IKN #346Premium

The IKN Weekly
Week 346, December 27th 2015
Contents
This Week: A blog break next week, The 2016 Low Cost Producer Basket next weekend.
Fundamental Analysis: The 2016 Copper Basket.
Stocks to Follow: Overview, B2Gold (BTG) (BTO.to), McEwen Mining (MUX), Lake Shore Gold
(LSG.to), Teranga Gold (TGZ.to) (TGZ.ax), Starcore Intl (SAM.to), Phoscan Chemicals (FOS.to),
Focus Ventures (FCV.v).
Copper Basket: Overview, Capstone Mining (CS.to).
Low Cost Producer Basket: Overview, Barrick (ABX).
Regional Politics: Chile: A new lithium policy, Chile: IPP deflation, Argentina: Export tax on
gold exports eliminated, Ecuador: Mirador starts (at last), Peru: Copper production forecast at
2.5 million tonnes in 2016.
Market Watching: Tax loss selling season on cue, Sunridge Gold (SGC.v), Minera IRL (IRL.to)
(MIRL.L).
I remind subscribers that no part of this newsletter can be copied, reproduced or
given to any third party without the express permission of the author.
This Week
Taking a break next week: No blog posting until Friday minimum
I’ll be back in time to write the abridged IKN347 (see the heads-up of last week) but expect
zero posting on the blog next week, Monday through Friday, because I’m going to take myself
away and have a complete electronic break for a few days. It’s going to be fruity rum punches
and book-reading, no more no less. For various reasons it’s been a tiring year and it’ll be nice to
get away from it all for a short vacay. Back with fully charged batteries next weekend.
The 2016 Low Cost Producer Basket next week
This time last week I wrote that you’d get the components of the 2016 Copper Basket and the
components of the 2016 Low Cost Producer Basket in this edition. In fact you only get the
Copper Basket this week, because I’m still trying to decide on the exact composition of the ten
names for the low cost PMs list. Which is a diplomatic way of saying that I’ve been lazy over the
Christmas period.
In other words, the list is deferred until next weekend, but you’ll get it then. Pretty promise.
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Fundamental Analysis of Mining Stocks
The 2016 Copper Basket
This weekend we unveil the new make-up of The Copper Basket, our sub-sector tracker of
redmetal companies. It used to be purely juniors, last year we opened it up to include a few
smaller producers and as mentioned in last week’s intro, this year that idea is expanded a little
more. That’s because of two things:
• The junior copper exploreco sector has been decimated and dozens of the names are
now trading for peanuts. There’s little point in covering five or six companies that are,
to all intents and purposes, zombie entities.
• With the death of many projects comes a dearth in traded volume. Having a penny-
priced company can be okay as long as it trades regularly, but far too many of the
explorecos are now ignored and trade but a few hundred shares every now and again.
Therefore, to continue with a representative list of what’s out there in copper, I’ve chopped out
a lot of the crud (bye bye Catalyst Copper, Coro Mining, AQM Copper etc) and also cut
companies that do no serious volume in cash terms (bye bye Regulus even though I like you,
Metminco). In their place I’ve gone either for juniors that trade reasonably or larger companies
and one large one in particular, that just to ring the changes (and track it more closely in what
promises to be a key year)
Therefore and to get down to business, if we assume the end-year prices are the same as this
weekend (they won’t be, they’ll all trade between now and then but I’ll adjust the pennies in
IKN347) here’s how the list will look for the next twelve months.
Here they all are in market-cap order, biggest to smallest.
company ticker price 1/1/16 Shares out Market Cap current pps gain/loss%
1 HudBay Min. HBM.to 0.35 235.23 1345.52 5.72 0.0%
2 Ivanhoe Mines IVN.to 0.61 778.96 475.17 0.61 0.0%
3 Reservoir Min. RMC.v 3.96 48.46 198.69 4.10 0.0%
4 Capstone Min. CS.to 2.03 382.04 179.56 0.47 0.0%
5 NGEx Resources NGQ.to 1.17 187.71 122.01 0.65 0.0%
6 Copper Mtn CUM.to 0.48 118.8 57.02 0.48 0.0%
7 Copper Fox CUU.v 0.135 417.64 54.29 0.13 0.0%
8 Nevada Copper NCU.to 1.65 80.5 49.11 0.61 0.0%
9 NovaCopper NCQ.to 0.58 104.33 42.78 0.410 0.0%
10 Hot Chili Ltd HCH.ax 0.16 420.12 36.97 0.088 0.0%
11 Western Copper WRN.to 0.68 94.19 35.79 0.38 0.0%
12 Amerigo Res ARG.to 0.27 173.61 32.99 0.19 0.0%
13 Atico Mining ATY.v 0.265 97.59 25.86 0.265 0.0%
14 Cordoba Min. CDB.v 0.150 66.11 9.92 0.15 0.0%
15 Revelo Res. RVL.v 0.050 99.19 4.96 0.05 0.0%
NB: HCH.ax priced in AUD$, rest CAD$ Portfolio avg 0.00%
And now for a word or three on each basket component company, again in market cap order.
The ones that were included in last year’s Copper Basket (or other years too) get just a few
words, while new members of the bunch get some more explanation on what they do as well as
the IKN justification for including the company in the 2016 basket.
A final point before diving in: In previous Basket adjustments I’ve included the 12 month price
chart for each company. This time I’m not going to bother because with very few exceptions
(e.g. Reservoir Minerals RMC.v) the shapes of the charts are very similar, with only the
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steepness of the declines being different. Okay, enough blathering, here we go:
HudBay Minerals (HBM.to) (HBM): By far the biggest market capper of the new list
(especially when you count in Canadian Dollars like we do here, it’s less than a Billion in
Greenbacks) and very much a producer with a suite of assets, not least the new operation at
Constancia in Peru, HBM is a bit of an outlier on the 2016 list but it’s going in because 1) it
provides a stepping stone between the real juniors and the large copper producers and 2) its
precipitous drop in market capitalization in 2015 means it’s really not that far away from the
larger-sized juniors any longer. With Garofalo leaving in 2016 to head up Goldcorp and to-date
COO Alan Hair(cut) in charge, plus a heavy liabilities book that could provide more downside
pressure to the stock price if copper doesn’t improve, HBM may turn into a litmus case study of
the whole sector. Also, it’s only a little bit more valuable in market cap terms than Capstone
(CS.to) was this time last year. Considering the way that one fell off a cliff, I’m keen to provides
a comparative stock in 2016 that can give us a better idea of the sink-or-swim status of mid-
sized copper plays this year. All that and, of course, it’s a well traded liquid stock.
Ivanhoe Mines (IVN.to)
It’s not a pure copper play and the South Africa Platreef project in particular is very much PGM,
but after the recent news that IVN has closed the deal to sell (what amounts to) half of the
Kamoa copper project in the Democratic Republic of Congo (DRC) to China’s Zijin for a cool
U$412m (U$206m up front, the other in five staged payments 3½ months apart), IVN is a most
intriguing proposition at its current valuation and I’m enthusiastic to the point of potential
ownership about this stock in 2016.
The main reason I like the idea of this stock is its (nowadays vitally important) balance sheet
position. If we consider the following...
• Total liabilities U$40m
• Cash & Equivalents around U$530m
• Background burn rate U$15m/qtr
• Shares out 779m
...it means that in effect, IVN is being priced at cash (in fact two cents lower than cash, by my
estimated count). Which means you’re being offered half of Kamoa, 64% of Platreef and 68%
its other very decent Kipushi zinc/copper project in DRC for nothing.
