineralization.
•
Pipewrench property: Located in Saskatchewan, the 100%-owned Pipewrench Lake property is situated approximately
120 kilometres south of the Athabasca Basin, and is located in the Wollaston Domain, the geologic sequence that hosts
many of the major uranium mines in the eastern Athabasca Basin. At the Pipewrench Lake property, exploration in the
1970s had defined significant uranium mineralization in surface outcrops. Since 2006, Uracan has completed surface
exploration and an initial drill program. Drill results from the summer 2008 season reported in Q3/08 from the Portage
Zone intersected wide zones of near surface uranium mineralization including 16.5 metres grading 0.018% U3O8 at 8.5
metres on the drill stem. At Narrows Lake, Hole 08PWL-010 intersected 21.9 metres grading 0.016% U3O8.
The company is compiling exploration and drill results in order to plan programs for the North Shore project for 2009. The
recent financing of approximately C$6.0 million is sufficient to cover expected work program and obligations in 2009.
An analyst has not visited the properties held by Uracan Resources Ltd.
Investment risks
The commercialization risks associated with uranium mineral exploration and development are high, thus investment in
the shares of Uracan Resources Ltd. is for risk accounts only.
18 December 2008
WEST TIMMINS MINING CORP. (WTM : TSX : C$0.20 | NOT RATED)
Figure 52: WTM : TSX
Shares O/S (M):
Shares FD (M):
LT Debt (M):
Market Cap (M):
Website:
Figure 53: WTM : TSX
113.7
124.6
$4.0
Nil
C$22.7
www.westtimminsminining.com
West Timmins Mining is a gold exploration company, focused in the Timmins camp of northern Ontario and the Sierra
Madre belt in Mexico. West Timmins is led by Darin Wagner, President and CEO, a 20-year veteran of the mining and
exploration industry, including previous involvement with Cominco Ltd., MAG Silver and Platinum Group Metals.
•
In the Timmins gold camp of northeastern Ontario, West Timmins has interests in 114 square kilometres of
exploration properties, including a joint venture with Lake Shore Gold at the Thunder Creek project (60% LSG/40%
WTM) and a 100% interest in the Thorne project. The Rusk Zone at the Thunder Creek project is located approximately
800 metres south of the Timmins West shaft, currently under construction by Lakeshore with completion expected
Q3/09. According to the company, drill intercepts to date, which include 24.61 g/t over 7.00 metres and 5.90 g/t gold
over 26.35 metres, average 12.50 g/t gold over a mineralized width of 3.31 metres down a plunge length of
approximately 420 metres, within a 30-metre-wide zone of veining and alteration. The zone remains open both up and
down plunge. A 36-hole 22,000-metre diamond drill program is underway at Thunder Creek. 9,300 metres have been
drilled to date and assays are currently pending for six holes. West Timmins has approximately $1 million budgeted for
exploration at Thunder Creek in 2009, part of the company’s total $2 million budget for its entire project portfolio.
•
At the Thorne project, host to an NI 43-101 compliant mineral resource of 400,000 ounces of gold at 3.0 g/t gold, a
10,000 metre drilling program was completed in 2008. At the Golden River West Zone, drilling returned 37.5 metres
grading 1.60 g/t gold. West Timmins indicates that the West Zone, located 3.0 kilometres southeast of the Rusk Zone, is
open in all directions and assays from an additional 17 holes are pending. At the high-grade Sub-Zone, assays included
25.30 g/t gold over 1.50 metres. According to the company, this zone has now been traced from surface to a vertical
depth of 350 metres and remains open to the west and down plunge. An NI 43-101 compliant resource estimate is
expected in Q2/09, based on an additional 175 holes drilled since the previous resource estimate.
•
West Timmins has a 100% interest in the 3,000-square-kilometre Universo project, along trend south from Canplats’
Camino Rojo project in Zacatecas State, Mexico. According to West Timmins, the Universo project hosts a 24kilometre-long belt of gold occurrences approximately 100 kilometres southeast of Camino Rojo and surface sampling
indicates the presence of arsenic, antimony and mercury in the area, elements that are often associated with gold
mineralization. West Timmins intends to conduct more targeted surface sampling at Universo in 2009.
•
In the Sierra Madre region of Mexico, West Timmins has a 100% interest in the Montana de Oro project and the Lluvia
de Oro gold-silver deposit. Due to market conditions, no exploration work at Lluvia de Oro is planned in 2009. Montana
is currently not a priority for the company.
An analyst has visited the main project held by West Timmins Mining Inc. Partial payment or reimbursement was received
from the issuer for the related travel costs.
Investment risks
of West Timmins Mining Inc. is for risk accounts only.
18 December 2008
INVESTMENT RISKS AND SITE VISITS
The commercialization risks associated with mineral exploration and development are
high, thus investment in the shares of any of the highlighted companies is for risk
accounts only. The mining industry by its nature is subject to numerous risks. Investors
should be aware that mineral exploration/development companies face many
uncertainties in maintaining or advancing projects.
An analyst may have visited one or more of the principal projects held by the following
companies and partial reimbursement may have been received for the related travel
costs. Figure 54 provides details for each company.
Figure 54: Site visits
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
1 An
Company name
Banro Corp.
Diamonds North Resources Ltd.
Extract Resources Limited
Golden Arrow Resources Corporation
International Royalty Corporation
Kivalliq Energy Corporation
Lumina Copper Corp.
Rubicon Minerals Corporation
Site visit1
Yes
No
No
No
Yes
No
Yes
Yes
No
No
Yes
No
No
No
No
Yes
Yes
No
No
Yes
analyst has visited the issuer’s material operations.
or partial payment was received from the issuer for the related travel costs.
Source: Canaccord Adams
2 Full
Reimbursement2
No payment
NA
NA
NA
No payment
NA
Partial payment
Partial payment
NA
NA
Partial payment
NA
NA
NA
NA
Partial payment
Partial payment
NA
NA
Partial payment
18 December 2008
GOLD IN SITU SPREADSHEET – CURRENT VALUE US$26.17/OZ ↑
Figure 55: Canaccord Adams gold in situ valuation spreadsheet
Company
Alexis Minerals
Sym Exch
AMC TSX
American Bonanza
BZA
TSX
Anatolia Minerals
ANO
TSX
Aquiline Resources Inc.
ADM TSX-V
AQI TSX
Atna Resources Ltd.
ATN
Axmin Inc.
AXM TSX-V
Canarc Resources
CCM
TSX
Comaplex Minerals Corp.
CMF
TSX
TSX
Committee Bay Resources CBR TSX-V
Detour Gold Corp.
DGC TSX
Etruscan Resources Inc.
EET TSX
Gabriel Resources
GBU
TSX
Golden Queen Mining
Gold Reserve Inc.
Great Basin Gold
GQM
GRZ
GBG
TSX
TSX
TSX
Guyana Goldfields
GSL
GUY
TSX
TSX
Halo Resources
HLO TSX-V
Intrepid Mines Ltd.
