IKN #405Premium

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The IKN Weekly
Week 405, February 19th 2017
Contents
This Week: Erratum, In today’s issue, My bad trades and investment errors, Despite the in-
house stupidity I remain cautious, Presidents’ Day, Non-work travel plans.
Fundamental Analysis: Lara deferred (again).
Stocks to Follow: Overview, Wesdome Gold (WDO.to), Starcore Intl (SAM.to), Belo Sun
(BSX.to), Regulus Resources (REG.v), Cordoba Minerals (CDB.v), Sandstorm (SAND), Tinka
Resources (TK.v), Excellon (EXN.to), Red Eagle Mining (R.to), Riverside Resources (RRI.v).
Copper Basket: Overview, Capstone (CS.to)
Producer Basket: Overview, Barrick (ABX), Goldcorp (GG).
Regional Politics: Colombia: The ANM visits Buriticá, Odebrecht bribery: LatAm gets
organized, Peru: The government plans the “reactivation” of five mining projects, Chile: Unions
in climbdown mode at the La Escondida strike, Argentina: So much for the mining jobs boom,
Ecuador: The fast-count result for today’s Presidential election.
Market Watching: Starcore International (SAM.to) 3q17 production results, Minera IRL: To be
clear, The Primero Mining (P.to) (PPP) strike, Episode eleven of “What I’d buy now”.
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
Erratum
In the B2Gold (BTO.to) (BTG) anal ysis last weekend in IKN404, I wrote this line...
“...AISC for 4q16 is estimated at U$783/oz...”
...which was immediately followed by a chart that showed clearly the AISC cash cost at
U$873/oz. To clear this one up the chart is the right number, I got the 7 and the 8 the wrong
way around while writing, I’m stupid sometimes and thank you to a couple of sharp-eyed
readers who pointed out the error to me. For the record, the blooper was script-only and didn’t
affect any internal calculations on the anal ysis. Apologies.
In today’s issue
• The call to raise cash continues, as I executed on just one of the trades last week and
would like to hit the numbers necessary for the others. But as today’s main intro piece
outlines, you shouldn’t trust my trading abilities very much anyway.
• Copper was pumped hard two weeks ago and was being shouted from the rooftops by
the bandwagon riders, while we urged caution. Caution was the right call, copper
dropped 10c/lb last week, we consider the current state of play.
• Fundies thoughts on Capstone, Starcore, Sandstorm and others pepper today’s edition,
but I find myself deferring on the overdue anal ysis of Lara Exploration (LRA.v) once
again. I’ve been frustrating myself and can’t get to a decent decision.
1

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My bad trades and investment errors
When times are good and pickings are easy in the junior mining market, as day follows night
you can guarantee the arrival of the ‘Look At Me’ brigade, so wrapped up in their own
wonderfulness and eager to tell you about how good they are at trading the market, picking
stocks, nailing down winners. They bore me stupid and if you can’t recognize the first couple of
months of 2017 as true Monkey With Dartboard territory, I honestly think you’re reading the
wrong thing on a Sunday evening*. Unless you’re daft/brave enough to put all eggs in one
basket and something goes wrong with your preferred vehicle (there’s more than one trader
out there with the lion’s share of their cash in Primero/Yamana/Tahoe, more fool them) it’s
tough not to be in profit in 2017, so what’s the big deal anyway?
No, more interesting is to study weaknesses, mistakes and failures in this market and my stars,
I have plenty. As I trimmed equities and added cash early last week (as per IKN404) then
watched gold strengthen and move through U$1,240/oz after a US CPI number that would
normally mean near-term death to the gold price, it occurred to me once again how poor some
of my market calls are. Here are just a few that come to mind from recent trades:
1) I had to hold out on Focus Ventures (FCV.v) until over 80% of my original capital
had been crushed.
2) I may have bought Continental Gold (CNL.to) well enough, but even if my reasons
for selling when I did stood up to logic, it was a poor sale decision and one that’s left
buckets of cash on the table (to be precise, $1.36 per share).
3) Even worse is the way that I’ve traded Wesdome (WDO.to). If I had stuck to the
plan I would have sold at $2.88 first time around, then when it dropped to $2.20 or
$2.00 it would have been irresistible for a second bite at the cherry. Now at $3.79, 26%
higher than my recent selling price, I’ve failed miserably in extracting value from the
original identification of value thanks to Kiena. Here’s what I did:
Bought $1.72, sold $3.00, pre-commish profit 74.4%
And here’s what I could easily have done with better trading skills:
Bought $1.72, sold on original target $2.88, bought back at
$2.20 (or its $1.99 low, but let’s be reasonable), hold to
today’s $3.79, pre-commish profit on whole round trip
288.3%
That’s a lot of difference money-wise for every dollar in original outlay and it matters not one
jot if I put on the bravado face and say “yeah well, that was the plan and if I sold too early it’s
still a decent profit”, or words to that effect. Hindsight screams loud, it was a mistake to sell
WDO when I did, period. Those above are just three that come to mind on reviewing the closed
trades for 2017, we could go on about the failure to capitalize on the moves in copper and zinc
(even though I called them nicely), the lack of portfolio leverage to silver (Joe Mazumdar called
buy on Bear Creek Mining at $1.90 over at Exploration Insights on a near-term trade for
precisely that reason and that’s smart value trading in a stock I personally wouldn’t touch, he’s
also held through on Continental Gold and made better profits in a shorter time period than me,
he’s been on fire recently in fact). I’m aware of the things I do well regarding the market; I can
spot undervalued stocks, I have patience to let them appreciate in their own time, most of the
time I manage to avoid the type of company that has the potential to blow up completely. But
I’m also a dumbass in many market respects and weak at things such as trading momentum,
avoiding value traps, failing to recognize macro turning-points that can make even the best
entry point into the best company a losing trade. Fortunately I don’t invest your money and I
hope that over time you manage to sift through the contents of The IKN Weekly and do a
better job than I do of seeing the strengths and weaknesses on offer here and using them for
you own ends.
2

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*Or Monday morning. Or some time in the week. Some of you even pay for this rag without even opening it, don’t let
me stop you on that one.
Despite the in-house stupidity I remain cautious
Despite all the failings listed above, I’m going to stick with the plan of raising some cash (as per
last week) and though gold didn’t swoon to order (quite right too, I’m still net long) there are
signs of fatigue in the rally. When it comes to gold it depends on how you measure it, because
the London PM Fix was up 1.1% on the week but, due to the different times at which the cut-
offs come, the gold bullion ETF GLD was up just 0.1%. What’s not in doubt however is that the
precious metals stocks didn’t do as well as the underlying metal (and nowhere near the
consecutive highs nailed down by the Dow, alongside highs in the other broad market indices)
with GDX down a full 2.0% and the junior PM ETF of choice, GDXJ, down 1.3%.
The fatigue also shows in GLD inventory holdings which on Friday saw their first daily drop this
month, down 2.37 metric tonnes
to finish at 841.17mt. Once GLD gold holdings, US Election to date (metric tonnes)
960
again that’s nobody’s idea of a
940
trend or a tradeable event, but
920
it’s something to keep an eye on
900
this week coming for any follow-
880
through. The way the broad
860
markets are bouncing and
840
roaring, money in boring old
820
gold may feel like money out of
800
the game to the insto jocks. The
780
other notable was the steadiness
in trading of the US Dollar, with
a tight range of 100.4 to 101.5
on the USD index on the week.
Nobody seems to know which way it’s going to jump.
Presidents’ Day
A quick reminder that tomorrow Monday is the George Washington birthday holiday (sometimes
attached to Lincoln too) and more commonly known as President’s Day in The USA and to be a
nerd about it for a second, Washington was born on February 11th Julian Calendar, which
transposes to Feb 22nd in our modern Gregorian calendar and these days the commemorative
day is always moved to the third Monday in February. What that means on a practical level is
that The US markets are closed tomorrow and in a practical level reply, Canada has cooked up
the idea of “Family Day” and takes the day off too, which means the Toronto exchanges are
also closed for business.
Non-work travel plans
Tuesday very early to through Friday very late I am away from the office. Not for work either,
I’m squeezing in a mini-break with a couple of daughters who get to go sandboarding, horse-
riding, dune-buggying and all sorts of other activities at a coastal resort hotel before the
summer vacation period ends here on the other side of the equator (first day of school March
1st). My time away won’t affect the publication of next weekend’s edition of The IKN Weekly,
but don’t expect much on the blog for those four days.
Fundamental Analysis of Mining Stocks
Lara Exploration analysis deferred again
3
61/9/11 61/11/11 61/51/11 61/71/11 61/12/11 61/32/11 61/82/11 61/03/11 61/2/21 61/6/21 61/8/21 61/21/21 61/41/21 61/61/21 61/02/21 61/22/21 61/72/21 61/92/21 71/3/1 71/5/1 71/9/1 71/11/1 71/31/1 71.81.1 71/02/1 71/42/1 71/62/1 71/03/1 71/1/2 71/3/2 71/7/2 71/9/2 71/31/2 71/51/2 71/71/2
mt
source: SPDR GLD data