These are big projects too, not least Kamoa and its 43.5Bn Lbs of copper at a grade that makes
your average large-scale porphyry deposit look very skinny indeed. The political risk of working
DRC is very high (no matter what Friedland might say about knowing the country well) and with
the PGM complex currently in the dumpster Platreef is probably more of a liability than an
asset, but even with all the weaknesses one could point to the market cap of IVN looks eye-
poppingly low for a company of its ilk.
Reservoir Minerals (RMC.v): In Cukaru Peki, part of the wider Timok project that’s being
fully funded to Feas Study level by Freeport (FCX), RMC owns a de-facto 25% (currently 45%
but FCX will almost certainly earn in the other 20%) of one of he most exciting mineral projects
in the world today. As well as that one, RMC is owner of a handful of other prospective
concessions in Serbia as well as a couple of sites in Cameroon and Gabon (West Africa
neighbour countries) which are interesting in their own right. Expertly managed by the RMC
brass and with plenty of funding, RMC is one of the very very few copper explorecos that
managed a winning 2015 and rightly so. At its current approx $200m market cap it’s not cheap,
plus its main buyout candidate FCX is cutting back hard on expenditures in these difficult times,
not expanding, so any buyout may have to wait a while. But there’s no way this one can’t be
part of the 2016 basket.
Capstone Mining (CS.to): See “The Copper Basket” below for the latest gossip on CS and
Minto in particular. As for CS the basket component, I stuck my neck out last year in including a
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near-$1Bn market capper and producer in the list and I’m very glad I did so, because
chronicling its waterfall drop and the way in which its liabilities position is and continues to
crush this mid-sizer has been a most useful window into the dynamics of the sector this year.
The question for CS.to in 2016 is the simplest one possible: Can it survive? That will depend
more on the fate of the copper price than the company internals , which means the company
board will have to light a candle, pray to the Market Gods and hope. Hope isn’t a valid
investment thesis.
Great to have in the basket, untouchable as an investment, if we get a sector bounce I’d own a
dozen other copper plays before this one.
NGEx Resources (NGQ.to): NGQ had a torrid time of it in 2015, the copper downturn
obviously the main culprit but also the unfashionable style of its deposit (big, low grade, difficult
access, Argentina) adding insult to injury. But the company has showed signs of fighting back in
the last couple of months with decent newsflow about the Argentine side of the the Vicuñas
property. There’s a new plan to incorporate two of the areas some 12 km apart into a bi-
national mega-project and that’s pretty decent, but the one I really liked was the news out of
Filo de Sol, the third area of identified mineralization that has a couple of high-grading zones
that could reasonably support a stand-alone “starter mine” (or perhaps “start the cluster
mine”), with a enriched silver zone the most interesting of the lot.
Add in the new macro optimism about Argentina (be careful what you wish for, but the North
suddenly likes the place and thinks it’s chap) and way that due to NGQ being part of the Lukas
Lundin empire it’s not going to be short of a deep-pocketed sponsor if more funding is required
and NGQ is definitely one to retain on our list for 2016.
Copper Mountain (CUM.to): The one with the ticker symbol that gets me cracking puerile
puns on the blog, CUM.to is owner of 75% of the Copper Mountain copper mine in South BC
Canada. It was always framed as a “Big Thing” by Canadian newsletters and brokerages and for
years was pumped to within an inch of its life by the whole sellside machine. Unsurprisingly, I
never bit. Today it’s a struggling producer trying hard to remain cash flow positive in the low
copper price environment and failing.
The reason it’s included in this year’s basket, aside from the way I’m happier to open up to
more producer companies now, is that it provides the potential for downside if the market
doesn’t rebound, but also upside potential from the latent thoughts about 25% owner
Mistubishi stepping in, buying out what it doesn’t own for a fraction of the price of just a year
or two ago, then securing copper supply for its own larger ends. I’m think it highly unlikely that
I’d get interested in owning CUM.to in 2016 (it fails on “Rule One”, it’s a producer that makes a
loss), but as a bellwether I like it for the Basket. It’s also still the subject of pump-jobs fro
sellside every so often and may be tradeable for those of you who can read near-term tealeves
better than I. A final advantage is that it’s of a decent market cap size and trades well, it’s
liquidity will help price discovery of the wider sector.
Copper Fox (CUU.v): A perennial dog it may be and not one I an ever imagine myself
owning, but my personal preferences are not what The Copper Basket has ever been about and
CUU continues to form part of the mix because 1) other people like it 2) it has four assets that
are as close to pure copper exposure as they come (no matter the dubious quality) and 3) it
does reasonable traded volume and is a liquid stock, so it will be able to reflect market
sentiment for the sector. So CUU stays in and it gives me at least one stock to badmouth all
next year.
Nevada Copper (NCU.to): Or make that two stocks to badmouth in 2016, because Nevada
Copper (NCU.to) is staying on the list too. The fun here is to consider whether the stock will
ever be able to either sell its uneconomic Pumpkin Hollow property, or manage to raise funds,
or die in the attempt. Way overpumped and promoted to the dumber end of the metals
speculator community, a rally here would mean a lot of others are going to rally harder and
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higher.
Hot Chili (HCH.ax): Part of the 2015 basket, I was in two minds whether to drop it but in the
end it trades in a reasonable manner, plus it has at least made progress on its projects in the
elapsed time. The only stock on the list that won’t be marked up in Canadian Dollars, our
antipodean hold-out (now that Metminco has been dropped).
Western Copper & Gold (WRN.to): A member of The Copper Basket since inception and
owner of the big, low-grade Casino project that I’ve had a soft spot for over the years, I even
owned this one briefly last year for a quick trade. The problem is the classic one that big low-
graders in remote locations; the economics are marginal at very best with copper where it is.
The upside is that the balance sheet is clean and it can survive in its current corporate structure
in 2016. Trading has been through a light period this year, but I managed to get in and out
when interest peaked and it wasn’t that difficult to flip. Stays in, a valid copper exploreco junior
and once again, my comparative of “much better than Schaft Creek (CUU.v)” applies.
Amerigo Resources (ARG.to): ARG has been hit hard by the downturn, coming at the same
time as its expansion program for with it took out financial debt. To the upside that’s now
showing its fruits and production has started to click up, with the corresponding reduction in
cash costs per Lb Cu coming as well. Plus Chile is getting cheaper to be a miner (see ‘Regional
Politics’). To the downside ARG isn’t making any money and now has the banks to pay. This
one sometimes gets a burst of buying energy and price moves that are asymmetric to peers,
but I’d vouch that in 2016 the main driver will be its own quarterly results.
Atico Mining (ATY.v): The fifth and last of the producers in the 2016 list and a new arrival.
Its flagship asset is the 90% it owns of the El Roble (The Oak) mine in Colombia (about four
hours Southwest of Medellín) which enjoys optimum infrastructure (road, water, power, people)
and was an established producing mine before ATY arrived.
ATY is run by the “Fortuna Team”, the people behind Fortuna Silver (FVI.to) (FSM) and in arm-
waving terms, that means the Ganoza family of Peru. They bought into the mine a few years
ago because of its strong potential for exploration upside and in effect, became a producer
from day one. The El Roble mine sits on top of a VMS (Volcanic Massive Sulphide) zone with
classic lens of mineralization (see the company presentations for more) that grade high in
copper and gold and on that point, it’s worth mentioning that for some reason the market often
pigeonholes ATC as a precious metals company. Perhaps that’s for the Fortuna connection, but
in fact copper accounts for around 2/3rds of its revenues (gold the rest) and in fact is a valid
component of a list such as ours; this was will succeed or fail on the price of copper, not of
gold.