IAU
TSX
Jaguar Mining Inc.
JAG
TSX
Kirkland Lake Gold
Klondex Mines Ltd.
Kimber Resources
KGI
KDX
KBR
TSX
TSX
TSX
LSG
TSX
Metallic Ventures
MVG
TSX
MFL
TSX
Source: Thomson One, Canaccord Adams
Sh o/s
Price C$ Mkt. Cap
Sum Oz Mkt Cap/oz Mkt Cap/oz
M Dec 11/08
$M Project Name
% own Country
/co
C$
US$
117.1
0.33
38.6 Lac Herbin
100 Canada
0.7
59.3
53.3
Lac Pelletier
100 Canada
115.7
0.03
3.5 Copperstone
100 US
1.0
3.3
3.0
Fenelon
100 Canada
Gold Bar
100 US
Northway-Noyon
70 Canada
83.1
0.96
79.8 Copler Oxide
100 Turkey
6.6
12.1
10.9
Tunceli
35 Turkey
79.3
0.85
67.4 Volcan
100 Chile
9.3
7.3
6.5
62.7
1.19
74.6 Calcatreu
100 Argentina
12.4
6.0
5.4
Navidad
100 Argentina
Pico Machay
75 Peru
82.0
0.44
35.7 Pinson
70 USA
2.3
15.4
13.8
Briggs Mine
100 Canada
Reward
100 NV
245.6
0.05
11.1 Passendro/Main
100 CAR
3.6
3.0
2.7
Kofi
90 Mali
Komahun/Nimini Hills
60 Sierra Leone
71.7
0.05
3.2 New Polaris
100 Canada
1.2
2.8
2.5
Benzdorp
40 Suriname
52.7
1.74
91.7 Meliadine West
78 Canada
2.7
34.5
31.1
Meliadine West (UG)
78 Canada
Meliadine East
50 Canada
96.1
0.07
6.2 Three Bluffs
100 Canada
0.7
9.0
8.1
44.8
5.30
237.4 Detour Lake
100 Ontario
13.1
18.1
16.3
124.2
0.34
42.2 Samira Hill
40 Niger
2.8
15.3
13.7
Youga
90 Burk Faso
Agbaou
85 Cote d’Ivoire
Finkolo
50 Mali
254.9
1.05
267.6 Rosia Montana
80 Romania
14.5
18.5
16.6
Bucium
80 Romania
85.6
0.24
20.6 Soledad Mtn
100 California
3.3
6.3
5.7
55.8
0.38
21.2 Brisas
100 Venezuela
14.0
1.5
1.4
215.2
1.32
284.0 Hollister
100 Nevada
15.3
18.6
16.7
Burnstone
100 S. Africa
46.1
1.00
46.1 Angostura
100 Colombia
16.3
2.8
2.5
51.7
1.52
78.6 Rory’s Knoll
100 Guyana
4.92
16.0
14.4
Aleck Hill
100 Guyana
E. Walcott
100 Guyana
65.2
0.03
2.0 Duport Lake
100 Canada
0.4
5.3
4.7
Jungle
100 Canada
413.1
0.12
49.6 Casposo
100 Argentina
2.0
25.1
22.6
Paulsens
100 Australia
San Cristobal
100 El Salvador
Tujuh Bukit
100 Indonesia
64.0
3.09
197.7 Sabara
100 Brazil
4.7
41.8
37.6
Caete
100 Brazil
Paciencia/Rio de P
100 Brazil
Turmalina
100 Brazil
55.5
4.30
238.7 Macassa Properties
100 Canada
3.1
75.8
68.2
22.9
0.51
11.7 Fire Creek
100 US
1.0
11.4
10.2
61.9
0.75
46.4 Carmen
100 Mexico
1.9
24.1
21.7
Carotare
100 Mexico
175.3
1.00
175.3 Timmins West
100 Ontario
1.60
109.6
98.7
Bell Creek
100 Ontario
52.0
0.30
15.3 Esmeralda
100 US
7.1
2.2
1.9
Converse
100 US
Goldfield
100 US
49.8
4.05
201.7 Dolores
100 Mexico
7.1
28.2
25.4
La Bolsa
100 Mexico
18 December 2008
Figure 56: Canaccord Adams gold in situ valuation spreadsheet
Company
Mundoro Mining Inc.
Nevsun Resources
Sym Exch
MUN
TSX
NSU
TSX
Novagold Resources Inc.
NG
TSX
OZN
TSX
Osisko Mining
Pacific Rim Mining
OSK
PMU
TSX
TSX
PG
TSX
Premier Gold Mines Ltd
Rainy River Resources
Seabridge Gold Inc.
RR TSX-V
SEA
TSX
Tyhee Dev. Corp
TDC TSX-V
Vista Gold Corp.
VGZ
Total
Average of 39 companies
TSX
Sh o/s
Price C$ Mkt. Cap
Sum Oz Mkt Cap/oz Mkt Cap/oz
M Dec 11/08
$M Project Name
% own Country
/co
C$
US$
38.6
0.24
9.3 Maoling
79 China
7.2
1.3
1.2
128.2
0.60
76.9 Bisha
70 Eritrea
4.9
15.7
14.1
Tabakoto
80 Mali
Segala
80 Mali
105.1
0.99
104.0 Donlin Ck
50 US
30.6
3.4
3.1
Nome Gold
100 US
Rock Creek
100 US
Shotgun
50 US
Galore Creek
50 Canada
Copper Canyon
40 Canada
Ambler
51 Alaska
356.8
0.52
185.5 Essakane
100 Burk. Faso
7.0
26.4
23.8
Sega
100 Burk. Faso
Bombore
100 Burk. Faso
Golden Hill
100 Burk. Faso
Bondi
100 Burk. Faso
161.9
2.87
464.7 Canadian Malartic
100 Canada
8.4
55.0
49.5
116.9
0.13
14.6 El Dorado-Minita
100 El Salvador
1.7
8.4
7.5
South Minita
100 El Salvador
Balsamo
100 El Salvador
Coyotera
100 El Salvador
Nance Dulce
100 El Salvador
Nueva Esperanza
100 El Salvador
69.2
1.52
105.2 East Bay
50 Canada
0.4
247.1
222.4
Rahall-Bonanza
49 Canada
Marathon/McNeely
100 Canada
Argosy
49 Canada
57.6
1.10
63.4 Rainy River Project
100 Canada
3.7
16.9
15.2
37.4
12.80
478.7 Courageous Lake
100 Canada
49.7
9.6
8.7
Kerr
100 Canada
Sulphurets
100 Canada
Mitchell
100 Canada
Noche Buena
100 Mexico
Red Mountain
100 Canada
Grassy Mountain
100 US
Quartz Mountain
100 US
Hog Ranch
100 US
Castle/Black Rock
100 US
169.0
0.18
30.4 Discovery - Ormsby
100 Canada
1.8
17.3
15.6
Nicholas Lake
100 Canada
Bruce Zone
100 Canada
34.5
1.40
48.2 Amayapampa
100 Bolivia
18.3
2.6
2.4
Awak Mas
100 Indonesia
G. de Los Reyes
100 Mexico
Long Valley
100 US
Paredones Amarillos
100 Mexico
Mt. Todd
100 Australia
Yellow Pine
100 US
4,036.7
287.5
29.07
26.17
18 December 2008
URANIUM IN SITU CHART
Figure 57: Canaccord Adams uranium in situ chart
150
18
16
130
12
110
10
90
8
6
70
4
50
2
Average Value US$/lb in situ
Source: Thomson ONE, UxC, Canaccord Adams
Uranium Spot Price (UxC)
11-Dec-08
6-Nov-08
4-Sep-08
31-Jul-08
26-Jun-08
22-May-08
17-Apr-08
13-Mar-08
7-Feb-08
3-Jan-08
29-Nov-07
25-Oct-07
20-Sep-07
30
16-Aug-07
0
Uranium Spot Price (UxC)
Average Value US$/lb in situ
14
18 December 2008
URANIUM IN SITU SPREADSHEET – CURRENT VALUE US$1.24/LB ↓
Figure 58: Canaccord Adams uranium in situ valuation spreadsheet
Company
Aurora Energy
Ticker
AXU-T
Price
Sh o/s 11-Dec-08 Mkt. Cap
73.3
0.95
69.6
Bannerman
BAN-T
150.8
0.45
67.9
Crosshair Explor. Ltd.