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I could of course do a patch-over job and you may not notice. What I could do is move the
Starcore (SAM.to) 3q17 production analysis up from ‘Market Watching’ below and pretend that’s
a main event fundies thing for this week. Or I could retrieve the half-finished half-baked anal
ysis I’ve already written (and edited, and re-written) on Lara Exploration (LRA.v) and pass it off
as my considered definitive opinion. Or I could claim the cat ate my homework.
But I prefer to be honest about it all and show you how flakey I’ve been this weekend. Even
though I’ve spent more time than I expected on LRA this week, I can’t come to the type of
proactive decision I want and due to that I’m going to be pathetic and defer this report again.
Ultimately I need to decide what I want to do with this position and that’s the problem, I simply
don’t know so rather than rush into a call I may regret, I’m going to give myself more time. For
what it’s worth, I’m between a hold, a partial sale or a full sale.
Stocks to Follow
Of our thirteen current open positions, just five registered week-over-week gains last week
(REG.v, EXN.to, ATY.v, R.to, LRA.v) and the other eight were weekly losers (BTO.to, SAND,
TK.v, CDB.v, SAM.to, BSX.to, RPM.v, RRI.v), but overall the moves both up and down were
reasonably modest last week, with no stock registering a double figure percentage change and
in fact, the only one that catches my eye this Friday evening as I put together the table is for
negative reasons, that being the 5.2% drop in Top Pick B2Gold.
We currently have 13 open positions on the ‘Stocks to Follow’ list, two less than our self-
imposed maximum number at any given time. Ten of the positions are in the green, three are
in the red.
company Ticker this week Avg Price Reco date Current PPS Gain/Loss% Notes
TOP PICKS
B2Gold BTO.to buy C$2.11 12-sep-14 C$4.22 100.0% tgt $5.30 Top Pick prod.
Regulus Res REG.v STR buy C$0.64 06-apr-15 C$1.56 143.8% LT exploreco top pick
Long positions (in current order of preference)
Sandstorm Gold SAND buy U$3.80 17-apr-16 U$4.66 22.6% $7 tgt IKN378, good Q4
Tinka Res TK.v buy C$0.195 19-apr-16 C$0.36 84.6% Under-radar Zn.
Cordoba Min. CDB.v buy C$0.73 15-sep-16 C$1.45 98.6% First $1.50 tgt hit
Starcore Intl SAM.to hold C$0.61 10-jan-15 C$0.57 -6.6% ex-Top Pick, holding thru
Belo Sun BSX.to buy C$0.90 30-jan-17 C$1.03 14.4% near-term trade $1.28 tgt
Excellon Res EXN.to STR buy C$1.71 09-oct-16 C$1.84 7.6% $3.13 tgt, Ag growth story
Atico Mining ATY.v hold C$0.51 24-jul-16 C$0.92 80.4% tgt $1.10, Cu play
Rye Patch Gold RPM.v STR buy C$0.31 02-sep-16 C$0.305 -1.6% 75c tgt, bot more IKN400
Riverside Res RRI.v sell at 60c C$0.39 27-jun-16 C$0.56 43.6% Will take profits at 60c tgt
Red Eagle Min. R.to STR buy C$0.71 13-dec-16 C$0.86 21.1% Big growth potential
Lara Expl. LRA.v hold C$1.15 08-apr-12 C$1.09 -5.2% solid biz model
Short positions
None at present
Closed in 2017 closed close price
Continental Gold CNL.to Jan'17 C$2.68 22-may-16 C$4.17 55.6% trade closed, profit taken
Focus Ventures FCV.v Jan'17 C$0.23 01-jul-12 C$0.05 -78.3% Give up, a disaster trade
Wesdome Gold WDO.to Feb'17 C$1.72 28-aug-16 C$3.00 74.4% Target hit, sold, good trade
2009 to 2016 annual closed positions in appendices below
Now for notes on some of the current basket stocks:
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Starcore Intl (SAM.to): Selling done, position trimmed: See ‘Market Watching’ below for
a summary of the 3q17 production numbers posted by SAM last week. Here we note that as
planned, I did indeed sell the tranche I wanted to get rid of early week and raised a little cash
in the process. The position now is my idea of the right size for what SAM has turned out to be,
a speculative gold sector trade more than one to start betting the farm upon.
Belo Sun (BSX.to): Still giving it until PDAC. BSX traded down last week, interest has
faded from the strength it showed originally on the permitting news and I won’t play fakey on
you, the soft performance last week surprised me. In fact the price this weekend hs got me to
remove the word “spec” from the near-
term sentiment column above and call
BSX a plain straight buy, because if I’ve
got my $1.28 target price right (and last
week I saw a new brokerage note calling
BSX at a $1.50 target price), this
weekend’s $1.03 offers a 24.3% upside.
That’s tasty enough for a very-near-term
opportunity so if you’re looking for one
of those perennial “PDAC Pump”
opportunities, this one is my idea of a
candidate.
Meanwhile in the real world, last Sunday
(while I was writing up IKN404) BSX held
another community meeting with locals
around the project (1), explaining the latest developments and what the permit awards mean
for the company. The company put a lot of emphasis on the way the project would now create
a lot of good –paying jobs among the local community, which reportedly went down well. As for
the potential for deal news, we’re now in a serious dealmaking window of the calendar year,
with the BMO conference (and a couple of satellite conferences that go on around it down
Florida way) an then of course PDAC in early March. If AEM were going to make a move on
BSX, it’d certainly be a logical time to see it happen.
Riverside Resources (RRI.v): Still selling at 60c. As this 10 day chart shows, there was
no more 60c on RRI in the last week and therefore my sale didn’t happen and RRI remains on
the list. I’m still a seller at my right price if it
shows up in the week ahead though and that
might happen easily, all it would take is a
piece of good news from one of their several
exploration projects, including JV drilling
holes.
In fundies news, on Tuesday RRI told us (2)
of initial exploration results at Glor, the
partner-funded JV with Centerra Gold. The
results are best described with that geology
catch-all word “encouraging”, baseline work
that is part of the process of generated drill
targets further down the line. Both sides
seem happy enough with the results so far
and work will now continue into the next stage. Nothing here to move markets up or down, but
good to see things happening.
Regulus Resources (REG.v): This weekend REG is hosting a site visit and that should create
some media coverage of the company and stock in the next week or two. We shall see. In
trading REG did very well and it would be nice to imagine that one of the people on the visit
5

