IKN #352Premium

The IKN Weekly
Week 352, February 7th 2016
Contents
This Week: In today’s issue, Fighting the Fed, The curse of PDAC.
Fundamental Analysis: Further comments on Lake Shore Gold (LSG) (LSG.to).
Stocks to Follow: Overview, New Gold (NGD) (NGD.to), Lake Shore Gold (LSG.to) (LSG),
Regulus Resources (REG.v), Lara Exploration (LRA.v), Sandspring Resources (SSP.v), B2Gold
(BTG) (BTO.to).
Copper Basket: Overview, HudBay Minerals (HBM.to) (HBM), Nevada Copper (NCU.to),
Cordoba Minerals (CDB.v).
Low Cost Producer Basket: Overview, Buenaventura (BVN), Sibanye (SBGL).
Regional Politics: Ecuador: The Mirador copper project, winning friends and influencing
people, Argentina: The vulture fund deal takes centre stage, Mexico: Hochschild (HOC.L)
cancels a project and hands back the concession, Mexico: Primero Mining (P.to) (PPP) under tax
review.
Market Watching: McEwen Mining (MUX) (MUX.to) redux, Continental Gold (CNL.to):
Community relations go from bad to worse, Tanzanian Royalty (TNX.to) comes undone.
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
In today’s issue
• I’m selling the near-term trade in New Gold (NGD)
• I set out my stall on why I think gold has limited near-term upside from here (but I’m
staying net long PMs, fear not, this isn’t a big change of opinion).
• I talk a little more about Lake Shore Gold and Tahoe Resources
• I point out that bigcaps are still where the mining action is. Juniors are starting to see
play as cash rotates out of the larger and into the smaller.
Fighting the Fed
In theory today’s intro, in reality this is today’s main piece. The TL:DR on this extended intro is:
• I think there’s some more upside in gold.
• But there’s a limit to this upmove,
• Gold reverses when the Fed decides to signal fewer (even no more) 2016 rate hikes.
• I’m guessing we have a month, but it’s tough to call. It may be mere days.
• Enjoy it while it lasts in the near-term. Medium/long term, stay fully bullish gold.
1

In last Thursday’s blog entry “Allow me to explain why gold is going up” (1), a post that got lost
behind all the Tahoe/Lake Shore kerfuffle, I tried to answer the title by getting it down to the
dirty, the most direct and simple. Here are the three points from the post...
1) There is buying interesting for gold in Wall St.
2) You can see that via the rise in GLD bullion inventories.
3) Wall St still rules the financial world.
...which pointed to the very obvious canary in the coalmine, that of GLD gold bullion stocks
rising, and ended with the words, “...it's going up because of more buyers than sellers in the
multiple bullion bars end of the market, the people who predict the US Dollar. That's most likely
because they don't believe Janet and her 2016 rate rise thing. And that's the real change here,
that big money has decided to fight the Fed.” Fighting the Fed, eh? If you’re in the world of
money one of the first rules you ever learn is “don’t fight the Fed” and widowmaker stories
abound of those who tried to do just that.
So what’s going on now? Is bigger money fighting the Fed and making a mistake? You’ll get my
view but first, let’s track back a couple of months. IKN345 dated December 20th came the
weekend after the much-anticipated “lift-off” from the Fed, that rate rise which your author
insisted was already fully baked into the market (and by way of a sidebar, I was right and the
“sub-U$1k/oz gold” soothsayers were wrong, but I’m far from the only person tootin’ and
crowin’ on that, just visit the permabull gold commentators over at Kitco for all you can eat).
The opening intro note that IKN345 day, “FOMC and Gold: Much ado about nothing” managed
to reference a Shakespearean comedy and a tragedy in the first paragraph (a horrid mess) but
then closed off by saying (I’ve bold-typed the last bit today):
“...while professing to be no expert on Fedwatching, I can’t help but think
that the way in which the market quickly did a new round of baking-in and
now assumes the Fed will raise four times in 2016 is an assumption with way
more risk to the downside than the upside. After all, this is the same Fed who
were going to bring us Lift-Off (ahh, love those buzzwords) in early 2015,
then mid-2015 before finally getting round to the move last week. The
reaction of a strong US Dollar is exactly the type of brake on GDP growth that
Janet & Friends don’t want to see, so it will only take one or two sets of
disappointing macro numbers to see the rate hike assumptions
tumble back to three or two...or one more. That’ll be bad for the
dollar. That’ll be good for gold in US Dollar terms.”
Even if I say so myself, that’s looking pretty accurate:
• In December Mr. Market was assuming four rate rises, today consensus has changed to
such an extent that you’re hearing traders on CNBC saying things like “If Janet raises
again this market will crash”. Hooboy, we like sentiment that goes from one extreme to
another.
2

• The US Dollar went through its strong period, the weighting index touching over 100
for the first time in a long time and commods suffering as a result. Now it’s stepping
back again. And perhaps it goes without saying but the whole “strong greenback a
brake on GDP” line is suddenly common coinage in macroeconomic commentaries.
• As for “good for gold”, Friday trading closed with gold printing U$1,174, that’s
U$112/oz higher than the weekend of IKN345 when Lady Janet had spoken (with
100% of FOMC votes going her way on the rate hike, zero dissent from the table). Gold
is 10.5% higher in US Dollar terms than the weekend of December 20th. Nuff said.
So hey wow, aren’t I just the most wonderful thing? Answer: No I’m not, I’m just another fool
grasping at shadows who on occasion sees the right pattern and gets to match his perception
of reality to real reality. Sometimes it happens, sometimes it doesn’t.
What’s more important now is to work out what happens next and, when faced with a precious
metals mining sector that’s suddenly gone from abject gloom to full-scale partytime in the
space of two or three weeks, forgive me for being a little doubtful and cynical about their
collective rush of bullishness. When I see late Friday evening news releases (2) from pathetic
zombie entities such as Sage Gold (SGX.v), with a share price of 4c and a market cap of
CAD$880,000, saying things like ”...(t)he recent rise in the gold price appears to have renewed
interest amongst various financial and mining groups to deploy financial and mining resources
in the belief that the precious metal market may have reached a correction bottom for this
cycle”, both spirit and soul scream we’re not done yet and there’s still dire need to clean up the
world, kill Zombies, clear out the flotsam and jetsam. Do Not Feed The Animals.
Switching gears slightly, there's a common perception out there now that the Fed has painted
itself into a corner. Well, if I had a dime for every time I've heard that one in the last ten years,
especially from the goldbug community, made up of people who have consistently called
macroeconomic backdrop incredibly badly, then I'd be (etc etc). I strongly advise that you read
the last couple of FOMC statements because the market may have interpreted the Fed as "four
hikes in 16" but that's not set in stone. The moment Janet jawbones away from that position
(and she will, of that there's little doubt) it'll be Party On Garth again. And she will.
Because this is the thing about the Fed; it never has been nor ever will be a market barometer,
that’s Wall Street’s job. The role of The US Federal Reserve, with its dual mandate and its
control over the US Dollar printing presses (to use the crass goldbug vernacular) is that of a
response entity. This is why I roll my eyes when I read people (and yes, especially goldbugs
with a limited grasp on financial reality) telling me that, “The Fed is behind the curve”, because
its the Fed’s very nature to be behind the curve! It doesn’t dictate, it responds! But don’t get
me wrong here, I know the Fed isn’t a passive entity either, it’s a political machine. It holds the
big lever controls to the most important economy in the world and it always adapts its narrative
to suit circumstances. Part of this is the famous “jawbone” aspect of what it does and it’s why
people who want to make money in the markets listen carefully to what the Fed has to say. An
extremely over-simplified flow would be:
Fed: “We’re doing X”
Market: “We need Y, not X!”
Fed: “That might take a while, hold on we need to ta...”
Market: “Hey Fedguys, we’re not joking! X is wrong, we need Y! Now!”
Fed: Okay. (clears throat): “Ladies and gentlemen, we’re thinking about doing Y”.
Market: YAY! “Hey everyone, Y is going to happen!”
Today I think we’re somewhere between lines four and five on my little conversation there. To
expand a little on that template above
Market 2015: “We want you to raise rates”.
3