CXX-T
94.9
0.10
9.0
Deep Yellow
Forsys Metals
Khan Resources Inc.
Laramide Resources
DYL-AU 1108.7
FSY-T
77.1
KRI-T
54.1
LAM-T
62.5
0.11
5.17
0.17
0.80
116.4
398.5
9.2
50.0
Mega Uranium
MGA-T
187.3
0.60
112.4
Pele Mountain Res.
Powertech
GEM-V
PWE-T
84.1
55.4
0.11
0.40
9.2
22.2
Strateco Res. Inc.
RSC-T
115.1
0.52
59.9
Strathmore Min. Corp.
STM-V
72.5
0.23
16.7
TVC-V
122.7
0.17
20.9
Triex Minerals Corp.
TXM-V
20.0
0.22
4.4
UEX Corp.
Uranium Energy Corp.
Uranium Power Corp.
UR Energy
UEX-T
183.7
0.54
99.2
URC-V
UEC-A
UPC-V
URE-T
90.7
46.3
98.2
93.2
0.15
0.19
0.08
0.52
13.1
8.8
7.4
48.5
Western Prospector
WNP-V
Total
Average of 20 companies
54.1
0.16
8.4
AEV Project Name
% Own Country
-43.6 Michelin
100 Labrador, Ca
Jacques Lake
100 Labrador, Ca
Inda, Nash,
Rainbow
100 Labrador, Ca
52.7 Etango
80 Namibia
Moran Lake -0.9 Upper C
90 Labrador, Ca
Moran Lake Lower C
90 Labrador, Ca
Two Time Zone
60 Labrador, Ca
50.5 Tubas
100 Namibia
354.3 Valencia
100 Namibia
-19.3 Dornod
58 Mongolia
41.8 Westmoreland
100 Australia
La Jara Mesa
100 New Mexico
49.4 Ben Lomond
100 Qld, Australia
Lake Maitland
100 W. Australia
Georgetown/
Maureen
100 Qld, Australia
3.2 Eco Ridge
100 Ontario
16.6 Dewey Burdock
100 South Dakota
Centennial
100 Colorado
39.9 Matoush
100 Quebec
Apple
100 Quebec
4.9 Churchrock
100 New Mexico
Roca Honda
100 New Mexico
Sky Project
100 Wyoming
Gas Hills /
Jeep Project
100 Wyoming
Kurislova
3.7 (Jahodna)
100 Slovakia
Arizona Strip
100 US
Mountain Lake,
-4.8 Hornby Bay
50 Nunavut
Wollaston NE
51 Sask
AthabascaWest Carswell
100 Sask
Mann Lake
60 Sask
Boulder Creek/
65 Alaska
FMM
66.0 Shea Creek
49 Athab., Ca
Anne
49 Athab., Ca
Beatty River
25 Athab., Ca
Raven
Horseshoe
100 Athab., Ca
West Bear
100 Athab., Ca
7.1 North Shore
100 Quebec
-3.9 Goliad
100 Texas
-3.2 Sheep Mountain
50 Wyoming, US
-21.5 Lost Soldier
100 Wyoming
Lost Creek
100 Wyoming
North Hadsell
100 Wyoming
Radon Springs
25 Wyoming
Kaycee
100 Wyoming
Saddle Hills/
100 Mongolia
-9.6 Gurvanbulag
Net M lbs/
Sum M Mkt Cap/lb
prop lbs U3O8
C$
101.6
133.6
0.5
17.8
AEV/lbs Mkt Cap/
U3O8
lb
US$
US$
-0.3
0.5
14.1
85.1
85.1
0.8
0.6
0.7
8.4
13.5
0.7
-0.1
0.6
39.1
60.1
32.0
58.9
3.0
6.6
0.3
0.8
1.2
5.3
-0.5
0.6
2.7
6.0
0.3
0.8
49.2
2.3
0.9
2.1
42.4
17.3
0.2
1.3
0.1
0.9
0.2
1.2
27.9
2.1
1.3
1.9
49.6
0.3
0.1
0.3
36.6
36.6
0.6
0.1
0.5
4.0
0.0
4.7
0.9
-0.9
0.8
47.6
2.1
1.2
1.9
19.6
6.5
7.8
28.7
0.7
1.4
0.9
1.7
0.3
-0.5
-0.4
-0.7
0.6
1.2
0.9
1.5
22.5
782.5
0.4
-0.4
0.3
1.38
0.44
1.24
1.4
3.6
39.1
60.1
32.0
48.6
10.3
10.7
21.6
16.9
42.4
7.5
9.8
16.7
11.1
15.3
32.8
0.99
0.46
0.0
0.0
0.7
23.0
22.9
1.6
19.6
6.5
7.8
14.1
10.9
2.1
0.6
1.0
22.5
18 December 2008
RESEARCH UNIVERSE
WENDELL ZERB, ERIC ZAUNSCHERB, NICHOLAS CAMPBELL AND TONI WALLIS
Figure 59: Research universe
Company
Alamos Gold Inc.
Aurora Energy Res. Inc.
AXMIN Inc.
B2Gold Corp.
Chariot Resources Ltd.
Copper Mountain Mining Corp.
Crosshair Explor. & Mining Corp.
Corriente Resources Inc.
Cue Resources Ltd.
Dynasty Metals & Mining Inc.
Exeter Resource Corporation
Forsys Metals Corp.
Fronteer Development Group Inc.
