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XMFSinchiruna (26.55)

Your Treasure Map to Western Canadian Gold



March 25, 2010 – Comments (2)

In case you hadn't noticed, British Columbia boasts quite a concentration of incredibly prospective gold and copper properties in various stages of development to suit every kind of precious metal investor.

To introduce you to the area's golden potential, I have prepared this survey of the province's most exciting potential gold mines. I hope you appreciate the first of what I hope will become a systemic survey of the world's greatest metal resource hotspots.

Your Treasure Map to Gold's Mother Lodes


"Diving right in with the smallest of all these golden prospects, New Gold's New Afton is the only one that is presently under construction. This underground mine is expected to achieve full production during late 2012, and yield 85,000 ounces of gold per year for a 12-year mine life. With power lines and natural gas pipelines already crossing the property, the company has a convenient head start on energy infrastructure. With powerful feasibility-study metrics including a cash cost of negative $852 per ounce after copper and silver by-product credits, New Afton is a slam dunk for New Gold. Longer-term investors will have their radars attuned to the company's nearby Ajax-Python property, which already boasts a 1-million-ounce measured and indicated mineral resources just 10 kilometers from New Afton."

"Meanwhile, Terrane Metals has issued a positive construction decision for its Mt. Milligan project, and now seeks to raise some C$915 million in project financing to complement the C$40 million credit facility floated by 60% equity stakeholder Goldcorp (NYSE: GG). Although the required sum is large compared to Terrane's market capitalization, here again the robust economics of the mine plan stand in favor of a successful outcome against the apparent odds. Construction costs are expected to be recuperated after just four years of a 22-year mine life."

While preparing the article, I came with an idea. I hadn't realized just how closely situated Silver Standard's Snowfield and Brucejack properties are to Seabridge's famous KSM project. They appear close enough to me on a map to warrant consideration of folding all the properties together into a single mining camp that would boast M&I resources of 63 million ounces of gold, 116 million ounces of silver, and 10 billion pounds of copper. Any miner holding that kind of resource would rule the metals world. With SA eager to sell KSM and through an all-stock deal, and SSRI focused on two other development projects, I think a move to fold those projects into each other to establish the premier mining camp of the 21st century would be a game-changing coup for any deep-pocketed miner.

It will be interesting to see if that's how it ultimately plays out.

Thanks for reading, reccing, and responding.



2 Comments – Post Your Own

#1) On March 25, 2010 at 4:41 PM, XMFSinchiruna (26.55) wrote:

Also out today:

Still Waiting for Stimulus Stimulation


"If trickle-down economics is a tired old model plagued by frequent clogs in the plumbing, then ongoing efforts to promote domestic growth through debt-based stimulus packages has yet to even build the pipes."

"Now that spring is in the air, I suspect you will hear plenty of anecdotal evidence to the effect that stimulus spending is finally bearing fruit and paving the way for a sustainable U.S. recovery. With 730 allegations of waste or fraud surfacing thus far, combined with the recent $75 billion upward revision of the cost of the stimulus, the pressure is on Washington to show some tangible results."

"Let's forget for a moment that China has just completely schooled us on how effective a stimulus package can be when it adequately targets the productive sectors of an economy rather than perpetuating a broken, debt-dependent, consumption-driven economic structure. While road crews have been out in force across this nation laying down enough asphalt to pave the moon, China quietly set about purchasing as many strategic natural resources as it could get its hands on while keeping its steel mills running full tilt. By October 2009, South Korea's POSCO (NYSE: PKX) was back to 92% capacity utilization while our domestic mills scraped their way back to 55%."

"This industrial bellwether still observes: "no effective stimulus for construction, lack of customer liquidity, high unemployment and building vacancy rates, and state budget woes." I remind Fools to avoid the convenient presumption that the long-awaited stimulative impacts that may be forthcoming constitute some kind of assurance of a sustainable economic recovery."

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#2) On March 26, 2010 at 12:43 PM, XMFSinchiruna (26.55) wrote:

Terrane raised $100 million today. ;)

Vancouver, British Columbia: Robert Pease, President and CEO of Terrane Metals Corp. ("Terrane" or the "Company") (TRX: TSX-V), is pleased to announce that Terrane has entered into an agreement with a syndicate of underwriters with respect to a $70,000,700 bought-deal financing and has agreed to terms with Goldcorp Inc. ("Goldcorp") on a $30,000,300 non-brokered private placement financing. In addition, Terrane and Goldcorp have agreed to work towards extending the Goldcorp-guaranteed $40,000,000 credit facility for another year (see press releases dated July 9, 2008 and January 8, 2010). The Company intends to use the proceeds to fund the 2010 construction program at the Mt. Milligan Project and for working capital purposes.

A syndicate of underwriters led by National Bank Financial Inc. and including Scotia Capital Inc., BMO Capital Markets and Sandfire Securities Inc. (collectively the "Underwriters") have agreed to purchase 63,637,000 units (the "Units") from Terrane on a bought-deal basis and sell them to the public at a price of $1.10 per Unit for gross proceeds of $70,000,700 (the "Public Offering"). Each Unit will consist of one common share and one-half common share purchase warrant. Each whole warrant will entitle the holder to purchase one additional common share of the Company at a price of $1.50 for a period of 12 months from closing.

Concurrent with the Public Offering, 27,273,000 additional Units will be issued at the same price on a non-brokered private placement basis (the "Private Placement") to Goldcorp for gross proceeds of $30,000,300.

Terrane has also granted to the Underwriters an over-allotment option to purchase an additional 9,545,550 Units at the same price, exercisable in whole or in part, for a period of 30 days on or following the closing date. If the over-allotment option is exercised in full, the gross proceeds to the Company from the Public Offering and the Private Placement will be $110,501,105. The Units in the Public Offering will be offered by way of a short-form prospectus in all the provinces of Canada except Quebec, and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended, as well as in other jurisdictions as may be determined by Terrane and the Underwriters. Both financings are expected to close on or about April 16, 2010.

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