Fed: “Ladies and gentlemen, we’re thinking about raising rates”.
Market: YAY””
Fed: “Ladies and gentlemen, we’ve raised rates a quarter point and we’re thinking
about a few more in the year ahead, 2016”.
Market 2016: “Uhhh...wait up there...we don’t want that any more...things aren’t
happening the way we expected”.
Fed: “Yeah dudes, but you said that we sho...”
Market: “Hey Fed, shut it! We need to stop the rate raise talk now! The market’s
going to crash if you don’t”.
And with that we get to the bottom line on this extended intro, the point I want to
make. Gold is going up due to its classic role as a fear trade. At other points in the cycle the
flight to safety can be to the US Dollar because other things are spooking the market, but when
it’s fear of jurisdiction deflation and dollar weakness itself (the spectre of negative rates in the
background, jigging it along nicely) that is suddenly less attractive. So people are finally piling
into gold.
THIS IS NOT GOING TO LAST FOREVER, SORRY TO BREAK THE BAD NEWS. Gold’s
appreciation on the Fear Trade will last as long as the Fed says nothing about the change in
direction which it will first jawbone, then announce formally. There is no way in the world that
Janet ignores shouts of “One more raise and the market crashes” because the Fed never
ignores these things, ever.
• The new jawbone will come.
• Then the subtle change of wording in a Fed presser will come.
• Then the policy will be formalized.
• Same as it ever was.
It’s why the microphone is given to the Doves and the Hawks in turn, it’s the reason Gary
Tanashian over at Biiwii/NFTRH refers to it as the Kabuki Theater. When it does, the fear will
subside and you’ll get those annoying “gold losing its lustre” headlines in the semi-comatose
bizpress channels.
How long do we have for this gold ride? I don’t know, I’m guessing we get a few more weeks
of bullish attitude towards the metal and I’m confident we’ll see North of U$1,200/oz, but that
may turn out to be just a few days, I don’t know how panicky Janet and her pals feel right now.
The advice therefore is to stay long gold stocks and add some more when you see fit, but don’t
fall for all the To-Da-Moon-Alice narrative that’s equally as stupid on the other side of the
shouting match. Gold’s move is welcome, but it’s not a straight flight to wonderland and the
perfect day to cash in will be the day before the Fed makes its change in narrative clear. That’s
virtually impossible to guess correctly so I’ll take the day after and the haircut that’ll come off
the top of my paper winnings. I will not fight the Fed.
Finally and to be clear, all the above addresses how I see the near-term market for gold and
precious metals. In the medium and long-term I’m as bullish as ever. To sum up, I see further
upside in gold stocks, then a jag down at some point in “the next few weeks”, then a period of
consolidation, then the return to gold price appreciation. So make the most of what the market
is offering us at the moment.
The curse of PDAC
Caesar: Who is it in the press that calls on me?
I hear a tongue shriller than all the music
Cry "Caesar!" Speak, Caesar is turn'd to hear.
Soothsayer: Beware the ides of March.
Caesar: What man is that?
Brutus: A soothsayer bids you beware the ides of March.
Julius Caesar, Act 1 Sc 2, LL15-19
4

We’re now less than a month away from PDAC and following on from the extended intro and
thoughts about the Fed and gold above, here’s a chart that takes in the last two PDAC periods:
Now for sure there’s nothing that should directly link PDAC to a sag in the price for mining
stocks. There’s no kind of bugaboo curse, no voodoo dolls with pins sticking into it and (to be a
little more serious) the late February/early March period isn’t the only area of that chart which
sees up/down activity. But I will say that I’ve approached the ‘PDAC period’ in last couple of
years with the thought of how the miners tend to peak around the time, I’ve done little or
nothing about it and I’ve come out in mid-March cursing myself and swearing to pay attention
to the Curse Of PDAC (cue “whoooo!” ghostie sound effect) next year. So, add that to my
musings on the Fed and the price of gold above and then take a guess as to my next probably
moves and adjustments in the portfolio.
To round this out, a quick return to Shakespeare’s play ‘Julius Caesar’ in which Caesar hears the
famous warning about the Ides of March (March 15th in the Julian calendar) from a soothsayer
in the throng of a parade. In another moments of the play there’s a loud peal of thunder at an
inopportune moment, later Caesar’s wife Calpurnia dreams of his death and tells him all about
it. But despite Caesar being set by BillQuill as a very superstitious person, he ignores the
warnings and goes out to face the Senate on The Ides of March. “Then fall, Caesar”.
I’ll leave it up to you to decide whether superstition has a place in modern investment theory.
Personally I’m not superstitious, because it’s unlucky to be superstitious.
Fundamental Analysis of Mining Stocks
I didn’t have anything planned for this section of the Weekly this weekend. I’ve been working
on research for Cordoba Minerals (CDB.v, see ‘The Copper Basket’ below) because it’s one
that’s beginning to intrigue me greatly at its current price range with Friedland an active buyer,
but I’m not comfortable enough with the level of DD so far and with copper still languishing I
don’t see a big rush to make any call and the only thing I may miss in a week is the drill results
from its current program. I’ll take that risk.
But as things turned out on Friday, your author managed to stick an almighty bomb under one
of his holdings, Lake Shore Gold (LSG) (LSG.to) due to the scoop published that Tahoe
Resources is in late-stage merger negotiations with the company. So rather than jam the extra
comment or three into ‘Stocks to Follow’ below, I’m going to use the space available here.
5

Further comments on Lake Shore Gold (LSG) (LSG.to)
An interesting week, no? Let’s begin with a quick reminder:
1) On January 17th IKN349 closed with these words (typo and all):
“IKN349 is done, we end a long edition with just one bullet point. Get the point.
• I’m buying more Lake Shore Goild (LSG.to) (LSG) and making it a new
Top Pick. I think it’s getting bought out soon. Buy low sell high, folks.”
2) Then IKN350 closed with these words: “Be long Lake Shore Gold (LSG.to) (LSG).”
3) And last week these were the last words in IKN351: “Be long Lake Shore Gold”
So yeah, I told you to be long Lake Shore Gold and if you caught the blog late last week you
now know why. There’s been something in the air with these two companies for a while and
when last week’s meeting between TAHO and LSG happened (and be clear, you can call it a
“rumour” or “speculation” if you like, this intel is
100% solid) it was time to remove Kevin
MacArthur’s opportunity of picking up LSG at its
current deep discount price. And now for some
extra flavour on last week’s news, which you can
also rely upon but if at points you feel there’s a
lack of backing for the statements that’s probably
deliberate, there are sources to protect.
First, background: Aside from the decent “let’s get
all disclosures on the table” news release from
LSG on Thursday (3) that talked about its Whitney
project JV with Goldcorp (the reason it bought out
Temex last year), LSG became a centre of attention on Friday when your author broke the
news Thursday post-close (4) that Tahoe Resources (TAHO) (THO.to) was in late-stage talks to
buy LSG in an all-paper deal. LSG shot higher on the news and higher still after it issued its
expected “denial that’s not a denial” NR (5). Here’s the body of the short NR, for the record:
TORONTO, ONTARIO--(Marketwired - Feb 5, 2016) - Lake Shore Gold Corp. (LSG)
(NYSE MKT:LSG) ("Lake Shore Gold" or the "Company") is issuing this press release
in response to a request by market regulation services to comment on recent trading
activity in its stock. The Company has also become aware of speculation concerning a
potential transaction involving the Company.
As a general policy, the Company does not publicly comment on market speculation
and rumours. The Company is not aware of any material, undisclosed corporate
developments that would account for recent trading in its stock. The Company will
continue to keep the market informed as required but does not intend to make any
further comment or release regarding market speculation.
As noted afterwards on the blog that day (6) the use of the word “material” in paragraph two is
the legal loophole, as negotiations between parties such as this are by definition non-material
and do not have to be disclosed to anyone. So that’s the background, here come the extra bits
and pieces
1) With a 17.3% rise on the week LSG.to did very well of course, but it was hardly the best
performing precious metals mining stock out there (check out ‘The Low Cost Producer Basket
for examples, several 20%+ moves in the big caps). However I was particularly happy about
this move because LSG has finally managed to bust through that strong ceiling price around
CAD$1.35. Then when LSG trading halted and the company gave us the denial-that-isn’t, the
market bid it straight back up again (a strongly bulish sign). As noted in ‘Stocks to Follow’, that
for me means there’s more left in this move.
6