Gammon Gold Inc
GlobeStar Mining Corp.
Harry Winston Diamond Corp.
Kimber Resources Inc.
MAG Silver Corporation
Minera Andes Inc.
U3O8 Corp.
UR-Energy Inc.*
Symb
AGI
AXU
AXM
BTO
BCM
CPQ
CHD
CSI
CUM
CXX
CTQ
CUE
DMM
XRC
FSY
FRG
GAM
GMI
HW
HAT
KBR
LSG
MAG
MFL
MAI
NDM
RR
SST
TVC
UWE
URE
Ex
T
T
T
T-V
T-V
T-V
T
T
T
T
T
T-V
T
T-V
T
T
T
T
T
T-V
T
T
T
T
T
T
T-V
T-V
T-V
T
T
Analyst
WZ
EZ/TW
NC
WZ
EZ/TW
NC
WZ
NC
WZ
EZ/TW
WZ
EZ/TW
WZ
WZ/TW
EZ/TW
WZ
WZ
WZ
EZ
EZ/TW
WZ
WZ
EZ/TW
WZ
WZ
EZ/TW
WZ
NC
EZ/TW
EZ/TW
EZ/TW
12-mo Target
52-wk
Sh. o/s
Market
Rating
$ P ($) P ($)
Rtn (%)
Hi ($) Lo ($)
M Cap ($M) FYE
SPEC BUY
C $6.73 $6.30 (6.39%) $8.40 $3.50
95.8
$644.7 31-Dec
UNDER REVIEW C $0.95
UR
N/A $13.96 $0.83
73.3
$69.6 31-Dec
HOLD
C $0.05 $0.25 455.56% $0.95 $0.03 245.6
$11.1 31-Dec
SPEC BUY
C $0.42 $1.00 138.10% $2.52 $0.30 162.8
$68.4 31-Dec
UR
N/A $9.37 $0.57
55.5
$71.0 31-Dec
SPEC BUY
C $1.35 $3.60 166.67% $5.43 $1.03
56.5
$76.3 31-Jul
SPEC BUY
C $0.10 $0.45 350.00% $1.09 $0.06 328.7
$32.9 30-Apr
SPEC BUY
C $0.50 $2.00 300.00% $4.00 $0.43
42.3
$21.2 31-Jul
SPEC BUY
C $0.56 $1.95 248.21% $2.66 $0.31
31.6
$17.7 31-Dec
UR
N/A $2.25 $0.09
94.9
$9.0 30-Apr
SPEC BUY
C $3.30 $7.30 121.21% $5.84 $2.50
75.0
$247.5 31-Dec
UR
N/A $1.65 $0.08
36.7
$2.9 30-Apr
SPEC BUY
C $1.50 $3.15 110.00% $8.65 $1.05
32.8
$49.2 31-Dec
SPEC BUY
C $1.73 $2.30 32.95% $5.57 $1.05
50.1
$86.7 31-Dec
SPEC BUY
C $5.17 $7.00 35.40% $6.19 $2.00
77.1
$398.5 31-Jan
SPEC BUY
C $3.05 $4.60 50.82% $11.50 $1.55
83.3
$254.1 31-Dec
HOLD
C $4.19 $4.75 13.37% $11.20 $2.68 120.0
$502.8 31-Dec
SPEC BUY
C $0.39 $1.10 182.05% $2.13 $0.32 105.3
$41.1 31-Dec
UR
N/A $33.47 $3.90
61.4
$364.1 31-Jan
SPEC BUY
C $2.88 $2.75 (4.51%) $4.40 $0.46
82.7
$238.2 31-Mar
HOLD
C $0.75 $1.20 60.00% $1.98 $0.53
57.9
$43.4 30-Jan
SPEC BUY
C $1.00 $2.05 105.00% $2.09 $0.60 175.3
$175.3 31-Dec
SPEC BUY
C $5.45 $7.50 37.61% $15.49 $3.52
49.2
$268.1 31-Dec
SPEC BUY
C $4.05 $8.95 120.99% $14.05 $3.33
49.8
$201.7 31-Dec
SPEC BUY
C $0.57 $1.40 145.61% $1.92 $0.44 189.4
$108.0 31-Dec
SPEC BUY
C $3.91 $4.50 15.09% $13.70 $1.92
92.5
$361.7 31-Dec
SPEC BUY
C $1.10 $2.50 127.27% $5.95 $0.62
57.6
$63.4 30-Sep
SPEC BUY
C $0.43 $1.50 248.84% $3.60 $0.35 125.1
$53.8 31-Dec
UR
N/A $1.59 $0.15 122.7
$20.9 31-Aug
SPEC BUY
C $0.26 $0.60 135.29% $1.41 $0.17
23.1
$5.9 31-Dec
SPEC BUY
C $0.52 $1.05 101.92% $3.60 $0.34
93.2
$48.5 31-Dec
* Best Idea
Prices as of December 11, 2008.
UR – Under Review; R - Restricted
WZ – Wendell Zerb; EZ – Eric Zaunscherb; NC – Nicholas Campbell; TW – Toni Wallis.
Further information on the methodologies used to derive our target prices, and the risks that could impede achievement of these targets, is available
upon request. Disclosure information for all Canaccord Adams research coverage can be found at
http://www.canaccordadams.com/research/Disclosure.htm.
Source: Canaccord Adams, Thomson ONE
18 December 2008
INK SPOTS
Source: www.squidinkbooks.com
Canaccord employs INK Research. This system reports, among other information, daily
changes on insider trading. Security regulators require corporate insiders to report their
trades within ten days of each transaction. We highlight recent changes below; noting
the acquisition or disposition of a position. Our intention is not to evaluate or analyze any
purchases or sales, but to note them for the interest of all investors. We include charts
generated by INK Research that note purchase and disposition points relative to share
price performance.