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was hitting the phones after seeing what’s up there. Whatever happens, I fully expect those in
the visiting party to be as impressed as I was about AntaKori.
Cordoba Minerals (CDB.v): Here’s an interesting little development. We knew previously that
CDB wanted to raise a small amount of cash for its own
internal G&A purposes. We also know that due to its
sudden and rapid rise, the 15m warrants priced at
$1.50 have come into play. So when CDB published its
new corporate presentation last week, a small detail
caught my eye and here it is, ripped straight from the
PDF (3):
• Instead of 86.8m shares out, CDB now boasts
88.6m shares out
• Instead of 15.1m warrants, CDB now has
13.6m warrants left out
• And instead of virtually nothing in the treasury,
CDB now has $2m in cash
In other words, one of those warrant holders has exercised already to the tune of 1.5m papers
and it looks as though 300k options have been exercised, too. This quiet move means CDB isn’t
under any further cash pressure and it may be the reason we saw the stock recover sharply on
Friday to close just four cents down on the week, instead of the large loss we saw as couple of
sellers turned up.
Sandstorm Gold (SAND): This week, to be exact on Tuesday February 21st, SAND releases
its 4q16 financials with a ConfCall scheduled for the next morning (the webcast on this link (4))
and although I’ll be spending most of that day splashing about in a swimming pool or
something I will be tuning into that CC because I expect SAND to be the main subject of next
weekend’s edition, IKN406.
In the run-up to its 2016 year-end financials, plus the all-important 2017 guidance, I’ve found
myself this weekend mulling over my long position in the company and the first impression was
that a 22.8% gain since last April 17th really isn’t that much to write home about. For sure a win
is a win and I’m not grumbling too much, but 22% for a junior position that’s closing in on a
year old isn’t the type of return I want from this risk-laden sector of the market.
With that in mind I did a little checking on companies that can reasonably be classed as peers
to SAND, the royalty/streamer companies which are usually larger sized by market cap, but
cover the same area of the market. The choices are the classic ones; Franco Nevada (FNV),
Osisko Gold Royalties (OR.to), Sliver Wheaton (SLW) and Royal Gold (RGLD). As for the time
period, that’s always going to be subjective and results will vary from the place you draw the
line. For this semi-scientific comparative I’ve chosen the date I opened the SAND position here
at the Weekly (even though I bought again a little later and averaged down on the overall
position). With that in place, here’s a little table to show the way things are:
How's the IKN Weekly SAND position doing? A comparative
company ticker price April 17th price today % change
Sandstorm SAND $3.80* $4.66 22.8%
Franco Nevada FNV $67.58 $67.21 -0.6%
Osisko Gold Roy. OR.to $14.54 $15.32 5.4%
Silver Wheaton SLW $17.05 $21.53 26.3%
Royal Gold RGLD $54.35 $69.95 28.7%
*SAND price the cost avg of two purchases, 1st buy Apr 16
Suddenly SAND’s 22.8% gain over the period doesn’t look so bad at all. Agreed it’s not quite as
sparkling as SLW’s 26.3% or RGLD’s 28.7% but it’s not far behind and the difference is likely
6

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about the timeline cut-off prices, rather than real relative under-performance. But we’re
definitely running more strongly than FNV (the perma-market darling) and its most direct like-
for-like market cap equivalent peer, OR.to.
So the relative performance isn’t that bad, but in absolute terms it’s undeniable that I’ve been
looking for more from SAND and it hasn’t delivered. That could well be my error of judgment
rather than anything the company has done (or not done), so next weekend and with solid up-
to-date numbers on board we’ll have the opportunity of taking a careful look at Sandstorm and
deciding what to do with the position.
Tinka Resources (TK.v): TK is starting to find a new trading range in the 34c to 37c frame,
not a bad thing. This week coming TK has its site visit happening and that’s a good thing. The
visitors will be able to see the newly arrived drill rig going about its business the type of thing
companies like to show off to eyeballs (quite right too) but personally I hope the visiting party
gets an idea of the scale of the Ayawilca/Colquipucro project and its district-sized potential.
That, ultimately, will be the making of this company and its share price (in my view at least).
Rye Patch Gold (RPM.v): An interesting week for RPM because the stock built a little bit of
positive momentum for the first time in a long
time, only to get whacked on Friday afternoon
by a couple of larger liquidation sales that
made what looked for all the world like a
winning week into a net loser, by half a cent.
I’ve stuck this up as a Strong Buy this week
on the sentiment column and could be wrong,
but my nose sniffs a breakout in the works. It
wouldn’t take much to see this stock start to
move and if there’s positive news from the
mine start-up, once people realize there’s no
liquidity problems there’s an awful lot of value
waiting to be filled in this equity.
The Copper Basket
After seven weeks of 2017, The Copper Basket shows an 22.29% gain to level stakes.
company ticker price 1/1/17 Shares out Market Cap current pps gain/loss%
1 Imperial Metals III.to 6.06 93.587 636.39 6.80 12.2%
2 Capstone Min. CS.to 1.26 382.04 615.08 1.61 27.8%
3 NGEx Resources NGQ.to 1.20 205.06 287.08 1.40 16.7%
4 Western Copper WRN.to 1.86 94.19 195.92 2.08 11.8%
5 Excelsior Min. MIN.to 0.63 167.364 143.93 0.86 36.5%
6 Copper Mtn CMMC.to 0.94 118.8 137.81 1.16 23.4%
7 Cordoba Min. CDB.v 0.73 86.86 125.95 1.45 98.6%
8 Regulus Res. REG.v 1.20 68.368 106.65 1.56 30.0%
9 Coro Mining COP.to 0.15 483.425 94.27 0.195 30.0%
10 Atico Mining ATY.v 0.95 97.59 89.78 0.92 -3.2%
11 Amerigo Res ARG.to 0.345 173.61 86.81 0.50 44.9%
12 Trilogy Metals TMQ.to 0.66 104.33 67.81 0.65 -1.5%
13 Copper Fox CUU.v 0.125 417.64 64.73 0.155 28.0%
14 Nevada Copper NCU.to 0.77 80.5 60.38 0.75 -2.6%
15 Revelo Res. RVL.v 0.070 128.486 7.71 0.06 -14.3%
NB: All stocks priced in CAD$ Portfolio avg 22.29%
7

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An overall negative week for our Copper Basket with the average dropping by 0.85%, hardly a
disaster but no follow-through from the big run-up we saw the week before last. On the
individual count we saw five winners
(NGQ.to, ATY.v, REG.v, COP.to, ARG.to) and The Copper Basket 2017, weekly evolution
ten losers (III.to, CS.to, WRN.to, CMMC.to,
30%
MIN.to, TMQ.to, CDB.v, NCU.to, CUU.v,
25%
RVL.v) among the fifteen, but of all that lot
20%
only one stock put in a double figure
percentage move, Amerigo (ARG.to up 15%
12.4%). 10%
5%
Moving to copper price action, here’s how we
0%
rounded out last week’s section that spent Jan1st jan8th 15th 22nd 29th feb5th 12th 19th
time considering the big upmove in the price source: IKN calcs
of copper that previous Friday:
“...expect this move to be ultimately opposed and when it does, it will spike
and drop fast. Don’t fall for this one...”
Sure enough there were no legs in that move as
this 90 minute chart right indicates. Last weekend’s
move above U$2.80/lb was as good as it got and
come the end of the week we were back at the
U$2.70/lb level for copper.
There is of course a lot of noise being created by
various strikes at large copper mines. We’ve
followed the La Escondida strike in ‘Regional
Politics’ recently (latest edition below) and we also
have the FreePort Grasberg mine in Papua New
Guinea under Force Majeur. On Friday these two
were joined by he Anglo American El Soldado mine
in Chile, which is also seeing industrial action due to
the breakdown of pay negotiations. For some this
has created a perfect storm (5) for copper, but the
obvious question to ask is just why the market price
dropped, instead of shooting off into the
stratosphere (the confident predictions this publication found itself opposing this time last
week). The answer is on the demand side of the equation and once again, it pays to follow the
data from world inventories as it shows the weak end-user demand. This may of course be due
to the Chinese holiday and the typical period of re-stocking in the annual cycle, but we’re not
seeing any sort of delivery pressure developing and that, ultimately, means higher prices are
unsustainable outside of speculative spikes. All this may change if the separate strikes drag on
of course, and the tell-tale sign of that will be lower TC/RC charges (as supply to the smelters
dwindles), but word from that end of the industry is that smelter companies generally have
enough stockpiled concentrate and are not desperate for new deals at easier terms. Give it a
week or two, that dynamic may change.
On that very subject, we turn to the regular weekly copper warehouse inventory bullets:
• Total world stocks moved up again last week, but this time the shift was minimal
overall. Add up three official futures systems and the number is 629,253 metric tonnes
(mt), up 4,993mt (+0.8%). Small stuff and from what we see below, there wasn’t
much new stock moving in to the warehouses, the shifts were arbitrage between
systems.
• At the SHFE Shanghai stocks ramped up once again, this time by 18,071mt (+6.5%) to
8