ATY’s share price got hit hard in 2015 and is now down to a level that’s potentially interesting
as an entry point, so as well as it being a copper company I want to keep closer tabs on its
weekly evolution. Hence the entry as a component this year, it could be a live one.
Cordoba Minerals (CDB.v): We get to the final two on the list, the tinycap end of the market
that always has its share of components but this time I’m restricting it to just two. The first one
is Cordoba Minerals (CDB.v), an exploreco working Colombia that’s connected to the Simon
Ridgway stable. It’s more interesting than the average play because it’s been getting insto
support from several quarters including Robert Friedland (Ivanhoe, see above) and is also going
to do that rare thing and put 3000m of diamond drilling into its main San Matias copper/gold
project in 2016. The property is prospective too, with recently added ground that consolidates
the target and previous drill results from the newly added area that returned numbers such as
188 metres of 0.71% Cu / 0.25 g/t Au and 128 metres of 0.84% Cu / 0.45 g/t Au. Those are a
typical sample of what seems to be on offer at the greater San Matias project, which is to ay
not bad at all.
At 79.45m shares out and just under $12m market cap, this is a tinycap that has a chance. It
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also tends to trade better than most, with bursts of real volume every now and again. It’s main
downside is the political risk because not only is it in Colombia, but it’s in an iffy corner of
Colombia that still suffers from terrorist violence and angry locals.
Revelo Resources (RVL.v): The final name this year is also a newcomer. Revelo Resources is
a new vehicle that has consolidated a lot of exploration acreage in Chile from a couple of
previous juniors that tried and failed to make a go of things in tough circumstances. Run by the
experienced and rated geologist Tim Beale, what you have in RVL is a classic grassroots play
that would do well if land assets start to get a valuation boost. Of the 20 projects on its books
there’s a mix of properties with a couple already under JV in classic “prospect generator” style,
some low grading deposits that are better understood but nothing wonderful (so far), other
prospective tracts that may get the worst thing possible happening to them (they get drilled).
It’s the kind of bottom end representative for the Basket that covers the chances of a great
many land-rich-cash-poor juniors out there, but at least it’s in a good country like Chile and at
least people take a little notice of it. Worth its place.
Conclusion
And that wraps up the overview of this year’s Copper Basket, with new and old names alike. We
will of course take closer notice of the individual companies as the year unfolds, with most
details possible on ones that really start catching the eye and potentially making it to trade
status. That’s going to depend on the fate of the copper price as much as anything else.
Copper will be a key commodity in 2016 and I think it’s THE key of all the metals; if the market
turns there’s real money to be made in some of these stocks (picking and choosing the best of
the bunch) but if it doesn’t there’s money to be lost as well. The Copper Basket verison 2016 is
designed to give a wider view of what’s going on and should be able to identify the sub-sectors
that over or under-perform. It may even have names in it that provide big wins.
Stocks to Follow
Of our 14 open positions on the ‘Stocks to Follow’ list, a full nine managed to register gains in
the Santa Claus rally we had in mining last week. I’m not going to list them all, just the two
best moves in Starcore Intl (SAM.to up 10.9%) and Regulus Resources (REG.v) up 9.1%).
There was one unchanged (IRL.to suspended) and another four downers (BTO.to, LRA.v,
TGM.v, FCV.v) and of those, by far the biggest worry is B2Gold that lost ground when just
about all its peers gained on the week. Not good optics.
We currently have 14 open positions in our 'Stocks to Follow' list, one below our self-imposed
15 name maximum. Four trades are green, ten are red.
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company Ticker this week Avg Price Reco date Current PPS Gain/Loss% Notes
TOP PICK
B2Gold BTO.to buy C$2.17 12-sep-14 C$1.49 -31.3% Top Pick, 4q15 prod key
Metals Producers (in current order of preference)
Lake Shore Gold LSG.to STR buy C$1.07 07-apr-15 C$1.17 9.3% M&A tgt 1.50 tgt
Teranga Gold TGZ.to STR buy C$0.55 15-feb-15 C$0.495 -10.0% V cheap sub-60c but no momo
McEwen Mining MUX hold U$1.09 25-jan-15 U$1.12 2.8% Santa Rally
Starcore Intl SAM.to spec buy C$0.48 10-jan-15 C$0.305 -36.5% 4-for-1 rollback, tgt 76c
Land Grab Stocks (in current order of preference)
Phoscan Chem FOS.to hold/sell C$0.28 29-mar-15 C$0.275 -1.8% Under offer, may sell
Sandspring Res SSP.v hold C$0.195 18-oct-15 C$0.145 -28.2% Risky small play, 30c tgt
Atacama Pacific ATM.v hold C$0.19 26-apr-15 C$0.15 -21.1% Spec buy, cheap adv proj
Lara Expl. LRA.v hold C$1.15 08-apr-12 C$0.235 -79.6% solid biz model, LT hold
Other Recommended Stocks (in current order of preference)
Dalradian Res DNA.to STR buy C$0.64 27-oct-13 C$0.76 18.8% New tgt 95c to $1 Sep 20
Minera IRL IRL.to Susp. C$0.195 22-jul-12 C$0.075 -61.5% Trading suspended
True Gold TGM.v spec buy C$0.18 23-aug-15 C$0.225 25.0% 25c to 30c sell price tgt
Focus Ventures FCV.v hold C$0.23 01-jul-12 C$0.11 -52.2% tgt 50c, phosphate great value
Regulus Res REG.v hold C$0.30 06-apr-15 C$0.24 -20.0% Comm. Rels slow progress
Closed in 2015 closed close price
Argonaut Gold AR.to jan'14 C$1.47 14-dec-14 C$2.53 72.1% Big gain small time, profit taken
Amerigo Res ARG.to jan'14 C$0.405 20-jul-14 C$0.285 -29.6% Given up on weak Cu prices
Reservoir Min. RMC.v jan'14 C$6.05 18-jun-14 C$4.12 -31.9% sold on Cu downturn
Coro Mining COP.to jan'14 C$0.075 26-jan-14 C$0.035 -53.3% sm, sold on Cu downturn
Fortuna Silver FSM mar'15 U$4.12 10-nov-14 U$3.75 9.0% Short used as hedge
GoldQuest Min. GQC.v mar'15 C$0.26 27-oct-13 C$0.085 -67.3% given up ghost
Rio Alto Mining RIO.to apr'15 C$2.30 07-apr-11 C$3.57 55.2% Top pick, bot out, big win
Timmins Gold TGD jun'15 U$0.60 19-apr-15 U$0.62 3.3% near-term trade, out of time
First Majestic AG jul'15 U$10.51 10-aug-14 U$4.55 56.7% horrible failed trade
NovaCopper NCQ.to jul'15 C$1.05 09-apr-14 C$0.50 -52.4% no more Cu exposure, sm sell
McEwen Mining MUX aug'15 U$0.695 21-jul-15 U$0.92 32.4% Closed nearterm flip for win
Midas Gold MAX.to sep'15 C$0.39 21-sep-15 C$0.35 -10.3% Sm. trade idea that didn't work
New Gold NGD oct'15 U$2.18 23-aug-15 U$3.05 39.9% trade closed, profit taken
Legend Gold LGN.v nov'15 C$0.085 01-mar-15 C$0.035 -58.8% tiny "land grab" idea, failed
Timmins Gold TGD nov'15 U$0.245 20-sep-15 U$0.15 -38.8% small near-term loser
2009, 2010, 2011, 2012, 2013 and 2014 closed positions in appendices below
Now for some notes on current basket stocks.