Figure 60: Banro Corp. (BAA : TSX)
Past 12-months – purchased:
Past 12-months – sold:
$1,873,726
$2,156,103
Since Dec. 1/08 – dispositions:
350,000 shares @ C$0.99-1.00
Officer: Mr. Arnold Kondrat
(dispositions):
350,000 shares
Source: INK Research
Figure 61: Brilliant Mining Corp. (BMC : TSX-V)
$530,800
$625,000
Since Sep. 6/08 – acquisitions & dispositions:
Nil
18 December 2008
Figure 62: Condor Resources Inc. (CN : TSX-V)
$58,850
$78,075
Since Nov. 6/08 – acquisitions & dispositions:
Nil
Figure 63: Diamonds North Resources Ltd. (DDN : TSX-V)
$375,739
$291,856
Since Sep. 18/08 – acquisitions & dispositions:
Nil
Figure 64: Extract Resources Ltd. (EXT : TSX)
Past 12-months – purchased & sold:
Nil
18 December 2008
Figure 65: Fortress Minerals Corp. (FST : TSX-V)
$362,000
$92,950
Since Dec. 1/08 - acquisitions:
Since Dec. 1/08 - dispositions:
175,000 shares @ C$0.20
Nil
Director: Mr. Ian Gibbs (acquisitions):
125,000 shares
Figure 66: Golden Arrow Resources Corp. (GRG : TSX-V)
$75,883
$51,445
Since Oct. 15/08 – acquisitions & dispositions:
Nil
Figure 67: Guyana Goldfields Inc. (GUY : TSX)
$5,386,735
$470,600
Since Nov. 18/08 - acquisitions:
Price range:
Since Nov. 18/08 - dispositions:
516,100 shares
C$0.63-0.75
Nil
CEO: Mr. Patrick Sheridan (acquisitions):
516,100
18 December 2008
Figure 68: Helio Resource Corp. (HRC : TSX-V)
Past 12-months – purchased & sold:
Nil
$185,883
$575,066
Price range:
22,000 shares
C$1.43-1.58
Nil
Officer: Mr. Paul Zink (acquisitions):
22,000 shares
$270,221
$445,187
Price range:
Price range:
3,000 shares
C$1.17-1.45
28,400 shares
C$1.37-1.59
Officer: Mr. Lawrence Talbot (dispositions):
28,400 shares
Figure 69: International Royalty Corp. (IRC : TSX)
Figure 70: International Tower Hill Mines Ltd. (ITH : TSX-V)
18 December 2008
Figure 71: Keegan Resources Inc. (KGN : TSX-V)
$155,707
$67,230
Since Oct. 6/08 - acquisitions:
Since Oct. 6/08 - dispositions:
Nil
Nil
Figure 72: Kivalliq Energy Corp. (KIV : TSX-V)
$312,690
Nil
Since Nov. 13/08 – acquisitions & dispositions:
Nil
$95,365
$5,150
Since Oct.16/08 – acquisitions & dispositions:
Nil
Figure 73: Lumina Copper Corp. (LCC : TSX-V)
18 December 2008
Figure 74: Peregrine Diamonds Ltd. (PGD : TSX)
$471,454
$4,451
Since Sep.19/08 – acquisitions & dispositions:
Nil
Figure 75: Rubicon Minerals Corp. (RMX : TSX)
$501,249
$363,416
159,111 shares @ C$1.35
Nil
Figure 76: Serengeti Resources Inc. (SIR : TSX-V)
$102,500
$945,961
Since Oct. 9/08 – acquisitions & dispositions:
Nil
18 December 2008
Figure 77: Underworld Resources Inc. (UW : TSX-V)
$30,230
$17,860
Price range:
4,000 shares
C$0.20-0.21
Nil
Figure 78: Uracan Resources Ltd. (URC : TSX-V)
$1,317,120
$41,000
100,000 shares @ C$0.10
75,000 shares @ C$0.15
$86,325
$27,320
13,000 shares @ C$0.14
Nil
Figure 79: West Timmins Mining Inc. (WTM : TSX)
18 December 2008
CHOCOLATE CHIP COOKIES – A FESTIVE RECIPE!
This is an excerpt from The Best of the Underground Gourmet, a book published by the Greater Vancouver Mining
Women’s Association (GVMWA), with proceeds supporting various scholarships to assist women in mining-related studies.
Reprinted with kind permission of the GVMWA/Mining for Miracles.
18 December 2008
JUNIOR MINING WEEKLY INDEX PREVIOUS 12 MONTHS
Figure 80: Junior Mining Weekly Index
Company/Commodity
Adriana Resources Inc.
Alamos Gold Inc.
Sym
ADI
AGI
Ex
TSX-V
TSX
Alexco Resource Corp.
Alexis Minerals Corp.
AXR
AMC
TSX
TSX
Amarillo Gold Corp.
Amera Resources Corp.
Anatolia Minerals Dev. Ltd.
AGC
AMS
ANO
TSX-V
TSX-V
TSX
Andean Resources Ltd.
AND
ADM
TSX
TSX-V
Aquiline Resources Inc.
AQI
TSX
Arctic Star Diamond Corp.
Atna Resources Ltd.
ADD
ATN
TSX-V
TSX
Aurcana Corporation
Aurelian Resources Inc.
Aurizon Mines Ltd.
Axmin Inc.
B2Gold Corp.
AUN
ARU
ARZ
AXM
BTO
TSX-V
TSX
TSX
TSX-V
TSX
Bannerman Resources Ltd.
BAN
TSX
TSX
Banro Corporation
BAA
Bard Ventures Ltd.
CBS
TSX-V
Bitterroot Resources Inc.
Blackstone Ventures Inc.
Bravo Venture Group Inc.
Brett Resources Inc.
BCM
BTT
BLV
BVG
BBR
TSX-V
TSX-V
TSX-V
TSX-V
TSX-V
Canadian Arrow Mines Ltd.
Canadian Gold Hunter Corp.
Canadian Royalties Inc.
BMC
CRO
CGH
CZZ
TSX-V
TSX-V
TSX
TSX
CPQ
TSX-V
Capstone Mining Corp.
CS
TSX
Cardero Resource Corp.
Central Sun Mining Inc.
Century Mining Corp.
CGA Mining Ltd.
CDU
CSM
CMM
CGA
TSX
TSX
TSX-V
TSX
Chesapeake Gold Corp.
Cogitore Resources Inc.
CKG
WOO
CSI
TSX-V
TSX-V
TSX
Columbia Goldfields Ltd.
Comaplex Minerals Corp.
Commander Resources
GOL
CMF
CMD
TSX
TSX
TSX-V
Committee Bay Res. Ltd.
CBR
TSX-V
Condor Resources Corp.
CN
TSX-V
Copper In Situ
Copper In Situ Update
Copper Mesa Mining Corp.
Copper Mountain Mng. Corp.
Cornerstone Capital Resources Inc.
Corriente Resources Inc.
Creston Moly Corp.
Crew Gold Corp.
Crystallex International Corp.
Detour Gold Corp.
CUX
CUM
CPG
CTQ
CMS
CRU
KRY
DGC
TSX
TSX-V
TSX-V
TSX
TSX-V
TSX
TSX
TSX
Diamondex Resources Ltd.
Diamonds North Res. Ltd.
DSP
DDN
TSX-V
TSX-V
Donner Metals Ltd.
Duran Ventures Inc.
Dynasty Metals & Mining Inc.
Eldorado Gold Corp.
Endeavour Silver Corp.
DON
DRV
DMM
ELD
EDR
TSX-V
TSX-V
TSX
TSX
TSX
Energy Fuels Inc.
Esperanza Silver Corporation
Etruscan Resources Inc.
EFR
EPZ
EET
TSX
TSX-V
TSX
European Goldfields Ltd.
Evolving Gold Corp.