2) Be in no doubt, this negotiation between LSG and TAHO is real, it’s advanced, it’s a question
of haggling over a price (or more accurately as TAHO wants to do a paper deal, the percentage
of the newco that would be owned by each side). The intel is very solid indeed and the leak on
the blog on Thursday evening caused a volcano-type reaction in TAHO’s offices in Reno. And for
the record, I’ve had no official communication from either TAHO or LSG people or their lawyers.
I’m fully expecting it to stay that way, they have nothing to say about being rumbled on facts.
3) I firmly believe Lake Shore Gold is in the position of strength in these merger negotiations, it
doesn’t need to do a deal with TAHO and can carry on just fine all by itself. What TAHO
recognized in LSG was an undervalued asset, but now the beans have been spilled if it wants to
do the deal it’s going to have to pay a better price. With the big ego of MacArthur now in-play,
it remains to be seen whether he’ll be able to stomach being bested by a pissant blogger such
as I. Either way, the BMO conference in Florida at the end of March will be fun.
4) However, don’t think it’s all roses for LSG. A consideration of the TAHO share price and the
lack of value that was added by the last transaction (TAHO bought Rio Alto using shares at a
nominal CAD$18, today it’s a sub-CAD$12 stock) means that if TAHO wants to make this all-
share, there will be a pinch point above which it cannot offer more else risk caving the stock
price. I think (I’m not sure, but I think) that its “best offer” might not be enough for LSG now
that the cat’s out the bag (meow). If TAHO walks away we should expect some near-term
weakness in LSG, but the company has probably been re-rated on the news that a serious offer
wis/was on the table and I doubt it will drop again from whence it came (certainly not now that
gold is where it is). I’m also of the opinion that the best thing LSG can do in the longer term is
to refuse the THO advances and build its own value (one of the reasons I posted what I did on
Thursday).
5) The second wrinkle for LSG: I’ve mentioned on several occasions that I believe Goldcorp
(GG) is a likely suitor for Lake Shore Gold, with the last time (I think) I said that out loud on
these pages IKN348 dated January 10th. I’m not going to mention how I know (I’m not into
blowing the cover on sources) but I now have firm reason to believe that Goldcorp will not be a
bidder for LSG in the case that LSG goes “in-play” (as they say). This is something I’ve changed
my mind on, therefore if you want a competing bid to come in you’ll need to find it from
somewhere else. Personally speaking I don’t see another great–fit company out there, not even
AEM. Therefore as things stand today I think there are two scenarios, 1) TAHO and LSG agree
on a friendly merger and the deal goes through smoothly or 2) TAHO walks away and LSG
stays the way it is.
6) We may get clues on this deal, or the position of TAHO, from watching any comment coming
out of Scotia. As noted on the blog Friday Tanya Jakusconek is the senior precious metals
analyst at Scotia and she’s also on the board of directors at Tahoe Resources. What we got on
Wednesday in the “Scotia Daily Scoop” morning mailer, the day after TAHO met “in secret” with
LSG, was suddenly a big splurge on TAHO and its strategy and even M&A thoughts. Entitled
“Tahoe Resources = A High Quality Laggard, We Think Market Concerns are Overdone; Time to
Take a Serious Look” When read on its own no biggie perhaps, but I was laughing hard at that
point, armed as I was with the knowledge of the TAHO-LSG meeting and the advanced talks.
As part of the big write-up it gave space to “What We Think the Market is Concerned About”,
which had three points. Point one was “reduced reserves and write down”, which is very likely
in the 2015 YE financials (but Scotia argues its effect is overdone). Point two was “Guatemala
Risk” which I’m not going to hash over again, my point on the TAHO political risk there has
been made too many times already. Then point three was “M&A Risk. Here’s that segment for
your consideration.
3) .M&A Risk: Tahoe Executive Chairman Kevin McArthur has actually been pretty vocal that
he plans on being active in M&A in the near future. At Scotiabankʼs December 2015 Mining
Conference in Toronto, Mr. McArthur went as far to say that “M&A is in his DNA” – and this was
relatively fresh off of the companyʼs acquisition/merger with Rio Alto in early 2015. We think that
some investors remain nervous that the company will maybe bite off more than it can chew from a
deal size standpoint – and potentially layer on too much debt onto its currently pristine balance
sheet. Of note is that Mr. McArthur explicitly mentioned both Canada and Mexico as jurisdictions
7

on which the company was focused.
Tahoe has one of the best balance sheets in the business, bar none. We think the company will
likely use paper to execute on M&A, and if not, the company is likely to purchase a non-core
asset which could be snapped up at a good price. Tahoe was rewarded by completing a good
deal in acquiring Rio Alto in early 2015 and we think the company will be careful to ensure any
deal completed is accretive.
That piece in the Scotia Scoop was nothing more nor less than an open letter to Tony Makuch,
CEO of LSG, with the company trying to tell him that they’re looking in all sorts of places and
was keen to do deals, but it loves its “strong balance sheet”, wants to do paper and wouldn’t
pay the earth for any deal either. The Tanya connection and the crass timing made it as subtle
as a kick in the nether regions with steel-capped boots. As a long of LSG who doesn’t want his
stock taken away before it shows something akin to its true value, it was high time to point out
to TAHO that publishing pressure works both ways. How’s that cheap asset opportunity looking
now, Kevin? ☺.
7) Finally and most importantly, be absolutely clear that I’m not a seller of LSG into
any near-term strength. If the deal eventually happens I’ll have my little moan at the world
then decide what to do, but if not there’s no reason to get cute on this. LSG is in-play because
it’s a run well company with a very solid asset, good financials, decent growth in the pipeline
but above all, it’s undervalued. The only thing that changed last week was that the perception
of the market was changed by the news that a bigger, richer mining company thinks the same
way and was looking to scoop it up on the cheap. Sorry Kevin, pay a decent price or move on
and for the record, I sincerely hope you move on and find some other sucker company to fall
for your all-paper deal spiel, rather than one I own.
Stocks to Follow
Of the 12 positions (or 11 stocks, BTO counts twice) we have open at the moment, the only
one that didn’t put in a winning week last week was Starcore (SAM.to unchanged). All the
others were winners and most of those had pretty hefty percentage gains, headed by
Sandspring (SSP.v up 48.0%), Atacama Pacific (ATM.v up 42.9%), Lara Exploration (LRA.v up
32.7%), New Gold (NGD up 18.4%), Focus (FCV.v up 18.2%), Lake Shore Gold (LSG.to up
17.3%), Regulus Resources (REG.v up 14.3%), and B2Gold (BTG up 13.3%, but the BTO.to
ticker only up 9.3%).
That’s what I call a winning week.
We currently have have 12 open positions on our ‘Stocks to Follow’ list, three below our self-
imposed maximum. Five of the open positions are in the green, which is a little better than in
the last few weeks but there’s still a lot of work to do.
8