B2Gold (BTG) (BTO.to): A bad week for
BTO and a worrying omen for the next few
weeks, which are crucial for the ongoing Top
Pick status of the stock. I’m still reserving
judgement on the stock until we get the 4q15
production numbers but the optics on a week
in which the stock dropped while all around
we saw peers rallying isn’t good.
It could be protracted tax loss selling of
course. Or it could be one or two larger funds
adjusting their holdings. Or it could be any
other thing, but BTO needs to hit a high
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production target for 4q15 in order to reach the guidance numbers it ratified just a few weeks
ago and if it doesn’t it’s going to take a significant credibility hit. And it’s going to see me drop
its Top Pick rating.
I didn’t enjoy the BTO performance last week one little bit, by a long way the stock most on my
mind this weekend.
McEwen Mining (MUX): As noted on
the blog a couple of times last in semi-
cryptic and fully ironic manner (here’s one
(1)) MUX is obviously being manipulated
higher by Rob McEwen (with the help of a
friendly desk or three, no doubt) in order
to close the stock at above U$1.00 for
2015 and strengthen his de-listing review
case at the NYSE. It’s nice to see my
personal position finally (FINALLY!!!) in
the green due to this manip move, but I’m
not under any illusions either.
Lake Shore Gold (LSG.to): LSG will be bought out by Goldcorp in 2016 and it’s trading that
way, too. Own it, hold it, keep it until the inevitable happens.
Teranga Gold (TGZ.to) (TGZ.ax): Still lagging and I wonder, along with BTO, whether this
one is suffering from a more protracted tax loss selling period.
Starcore Intl (SAM.to): It was good to see SAM bounce (with the sector) last week after its
post-rollback slump, even though it was on very bitty volume.
Phoscan Chemicals (FOS.to): I’m going to give this one a couple more weeks to rally into
the New Year if possible, then sell whatever happens. Let’s set a soft limit date of January 10th.
Focus Ventures (FCV.v): On reading the NR dated Wednesday December 23rd (2) that the
Pre-Feas study may not be delivered to the company by December 31st and thereby causing the
company to incur a penalty with the concession vendors (of $500k), I shot a mail to FCV
president David Cass to ask for more details (along with a general “WTF?” comment). What
came back was more optimistic than I’d expected, because Cass replied that he was still
confident they (the PFS compilers) would make the deadline and FCV wouldn’t have to pay the
penalty and that the NR was more a case of a necessary covering of rear ends just in case they
hit a glitch and don’t make it. In other words, it’s likely they’ll still make it but it’s by no means
guaranteed and as $500k would create a big hole for such a small company I hope that all
concerned are having a busier Christmas than I’ve been having.
The Copper Basket
After fifty-two weeks of 2015, The Copper Basket is showing a 43.36% loss to level stakes.
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company ticker price 1/1/15 Shares out Market Cap current pps gain/loss%
1 Reservoir Min. RMC.v 3.96 47.55 194.96 4.10 3.5%
2 Capstone Min. CS.to 2.03 381.95 179.52 0.47 -76.8%
3 NGEx Resources NGQ.to 1.17 187.71 122.01 0.65 -44.4%
4 Copper Fox CUU.v 0.135 402.96 52.38 0.13 -3.7%
5 Nevada Copper NCU.to 1.65 80.5 49.11 0.61 -63.0%
6 Western Copper WRN.to 0.68 93.68 35.60 0.38 -44.1%
7 Amerigo Res ARG.to 0.27 173.65 32.99 0.19 -29.6%
8 Hot Chili Ltd HCH.ax 0.16 333.11 29.31 0.088 -45.0%
9 NovaCopper NCQ.to 0.58 60.15 24.66 0.410 -29.3%
10 Panoro Minerals PML.v 0.295 220.64 24.27 0.11 -62.7%
11 Regulus Res REG.v 0.35 56.39 13.53 0.24 -31.4%
12 Metminco MNC.ax 0.008 2650 7.95 0.003 -62.5%
13 AQM Copper AQM.v 0.06 141 4.94 0.035 -41.7%
14 Catalyst Copper CCY.v 0.305 31.41 3.46 0.11 -63.9%
15 Coro Mining COP.to 0.045 159.37 3.19 0.02 -55.6%
NB: HCH.ax & MNC.ax priced in AUD$, rest CAD$ Portfolio avg -43.36%
NB: I’m calling the end of the year for both Copper Basket and Low Cost Producer Basket this
week because 1) we’re at week 52 by the
5% The Copper Basket 2015, weekly evolution
strict count 2) we can start the new baskets
0%
afresh this time next week and 3) I’m going -5%
to be away all next week and won’t follow -10%
-15%
things closely.
-20%
-25%
-30%
The overall basket doesn’t end its year at
-35%
lows, but the small gain it put on from the -40%
week before doesn’t mean much and 2015 -45%
-50%
was still an unmitigated disaster for copper
juniors. On the week we saw seven winners
(CS.to, NGQ.to, NCU.to, WRN.to, CUU.v,
ARG.to, REG.v), four unchanged stocks
(RMC.v, PML.v, MNC.ax, AQM.v) and four losers HCH.ax, NCQ.to, COP.to, CCY.v). Biggest
winners were Capstone (CS.to 23.7%) which got
the full Santa Rally treatment as heavy tax loss
selling in the first two weeks of December came to
a halt, with double figure percentage moves also
from NGEx Resources (NGQ.to up 14.0%) and
Copper Fox (CUU.v up 13.0%). Coro Mining (COP.to
down 20.0%) was the biggest loser and one of the
five that’s getting dropped frm the 2015 list, the
other four being Panoro (PML.v), Metminco
(MNC.ax), AQM Copper (AQM.v) and Catalyst
Copper (CCY.v). All zombie stocks until futher
notice and not much good for sector tracking
purposes.
Here’s the copper metal price action on the week,
reported in very light holiday trading that saw
prices rise inside the recent trading range but not
break out any further. Not much to read into this
chart today, we mark it and move on.
We wrap up the Copper Basket 2015 with the Best Of chart (below) and as you can see, by far
9
ht4naj ht81 ts1bef ht51 ts1ram ht51 ht92 ht21 ht62 ht01 ht42 ht7nuj ts12 ht5luj ht91 dn2gua ht61 ht03 ht31 ht72 ht11 ht52 ht8 dn22 ht6ceD ht02
source: IKN calcs

the best performer on out list all year was the ultra-consistent Reservoir Minerals (RMC.v) which
is the only one to have made a nominal profit on the year (though by only 3.5%). Copper Fox is
a promo pump thing that started well but faded, so the question is whether that pattern will
repeat in 2016.
Copper Basket Components after 52 weeks
100%
80%
60%
40%
3.5%
20%
0%
-3.7%
-20%
-40% -29.3%-29.6%-31.4%
-60%
-41.7% -44.1%-44.4%-45.0%
-55.6%
-62.5%-62.7%-63.0%-63.9%
-80% -76.8%
10
v.CMR v.UUC ot.QCN ot.GRA v.GER v.MQA ot.NRW ot.QGN xa.HCH ot.POC xa.CNM v.LMP ot.UCN v.YCC ot.SC
source: TSX, ASX, IKN stats and calcs
All the others were between bad (negative 30% on the year) and awful (negative 60% and
more) and let’s note that even with the big pop, Capstone finished at -76.8% for the periods
and was by ar the worst of the lot. The pleasures of a weak balance sheet.
Now our regular weekly warehouse comment section:
• It was another quiet trading week due to the Christmas period. Stocks in the official
warehouse systems rose by 2,892 metric tonnes (MT) (+0.6%) to finish at 475,951mt.