EGU
EVG
XRC
TSX
TSX-V
TSX-V
Source: Canaccord Adams
Date
26-Aug-08
15-Sep-08
28-Jan-08
22-Sep-08
22-Oct-08
5-Feb-08
22-Jul-08
29-Jul-08
11-Nov-08
5-Feb-08
12-Feb-08
11-Nov-08
12-Feb-08
14-Oct-08
12-Aug-08
10-Jun-08
8-Apr-08
5-Feb-08
6-Aug-08
12-Feb-08
28-Jan-08
5-Feb-08
27-Oct-08
8-Sep-08
12-Aug-08
3-Jun-08
11-Mar-08
19-Nov-08
30-Sep-08
20-Feb-08
26-Nov-08
22-Sep-08
15-Jul-08
3-Jun-08
11-Nov-08
30-Jun-08
29-Jul-08
7-Oct-08
22-Oct-08
22-Jul-08
22-Oct-08
22-Jan-08
29-Apr-08
22-Oct-08
7-Oct-08
11-Nov-08
15-Apr-08
11-Mar-08
26-Feb-08
12-Feb-08
15-Sep-08
26-May-08
22-Oct-08
28-Jan-08
28-Jan-08
11-Nov-08
5-Feb-08
12-Feb-08
9-Dec-08
2-Dec-08
11-Nov-08
27-Oct-08
7-Oct-08
26-Aug-08
29-Jul-08
17-Jun-08
12-May-08
12-Feb-08
29-Jul-08
9-Dec-08
18-Mar-08
12-Feb-08
19-Aug-08
29-Jul-08
22-Oct-08
15-Jul-08
8-Apr-08
22-Sep-08
18-Mar-08
2-Dec-08
11-Nov-08
4-Nov-08
28-Jan-08
5-Feb-08
11-Nov-08
12-Feb-08
24-Jun-08
3-Jun-08
18-Mar-08
3-Jun-08
9-Dec-08
5-Feb-08
28-Jan-08
30-Sep-08
12-Aug-08
24-Jun-08
17-Jun-08
26-May-08
7-Oct-08
3-Sep-08
8-Jul-08
26-Mar-08
28-Jan-08
5-Feb-08
15-Sep-08
2-Dec-08
27-Oct-08
6-Aug-08
Company/Commodity
Sym
XRC
Ex
TSX-V
Extract Resources Ltd.
EXT
TSX
Fancamp Exploration Ltd.
Farallon Resources Ltd.
FNC
FAN
TSX-V
TSX
First Point Minerals Corp.
First Uranium Corp.
Fronteer Dev. Group Inc.
FPX
FIU
FST
FRG
TSX-V
TSX
TSX-V
TSX
Full Metal Minerals Ltd.
Gabriel Resources Ltd.
Gammon Gold Inc.
GBS Gold International Inc.
Global Copper Corp.
Gold In Situ
Gold In Situ Update
FMM
GBU
GAM
GBS
GLQ
TSX-V
TSX
TSX
TSX
TSX
Gold Reserve Inc.
Gold Star Resources Corp.
Golden Predator Mines Inc.
Golden Share Mining Corp.
Golden Star Resources Ltd.
Gold-Ore Resources Ltd.
Goldsource Mines Inc.
GRZ
GXX
GP
GSH
GSC
GOZ
GXS
TSX
TSX-V
TSX
TSX-V
TSX
TSX-V
TSX-V
GYD
TSX-V
Great Basin Gold Ltd.
Great Panther Res. Ltd.
Greencastle Resources Ltd.
GBG
GPR
VGN
GSL
GUY
TSX
TSX
TSX-V
TSX
TSX
HAT
TSX
High River Gold Min.
Imperial Metals Corp.
International Minerals Corp.
Intl. Tower Hill Mines Ltd.
HRG
III
IMZ
ITH
TSX
TSX
TSX
TSX-V
Jaguar Mining Inc.
Jinshan Gold Mines Inc.
Kaminak Gold Corp.
Kimber Resources Corp.
Kivalliq Energy Corp.
Klondex Mines Ltd.
Kodiak Exploration Ltd.
JAG
JIN
KAM
KBR
KIV
KDX
KXL
TSX
TSX
TSX-V
TSX
TSX-V
TSX
TSX-V
LSG
TSX
Laramide Resources Ltd.
LAM
TSX
Luna Gold Corp.
LGC
TSX-V
MAG Silver Corp.
MAG
TSX
Marathon PGM Corp.
Mega Uranium Ltd.
Merrex Gold Inc.
MAR
MGA
MXI
TSX
TSX
TSX-V
Metalex Ventures Ltd.
Metallic Ventures Gold Inc.
Metallica Resources Inc.
Minco Silver Corp.
Minera Andes Inc.
MTX
MVG
MR
MSV
MFL
MAI
TSX-V
TSX
TSX
TSX
TSX
TSX
Moto Goldmines Ltd.
Nickel In Situ Update
MGL
TSX
Noront Resources Ltd.
NOT
TSX-V
North American Gem Inc.
Northern Shield Res.
Northgate Minerals Corp.
NAG
NDM
NRN
NGX
TSX-V
TSX
TSX-V
TSX
Molybdenum In Situ Update
Date
30-Jun-08
6-May-08
1-Apr-08
12-Feb-08
26-Nov-08
19-Nov-08
7-Oct-08
20-Feb-08
15-Sep-08
1-Apr-08
21-May-08
26-Nov-08
30-Sep-08
12-Feb-08
27-Oct-08
12-Feb-08
19-Aug-08
5-Feb-08
28-Jan-08
28-Jan-08
18-Mar-08
in all editions
14-Oct-08
19-Aug-08
29-Apr-08
22-Jan-08
5-Feb-08
30-Jun-08
6-Aug-08
2-Dec-08
28-Jan-08
5-Feb-08
30-Jun-08
6-May-08
11-Nov-08
8-Jul-08
12-Feb-08
22-Jan-08
5-Feb-08
17-Jun-08
30-Jun-08
12-Feb-08
19-Aug-08
12-Feb-08
11-Nov-08
27-Oct-08
7-Oct-08
30-Sep-08
3-Sep-08
29-Jul-08
15-Jul-08
26-May-08
11-Mar-08
28-Jan-08
30-Sep-08
5-Feb-08
4-Nov-08
12-Aug-08
8-Jul-08
26-Feb-08
28-Jan-08
28-Jan-08
20-Feb-08
15-Apr-08
15-Jul-08
12-Feb-08
3-Sep-08
12-Feb-08
28-Oct-08
27-Oct-08
5-Feb-08
19-Aug-08
6-Aug-08
20-Feb-08
24-Jun-08
26-Feb-08
12-Feb-08
11-Nov-08
27-Oct-08
22-Sep-08
24-Jun-08
14-Oct-08
28-Oct-08
26-Aug-08
1-Apr-08
4-Mar-08
12-Feb-08
10-Jun-08
12-Feb-08
28-Jan-08
6-May-08
5-Feb-08
27-Oct-08
15-Sep-08
19-Nov-08
19-Aug-08
6-May-08
5-Feb-08
26-Nov-08
26-Aug-08
21-May-08
8-Jul-08
26-Mar-08
4-Mar-08
30-Jun-08
27-Oct-08
24-Jun-08
28-Jan-08
Company/Commodity
NovaGold Resources Inc.