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$1.17 -46.1% Rebounding after heavy selling
Lake Shore Gold LSG.to STR Buy C$1.10 07-apr-15 C$1.49 35.5% New Top Pick, M+A tgt
Metals Producers (in current order of preference)
B2Gold BTG Buy U$0.85 13-jan-16 U$0.845 -0.6% separate new trading tranche
New Gold NGD SELL U$2.06 24-jan-16 U$2.89 40.3% Target hit, will sell
Teranga Gold TGZ.to hold C$0.55 15-feb-15 C$0.425 -22.7% poor 4q15, under review
Starcore Intl SAM.to hold C$0.48 10-jan-15 C$0.28 -41.7% Target under review
Land Grab Stocks (in current order of preference)
Sandspring Res SSP.v hold C$0.195 18-oct-15 C$0.185 -5.1% Risky small play, 30c tgt
Atacama Pacific ATM.v hold C$0.19 26-apr-15 C$0.20 1.1% Spec buy, cheap adv proj
Lara Expl. LRA.v hold C$1.15 08-apr-12 C$0.345 -70.0% solid biz model, LT hold
Other Recommended Stocks (in current order of preference)
Dalradian Res DNA.to Buy C$0.64 27-oct-13 C$0.78 23.4% New tgt 95c to $1 Sep 20
Focus Ventures FCV.v spec buy C$0.23 01-jul-12 C$0.065 -71.7% Hit hard by PFS news
Regulus Res REG.v hold C$0.30 06-apr-15 C$0.32 6.7% Comm. Rels slow progress
Closed in 2016 closed close price
Phoscan Chem FOS.to jan16 C$0.28 29-mar-15 C$0.265 -5.4% Buyout trade, bot but poor deal
True Gold TGM.v jan16 C$0.18 23-aug-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-jan-15 U$1.20 10.1% sold due to lack of value
2009, 2010, 2011, 2012, 2013, 2014 and 2015 closed positions in appendices below
Now for some notes on current basket stocks.
New Gold (NGD): SELLING. It seems like only yesterday I was writing up on NGD and
calling it as a buy at U$2.02. Okay, not yesterday but it was in IKN350 dated January 24th when
I pounded on the stock in a NOBS report and came to this conclusion:
“...I’m a buyer of NGD next week and plan a near-term trade that, in the best
of worlds, will offer a decent return in the space of just a month. I’m exposing
myself to the vagaries of the gold price once again of course, plus it remains
to be seen whether Rainy River is built on time and in budget. However those
risks look low level in the timescale I envisage on this trade therefore The IKN
Weekly recommends New Gold (NGD) (NGD.to) as a near-term buy and sets
a target of $2.80, representing a 38.6% upside to Friday’s close, the target
assuming a 0.7X price book ratio re-rating and NGD getting in line with its
peers. In a perfect world, this trade will close out before the end of February.”
Here we are, two weeks later, NGD at U$2.89 and a target hit. So what to do?
• On the one hand, NGD making a 40% profit by the beginning of February and not the
end is nothing to be sniffed at.
• On the other, gold at U$1,174/oz and on the rise all last week means a new set of
fundies numbers, no need to use U$1,100/oz assumptions any longer (if I feel like it)
and that sets the same fundies assumptions that much higher.
Then there are the rumours that floated around on Thursday of Goldcorp (GG) in “preliminary
discussions” with NGD about a buyout. But that’s easier for me to discard, I think that’s a crock
and NGD is no sort of fit for GG at the moment (potted argument; Rainy River is nice enough
but there are too many itty-bitty ops at NGD for GG, things that wouldn’t move its dial, then
Blackwater looks expensive capex and marginal, and what’s more GG has just uncoupled itself
from NGD by buying its minority of El Morro in Chile, no point in diving back in).
9

So with that discarded we’re back to “stick to the plan and sell” versus “take into account the
new gold price and hold” and after a day or so of due deliberation and playing with the
spreadsheet (that was Saturday if you care enough, Friday was all about LSG/THO and then in
the evening I went to the movies to watch Di Caprio’s sure-fire Oscar winning performance in
The Revenant (7)) I’ve decided to stick to the plan, but with one small wrinkle (which I’ll bold
type and underline to make sure it’s seen). I’m selling my NGD next week and taking the
profits, but I’ll be looking to get out at U$3.00 or above if possible so I’m not a seller
first thing on Monday morning. However I will be out by this time next week so if my desired
U$3.00+ doesn’t show after a while, I’ll take what’s offered. I got lucky with the timing here,
let’s not beat around the bush or claim genius status. But I’ll take my slice of luck without any
problem or shame.
Lake Shore Gold (LSG.to) (LSG): We do the main LSG discussion above, here we make note
of price action only and move on. With a
17.3% rise on the week LSG.to did very well
of course, but it was hardly the best
performing precious metals mining stock out
there (check out ‘The Low Cost Producer
Basket for examples, several 20%+ moves in
the big caps). However I was particularly
happy about this move because on Friday
LSG finally managed to bust through that
strong ceiling price around CAD$1.35 that
we’ve mentioned on several occasions. I’d be
happy enough to see it re-tested at some
point, but can’t help feeling that we’re going
to see higher prices in the week to come
(gold price permitting of course), considering how well it was bid up after coming off its trading
halt Friday afternoon.
Regulus Resources (REG.v) For sure it looks good on paper to have a 14.3% rise on the
week, even more so when it changes my personal red ink to green on the above table, but
perspective at all times and the fact that REG traded less than 60,000 shares on the whole
week is more important for the long-term of this stock than any markers on the stock that
adjust it to the general market surge.
REG is playing the longer-term game and I doubt we’ll get much from the company before the
Peru elections are done and dusted, what with the Cajamarca regional/provincial/municipal
elections being an important part of the backdrop to the negotiations between REG and the
Antakori locals. There’s no reason to disparage or ignore the mini rally in REG but be clear, it’ll
only take one modest seller to knock it right back down to 20c, don’t kid yourself otherwise.
Lara Exploration (LRA.v): A very decent week percentage move-wise, with fundies drivers
too, but the lack of volume running through the stock is still the overriding message so if you
like the idea of getting in beware of chasing the ask, there’s no point. Here are the events in
bullet point
On Monday a positive: The company announced (8) that it had acquired the Tocantins gold
project, previously owned by Vale and with plenty of drill data already in the deposit. The deal
is light on the pocket, with LRA liable for exploration costs only in order ot earn its 50% from
the current I’d expect this to be a low cost exploration program for LRA and one that fits in with
recent comments picked up form Miles Thompson that there’s plenty of opportunity to buy into
prospective looking concessions in Brazil at deeply cut prices.
On Tuesday a mild negative: The company announced (9) the results of a review by the
Canadian fusspots over the 43-101 disclosures at its Maravaia project in Brazil. The main part of
10

the resource was left untouched, but according to the fusspots LRA can’t add in the smaller
satellite deposit any longer, or not until more work is done. This news is a bit of a pain, but
with its big range of exploration projects and the minor nature of the 43-101 reversal, LRA
stock was never going to feel the pinch from this.
Then on Wednesday a mild positive, as company head honcho Miles Thompson announced (10)
he’d added 217,000 shares to his position and now that he’s a (fully diluted) 10%+ holder that
needs to be public record. Thompson has continued to add to his LRA position in small pieces
all the way through 2015 and into 2016, he knows a bargain when he sees one.
However the lack of trading in LRA, with just 55,000 shares spread over the five days of last
week, is the biggest reason not to wade in at any price. We’re deep bagholders in this stock
and there’s no reason to add to this illiquid position at the moment either, not until land asset
prices begins to click back up.
Sandspring Resources (SSP.v): SSP came out with drill results news last week (11) and
that’s good, the market reacted positively with renewed buying interest that pushed the big
share price pop, which is even better.
As for the news, that was the results of
the 3,700m drill program at the Sona
Hill target, part of its Guyana
concession but some 5km South of the
main Toroparu deposit (here’s the
location map, get it big-size from the
NR if you need more detail):
The results of the drilling are the type
that geologists call “encouraging”, i.e.
worthy of more investigation but we’re
not in slam daunk new mine territory
yet. The 37 drills hit plenty of 1g to 3g
intercepts and along the way there
were several higher grading hits which
seem to intersect thinner bands of good
stuff, but we need to take into account
the relative depth of the average
mineralization (depending, but there’s 30m to 450m of overburden if they go open pit). But
what there certainly is there is gold and with
Sona Hill being just one of ten identified
geophysical anomalies around Toroparu,
there’s plenty of exploration potential here.
As for the stock, it shot higher Wednesday,
levelled off at perhaps 17c when volumes
tailed a little and it looks as though we saw
some tape-painting end-Friday to get it to
18.5c. Still, it did 1.5m shares on the news
day Wednesday, 600k on Thursday and 300k
on Friday, all those numbers a lot better than
recent trading days. I’m not expecting SSP to
break me through into the profit zone yet and
a step back to 15c is feasible, but I think the worst of the selling and the sillycheap 11c and 12c
prices are now gone. SSP has reacted well to the gold pop and managed to drum up some
trading interest at the right time, not so many tinycap explorecos can say that. Easy hold.
11