• Shanghai stocks were unchanged (closed for business) and stay at 179,612mt.
• LME stocks rose by a small 3,375mt (+1.5%) to finish at 235,200mt.
• Finally the Comex warehouse system saw a drop of 483mt (-0.7%), to finish at
64,031mt.
Here's the Shanghai chart, which remained unchanged on the week.
Shanghai Futures Exchange Warehouse Stocks, 2014/2015
260000
240000
220000
200000
180000
160000
140000
120000
100000
80000
60000
31'13ceD ht91 ht9 dn2ram dr32 ht31 ht4yam ht52 ht51 ht6yluj ht72 ht71 ht7 ht82 ht91 ht9 ht03 ts12 ht11 ts1bef dn22 ht51 ht5rpa ht62 ht71 ht7nuj ht82 ht91 ht9 ht03 ht02 ht11 ts1von dn22 ht31
Mt Cu
source: Cochilco
Summing up, much the same as the price action of last week, stock movements gave no clues
at all to the future of the copper market. We now enter the pre-Chinese New Year period in
which warehouse stocks traditionally rise. Let’s see what happens and whether my “300k for
Shanghai” forecast comes true.

Capstone Mining (CS.to): A very strong Santa Claus Rally in CS.to last week, up over 23%
on strong volumes that look speculative in nature, but full kudos to those smart than me who
bought at the cheapest prices to anticipate the move.
Ten day chart here right.
However, word from the North is that there may be
problems at CS in 2016, as a reliable reader and
source of Whitehorse news “B” mailed me on
December 23rd to say that the local radio were
warning workers at the Minto mine “to be ready for
the New Year as they may be having a “temporary”
shutdown”. As B also noted in his mail, this sounds
kind of strange when we consider that CS at Minto has
been in a higher grading zone of mineralization at the
moment (1.6m tonnes of 2.3% Cu with a gold/silver kicker) and it’s also been permitted to
operate the Minto North U/G mine as of August, which should help (or have helped?) economics
no end. On the other hand, the rumour started just one month after CS brought in RBC and TD
Sec to assist in a corporate review and consider “various alternatives” for the company.
There’s no official confirmation on the “temporary” shutdown as yet and as always, take
unconfirmed snippets with a pinch of salt, decent local radio or not. But if it comes to pass it’s
fair to say that Capstone’s problems are only just beginning.
The Low Cost Producer Basket
After 52 weeks, the 2015 Low Cost Producer Basket is showing a 23.73% loss to level stakes.
company ticker price 1/1/15 Shares out Mkt Cap (Bn) current pps gain/loss%
1 Goldcorp GG 18.52 830 10.11 12.18 -34.2%
2 Newmont NEM 18.90 528.08 9.80 18.55 -1.9%
3 Barrick ABX 10.75 1164.67 9.11 7.82 -27.3%
4 Franco Nevada FNV 49.19 156.5 7.49 47.85 -2.7%
5 Agnico Eagle AEM 24.89 214.12 5.83 27.21 9.3%
6 Silver Wheaton SLW 20.33 403.75 5.22 12.92 -36.4%
7 Kinross KGC 2.82 1146.2 2.24 1.95 -30.9%
8 Buenaventura BVN 9.56 254.19 1.11 4.35 -54.5%
9 Pan American PAAS 9.20 151.64 1.04 6.86 -25.4%
10 B2Gold BTG 1.62 926.68 1.00 1.08 -33.3%
all prices in U$, using NYSE ticker prices Portfolio avg -23.73%
NB: As noted above I’m calling the end of the year for both Low Cost Producer Basket and
Copper Basket this week because 1) we’re at week 52 by the strict count 2) we can start the
new baskets afresh this time next week and 3) I’m going to be away all next week and won’t
follow things closely.
A very welcome Santa Claus Rally in the mining producers, with nine winners on our list and
just one dropper, the aforementioned B2Gold (BTG). The best results were posted by Pan
American Silver (PAAS up 8.4%) and the outperforming Barrick (ABX up 8.2%), with the typical
gain around 4% for peers.
The year ends with the GDX benchmarker outperforming our Basket by a little under a
percentage point and as the charts show, there was never too much between the two sets all
year.
11

The Low Cost Producer Basket: Weekly performance
30% and comparative to GDX control
20%
10%
0%
-10%
-20%
-30%
-40%
12
ts13ceD ht11 ht52 ht8 dr42 ht8 dr32 ht5rpa ht91 dr3yam ht71 ts13 ht41 ht82 ht21 ht62 ht9 dr32 ht6peS ht02 ht4tco ht81 ts1von ht51 ht92 ht31 ht72
basket
gdx control
source: Google Finance, IKN calcs
Low Cost Basket: Percentage difference between
3.0% basket and GDX control, 2014
2.0%
1.0%
0.0%
-1.0%
-2.0%
-3.0%
-4.0%
ts13ceD ht11 ht52 ht8 dr42 ht8 dr32 ht5rpa ht91 dr3yam ht71 ts13 ht41 ht82 ht21 ht62 ht9 dr32 ht6peS ht02 ht4tco ht81 ts1von ht51 ht92 ht31 ht72
|
source: ikn calcs, NYSE/Nasdaq data
The plan this year was to choose stocks that would perform in roughly that way, so all good.
However we’re changing gears for 2016 and the idea will be for me to try and pick ten names
that, taken as a whole, will outperform the GDX over the year. Those get reveled this time next
weekend.
Barrick (ABX): The coverage on Misha
last weekend got interesting feedback
and even a couple of you that said it was
the reason ABX outperformed peers by
aorund 4% on the week (I strongly
doubt that, the whisper wasn’t originated
on these pages, merely passed on). The
first of the Community Meetings happens
this weekend, with the final and main
one (that will get the official approval
ABX is looking for) set for the second
week of January.
Regional politics
Regional Risk Review next weekend
A quick reminder that our regular quarterly regional risk review will be the main feature of
IKN347 next weekend.
Chile: A new lithium policy
Last week Chile reports (3) were about an upcoming official policy move by Chile, via Mining
and Energy Minister Aurora Williams, that plans to make lithium a central policy going forward

and to promote Chile’s lithium industry to the world. The big announcement is expected in the
first days of 2016.
To underscore the reason why that gets space in today’s reduced edition of the Weekly, here’s
something Rick Rule said about Li in an interview last week (4):
“I absolutely think it is a fad. I think that lithium demand will grow. But lithium supply is
incredible. I remember two years ago reading the annual report from SQM, the big
Chilean producer, when they describe themselves in terms of having reserves and
resources about 180 years of supply and then taking advantage of increases in
demand is simply a function of front-ending capital costs. I think that demand for lithium
is going to continue to grow, but I think that the big three lithium producers can easily,
easily accommodate the increase in demand growth.”
For the record, I fully agree with Rule’s sentiment. We’re seeing lithium juniors pop up like
proverbial mushrooms all of a sudden, it’s Li 2.0 as the juniors crank into yet another round of
overhype, with the crop including a highly touted Frank Giustra vehicle that’s aimed at on exit
strategy of selling “American Lithium” to Elon Musk.
For one thing I’d bet dollars to donuts that Musk feels no compulsion to “buy USA” on this
particular commodity. For another thing its not just Chile, because Argentina is a potentially
enormous supplier of lithium to the world and has production starting to run (at last). For
another we haven’t even mentioned the Uyuni salt flats of Bolivia yet. Though the largely State-
controlled projects there have promised far more than they’ ve delivered so far, Uyuni alone
could supply the world with the lithium it needs if Evo’s peole ever get their act together.