,
finish Friday at 295,730mt. Chinese New Year is now over, time to see if the stocking
cycle kicks higher (hint: it will I think).
• At the LME warehouses we saw a drop of 19,125mt (-7.7%) in copper stocks to a
Friday close of 229,075mt. The similar size of the LME down and the SHFE up is
unlikely to be a coincidence.
• A cheer for the Comex copper stocks, which broke through the 100k barrier in fine style
and continue their potentially game-changing run. We finished the week here with
104,448mt of copper in the Comex system, an improvement of 6,047mt (6.1%).
Here’s the Shanghai-only chart, and the re-stocking cycle is in full swing. This is not a chart to
give cheer to near-term copper bulls
Shanghai Futures Exchange Warehouse Stocks, Dec'13 to date
400000
350000
300000
250000
200000
150000
100000
50000
9
ht5naj ht9 ht61 ht02 ht52 ht92 dr3gua ht7 ht21 ht61 ts12 ht52 ts1ram ht5rpa ht01 ht41 ht91 dr32 ht72 ts1von ht6ced ht01 ht41 ht02 ht42 ht92 dr3luJ t7guA ht11 ht61 ht72 ts1naJ ht5beF
Mt Cu
source: Cochilco
As for further out, I’m still happy enough about sticking with my $3+/lb prediction on copper at
some point in 2017 but there’s no rush to get there, we’re in month two of the year and not
month 10, a lot yet to happen
Now for some notes on just one of our basket stocks:
Capstone Mining (CS.to): Yes, CS again, I apologize I’m a little fixated as to how this
company can command its current level of share price/market cap. This week saw CS.to deliver
its 4q16 financials (6) and they were particularly crappy. As a hack on the figures I’m going to
use this table, ripped from the YE MD&A rather than go through all the numbers using the
charts (keeping it concise and I’m not planning on buying any CS.to in the near future either):
I chose this section of the MD&A because it gives a window into the three main influences on
the Q4 numbers. First at the top, the basic business of CAS.to, i.e. mining copper and selling it,

,
is in reasonable shape thanks to the pop in copper prices. Revenues of $163m,
COGS/royalties/DD+A in line, and a mine operating profit of $55.814m...nothing wrong there.
Then BTL comes the bad news, first th $189.2m impairment charge taken by the company and
most of that due to the second impairment charge on its badly timed and expensive purchase
of the Santo Domingo copper/iron project in Chile (it took a $115m charge back in 4q15 as
well. In so many words, two years ago CS.to claimed Santo Domingo was worth around
$542m, these days it admits it’s only worth $239.7m as stands.
The other red highlight on the above table is a more direct influence on the company’s financial
performance and what’s more, promises to be in the next couple of quarters minimum, too. The
$30.323 “other expenses” charge is mostly due to the $29.84m CS.to has had to swallow due to
CEO Darrn Pylot’s so-called “costless collar”, the move made by CS.to in 4q16 that we at IKN
criticized heavily at the time. And be clear, this is a real money charge, it’s not just some sort of
non-cash adjustment or balance sheet movement. This type of thing is due to the real CFO
getting out a real pen and writing a real cheque to the people owed the money).
The bottom line: If you want to ignore the impairment charge and argue it has no direct effect
on the equity price then go ahead (I don’t say that, for me it’s indicative of bad management
that overpays for assets and the wrong points in the cycle). But the decision to add this
“costless” (oh the irony) collar has stripped the company of the majority of its operating profit
in the quarter and the multi-million dollar loss is due purely and simply to a crass error of
judgment at executive level. When CS.to put this hair-brained scheme into operation it said the
following (7):
VANCOUVER, Nov. 9, 2016 /PRNewswire/ - Capstone Mining Corp. ("Capstone") (CS.TO) today
announced that it has entered into zero-cost collars for 43,000 tonnes of copper with settlements
between January and December 2017 at a minimum of US$5,025 and a maximum of US$5,585
per tonne of copper. There was no cost to Capstone to put this protection in place.
"Capstone's strategy over the long term is to remain unhedged on our copper production," said
Darren Pylot, President and CEO of Capstone. "However, we determined our most prudent
course of action was to opportunistically protect our business from near term downside risk. Our
actions ensure we can continue to reduce debt in 2017, while retaining meaningful exposure to
copper prices, particularly in the second half of 2017 and beyond."
To that, IKN replied (8):
If copper goes above U$2.54/lb between now and early next year those of you
wondering why all the gross profits have suddenly disappeared from the CS.to 1q17
and 2q17 results will receive a sharp lesson in just how "zero cost" this all is. And the
higher copper goes the nastier it'll get, as anyone old enough to remember what
Whisler did to Phelps Dodge back in the day will know all too well.
And we didn’t even need to wait until the
2017 rolled in, the financial vortex has
already begun. And be in no doubt, this
effect will continue in the next couple of
quarters and to give a ballpark idea, if
copper stays at its current price for every
tonne CS.to delivers under the costless
collar, it pays the contract counterparty
around U$390.
As seen in this ten day price chart, when
the results hit the illogical momentum-only
rally in CS.to shares came to a shuddering
halt. Unsurprising and overdue in my
opinion, CS has more downrisk risk at its
current valuation. And next week I promise, no Capstone. There are 14 other stocks on that list
above, some of them are just as interesting as this one.
10