Atacama Pacific (ATM.v): The 134,500 shares that changed hands at 20c on Thursday give
its rebounded price some credence, but it’s still thin stuff on no news so I’ll enjoy the green ink
on the table this week and not get my hopes up too high as yet. ATM needs news to really
drive it and it’s the type of stock that could deliver something “coincidentally” on PDAC week.
B2Gold (BTG) (BTO.to): B2 finally moved nicely, but even a 10% or 13% (depending on the
ticker) weekly move was beneath its peer average and there’s still a distinct air of the stock
lagging behind the pack.
The plan from a couple of weeks ago hasn’t changed; BTO is still a Top Pick and is still woefully
undervalued, but once it gets back up above (say) U$1.00 (which shouldn’t take too long) I’ll
begin the lightening process and at that point, BTO will come off the top of the shop Top Pick
status. However, it’d be daft not to wait for the next 20% rise in value before doing so,
therefore patience is applied and if there are any of you looking for a solid bet to flip in the
near-term, BTO at 80c looks great value. Which is why it’s still a Top Pick until then.
The Copper Basket
After five weeks of 2016, The Copper Basket shows a 7.90% loss to level stakes.
company ticker price 1/1/16 Shares out Market Cap current pps gain/loss%
1 HudBay Min. HBM.to 0.35 235.23 717.45 3.05 -42.6%
2 Ivanhoe Mines IVN.to 0.61 778.96 490.74 0.63 3.3%
3 Reservoir Min. RMC.v 4.08 48.46 193.84 4.00 -2.0%
4 Capstone Min. CS.to 0.44 382.04 141.35 0.37 -15.9%
5 NGEx Resources NGQ.to 0.65 187.71 116.38 0.62 -4.6%
6 Copper Mtn CUM.to 0.445 118.8 53.46 0.45 1.1%
7 Nevada Copper NCU.to 0.66 80.5 52.33 0.65 -1.5%
8 Copper Fox CUU.v 0.125 417.64 52.21 0.125 0.0%
9 NovaCopper NCQ.to 0.395 104.33 40.17 0.385 -2.5%
10 Western Copper WRN.to 0.38 94.19 31.08 0.33 -13.2%
11 Hot Chili Ltd HCH.ax 0.09 420.12 29.41 0.07 -22.2%
12 Atico Mining ATY.v 0.28 97.59 26.35 0.27 -3.6%
13 Amerigo Res ARG.to 0.205 173.61 26.04 0.15 -26.8%
14 Cordoba Min. CDB.v 0.16 79.45 11.92 0.15 -6.3%
15 Revelo Res. RVL.v 0.055 99.19 6.45 0.065 18.2%
NB: HCH.ax priced in AUD$, rest CAD$ Portfolio avg -7.90%
Copper joined in the party. Our basket took a big lump out of its 2016-to-date losses thanks to
a week in which just two of our stocks
dropped (IVN.to, HCH.ax) and one other The Copper Basket 2016, weekly evolution
remained unchanged (CUU.v). The other 12 5%
were all winners with the biggest moves made
0%
by Revelo (RVL.v up 30.0%), Nevada Copper
-5%
(NCU.to up 30.0%), Amerigo Resources
(ARG.to up 25.0%), NovaCopper (NCQ.to up -10%
20.3%), Atico Mining (ATY.v up 17.4%), -15%
HudBay (HBM.to up 14.2%) and Reservoir
-20%
(RMC.v up 11.7%). Chunky numbers by
anyone’s standards. -25% source: IKN calcs
jan3rd 10th 17th 24th 31st feb7th
Copper the metal rallied away from that
“psychologically important” (now debatable) U$2.00/lb level, though notably it couldn’t hold on
to the best of its gains on Friday, the day that saw precious metals (and their miners) add extra
sauce to an already good week. The classic precious metal/industrial metal split is again in-play
12

here, so it’s going to be interesting to watch silver for
further clues, I’d vouch.
The Chinese New Year is now upon us, the big day
for the incoming Fire Monkey (must say I like this
year’s designated moniker) being February 8th. As
Reuters pointed out in its weekly wrap of the copper
scene (12) that and the dollar weakness are the two
main influences on copper at the moment, the dollar
weakness pushing spot prices higher and the Fire
Monkey (!!) making sure that nobody cares too
much.
And on the subject of Gong Xi Fa Cai and all that
(don’t ask me for the real characters) here’s the
weekly update of copper inventory positions, with
news that numbernerds like I will appreciate.
• Total world copper stocks in the three official warehouse systems rose by 15,767 metric
tonnes (MT) (+3.1%) to stand this weekend at 529,551mt. The break above 500k is
consolidated and I’d say we’re more likely to see a 6-handle next than a 4-handle.
• Shanghai stocks surged, with the Chinese New Year pre-week having its expected
effect. Stocks in SHFE rose by 29,317mt (+13.8%) to finish at 241,282mt, the biggest
move of the year and it means that SHFE has added over 55k tonnes in the last two
weeks. We’re also less than 3,000 tonnes away from the all-time record inventory
number in this corner of the system.
• At the LME, we saw a drop in copper inventories and that’s the reason there’s number-
nerd news this week. Stocks dropped by 13,725mt (-5.7%) to finish the week as
228,650mt. That means, for the first time ever (as in ever, historic and all) the SHFE
warehouses hold more copper this weekend than those of the LME. We have a new
Daddy, ladies and gentlemen, a new top dog. China rules.
• Comex copper warehouses added the tiny amount they lost the previous week. Stock
are now at 59,619mt, up by 175mt from last week.
Here's the Shanghai-only chart. We’re just a spit and a lick away from the all-time highs in this
system ratcheted up last year (in the weeks after Chinese New Year. You can bet your
mortgage on that number being taken out before the end of February, but we’re not going to
see any movement next week as China closes down for its biggest holiday of the year.
Shanghai Futures Exchange Warehouse Stocks, 2014-2016
260000
240000
220000
200000
180000
160000
140000
120000
100000
80000
60000
13
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 dr3naj ht42
Mt Cu
source: Cochilco
Now for comments on a few of our basket stocks:

HudBay Minerals (HBM.to) (HBM): I was laying into this debt-ridden dog during its
waterfall drop in January so it’s only fair (I
think) to make mention of its relief rally,
too. This ten day chart comparing HBM to
the copper ETF COPX gives the visual idea,
with the final selling in HBM on Tuesday
and then the stock decided to join in the
major mining company rally and shoot
higher, with Friday’s consolidation
performance against copper metal price
headwinds reasonably decent, too.
It’s still down a ton so far this year and I
think it’s horrid due to its debt position, but
last week shows that HBM is still playable
by traders looking for a highly leveraged
vehicle to copper. It’s definitely not for me, risk is asymmetrically high (and I still don’t think it’s
understood well by the general market that seems to ignore financial debt issues until it’s too
late), but it might be a trader.
The other news of course was about “El Jefe” (Sp. ‘The Boss’) (13), now also nicknamed “the
HudBay Cat” that’s threatening the good name of the Rosemont project just by having the
temerity of being a jaguar, alive and wild in the hills in the area. Though the video released by
enviro groups last week was a headline-catcher it isn’t new news for the project or HBM. It’s
going to need to address the matter correctly in order to win over public opinion and moments
like last week’s make sure the company can’t ignore it. As they say in any company worth its
salt, you can only have one boss.
Nevada Copper (NCU.to): This fakey-scammy BS member of the copper exploreco
community stuck in a 30% win on the week, which you might think is cool but...
• On Monday it moved up 7.8% on 7,900 shares traded
• On Tuesday, zero shares traded
• On Wednesday up moved up 5.5% on 12,800 shares traded
• On Thursday it moved up 5.2% on 5,500 shares traded
• On Friday it moved up 6.6% on 3,100 shares traded
In other words, manipulated upwards by people with more substance than style on waferthin
volumes, the whole operation designed to hoodwink the naive in the investment community.
Leave this one to the Russians.
Cordoba Minerals (CDB.v): Last week brought news (14) that Robert Friedland (yeah, him)
via his holding company Ivanhoe Industries had added more to his already large position in
CDB. Here’s the bit of the NR that matters:
Upon completion, Ivanhoe Industries will have actual beneficial ownership and control
over 23,070,833 common shares representing 29% of the currently issued and
outstanding common shares, and will be deemed to beneficially own 30,370,833
common shares (including 7,300,000 unissued common shares issuable upon the
exercise of common share purchase warrants), representing approximately 35% of
Cordoba's then issued and outstanding common shares on a partially diluted basis.
He added 3m shares to his pile last week (at 13.4c and 15c) and to my slight surprise the
market ignored this news, with CDB finishing just a penny up at that final 15c price. The more I
think about this stock, the more I like its chances.
14

The Low Cost Producer Basket
After 5 weeks of 2016, the Low Cost Producer Basket shows a gain of 36.01% to level stakes.
company ticker price 1/1/16 Shares out Mkt Cap (Bn) current pps gain/loss%
1 Barrick ABX 7.38 1164.67 13.56 11.64 57.7%
2 Newmont NEM 17.98 529.12 12.92 24.42 35.8%
3 Goldcorp GG 11.56 830.22 11.42 13.75 18.9%
4 Franco Nevada FNV 45.75 157.07 7.86 50.06 9.4%
5 Agnico Eagle AEM 26.28 217.67 7.30 33.52 27.5%
6 Ang/Ashanti AU 7.10 405.27 4.35 10.73 51.1%
7 Detour Gold DGC.to 14.41 170.85 3.31 19.39 34.6%
8 Sibanye Gold SBGL 6.09 228.71 2.60 11.38 86.9%
9 New Gold NGD 2.32 509.16 1.47 2.89 24.6%
10 Buenaventura BVN 4.28 254.19 1.24 4.86 13.6%
Prices in U$/NYSE tickers, except DGC.to (CAD$) Portfolio avg 36.01%
Another massive week for the bigger The Low Cost Producer Basket: Weekly performance
caps, even better than the week before 40% and comparative to GDX control
and for the first time ever (I think) all 35%
ten of our basket stocks put in double 30%
25%
figure percentage gains week-over-week.
20%
I’m not going to bore you with intricate 15%
lists, let’s just settle for mentioning that 10%
the “worst” performer (perhaps “least 5%
0%
best” is more accurate) was Franco
-5%
Nevada (FNV up 13.5%), while the best
-10%
was Sibanye (SBGL up 29.0% and totally
unstoppable in 2016).
The GDX control is up a very strong
24.27% for the year. However our 36.01%
to date blows that clean out of the water
and I’m pleased to say the gap just keeps
on getting wider. Hubris alert.
Buenaventura (BVN): BVN’s plan to
refinance via syndicated debt finally got
traction in the market and BVN rose with
the others, up 21.5% on strong volumes
and leaving me kicking myself once again
for talking the talk instead of walking the
walk.
Sibanye Gold (SBGL): Monday February 1st saw the CEO of Sibanye, Neal Froneman, turn up
in an interview at Bloomie (15) in which he mused on the possibility of his company moving into
the base metals world, what with his share price riding high and the copper (et al) plays
extremely depressed. The other idea was moving Out of Africa (tm) and picking up precious
metals assets in another place. His company’s stock price continued its surge later in the week
and is now up a very impressive 87% in 2016 alone, the man can do no wrong (at the
moment).
Regional politics
Ecuador: The Mirador copper project, winning friends and influencing people
We congratulate the community relations team at Ecuacorriente (ECSA), currently in the initial
15
dr3naj ht01 ht71 ht42 ts13 ht7bef
basket
gdx control
source: Google Finance, IKN calcs
Low Cost Basket: Percentage difference between
basket and GDX control, 2014
2%
0%
-2%
-4%
-6%
-8%
-10%
-12%
-14%
-16%
dr3naj ht01 ht71 ht42 ts13 ht7bef
source: ikn calcs, NYSE/Nasdaq data

stages of construction for its mega-mine copper project ‘Mirador’ in Ecuador, for its wonderful
grasp on community relations. Yes, that’s sarcasm.
On Thursday, during its third round of forced evictions of locals from its project site (the first
was September 2015, the second December 2015), ECSA forcibly removed the indigenous
Shuar native (16) Rosario Wari along with her son, Mariano Mashendo, from their home and
property. They took them out to Pangui national park territory and left them there, without food
or shelter.
We’re not told Mariano’s age, but Rosario Wari is 107 years old. That number is not a typo.
Unsurprisingly indigenous protection and pressure groups such as Ecuador’s umbrella group
CONAIE are up in arms about both style and substance of this eviction. ECSA’s response to the
outcry, which can be fairly summed up by “Well we gave them enough warnings”, didn’t help
matters in the slightest either. It’s worth reflecting that any long-term benefit on public opinion
about the mining industry in Ecuador achieved from the good work (so far) done by Lundin
Gold (LUG,to) at Fruta Del Norte can be undone in an instant by this type of thing.
Argentina: The vulture fund deal takes centre stage
It’s been delayed for a couple of weeks longer than expected, but last week we finally got to
hear the basis on which the Macri government was looking to close its deal with the bond
holdouts (aka vulture funds). The top line is simple enough, the Argentina government’s offer is
to pay U$6.5Bn to the funds, which implies a 25% haircut to the Judge Griesa ruling. It’s also a
figure that represents an average profit of around 1,000% for the funds that bought up the
defaulted paper and then waited it out, instead of agreeing to the Kirchner government deal.
According to reports (17) from the serious (and pro-Macri) end of the Argentina media there
are four vulture funds included in the negotiations and the two smaller ones, Dart Management
and Montreux, have accepted the offer in principle. The two larger ones, Elliott Assoc (Paul
Singer, the architect of the strategy) and Aurelius, are as yet undecided. Unsurprisingly the deal
is making all headlines in Argentina and being used as a large stick by the opposition with
which it’s whacking the Macri piñata.
In other Argentina macro news, the 2016 round of salary negotiations are now underway
between government and the main unions, which usually set the tone for wage increases in
public and private entities all over the country. President Macri has asked workers’ associations
to be prudent and not demand more than 20% or 25% salary increases in Peso terms. It’s fair
to say that the much vaunted Macri pledge to bring inflation under control won’t see much
effect in 2016, so throw that into your Argentina mining costs calculations.
Mexico: Hochschild (HOC.L) cancels a project and hands back the concession
Last week and very quietly, Peru-based silver miner Hochschild (HOC.L) dropped its “El Corazón
de las Tinieblas” (in English that’s “Heart of Darkness” and therefore under the circumstances
impossible not to translate for you) project in Mexico and handed it back to the authorities, with
the only news of this coming in the country’s Official Gazette (in which things must be
published to be made official).
However, it’s not due to dire straits at HOC or the drop in the price of precious metals.
According to the Mexican anti-mining environmental group ‘Rema’, (18) the decision taken by
HOC to drop the project was due to the company facing a loss of a law case at Supreme Court
level. The project was opposed by a local court (who ruled in favour of local community policing
organization, or CRAC, who didn’t want HOC there) and HOC decided to take the case to higher
courts inside Mexico. Last year it reached Supreme Court level and HOC based its case on
arguments that the current Mining Law in Mexico was unconstitutional and that the CRAC
system was incompatible with national law (more about this aspect of the case for those who
care enough and read Spanish right here (19)). Apparently on hearing that they were about to
lose, a ruling that may have caused a whole mountain of similar cases to be brought against
16