And now, on top of that you have a serious mining country in Chile with enormous potential
supply upside moving to make lithium a key component of its future mining policy. Rule is
calling the lithium sector correctly, so let Giustra waste his money and not yours.
Chile: IPP deflation
News from chile confirms the trend to lower operating costs in the mining industry. Chile’s
beancounter bureau is more trustworthy than the average and according to its latest figures (5)
the Producer Price Index (IPP) from the mining sub-sector dropped by 7.2% month-over-month
between October and November (seriously, just one month), as well as a accumulated drop of
23.3% in 2015 to date and a 12 month rolling drop of 26.1%. The vast majority of the
weighting in Chile’s PPI mining data is to the copper industry.
In a separate presentation from Chile’s Cochilco (6) (7) average copper operating cash costs
(aka C1 cash cost) for all mines in Chile (via a survey of 19 companies that represent 91% of
production) was found to have dropped from U$1.655/lb in the first half 2014 to U$1.625/lb in
the first half of 2015. That’s a smaller change, but it doesn’t take into account the acceleration
of costs reductions seen in the second half of 2015.
Argentina: Export tax on gold exports eliminated
It was expected as part of the re-vamp inthe Argentina tax code as announced by the new
Macri government a day or so after his took office, but official word came only last week via NR
from London listed junior Patagonia Gold (PGD.L) (8) that export taxes on gold had been
eliminated. Here’s the pay dirt lines from the NR:
London, United Kingdom - 23 December 2015 - Patagonia Gold Plc (AIM: PGD)
("Patagonia Gold" or the "Company") confirms that the tax on gold exports has been
removed in Argentina.
Following an announcement last week by the Argentine government eliminating the
export tax on farm and industrial products, it was confirmed yesterday that the
measure includes removal of the 5% tax on mining products. The export tax on mining
products was introduced in December 2007.
13

X
With this news, we can also expect that the 10% export tax on copper and other base metals
concentrates will be officially announced as lifted soon.
Ecuador: Mirador starts (at last)
Pomp and circumstance in Ecuador last week (9) as the long-delayed Mirador copper project
(ECSA, Chinese capital) was given its environmental licence and announced as “starting now”
by Ecuador’s Mining Secretary Javier Cordova (who never misses an opportunity to BS the
world). In fact the $1.4Bn project is expected to start production in 2018 if we assume there
are no more delays between now and then, which would be a pretty stupid assumption to
make. This is Ecuador.
Peru: Copper production forecast at 2.5 million tonnes in 2016
Between five and two years ago there was a constant three-way scrap for second place in the
copper production league table between The USA, Peru and China, which all churned out the
metal at around 1.2 million tonnes per year (Chile is top by a long way at around 6m tonnes,
with La Escondida alone accounting for 1.2m tonnes).
Today the fight is settled and with the new developments at Toromocho, Constancia,
Antapaccay and in the year ahead the expected coming online of first Las Bambas and later the
Cerro Verde expansion, Peru was this week forecast by its mining ministry (10) to produce
2.5mt Cu in 2016. Something the copper bulls will forget when they’re quick to tell you about
Freeport, Glencore etc cutting back production.
Market Watching
Tax loss selling season on cue
Back in IKN 342 dated November 29th we
noted that the pattern of the Canadian tax
loss selling season shows the worst trough at
the end of the second week of December.
Here’s a one month chart of GDX and GDXJ
and although not very pronounced as yet the
rally we saw last week fits right into that
pattern. If things go to plan we should see
better prices this week too. Marking your
cards here, I’m not going to be watching any
sort of screen next week, financial or
otherwise.
Sunridge Gold (SGC.v) update
On Monday 22nd SGC filed its meeting date and information circular on the EGM now scheduled
for January 22nd 2016 that seeks to approve the buyout (and will do so). The most important
part of the file was the management’s confirmation that the eventual selling price will be “at
least 35c CAD), with the payment set to happen in two stages, one at the time and the other
later in 2016. SGC hasn’t re-rated yet and the 27.5c close was on a spike that move it up from
a general 25c and 26c available all week. This arb opportunity is getting more solid by the week
and I’m going to hold mine through to the meeting date if necessary, bound to get 320c or
more now.
14

Minera IRL (IRL.to) (MIRL.L: Jorge Ramos resigns
It would be remiss of me not to mention that Jorge Ramos, one of the “Team Benavides”
members of the new board of directors, handed in his resignation last week (11) and leaves a
board now comprised of two “Team Hodges” to one “Team Benavides”. That doesn’t look good
at first sight but my advice on this is not to worry about it. January is going to be a much more
interesting month for this ongoing soap opera than last week and there’s a lot left to happen.
For the record, far more interesting is the news that contradicted information that I’d previously
received from a decent source, that Rio Tinto (RTZ) has decided not to hand back its La Granja
concession (12) and has signed on for another eight years with the government of Peru. That’s
good people, that’s very good.
Conclusion
IKN346 is done, we end with a few bullet points:
• The abridged Christmas edition doesn’t cover in the same depth as normally, especially
on the quiet trading side, but when trading is the subject we do note that the Canadian
tax-loss selling season pattern worked very much in the same way as the last three
years. This “buy week three of December” is one that’s worth remembering one of
those that will work right up to the moment that it doesn’t. Maybe we should take 2016
off and just buy the GDXJ mid-December ’16.
• The new composition of The Copper Basket is today’s main feature, because for one
thing we’re expanding its net this year with five producers and a couple of bigger-sized
market cappers in HudBay and Ivanhoe. For another copper is going to be the key
metal in 2016 and it’s going to be centre of my radar for at least the first quarter of the
year ahead.
• I’ll make no bones about it, BTO’s performance last week was a worry. It needs to rally
to provide the right type of optics going into the production results NR, else I’m going
to have to drop its rating and sell at least a few of the shares held at a hefty loss.
• Don’t buy into the lithium juniors BS. There’s no doubt that the world will use a lot
more lithium in its future, but don’t confuse that with juniors looking to ride a fad. The
future of lithium is far brighter than any cash you decide to plough into the rip-off end
of the exploreco world that jumps on this particular bandwagon.
• Happy New Year, everyone. I go offline tomorrow lunchtime approx and won’t be back
in the office until 2016.
I thank you in advance for any feedback. Our Top Pick stock is B2Gold (BTG) (BTO.to). Flash
updates will be sent if required by events.
I wish you good trading fortune, ladies and gentlemen.