,
The Producer Basket
After 7 weeks of 2017, the Producer Basket shows a gain of 18.34% to level stakes.
company ticker price 1/1/17 Shares out Mkt Cap (Bn) current pps gain/loss%
1 Barrick ABX 15.98 1165.33 23.50 20.17 26.2%
2 Newmont NEM 34.07 530.595 19.64 37.01 8.6%
3 Goldcorp GG 13.60 832.381 14.48 17.39 27.9%
4 Franco Nevada FNV 59.76 178.01 11.96 67.21 12.5%
5 Agnico Eagle AEM 42.00 223.475 10.46 46.82 11.5%
6 Ang/Ashanti AU 10.51 405.27 5.23 12.90 22.7%
7 Kinross Gold KGC 3.11 1245 4.83 3.88 24.8%
8 Royal Gold RGLD 63.35 65.281 4.57 69.95 10.4%
9 Buenaventura BVN 11.28 254.19 3.34 13.13 16.4%
10 Sibanye Gold SBGL 7.06 228.71 1.98 8.64 22.4%
Prices in U$, NYSE or NASDAQ tickers Portfolio avg 18.34%
An interesting week at the races for our larger scale producer basket, because while the general
direction was down for the sector and we had eight weekly losers, two of the biggest names in
precious metals mining returned weekly wins, namely Barrick (ABX up 3.5%) and Goldcorp (GG
up 2.3%) and those trend-buckers were on the best fundies news possible; strong quarterly
results. As for the losers, the biggest drops in our basket list came from Agnico Eagle (AEM
down 7.9%) on results that didn’t impress the market, plus the volatile Buenaventura (BVN
down 7.3%).
The 2017 Producer Basket: Weekly performance and
comparative to GDX control
As the GDX benchmark carries both ABX and 25%
GG as overweight positions and we don’t, it’s
20% basket
not much of a surprise to find the ETF gdx control
seriously out-performed our basket last week 15%
and after having our nose in front for weeks,
the IKN Weekly basket is now lagging the 10%
benchmark. Not by much, but loser is loser
5%
(ask The Donald). source: Google, IKN calcs
0%
Goldcorp (GG): Meanwhile over at GG the Jan1st 8th 15th 22nd 29th feb5th 12th 19th
basic reason for the impressive trend-
bucking performance was also a positive set of financials, but the underlying story is different.
The top line EPS of 12c beat the street, but the improvement was mostly one-time financial
adjustments rather than operations that were in-line, as was the 2017 guidance. The thing that
seems to be changing at GG is the market’s attitude towards the way direction Garofalo is
taking the company, the emphasis on margin over absolute ounces is gaining traction and after
its rotten 2016, this chart pitting GG against the XAU index shows the company now beating
out the sector average.
11

,
Barrick (ABX): Last week ABX delivered a beat on EPS for 4q16 (22c versus the street
consensus of 20c) which was the start of the good news. The market also liked the follow-up
information on guidance of 5.5m oz to 5.9m
oz gold in 2017 (consensus around 5.5m oz) Barrick (ABX): Non-current financial debt
and the thing I really liked,the continued 14
aggressive push to pay down debt by 12
another U$2.9Bn in the next two years, the 10
objective set at U$5.0Bn by end 2018. Here 8
right is a little chart that shows what that 6
would mean, more or less.
4
2
For years the ABX balance sheet was
0
considered its Achilles’ Heel, but under
Thornton and his hard-nosed approach to
corporate financial health it’s moved form a
weakness and towards a true comparative
strength. ABX is back at the top of the gold tree, deservedly so too.
Regional politics
Colombia: The ANM visits Buriticá
Some official government love for Continental Gold (CNL.to) last week when the bigwigs of the
National Mining Agency (Agencia Nacional de Minra, ANM) visited the Buriticá project. The
group was headed up by Silvana Habib Daza, president of the ANM who left this soundbite
(translated) for assembled reporters at the press conference (9):
“Today, the Buriticá case is known all over the country as an example of
working together in favour of Mining Done Well*. Due to this, as part of the
mining institutionality we have come here today to reaffirm the support of the
National Government and that of the ANM agency for Buriticá, its people its
authorities and all those who want to work in legal and environmentally
responsible mining.”
* “Mining Done Well”, in Spanish “Mineria Bien Hecha”, is a slogan of the Santos government and the ANM.
Odebrecht bribery: LatAm gets organized
The news that public prosecution offices up and down LatAm are getting together in order to
coordinate and share information on the Odebrecht “Lava Jato” bribery and corruption case
may not mean much to people on the outside of the region looking in, but it made my jaw drop
it was so novel. These people never organize themselves, never help each other and prefer
secrecy at all times, so to see the Attorneys General from Brazil, Argentina, Chile, Colombia,
12
9002 0102 1102 2102 3102 4102 5102 6102 tse7102 tse8102
U$Bn
source: company filings, ABX est for FY18

,
Peru, Mexico, Ecuador, Panama, Venezuela, Dominican Republic and Portugal sign and agree to
pool information in order to get names and bring charges was quite a thing (10).
It also means that it won’t just be ex-Presidents and carefully selected sacrificial lambs such as
Alejandro Toledo who are sweating it all out, sitting Presidents such as Santos of Colombia,
Temer of Brazil and Varela of Panama will now find it much harder to keep a lid on any
wrongdoing, what with investigations that can go on outside their direct sphere of influence.
There are stories about Alan Garcia in Peru and even stories about current President PPK having
been involved with some sort of past incident, but so far it’s just hearsay.
Peru: The government plans the “reactivation” of five mining projects
On Friday, Peru’s Finance Minister Alfredo Thorne appeared on a local business TV program and
gave a sneak preview of the initiative his ministry will unveil this week coming. The idea is to
get behind seven (in fact eight, local press can’t count) large-scale mining projects that the
ministry considers bogged down or paralyzed and get at least five of them unstuck and on the
development track (11), because the country must have GDP growth (according to these
people). In justifying the upcoming thrust, Minister Thorne used some iffy math including
(translated) “...one thing that’s helping is the recovery of international metals prices, for
example the price of copper has recovered almost 80%...”, so if you’re a copper producer and
fell like selling your wares for around U$3.60/lb, give the man a call.
Anyway, the eight projects that the FinMin is about to get behind and push are the following,
with next to each name The IKN Weekly percentage estimate on the chances they have of
getting real progress on each by February 2019:
• Toromocho Expansion (Chinalco, copper): 100%, the budget has already been
approved by Chinalco. This is the FinMin giving himself an easy win, nothing wrong
with that in my book.
• Michiquillay (without owner, copper): 100%, this is another lay-up, as the
government currently owns the project and will put it up for tender in 3q17. after that,
any initial progress made by the new owner fulfills the brief.
• San Gabriel (Buenaventura (BVN), gold, Moquegua): 90%, though on hold right now
it will be easy to get it out of suspension and show at least some progress. As noted a
few weeks ago, BVN’s Gobitz has put it on ice in order to play politics with the often
difficult local communities.
• Quellaveco (Anglo American, copper): 75%, this one has serious local opposition due
to water use concerns, plus Anglo itself has put it on ice for year after year, but the two
year time window plus the general brief of “making progress”, not necessarily getting it
into production, wouldn’t be too difficult to achieve.
• Tia Maria, (Southern Peru (SCCO), copper): 20%, a tough nut to crack and very
politicized these days, it would take real community relations progress by a new team
and an SCCO willing to take some sort of back seat. Unlikely, not impossible though.
• Mina Justa (Minsur, copper): 30%, this is the horrible copper vat leach project that
sits next to Shougang iron ore mine on South coastal Peru once developed by Chariot
Resources (remember Ulli Roth?). If copper continues going up, this may eventually
become economic (though I will still harbour my doubts).
• Pampa del Pongo (Zhongrong, iron): 50%, this was sold to these Chinese suckers
by Henk van Alphen and Cardero Resources way back, since then it’s sat fallow. With
iron ore prices now taking off it has a chance to get moving again, though I’ll be honest
and say I haven’t really got a strong opinion on this one either way.
13