Sym
NG
OZN
Ex
TSX
TSX
Orko Silver Corp.
Orvana Mineral Corp.
Osisko Exploration Ltd.
Pacific Rim Mining Corp.
OK
ORV
OSK
PMU
TSX-V
TSX
TSX
TSX
Panoro Minerals Ltd.
PC Gold Inc.
Peak Gold Ltd.
Pediment Exploration Ltd.
Peregrine Diamonds Ltd.
Petaquilla Minerals Ltd.
Premier Gold Mines Ltd.
Quest Uranium Corp.
PML
PKL
PIK
PEZ
PGD
PTQ
PG
QUC
RR
TSX-V
TSX
TSX-V
TSX-V
TSX
TSX
TSX
TSX-V
TSX-V
Red Back Mining Inc.
Remstar Resources Ltd.
Riverstone Resources Inc.
RBI
REM
RVS
TSX
TSX-V
TSX-V
Rockwell Diamonds Inc.
RDI
TSX
RMX
TSX
Rusoro Mining Ltd.
Rye Patch Gold Corp.
San Gold Corp.
Saturn Minerals Inc.
Seabridge Gold Inc.
RML
RPM
SGR
SMI
SEA
TSX-V
TSX-V
TSX-V
TSX-V
TSX
Semafo Inc.
Sherwood Copper Corp.
Shore Gold Inc.
Silver In Situ
SMF
SIR
SWC
SGF
TSX
TSX-V
TSX-V
TSX
Silver Standard Resources Inc.
Sinchao Metals Corp.
Skygold Ventures Ltd.
SSO
SST
SMZ
SKV
TSX
TSX-V
TSX-V
TSX-V
Stornoway Diamond Corp.
SWY
TSX
Strateco Resources Inc.
Strathmore Minerals Corp.
Swift Resources Inc.
Target Explor. & Mining Corp.
Tenajon Resources Corp.
Terrane Metals Corp.
Thundermin Resources Inc.
RSC
STM
SWR
TEM
TJS
TRX
THR
TVC
TSX
TSX-V
TSX-V
TSX-V
TSX-V
TSX-V
TSX
TSX-V
Triex Minerals Corp.
TTM Resources Inc.
TXM
TTQ
TSX-V
TSX-V
Ucore Uranium Inc.
UEX Corp.
UCU
UEX
TSX-V
TSX
URC
TSX-V
Uranium Energy Corp.
UEC
AMEX
Uranium In Situ
Uranium Participation Corp.
Uranium Power Corp.
Uranium Update
U
UPC
TSX
TSX-V
Ur-Energy Inc.
URE
TSX
Uruguay Mineral Explor. Inc.
Vista Gold Corp.
VMS Ventures Inc.
UME
VGZ
VMS
TSX-V
TSX
TSX-V
Wealth Minerals Ltd.
Wesdome Gold Mines Ltd.
Westar Resources Corp.
Western Goldfields Inc.
WSR Gold Inc.
WML
WDO
WER
WGI
WSR
XE
TSX-V
TSX
TSX-V
TSX
TSX-V
TSX-V
Zazu Metals Corp.
Zinc In Situ Update
ZAZ
TSX
Date
5-Feb-08
11-Nov-08
11-Mar-08
5-Feb-08
8-Jul-08
28-Jan-08
12-Feb-08
12-May-08
5-Feb-08
22-Jan-08
19-Aug-08
4-Nov-08
28-Jan-08
26-Feb-08
3-Sep-08
5-Feb-08
12-Feb-08
30-Sep-08
27-Oct-08
15-Sep-08
4-Mar-08
12-Feb-08
28-Jan-08
30-Jun-08
12-Feb-08
4-Mar-08
14-Oct-08
15-Sep-08
3-Sep-08
15-Jul-08
26-May-08
23-Apr-08
28-Jan-08
2-Dec-08
28-Jan-08
30-Jun-08
9-Dec-08
12-Feb-08
28-Jan-08
1-Apr-08
15-Sep-08
28-Oct-08
22-Oct-08
22-Sep-08
9-Dec-08
27-Oct-08
4-Nov-08
1-Apr-08
12-Feb-08
4-Nov-08
14-Oct-08
8-Sep-08
20-Feb-08
20-Feb-08
30-Jun-08
20-Feb-08
21-May-08
22-Sep-08
2-Dec-08
11-Nov-08
30-Sep-08
1-Apr-08
20-Feb-08
8-Sep-08
22-Jul-08
10-Jun-08
20-Feb-08
7-Oct-08
20-Feb-08
2-Dec-08
15-Jul-08
4-Mar-08
20-Feb-08
26-May-08
4-Mar-08
20-Feb-08
in all editions
23-Apr-08
20-Feb-08
4-Nov-08
12-Aug-08
15-Jul-08
23-Apr-08
11-Nov-08
27-Oct-08
30-Sep-08
15-Sep-08
28-Jan-08
12-Feb-08
11-Nov-08
7-Oct-08
8-Sep-08
29-Apr-08
20-Feb-08
28-Jan-08
30-Jun-08
5-Feb-08
10-Jun-08
19-Nov-08
30-Jun-08
20-Feb-08
26-Aug-08
28-Oct-08
6-Aug-08
29-Jul-08
29-Apr-08
18 December 2008
APPENDIX: IMPORTANT DISCLOSURES
Each authoring analyst of Canaccord Adams whose name appears on the front page of this investment
Analyst Certification:
research hereby certifies that (i) the recommendations and opinions expressed in this investment research
accurately reflect the authoring analyst’s personal, independent and objective views about any and all of the
designated investments or relevant issuers discussed herein that are within such authoring analyst’s
coverage universe and (ii) no part of the authoring analyst’s compensation was, is, or will be, directly or
indirectly, related to the specific recommendations or views expressed by the authoring analyst in the
investment research.
Price Chart:*
In order to obtain these (6 or more) stock price charts or additional applicable disclosures and
information concerning Canaccord Capital’s recommendations of companies under coverage
mentioned in this report, please contact Canaccord Capital at 1-800-382-9280 or visit
www.canaccord.com.
* Price charts assume event 1 indicates initiation of coverage or the beginning of the measurement period.
Distribution of Ratings:
Global Stock Ratings
(as of 1 December 2008)
Canaccord Adams
Ratings System:
Rating
Buy
Speculative Buy
Hold
Sell
Coverage Universe
#
%
360
61.7%
69
11.8%
138
23.7%
16
2.7%
583
100.0%
IB Clients
%
33.3%
55.1%
18.8%
12.5%
BUY: The stock is expected to generate risk-adjusted returns of over 10% during the next 12 months.
HOLD: The stock is expected to generate risk-adjusted returns of 0-10% during the next 12 months.