Otto
Footnotes, appendices, references, disclaimer
(1) http://incakolanews.blogspot.pe/2015/12/a-christmas-miracle.html
(2) http://finance.yahoo.com/news/focus-provides-bayovar-12-pre-173303148.html
(3) http://www.portalminero.com/pages/viewpage.action?pageId=106432959
15

(4) http://yukonprospectors.ca/Wordpress/?p=1868
(5) http://www.entornointeligente.com/articulo/7596214/CHILE-Indice-de-Precios-de-Productor-%28IPP%29-de-
Industrias-registra-una-variacion-mensual-de-32
(6) http://www.cochilco.cl/
(7)
www.cochilco.cl/Archivos/destacados/20151221160001_COMUNICADO%20DE%20PRENSA%20OBSERVATORIO%2
0DE%20COSTOS.pdf
(8) http://ir.patagoniagold.com/scripts/php/rns_viewer.php?id=23761283
(9) http://www.almanoticias.com/ecuador-pone-en-marcha-primer-proyecto-de-mineria-a-gran-escala/
(10) http://spanish.xinhuanet.com/2015-12/27/c_134954708.htm
(11) http://incakolanews.blogspot.pe/2015/12/the-fun-never-stops-at-minera-irl-irlto.html
(12) http://incakolanews.blogspot.pe/2015/12/rio-tinto-stays-on-at-la-granja.html
Stocks To Follow Closed Positions 2014
Closed in 2014 closed close price
Fortuna Silver FVI.to jan'14 C$2.80 23-dic-13 C$3.19 13.9% small ST trade closed
Rio Alto Mining RIO.to jan'14 C$2.06 07-jun-13 C$2.30 11.7% trading position finally closed
Network Expl. NET.v feb'14 C$0.01 22-jul-12 C$0.005 -50.0% position closed, did nothing
Tahoe Resources TAHO feb'14 U$13.10 08-abr-13 U$21.72 -65.8% short closed due to reality
Darwin Res DAR.v mar'14 C$0.10 14-jul-12 C$0.045 -55.0% tiny risk play dropped
B2Gold BTO.to mar'14 C$3.07 28-nov-12 C$3.35 9.1% closed to free up capital
Pretium Res PVG mar'14 U$5.38 22-nov-13 U$6.50 -20.8% short closed as port longer
Gold Res Corp GORO may'14 U$5.07 26-ene-14 U$4.12 16.7% took profit
Bear Creek Min BCM.v may'14 C$1.63 23-mar-14 C$2.05 25.8% Took profit, sm near-term win
Eco Oro Min. EOM.to aug'14 C$0.48 22-sep-13 C$0.26 -45.8% sold small loser to make room
True Gold TGM.v sep'14 C$0.395 02-feb-14 C$0.41 3.8% M&A won't happen, sold
Santacruz Silver SCZ.v sep'14 C$1.04 26-ene-14 C$0.86 -17.3% silver/M&A spec, rel. small
Timmins Gold TGD nov'14 U$1.38 09-abr-14 U$0.99 -28.3% failed trade, sell, raise cash
Kinross Gold KGC nov'14 U$2.90 20-oct-14 U$2.15 -25.9% V small trade, didn't work, chau
Salazar Res SRL.v hold C$0.28 02-mar-14 C$0.145 -48.2% lost China sponsor
Stocks To Follow Closed Positions 2013
Closed in 2013 closed close price
USA Graphite USGT feb'13 U$0.93 08-ene-13 U$0.17 81.7% short tgt made/trade closed
Lachlan Star LSA.to feb'13 C$1.50 30-sep-12 C$0.95 -36.7% sold to reduce port risk
United Silver USC.to mar'13 C$0.21 28-oct-12 C$0.095 -54.8% small Ag sector trade, failed
Aurcana Corp AUN.v apr'13 C$1.07 11-nov-12 C$0.55 -48.6% closed on poor YE results
Gold Res Corp GORO apr'13 U$14.11 25-ene-13 U$9.38 33.5% short tgt made/trade closed
Marlin Gold MLN.v apr'13 C$0.075 10-feb-13 C$0.065 -13.3% closed trade
Bear Creek BCM.v may'13 C$2.58 01-abr-13 C$2.40 -7.0% near-term, time ran out
Lupaka Gold LPK.to may'13 C$1.12 23-oct-11 C$0.32 -71.4% towel thrown in
Tahoe Resources TAHO may'13 U$18.62 08-abr-13 U$14.70 21.1% took profit on ST short
OceanaGold OGC.to jun'13 C$3.03 16-sep-12 C$1.18 -61.1% sold on gold drop
IMPACT Silver IPT.v jun'13 C$1.14 13-ene-13 C$0.62 -45.6% sold on silver drop
Duran Ventures DRV.v jun'13 C$0.045 10-may-13 C$0.025 -44.4% ST trade never worked
Plata Latina PLA.v jun'13 C$0.79 10-abr-12 C$0.13 -83.5% closed
Bellhaven BHV.v jun'13 C$0.065 03-jun-13 C$0.12 84.6% closed ST trade
B2Gold BTO.to aug'13 C$3.07 28-nov-12 C$3.44 12.1% sold 1/2 to raise cash
Colossus Min. CSI.to aug'13 C$0.72 24-jul-13 C$0.79 9.7% closed thru nerves on future
Pretium Res PVG.to aug'13 C$8.20 11-jun-13 C$10.14 23.7% closed to raise cash
Bear Creek BCM.v sep'13 C$2.06 30-may-13 C$2.20 6.8% sold on pol risk decision
16

MAG Silver MVG oct'13 U$7.00 12-sep-13 U$5.62 19.6% near-term short
Gold Res Corp GORO oct'13 U$9.52 03-may-13 U$4.98 47.7% short tgt made, covered
AQM Copper AQM.v oct'13 C$0.31 16-oct-11 C$0.125 -59.7% closed failed trade
First Majestic AG nov'13 U$11.51 07-nov-13 U$10.50 8.8% v near term short, closed
Fortuna Silver FSM nov'13 U$4.00 07-nov-13 U$3.68 8.0% v near term short, closed
Primero PPP nov'13 U$5.70 07-nov-13 U$5.75 -0.9% v near term short, closed
Starcore Intl SAM.to nov'13 C$0.235 08-sep-13 C$0.17 -27.7% ST trade didn't work, sm loss
B2Gold BTO.to dec'13 C$2.22 28-nov-12 C$2.16 -2.7% closed ST trade to raise cash
Stocks To Follow Closed Positions, 2012
Closed in 2012 closed close PPS
Soltoro SOL.v jan'12 C$0.87 07-nov-11 C$0.94 8.0% cash moved to BCM.v
Gold-Ore Res GOZ.to feb'12 C$0.84 13-oct-10 C$0.98 16.7% trade closed on ELG.v offer
Minefinders MFN feb'12 U$11.68 17-nov-11 U$14.80 26.7% target made, trade closed
Iron Creek IRN.v mar'12 C$0.58 26-sep-10 C$0.31 -46.6% time up on small bad trade
U.S. Silver USA.to apr'12 C$2.18 15-mar-12 C$1.86 -14.7% ST trade no good, cut loss
Augusta Res. AZC.to may'12 C$3.10 29-jan-12 C$2.07 -33.2% bad mkt, bad trade cut loss
Bellhaven BHV.v may'12 C$0.50 22-sep-10 C$0.28 -44.0% new mgmt not impressive
Zincore Metals ZNC.to may'12 C$0.325 29-jul-11 C$0.17 -47.7% bad mkt, bad trade cut loss
Soltoro SOL.v may'12 C$0.70 18-mar-11 C$0.41 -41.4% bad mkt, bad trade cut loss
U.S. Silver USA.to aug'12 C$1.78 27-jul-12 C$1.36 -23.6% fail ST trade close pre split
Estrella Gold EST.v aug'12 C$0.91 27-mar-11 C$0.14 -84.6% Closed on port realignment
Fortuna Silver FVI.to sep'12 C$1.07 03-may-09 C$5.32 397.2% sell call $6.17/ Mar25
Strait Minerals SRD.v oct'12 C$0.125 09-dec-11 C$0.12 -4.0% closing coverage til FY13
Sunward Res SWD.to oct'12 C$1.47 13-mar-11 C$1.21 -17.7% sold, took loss
Gold Res Corp GORO oct'12 U$21.47 09-sep-12 U$17.40 19.0% Short trade closed
Yellowhead Min. YMI.to nov'12 C$1.00 01-apr-12 C$0.63 -37.0% sold, took loss
Primero Mining PPP nov'12 U$7.26 07-oct-12 U$6.73 7.3% Short trade closed
Bear Creek Min. BCM.v nov'12 C$3.38 07-nov-11 C$3.72 10.1% Took small profit
Vena Resources VEM.to dec'12 C$0.70 31-may-09 C$0.18 -74.3% Failed trade (caps F)
Galway Res GWY.v dec'12 C$2.19 24-nov-12 C$2.30 5.0% closed good ST arb trade
Stocks To Follow Closed Positions, 2011
Closed in 2011 closed close PPS
Sunward Res SWD.v jan'11 C$1.05 21-nov-10 C$1.63 55.2% target made, trade closed
Serengeti Res SIR.v mar'11 C$0.245 05-dec-10 C$0.285 16.3% sold pre-tgt, ST trade fail
Fronteer Gold FRG apr'11 U$2.37 03-may-09 U$15.24 543.0% buyout, trade closed
Minefinders MFN apr'11 U$9.09 07-nov-10 U$16.89 85.8% target made, trade closed
Metalline Min. MMG may'11 U$1.04 26-jan-11 U$0.89 -14.4% exit, resource disappointed
Peregrine Met PGM.to jul'11 C$0.87 06-mar-11 C$2.60 198.9% buyout offer, closed
Dynasty Metals DMM.to jul'11 C$4.20 03-may-09 C$2.85 -32.1% Sold. Fail. Move on.