,
• Rio Blanco (Xiamen Zijin Tongguan, copper): 10% and the most interesting one of
the lot. If PPK’s government can get this one moving it will do so against the wishes of
locals, be they narcotraffickers (the govt like to pain all Rio Blanco opposition with this
word), spiritual protectors of local spiritually sacred zones (e.g. the shamans and the
nearby lakes) or local residents who simply don’t want a freakin’ big mine next to their
houses. Stopped in its tracks years ago when Monterrico metals was found to have
seized and tortured protestors, PPK has spoken a lot about this project in the last six
months. I would not be shocked to my core to see this project come out of the deep
freeze, but would be very surprised to see significant development progress made.
Locals won’t even allow geologists to traipse the area.
Overall, I think the Peru government has a reasonable shot at getting four out of the eight
moving forward, possibly five of them and their stats win. But they’ve also chosen carefully in
order to get a couple of really obvious wins on their side so even when Tia Maria and Rio
Blanco get nowhere, this will provide a positive marketing spin for the years to come. A smart
bit of politicking by FinMin Thorne.
Chile: Unions in climbdown mode at the La Escondida strike
Today is day eleven of the strike and mine closure at La Escondida, the world’s single largest
copper mine. Although I called the lead-up to the strike badly by saying it would either a) not
happen or b) if it did get resolved in a couple of days, it’s only a tiny corner of my ego that gets
a hit and I don’t have a dog in this fight, for me the battle of Chilean copper mining company
versus Chilean mining unions always strikes me as one of Greedy Pigs vs Greedy Pigs. Even so
it’s interesting to watch this battle over La Escondida play out because it now looks as though
the greedy union bosses are capitulating, their rhetoric now a far cry from the “never accept”
and “we’re resolute” cries of just a few days ago. Now it’s “let’s talk”.
The union climbdown started Monday (12) when it asked the government to intervene and
mediate in the strike and stand-off between the two sides. Chile’s government offered to help,
in the shape of the Ministry of Labour and its minister, Alejandra Krauss, who scheduled a three
cornered meeting for Thursday. But at the last minute La Escondida management led by major
owner/operator BHP announced (13) they wouldn’t attend, claiming “a clash of schedules”,
leaving the union reps to meet with the Minister in a totally useless meeting. Afterwards, the
union spokesperson Carlos Allendes said that “It seems they (the company) are more interested
in being under a strike action than producing”.
After the slight, the the Minister of Labour has scheduled (14) a second meeting for the sides
which is set to take place tomorrow Monday 20th and though the unions are already using the
rhetoric of not backing down, they’re less about their own salary claims and now more about
not ceding to what the company wants, a significant backtracking. What we may see tomorrow
is a company that offers a grain of improvement to the deal, at which the unions will happily
grab in order not to lose too much face. However, it’s clear that the company is in the position
of strength this time around.
Argentina: So much for the mining jobs boom
We’ve had over a year of Macri government and among the unfulfilled promises was the one to
bring investment and jobs to the mining industry. But according to the official figures released
last week (15) the mining sector employed around 80,000 people in direct jobs at the end of
2016. That’s around 5,000 less than at the end of 2015. Meanwhile, we noted on the blog last
week (16) that the big government plan to bring new FDI to the Argentine mining industry, the
Federal Mining Agreement, is in trouble as Chubut governor Mario das Neves was reported by
Argentina’s Ambito Financiero biznews paper as saying that he won’t sign the document. As
the FMA was designed to be as loosely worded as possibly in order to get all 23 provincial
governors on board, this refusal (which may be the first of other among from seven known
anti-mining provinces) is a major setback. According to latest reports (17) the government
plans to push ahead with the FMA even if they don’t get all signatures.
14

,
Ecuador: The partial official result for today’s Presidential election
Although not the 100% count, as things stand this evening we have an official result 71.6% of
votes counted and it’s beginning to look like a solid result. Here’s the need-to-know (17a):
• Lenin Moreno: 38.40%
• Guillermo Lasso 29.32%
• Cynthina Viteri 15.9%
If confirmed, which is very likely now as the tendency is strengthening, this means that there
will be a second round run-off between the Correa government candidate Moreno and the
second placed Lasso. That vote is scheduled for April 2nd and it’s going to be a close-run thing
as the “non government” votes are likely to congregate around Lasso.
And the interesting thing for us is that in his “victory” speech tonight Guillermo Lasso made a
direct call to the Pachakutik party, the political party arm of the CONAIE indigenous umbrella
group, thanking them for their support in round one and promising to work closely with them in
round two and any eventual government. For people thinking that this Ecuador election won’t
make much difference to the mining scene in the country, that declaration is like a bucket of
cold water as Pachakutik/CONAIE is the centre of anti-mining resistance in the country. If Lasso
beats Moreno in the second round, I wouldn’t like to be holding Ecuador mining exposure.
Market Watching
Starcore International (SAM.to) 3q17 production results
Wednesday February 15th saw Starcore International (SAM.to), our previous Top Pick recently
demoted back to a normal-scale recommended stock, release its 3q17 production numbers for
the quarter ended January 31st 2017 (18).
SAM.to: Gold Equivalent produced
Here we run the numbers and show the usual 8000
suspect charts but if you want the short 7000
version it’s easy: the numbers suck. 5749
6000 5338 5381 5130 5194
5000 4429 4686 4544 4207 4400
Now for the longer version starting with the
4000 3476 3237
main event chart, quarterly production in gold
3000
equivalent ounces (right). See, told you the
2000
quarter sucked. The 3,237 ounces produced at
1000
the San Martin mine does get a bit of a boost
0
from the first official production from the
Altiplano toll milling facility this quarter and
15
41.rpa 41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco 71.naj
oz AuEq
source: company filings

,
we’ll see how that affects things as 2017 unfolds, but this like-for-like top line number is what
we need to base our financial estimates upon.
SAM: tonnes per day throughput
85000
And thus production sucked, but why? These next 80000
three charts outline the story that’s a combo of 75000
70000
lower than normal tonnage throughput (69,703mt),
65000
lower than normal gold grades (1.90 g/t which is 60000
even more disappointing than that chart makes out, 55000
as we’d expected thing to improve and not just stay 50000
45000
the same), plus much lower than normal recoveries 40000
(70.7%, which is plug ugly).
SAM explains the significant shortfall in recoveries this way:
In November, the mill processed carbonaceous ore for 10 days using Carbon in Leach
"CIL" technology. Recovery of gold from the carbonaceous ore averaged 45% using
CIL, much better than the 10% indicated by testwork using Merrill Crowe
processing. After this trial, the plant was fed normal ore again for the remainder of the
quarter and metal recoveries have returned to normal (80-85% for gold).
Recoveries stabilized in January and testing is continuing to determine the best
method to treat the carbonaceous ore. The CIL/ ADR plant worked very well from a
physical perspective but there appears to be a mineralogical constituent within the ore
that is hampering recovery in addition to organic carbon content.
That’s a lot of words, what it means is the following:
• Along the way SAM has been mining out some carbonaceous (high carbon content, as
the word suggests) mineral with higher gold grades, stockpiling it and wondering what
to do with it.
• This quarter they took 10 days out to test process a batch of it. Recoveries were poor
and they ended up throwing gold into the tailings pit.
• They went back to normal run production, but as that’s now pretty low grading stuff
the quarter’s production still sucked badly.
This is the type of unpleasant curveball surprise that small scale miners such as SAM can throw
at you from out the blue. It’s part of the risk profile and I’m just glad I managed to trim the
position before the announcement, which is pretty selfish of me buy hey, that’s capitalism. All
the same I was expecting a worse reaction than the moderate 4c drop on the week from these
numbers so it wasn’t all bad and the now downsized position is going to be a comfortable hold.
So what does this all mean for the quarterly financials to come? Let’s start with San Martín only
production and when combined with the likely average selling prices for gold and silver in the
quarter, here’s a US Dollar revenues comparative:
16
31.naj 31.rpa 31.yluj 31.tco 41.naj 41.rpa 41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco 71.naj
tpd
source: company filings
SAM.to: Gold recovery percentage
100
95
90
8
8
0
5 79.384.6 868.89.286.3 86 8 .7 3.984.5 85.6 86.9 86.6 84.2
83.5
86.5 85.8
75 78.4 70.7
70
65
31.naj 31.rpa 31.yluj 31.tco 41.naj 41.rpa 41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco 71.naj
SAM.to: Avg gold head grade (g/t) per qtr
3.50
3.00 2.812.89
2.50 2.23 2.38 2.55 2.342.422.362.22 2.22 2.17 1.982.00 1.99 2.001.90 2.00 1.66
1.50
1.00
0.50
0.00
source: company filings
31.naj 31.rpa 31.yluj 31.tco 41.naj 41.rpa 41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco 71.naj
g/t Au
source: company filings