mining companies up and down the land by other disgruntled landowners, HOC decided (for the
good of the industry?) that discretion is the better part of valour and dropped both the case
and the concession.
Mexico: Primero Mining (P.to) (PPP) under tax review
Last week was not the first but the second time in less than a year that Primero Mining (P.to)
(PPP) complied with “Otto’s First Law of Mining NRs”:
Otto's First Law of Mining News Releases: Considering that anything
contained in a mining news release is presented in the best possible
way for the company in question, any piece of information contained in a
NR that comes across in any way negative means the real news and/or
events behind it must be very, very bad indeed.
The first was in July 2015 when PPP announced (20) that its import/export licence had been
suspended in May 2015 by the Mexican authorities. At that time I got snarky on the blog (a
rarity, no?) and wrote this:
Aaaaand, STOP RIGHT THERE! No need for the company's spin or reasoning as to why their
impex licence was revoked, we'll stick with the plain facts thanks very much Mister Conway. As
noted in another place when the news hit, it's a case of, "Yeah...well....we did lose our licences in
May....but we weren't gonna bother you about it....detail y'see...but what with the delays to
shipments....and 2q15 and that...y'know...here we are, tellin' ya now guv....innit". Ah, it's at times
like this that I regret giving up the use of strong swear words on this blog, some really choice
epithets for the "management" at P come to mind right now.
Last week came the second occasion and I’d lay dollars to donuts that it’s connected to the first
one, too. PPP told us that it had come
under tax review and huffily told us
the move was “unprecedented”, which
apparently means they don’t think it
should apply or stick to them. No
matter that their streaming deal on
production from San Dimas is also
unprecedented in Mexican corporate
law and the tax people have finally
caught up to the fact that companies
such as SLW and PPP have been using
it as a loophole.
Last time, as that 12 month chart
shows, P.to managed to dump from
CAD$5 to the low $3s, later managing to climb back over $4 when the licence was renewed.
This time the sell-off was vicious and took it from the $3.50 range down to a Friday close of
CAD$2.25 (or PPP in the USA at U$1.62), all at a time when others were rallying.
Market Watching
McEwen Mining (MUX) (MUX.to) redux
Akin to the True Gold redux of last week, this short passage exists to point to the fact that last
week, on recording my sale of MUX at U$1.20, I finished the segment with, “I’m pretty sure
there are better places to deploy this cash”. Here we are one week later and MUX is 20%
higher than my sale price. More fool me.
Despite that I’m sticking to my fundies guns and saying that it’s going to be difficult for MUX to
justify its relative valuation (to other PM miners) on the back of its mediocre-looking 2016
17

production parameters (and 4q15 financials when they turn up). But one of the traps of being
fundies-centric is that it gets very easy to
ignore momentum. Due to that, I’ve left
significant cash on the table in my last two
sales. I’ll console myself with Bernard
Baruch’s famous little ditty, “The way to
always make money in the market is by
selling too early and buying too late”.
Semi-OT: True Gold (TGM.v) looks
distinctly overbought now (that’s not just
my sour grapes, either). If you were
smarter than me and held on take the 33c
and 34c on offer. As for MUX, it could
easily hang around this current $1.40 level
for a while (as long as gold stays on our side) but upside is difficult to envisage. There are still
better things out there, but WTFDIK?
Continental Gold (CNL.to): Community relations go from bad to worse
Wednesday February 3rd saw the meeting of the “Mesa Minera de Buriticá”, a round table
gathering in the city of Medellín of the main actors in the currently conflictive situation
surrounding Continental Gold (CNL.to)
and its Buriticá project. It was a chance
for those in the town to voice their
opinions and the hall was full of locals
who came to hear all side, including
representatives of CNL, their own
spokespeople and local politicos. Here
right is your photo of the meeting,
gallery packed as seen.
This 90 second TV report on the meeting
from regional TV channel Teleantioquia
(21) gives a general overview of what
went on (Spanish language) but the best
is this 29 minute Youtube (22) of the
speech given by Jorge Gomez, local
politico (leftist politics) and a long-term supporter of the struggle of Buriticá
informal/artisan/illegal (pick your preferred word) miners against CNL (thanks for the heads up,
reader SB). Gomez catalogues a list of abuses of authority committed by CNL, including the
occasion on April 25th 2014 when four artisanal miners died after CNL employees, with the help
of local police detonated ANFO in tunnel heads in order to block them. The people setting the
charges knew that there were people working inside those mines that day. That same day four
illegal/informal miners were reported killed by rockfalls inside the mines in that vicinity. The
deaths were attributed by authorities at the time to illegal explosives that the miners were using
inside the mines, but locals are much clearer on the likely cause of their deaths, they were
caused by the ANFO explosions and blame the company directly.
Other issues include a recent video of a water pipe Gomez claims comes from the CNL project
works that is depositing polluted water straight into the local river, a case of the pot calling the
kettle black according to the speaker (as CNL accused the locals of pollution on Wednesday).
He also notes the fine imposed on CNL of around U$100,000 for contamination of the
environment that CNL refused to pay for years, even after being taken to court, until they
finally relented and paid it in October last year. The video goes on (and on) but even if you
don’t understand Spanish the applause he gets from locals in the audience will give you big
clues as to the support he gets from locals and their obvious disdain for the company.
18

Later in the video came my preferred segment. I was utterly unsurprised to hear that CNL was
using the same type of tactics we’ve seen from mining companies in Peru who try to split local
public opinion on contentious mining projects. Just two examples we’ve followed closely here
are Southern Copper at Tia Maria and Minera IRL Ltd “Team Hodges” at Ollachea, who both
used propaganda flysheets and then setting up alternative “real voice of community” groups to
pronounce against the elected authorities, accuse them of corruption, tell people that the
majority want the mine project etc. For that check out minute 13:00 onwards on that Jorge
Gomez video and you’ll hear that was happening in Buriticá on the very day that the local
miners and their families had packed the viewer galleries of the hearing you see above. When I
shared the video with a Peruvian expert in community relations yesterday Saturday, her
reaction was at first of incredulity and then a comment of, “It seems these Canadian companies
go to a supermarket and buy a pre-packaged strategy to work against local communities”.
You're looking at a situation akin to some of the Peru problem projects, where the national
government can issue all the permits it wants but if you don’t have the backing of locals, there’s
no way in the world that the project gets off the drawing board. CNL has ruined its relationship
with the local miners over the years, the company is now hated (no other word will do) and the
opposition to what they’re trying to push through is overwhelming. Buriticá will not allow this
one to happen and much like the case of the bad blood caused by Bear Creek Mining (BCM.v)
at Santa Ana, the local geography of Buriticá will make it extremely difficult for the national
government to impose itself and its permits even if it decides that it cares enough to send in
troops for a while and subjugate the community in favour of CNL. There's one road in and one
road out of Buriticá and that makes it easy to, quite literally, defend.
I’ve seen anal ysis reports out of Canada this week that hypothesize CNL will double from its
current level just on the issuance of the national level permits, if they’re granted by the Santos
government under the PINES initiative. That’s crazy, because even if those permits are granted
on time and in good order (and we still need to find out if the serious water level problem at
the mine has been taken into account by its new adjusted EIA application) any serious holder of
CNL will see it as their last chance of the liquidity window that will let them leave somebody
else holding the bag. Even with a bunch of national-level permits in-hand, any financier would
be stone cold crazy to fund this project and stump up the hundreds of millions in cash needed
for Capex once they’d done just even cursory level DD.
Tanzanian Royalty (TNX.to) comes undone
TNX/TRE is a stock I’ve followed with half an eye for many years, partly due to the incredible
length of time it’s been about to go into production, measured in years (you could almost
stretch that into decades) but mostly because it’s run by the “Comrade In Golden Arms”
himself, arch-goldbug Jim Sinclair. I’ve never really cared enough about the stock to wonder
exactly how exactly the scam was working, but on a couple of occasions I’ve taken a scan at
the underlying numbers to keep myself up to date It’s never been a project that’s managed to
get to first base (i.e. worthy of closer investigation).
But specific economics and project aside, one thing Jim Sinclair has always waxed lyrical about
is the pro-business/pro-mining attitude of its friendly and stable government and the welcoming
attitude of the locals. His effusive prose on the country and the way he’s always been keen on
separating Tanzania from the sketchier parts of Africa and its political risk has been a staple all
the way through this chronic promo.
That is, until last week when this news release hit the airwaves (23) which told us his company
was going into Force Majeure (he kindly offers a definition of the term in the NR for us lesser
lights), due to an artisanal miner invasion that was supposedly caused by declarations made by
the government’s deputy minister of mining. Here’s an extract from the NR:
This event, we believe, may have been incited by an energetic speech made in the local village
by the Deputy Minister of Energy and Minerals stating that land would be given to the artisans for
legal mining within 14 days. On the 15th day the large invasion took place. Our decision to act
was to protect the assets of our stockholders and put a stop to these actions which do not respect
19