Aura Silver AUU.v aug'11 C$0.22 13-oct-10 C$0.16 -36.4% Bad pick. Take loss
U.S. Silver USA.v aug'11 C$0.52 26-jan-11 C$0.71 36.5% closed to make room
B2Gold Corp BTO.to sep'11 C$2.80 12-may-11 C$4.27 52.5% target made, trade closed
Bear Creek Min. BCM.v sep'11 C$3.80 27-may-11 C$4.17 9.7% macro sell call victim
Minefinders MFN sep'11 U$14.70 10-aug-11 U$15.15 3.1% macro sell call victim
Great Panther GPR.to sep'11 C$3.03 22-aug-11 C$2.64 -12.9% macro sell call victim
Fortuna Silver FVI.to sep'11 C$1.07 03-may-09 C$5.36 400.9% sold 20%, macro sell call
Focus Ventures FCV.v nov'11 C$0.40 20-apr-10 C$0.20 -50.0% cut losses, bad trade
Regulus Res. REG.v dec'11 C$1.17 14-aug-11 C$0.52 -55.6% cut on news of poor 43-101
2009 and 2010 closed positions in appendices below
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Stocks To Follow Closed Positions, 2010
Closed in 2010 closed close PPS
B2Gold Corp BTO.to Jan'10 C$0.88 08-nov-09 C$1.49 68.2% target made, trade closed
Radius Gold RDU.v Jan'10 C$0.18 23-aug-09 C$0.40 122.2% target made, trade closed
MAG Silver MVG mar'10 U$5.60 23-nov-09 U$7.28 30.0% closed in pdac week
Riverside Res RRI.v mar'10 C$0.435 20-sep-09 C$0.60 37.9% closed in pdac week
Amarillo Gold AGC.v mar'10 C$0.81 31-may-09 C$0.70 -13.6% closed in pdac week
B2Gold Corp BTO.to apr'10 C$1.24 18-feb-10 C$1.50 21.0% target made, trade closed
Lumina Copper LCC.v apr'10 C$0.84 14-jun-09 C$1.55 51.2% total position now sold
Troy Resources TRY.to may'10 C$1.10 03-may-09 C$2.25 104.5% sold on negative results
AuEx Ventures XAU.to may'10 C$2.51 24-may-09 C$3.38 34.7% trade closed
Nevada Copper NCU.to jun'10 C$3.27 14-mar-10 C$2.03 -37.9% need to lower Cu exposure
Carpathian Gold CPN.to jun'10 C$0.39 14-mar-10 C$0.35 -10.3% too exposed to cap raising
Amerix PM Corp APM.v jun'10 C$0.065 08-nov-09 C$0.05 -23.1% victim of macro bear
Antares Minerals ANM.v jun'10 C$1.42 06-dec-09 C$2.10 47.9% sold half
Vena Resources VEM.to jun'10 C$0.37 31-may-09 C$0.23 -37.8% sold half
Minera Andes MAI.to sep'10 C$0.75 28-jul-10 C$0.95 26.7% ST trade closed
Gold-Ore Res GOZ.to sep'10 C$0.52 01-aug-10 C$0.75 44.2% target made, trade closed
B2Gold Corp BTO.to sep'10 C$1.45 25-may-10 C$2.01 34.5% target made, trade closed
Blue Sky Uran BSK.v oct'10 C$0.41 19-may-10 C$0.22 -46.3% v small v bad trade closed
Dia Bras Expl DIB.v oct'10 C$0.14 30-aug-09 C$0.35 150.0% target made, trade closed
S. Amer. Silver SAC.to nov'10 C$1.38 24-oct-10 C$1.60 -15.9% loss on short, small fail
Ventana Gold VEN.to nov'10 C$7.92 27-jun-10 C$13.51 70.6% trade closed on buyout
Lumina Copper LCC.v nov'10 C$1.42 11-aug-10 C$3.65 157.0% trade closed
Antares Minerals ANM.v dec'10 C$1.42 06-dec-09 C$8.40 491.5% trade closed
Rio Alto Mining RIO.v dec'10 C$0.69 23-mar-10 C$2.16 213.0% trade closed
Coro Mining COP.to dec'10 C$0.585 03-oct-10 C$1.24 112.0% target made, trade closed
Stocks To Follow Closed Positions, 2009
Closed positions closed closing PPS
Cardero Res CDY/CDU.to May'09 U$1.20 03-May-09 U$0.87 -27.5% sold on negative news
Eastmain Res. ER.to May'09 C$1.04 06-May-09 C$1.315 26.4% trade closed
Radius Gold RDU.v May'09 C$0.165 03-May-09 C$0.235 42.4% trade closed
Latin Amer Min. LAT.v May'09 C$0.12 03-May-09 C$0.158 29.2% trade closed
Aquiline Res. AQI.to July'09 C$2.03 16-Jun-09 C$1.68 -17.2% took loss, bad timing
Chariot Resources CHD.to Aug'09 C$0.20 12-Jul-09 C$0.415 107.5% trade closed
Castle Gold CSG.v Sep'09 C$0.64 02-Aug-09 C$0.60 -6.3% ST trade didn't work out
Guyana Goldfields GUY.to Sep'09 C$2.30 12-May-09 C$4.50 95.7% profit taken
Los Andes Copper LA.v Sep'09 C$0.09 21-Jun-09 C$0.09 0% trade closed
Pediment Gold PEZ.to Oct'09 C$0.80 09-Aug-09 C$1.00 25.0% trade closed
Minera Andes MAI.to Oct'09 C$0.68 03-May-09 C$0.71 4.4% too much bad news
Dynasty Metals DMM.to Nov'09 C$4.18 03-May-09 C$6.01 43.8% half sold
Rusoro Mining RML.v Nov'09 C$0.55 03-May-09 C$0.57 3.6% underperformed
Important Disclosure
The information and opinions contained within this report reflect the personal views of the author and therefore all
material within should not be construed as accurate or reliable or be utilized as advice for investment or business
purposes. Independent due diligence and discussions with ones own investment and business advisor is strongly
recommended. Accordingly, nothing in this report should be construed as offering a guarantee of the accuracy or
completeness of the information contained herein, as an offer or solicitation with respect to the purchase or sale of any
security or as an endorsement of any product or service. All opinions and estimates included in this report are subject to
change without notice. It is prohibited to copy or redistribute this report to any type of third party without the express
permission of the author.
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