,
SAM.to: Revenue by metal (U$)
10
9
8
7
6
5
4
3
2
1
0
17
21.tco 31.naj 31.rpa 31.yluj 31.tco 41.naj 41.rpa 41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco 71.naj
$m
silver
gold
source: company filings, IKN ests
That’s a big drop. We’re expecting less than U$4m in revenues (model goes for U$3.87m but
that will depend on SAM selling exactly the same amount as it produces in the quarter, normally
there are small variations on either side) and if so, that will be the lowest total in recent
memory from the mine. Not good.
As for a few predictions on the financials it will file (which are in Canadian Dollars, please
remember) we take the above, add in the minor sales from the Altiplano start-up production, an
estimate on production costs which now includes Altiplano (no longer capitalized), mix
thoroughly and place in a hot oven for 45 minutes:
SAM.to: Operations overview
9
8
7
6
5
4
3
2
1
0
-1
-2
41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco tse71.naj
$m revenues
COGS
mine op earnings
source: SAM filings, IKN ests
As long as SAM keeps a lid on costs it’s not going to be an outright disaster quarter, but all the
same it’s no fun seeing your long position about to post a mine operating loss. This does not
fulfill Rule One (make a profit) and the company can spin it all it likes, this is a negative in the
pipeline. What it means for the balance sheet isn’t totally certain as I’m keen on seeing how the
newly designated commercial Altiplano is booked to the assets, but we can take a reasonable
guess at the liquidity position (probably more important today) as per these charts:
SAM: Cash & short-term investments
12
10
8
6
4
2
0
With C$6m in cash and short-term investments there’s no cash crunch happening, but working
capital is dropping towards zero now (there’s the debt repayment to happen mid-year) and we
31.tco 41.naj 41.rpa 41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco tse71.naj
$m SAM.to: Working Capital per qtr
14
cash st inv 12
10
8
6
4
2
0
source: SAM filings, IKN ests
31.yluj 31.tco 41.naj 41.rpa 41.yluj 41.tco 51.naj 51.rpa 51.yluj 51.tco 61.naj 61.rpa 61.yluj 61.tco tse71.naj
source company filings
srallod
fo
snoillim

,
don’t like that. The working cap position safely around the C$10m mark was always one of the
stronger points in the SAM story, suddenly it’s not. We are of course waiting on news of the
closure of the real estate deal which would bring in around U$7m to treasury and make all
potential problems disappear into a puff of smoke. But so far no news and we’re already three
or four months late on the originally mooted closure date.
Bottom line: This was a poor quarter from SAM, no ifs or buts. However size matters and
having recently dropped my exposure to the stock and got out the way (just in time with the
last part of the sale, too) I’m comfortable about holding through on the shares left in my
portfolio and riding the risk. SAM hasn’t had a great two or three quarters but at this size of
company in the sector, luck can change quickly and as long as a couple of pieces drop into
place, perhaps a strong ramp-up at Altiplano which starts to pay its own way, perhaps the real
estate deal or perhaps even an asset sale of one of the many projects it owns, this company is
still in bargain territory. We acknowledge the crappy quarter it’s about to post, recognize the
risk and take it in our stride.
Minera IRL: To be clear
I’ve received a few mails this week on this company, so to be crystal clear on the house
situation as regards Minera IRL you get a short note today. Yes, I’m pleased that it’s trading
again in both Canada and Peru and yes, it’s also clear the company has every intention of re-
listing in London AIM, which will be an important and positive step, what with 55% or so of
total shares having been traded through that exchange. However, having waited nearly two
years for the re-start of trading there’s no hurry to re-open coverage on the stock until I know
as much as possible about its future plans. On that score I’ve heard all sorts of rumours and
whispers. They’ve come from less and more reliable sources and I certainly know what I want
to ask and get straight when the time comes, but until I get some straight answers from the
people that really matter I see no need to launch into an analysis that may ultimately use a
whole bunch of incorrect assumptions and be wildly wrong in its forecasts as a result. All that’s
a long way of saying that you’ll get a detailed analysis and my views on this stock once I’ve
spoken with Diego Benavides, CEO of Minera IRL, along with members of his team as
necessary, in our formal face-to-face meeting scheduled for the end of this month.
I happen to know that CEO Benavides has been very busy in the last few days and is currently
on another overseas trip directly connected with the future of Ollachea. The date for meeting at
the end of this month was selected because before then, more solid data won’t be available
(plus of course I’m taking a couple of days off myself this week coming). I, as a shareholder,
am just as keen as you to get my head straight about Minera IRL and make a decision on the
most basic of all questions in capital markets; buy, hold or sell IRL? However I understand the
advantages of waiting a little longer to get decent information, on which I can turn my wild-
assed guesses into at least educated guesses. I hope you’ll bear with me a couple more weeks.
The Primero Mining (P.to) (PPP) strike
We saw last week the NR from Primero Mining (PPP) (P.to) regarding the strike action at its San
Dimas mine in Mexico that unsurprisingly sunk the stock on
announcement. This is a stock I’ve covered with some
disdain over at the open blog and have a clear “avoid like
plague” rating on the stock so would have left it there, if it
weren’t for the back-story of the strike as seen in the
Mexican press. According to reports (19) the company and
the two unions at the mine had been in negotiations on a
new pay deal since February 7th and had come to
agreement on most points, including pay and work
conditions (the classic points) with just details to resolve,
when suddenly on Sunday 12th February the company
backtracked on all agreements it had come to and
demanded that the negotiations start again “from zero”. The company then demanded
significant cuts in the number of employees (via the right to lay off workers) and a freeze on
18

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pay rises. This would have gone down badly at any point in talks, but after coming to previous
agreements the union representatives took it as an insult, talks screeched to a halt, workers
voted on industrial action and the strike began Wednesday at midnight. It continues until today.
The reason this is interesting is that the negotiation and sudden backtracking have all the
hallmarks of a) a dysfunctional company and b) a mine level management that comes to a
reasonable agreement with its on-site workforce, only for the deal to be vetoed by head office.
And that smacks of real financial trouble at Primero, as it comes alongside a company making
net losses per quarter, with severely crimped production for 4q16 and 1q17 and balance sheet
that as at 3q16 includes a dwindling $31m treasury, working cap only just to the positive but
heaviest of all, a $50m revolver debt that matures in May 2017. I have no vested interest in the
outcome of this company at all, neither long nor
short, but if I had to bet on the reasons behind last
week’s events it would be on a company that’s facing
a severe cash crunch. Not only does it have that
revolver, but on June 30th every year it has to settle
the streaming silver deal with Silver Wheaton and if it
hasn’t delivered enough metal, it has to make up the
difference in cold, hard cash. There’s a smell of
default in the air here and even if not, only the most
risk-tolerant among this readership could consider
this a trade, even at its beaten down share price.
Cheaper yes, bargain basement no, this is a very
easy stock to avoid. So do so.
Episode eleven of “What I’d buy now”
Our established feature gets to edition number eleven, quite the regular thing nowadays and
from the feedback received, a popular one too. As always we first dial in on the results of our
picks and weightings in IKN401, then we move to the new choices for the next four weeks. For
those just joining us here come the rules (copypasted from before):
The feature conveys “what I like now” in my own portfolio considering the state of the market,
the company particulars and their shares prices right here and now. It has been, is and forever
will be more of a thought experiment than a map of how I’m trading the market (because I
tend not to day-trade very much). The rules are these:
1) You give me $50,000. We assume flat forex during the time period.
2) You tell me I have to invest every dollar in currently open IKN Weekly stock picks.
3) I’m allowed to allot different dollar amounts to different stocks, from zero on up.
4) I base my decisions, choices and dollar amounts on what I think today about the
company, the stock price and the current underlying micro and macro fundamentals.
5) You know that I like all the stocks because you know I already own them, we both
understand these answers are about how I feel today about the open stock positions
for the next four weeks, no more and no less.
We’ve had ten periods so far (IKN369 to IKN372) (IKN372 to IKN375) (IKN375 to IKN379)
(IKN279 to IKN383) (IKN383 to IKN387) (IKN387 to IKN391) (IKN391 to IKN394) (IKN394 to
IKN398) (IKN398 to IKN401) and now this one, 401 to 405. Here’s how the latest period
finished:
Mark spends $50,000 in IKN401 Mark's $50k in IKN405
company ticker current PPS amount I'd invest today PPS today position value
Excellon EXN.to C$1.87 7000 $1.84 6888
Rye Patch Gold RPM.v C$0.295 6000 $0.305 6203
B2Gold BTO.to C$3.76 5000 $4.22 5612
Tinka Res TK.v C$0.30 5000 $0.36 6000
Wesdome WDO.to C$2.47 5000 $3.79 7672
19