contracts or due process of law.
Invasions are continuing by stealth and at night.
The Deputy Minister requested a meeting onsite in early January. During the meeting cell phones
and note books were forbidden by the Deputy Minister's staff, but the Deputy Minister's speech
was videotaped. We have the master of this videotape. This same Deputy Minister made many
other requests to be accomplished within 14 days that were not contractual obligations or required
by mining law. The Company was threatened with extreme sanctions without due process of law if
the demands were not met.
The stock was halted for the news and when it re-opened it did what you can see in this chart:
Now as noted above, I’ve never gone
into the deep DD on TNX.to (better
things to do) but I know that buying
into a True Believer stock is a
dangerous hobby, for your back
pocket at least. Back when people
listened, it was virtually de rigueur to
own some TNX if you wanted to be an
accepted member of Jim Sinclair’s
hardcore goldbug’s site, “JS
Mineset”(24) and for proof on that,
check out his open letter to JS Mineset
readers (25) dated June 2009 that
ends, “From this moment forward only
REGISTERED TRE stockholders have
absolute right to my time on whatever subject they require help on”. And when your only
source of Tanzania political risk news is a company head who insists that everything is rosy,
right up to the moment when it’s not, but if you step out of line and dare to criticize you get
branded an unbeliever or even traitor, it’s a combo of the biggest red flags you can get in the
junior sector. With last week’s news, TNX hit an all-time low the same day that real mining
companies were rallying to recent highs on the back of a resurgent gold price. There’s a lesson
there somewhere, I somehow doubt those fooled by this scam will have learned it though.
Conclusion
IKN352 is done, we end with bullet points:
• I’m banking the winnings in New Gold (NGD) (NGD.to) this week. Yes there’s an
argument to let it run due to the new level of gold, but it was always set as a near-term
trade and it’s done everything I wanted from it. After the pain comes the gain, I’m not
going to turn my nose up at a swift and chunky 40% profit in so short a time. I’ll be
looking for U$3.00 if possible, so I’m not selling first thing Monday morning, but the
shares won’t be mine this time next weekend.
• B2Gold, though improving, is still underperforming. There’s more rally in it yet so I’m
keeping my hands away from the controls, but I own too much of this and as per the
message of a couple of weeks ago I’m still looking for a place to lighten. At that point
the stock will likely be notched down from ‘Top Pick’ level.
• On the contrary, Lake Shore Gold (LSG.to) (LSG) is a tight hold from now on. The
message isn’t “be long”, it’s “stay long”.
• It’s Chinese New Year next week, expect base metals to take a breather before we get
confirmation that copper (and its friends) are on the way back or whether the small
rally (so far) was a flash in the pan. And on the subject, one I learned a few years ago:
If somebody says to you “Gong Xi Fa Cai” next week, try responding with “Hong Bao
Na Lai” (phonetic equivalents, of course). That means “Red Envelope Please”.
20

I thank you in advance for any feedback. Our Top Pick stocks are B2Gold (BTG) (BTO.to) and
Lake Shore Gold (LSG.to) (LSG). 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/2016/02/allow-me-to-explain-why-gold-is-going-up.html
(2) http://finance.yahoo.com/news/sage-gold-223000141.html
(3) http://finance.yahoo.com/news/lake-shore-gold-confirms-expands-110000243.html
(4) http://incakolanews.blogspot.pe/2016/02/tahoe-resources-taho-thoto-in-late.html
(5) http://finance.yahoo.com/news/lake-shore-gold-comments-trading-195903099.html
(6) http://incakolanews.blogspot.pe/2016/02/three-more-things-about-ikns-tahoe.html
(7) http://incakolanews.blogspot.pe/2016/02/the-revenant-no-spoilers.html
(8) http://finance.yahoo.com/news/lara-acquire-tocantins-gold-project-130000409.html
(9) http://finance.yahoo.com/news/revised-estimate-report-filed-maravaia-223401056.html
(10) http://finance.yahoo.com/news/acquisition-further-shares-lara-exploration-171720993.html
(11) http://finance.yahoo.com/news/sandspring-resources-reports-encouraging-results-123000384.html
(12) http://www.reuters.com/article/global-metals-idUSL3N15K3JI
(13) http://incakolanews.blogspot.pe/2016/02/hudbay-hbm-and-its-jaguar.html
(14) http://finance.yahoo.com/news/ivanhoe-industries-acquisition-common-shares-234730827.html
(15) http://www.bloomberg.com/news/articles/2016-02-01/sibanye-ceo-considers-move-into-base-metals-after-stock-
surge
(16) http://www.ecuadorinmediato.com/index.php?module=Noticias&func=news_user_view&id=2818796050
(17) http://www.lanacion.com.ar/1868606-el-gobierno-presento-su-primer-oferta-a-los-fondos-buitre
(18) http://www.inversorenergetico.com.ar/minera-opera-en-el-pais-cancela-proyecto-de-oro-plata-en-mexico/
(19) http://www.jornada.unam.mx/2014/05/06/opinion/017a1pol
(20) http://incakolanews.blogspot.pe/2015/07/primero-mining-pto-ppp-and-ottos-first.html
(21) https://www.youtube.com/watch?v=d_jGfjM0_GE
(22) https://www.youtube.com/watch?v=4z8Emq5HXf8
(23) http://finance.yahoo.com/news/tanzanian-royaltys-subsidiary-tanzam-provides-135156338.html
(24) http://www.jsmineset.com/
(25) http://incakolanews.blogspot.ca/2009/06/somebody-has-to-call-out-this-lout-jim.html
21

Stocks To Follow Closed Positions 2015
Closed in 2015 closed close price
Argonaut Gold AR.to jan'15 C$1.47 14-dec-14 C$2.53 72.1% Big gain small time, profit taken
Amerigo Res ARG.to jan'15 C$0.405 20-jul-14 C$0.285 -29.6% Given up on weak Cu prices
Reservoir Min. RMC.v jan'15 C$6.05 18-jun-14 C$4.12 -31.9% sold on Cu downturn
Coro Mining COP.to jan'15 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
Stocks To Follow Closed Positions 2014
Closed in 2014 closed close price
Fortuna Silver FVI.to jan'14 C$2.80 23-dec-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-apr-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-jan-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-jan-14 C$0.86 -17.3% silver/M&A spec, rel. small
Timmins Gold TGD nov'14 U$1.38 09-apr-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-jan-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-jan-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-apr-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-apr-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-jan-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-apr-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
22

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
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
23

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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