SELL: The stock is expected to generate negative risk-adjusted returns during the next 12 months.
NOT RATED: Canaccord Adams does not provide research coverage of the relevant issuer.
“Risk-adjusted return” refers to the expected return in relation to the amount of risk associated with the
designated investment or the relevant issuer.
Risk Qualifier:
SPECULATIVE: Stocks bear significantly higher risk that typically cannot be valued by normal fundamental
criteria. Investments in the stock may result in material loss.
Canaccord Adams is the business name used by certain subsidiaries of Canaccord Capital Inc., including
Canaccord Adams Inc., Canaccord Adams Limited, and Canaccord Adams, a division of Canaccord Capital
Corporation. Clients of Canaccord Adams, in the past 12 months, may have been clients of Canaccord
Capital Corporation, Canaccord Capital (Europe) Limited, Canaccord Capital Corporation USA Inc., and/or
Adams Harkness Financial Group Ltd.
The authoring analysts who are responsible for the preparation of this investment research are employed
by Canaccord Adams, a securities broker-dealer with principal offices located in Vancouver, Calgary,
Toronto, Montreal (all Canada), Boston, New York, San Francisco (all US) and London (UK).
In the event that this is compendium investment research (covering six or more relevant issuers), Canaccord
Adams and its affiliated companies may choose to provide specific disclosures of the subject companies by
reference, as well as its policies and procedures regarding the dissemination of investment research. To
access this material or for more information, please send a request to Canaccord Adams Research, Attn:
Disclosures, P.O. Box 10337 Pacific Centre, 2200-609 Granville Street, Vancouver, BC, Canada V7Y 1H2 or
[email protected].
The authoring analysts who are responsible for the preparation of this investment research have received
(or will receive) compensation based upon (among other factors) the Corporate Finance/Investment Banking
revenues and general profits of Canaccord Adams. However, such authoring analysts have not received, and
will not receive, compensation that is directly based upon or linked to one or more specific Corporate
Finance/Investment Banking activities, or to recommendations contained in the investment research.
Canaccord Adams and its affiliated companies may have a Corporate Finance/Investment Banking or other
relationship with the company that is the subject of this investment research and may trade in any of the
designated investments mentioned herein either for their own account or the accounts of their customers, in
good faith or in the normal course of market making. Accordingly, Canaccord Adams or their affiliated
companies, principals or employees (other than the authoring analyst(s) who prepared this investment
research) may at any time have a long or short position in any such designated investments, Related
designated investments or in options, futures or other derivative instruments based thereon.
Some regulators require that a firm must establish, implement and make available a policy for managing
conflicts of interest arising as a result of publication or distribution of investment research. This investment
16 December 2008
research has been prepared in accordance with Canaccord Adams’ policy on managing conflicts of interest,
and information barriers or firewalls have been used where appropriate. Canaccord Adams’ policy is
available upon request.
The information contained in this investment research has been compiled by Canaccord Adams from
sources believed to be reliable, but (with the exception of the information about Canaccord Adams) no
representation or warranty, express or implied, is made by Canaccord Adams, its affiliated companies or
any other person as to its fairness, accuracy, completeness or correctness. Canaccord Adams has not
independently verified the facts, assumptions, and estimates contained herein. All estimates, opinions and
other information contained in this investment research constitute Canaccord Adams’ judgement as of the
date of this investment research, are subject to change without notice and are provided in good faith but
without legal responsibility or liability.
Canaccord Adams salespeople, traders, and other professionals may provide oral or written market
commentary or trading strategies to our clients and our proprietary trading desk that reflect opinions that
are contrary to the opinions expressed in this investment research. Canaccord Adams’ affiliates, proprietary
trading desk, and investing businesses may make investment decisions that are inconsistent with the
recommendations or views expressed in this investment research.
This investment research is provided for information purposes only and does not constitute an offer or
solicitation to buy or sell any designated investments discussed herein in any jurisdiction where such offer
or solicitation would be prohibited. As a result, the designated investments discussed in this investment
research may not be eligible for sale in some jurisdictions. This investment research is not, and under no
circumstances should be construed as, a solicitation to act as a securities broker or dealer in any
jurisdiction by any person or company that is not legally permitted to carry on the business of a securities
broker or dealer in that jurisdiction. This material is prepared for general circulation to clients and does not
have regard to the investment objectives, financial situation or particular needs of any particular person.
Investors should obtain advice based on their own individual circumstances before making an investment
decision. To the fullest extent permitted by law, none of Canaccord Adams, its affiliated companies or any
other person accepts any liability whatsoever for any direct or consequential loss arising from or relating to
any use of the information contained in this investment research.
For Canadian Residents:
For United Kingdom
Residents:
For United States
Residents:
For European Residents:
This investment research has been approved by Canaccord Adams, a division of Canaccord Capital
Corporation, which accepts responsibility for this investment research and its dissemination in Canada.
Canadian clients wishing to effect transactions in any Designated Investment discussed should do so
through a qualified salesperson of Canaccord Adams, a division of Canaccord Capital Corporation in their
particular jurisdiction.
This investment research complies with the Financial Services Authority’s Handbook chapter on Conduct of
Business and is approved by Canaccord Adams Limited, which is authorized and regulated by the Financial
Services Authority, in connection with its distribution in the United Kingdom. This material is not for
distribution in the United Kingdom to retail clients, as defined under the rules of the Financial Services
Authority. Canaccord Adams Limited accepts responsibility for this investment research and its
dissemination in the United Kingdom. The information contained in this investment research is only
intended for distribution in the UK to persons who qualify as professional clients or eligible counterparties,
as defined under the rules of the Financial Services Authority.
Canaccord Adams Inc., a US registered broker-dealer, accepts responsibility for this Investment Research
and its dissemination in the United States. This Investment Research is intended for distribution in the
United States only to certain US institutional investors. US clients wishing to effect transactions in any
Designated Investment discussed should do so through a qualified salesperson of Canaccord Adams Inc.
If this investment research is intended for disclosure in any jurisdiction other than the United Kingdom, the
US or Canada, then the relevant rules and regulatory requirements of that jurisdiction will apply.
Additional information is available on request.
Copyright © Canaccord Adams, a division of Canaccord Capital Corporation 2008. – Member IIROC/CIPF
Copyright © Canaccord Adams Limited 2008. – Member LSE, authorized and regulated by the Financial
Services Authority.
Copyright © Canaccord Adams Inc. 2008. – Member FINRA/SIPC
All rights reserved. All material presented in this document, unless specifically indicated otherwise, is under
copyright to Canaccord Adams, a division of Canaccord Capital Corporation, Canaccord Adams Limited, and
Canaccord Adams Inc. None of the material, nor its content, nor any copy of it, may be altered in any way,
or transmitted to or distributed to any other party, without the prior express written permission of the
entities listed above.

Name(XXX) XXX-XXXXemail @canaccord

Transcription

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