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Red Eagle R.to C$0.84 4000 $0.86 4095
Starcore Intl SAM.to C$0.57 4000 $0.57 4000
Cordoba Min CDB.v C$0.93 4000 $1.45 6237
Sandstorm Gold SAND U$4.41 3000 $4.66 3170
Riverside Res RRI.v C$0.48 3000 $0.56 3500
Atico Mining ATY.v C$0.90 2000 $0.92 2044
Regulus Res REG.v C$1.45 1000 $1.56 1076
Lara Expl. LRA.v C$1.14 1000 $1.09 956
Focus Ventures FCV.v C$0.055 0 $0.06 0
Total 50000 NEW TOTAL--> 57453
Another successful four week period, which would have been even better if I hadn’t dropped
Cordoba (CDB.v) from its top weighting. Instead of having $7k running on that nag the $4,000
allotted turned into an impressive $6,237. The other big win was Wesdome (WDO.to), which
frankly feels like a bit of a cheat what with me selling my position half way up the move, but
rules are rules I suppose (and it won’t feature in the next edition). Between them, those two
accounted for $4,909 of the final $7,453 profit margin. Ironically, my top weigh choice Excellon
was one of only two losers over the period. So we add this latest result into the period table
and get this:
period final total profit/loss to $50k
IKN369 to IKN372 $58,003 $8,003
IKN372 to IKN375 $53,274 $3,274
IKN375 to IKN379 $49,853 $-147
IKN379 to IKN383 $55,918 $5,918
IKN383 to IKN 387 $44,597 $-5,403
IKN387 to IKN391 $58,210 $8,210
IKN391 to IKN394 $44,651 $-5,349
IKN394 to IKN398 $52,235 $2,235
IKN398 to IKN401 $56,668 $6,668
IKN401 to IKN405 $57,453 $7,453
Three wins in a row...hey this junior investing thing is easy, what could possibly go wrong? Not
only are we now racking up a win streak but this time we nailed down a near 15% profit in the
space of just four weeks, the second best period profit so far. Whoop-dee-doo. For more totally
artificial stats, from start to finish of this “What I’d Buy Now” sequence, IKN369 to IKN405,
we’ve seen 36 weeks go by and the total profit for the original $50k stake is now $30,862.
Pretty wild for a portfolio, even for juniors and even though it’s pure luck and fortunate timing.
Enough about the past, time to get forward-looking and roll out the new list and weightings for
the period from today to the publication of IKN409. Here’s how I’m playing it:
Mark spends $50,000 in IKN405
company ticker current PPS amount I'd invest today
Excellon EXN.to C$1.84 7000
Rye Patch Gold RPM.v C$0.305 7000
Sandstorm Gold SAND U$4.66 6000
Belo Sun BSX.to C$1.03 6000
B2Gold BTO.to C$4.22 5000
Atico Mining ATY.v C$0.92 5000
Red Eagle R.to C$0.86 3000
Tinka Res TK.v C$0.36 3000
Cordoba Min CDB.v C$1.45 3000
Riverside Res RRI.v C$0.56 2000
Starcore Intl SAM.to C$0.57 1000
Regulus Res REG.v C$1.56 1000
Lara Expl. LRA.v C$1.09 1000
Total 50000
20

,
The main changes this time:
• Sandstorm (SAND) weighting doubles to $6,000 as I think it’s got a good chance of
putting in a spurt on strong annual numbers and 2017 guidance.
• As this is likely to be the only time I get to put Belo Sun (BSX.to) in the mix (I’m selling
soon) it also gets a solid wedge of weighting.
• Atico (ATY.v) is up from $2k to $5k, it’s about time it broke through the $1.00 barrier.
• I’ve dropped Starcore (SAM.to) from $4k to $1k on the back of those dreary quarterly
production numbers. It’s unlikely to drop much, but I can’t envisage a big upmove in
four weeks, either.
With that, the bets are laid for the next four weeks, we’ll come back IKN409 to see if we can
make it four green ink lines in a row.
Conclusion
IKN405 is done, we end with bullet points:
• Pay close attention to the Ecuador presidential elections, because the CONAIE backing
of Guillermo Lasso could have serious and negative consequences for miners in the
country if (and I repeat IF) he manages to a) get to a second round run-off (likely now)
and b) become the next President (your guess is as good as mine this evening).
• Starcore (SAM.to) delivered a sucky quarter but with my newly reduced exposure I’m
comfortable about holding through on this. There are still a lot of things that can go
right at SAM.
• Sometimes the Weekly comes out well, sometimes it doesn’t and this week is a sub-
standard version. It happens, apologies.
I thank you in advance for any feedback. Our Top Pick stocks are Regulus Resources (REG.v)
and B2Gold (BTG) (BTO.to). Flash updates will be sent if required by events.
I wish you good trading fortune, ladies and gentlemen. Namaste.
Mark
Footnotes, appendices, references, disclaimer
(1) http://www.portaldoxingu.com.br/belo-sun-faz-reuniao-com-sociedade-civil-organizada-e-autoridades-politicas-de-
souzel/
(2) http://finance.yahoo.com/news/riverside-announces-exploration-results-400-152106181.html
(3) http://www.cordobamineralscorp.com/assets/docs/Cordoba-Presentation-Feb-2017-1487180093.pdf
(4) http://ow.ly/Z5RU3094L8D
(5) http://elcomercio.pe/economia/peru/apoyo-tres-huaycos-que-sacuden-economia-peruana-noticia-1969747?flsm=1
(6) http://finance.yahoo.com/news/capstone-mining-2016-financial-results-220500150.html
(7) http://finance.yahoo.com/news/capstone-mining-announces-2017-copper-231800312.html
(8)http://incakolanews.blogspot.pe/2016/11/capstone-mining-csto-and-zero-cost.html
21

,
(9) https://www.anm.gov.co/?q=proyecto_buritica_oro_puro_para_colombia_principal
(10) http://riotimesonline.com/brazil-news/rio-politics/brazil-signs-agreement-with-10-countries-to-investigate-odebrecht/
(11) http://gestion.pe/economia/gobierno-se-plantea-como-meta-desarrollo-cinco-proyectos-mineros-dos-anos-2182528
(12) http://www.lanacion.cl/noticias/economia/mineria/trabajadores-de-escondida-nosotros-no-somos-
intransigentes/2017-02-16/135346.html
(13) http://www.lanacion.cl/noticias/economia/mineria/ministra-del-trabajo-descarta-mediar-entre-minera-escondida-y-
trabajadores/2017-02-16/172949.html
(14) http://www.elpais.cr/2017/02/16/empresa-bhp-billiton-se-beneficia-en-chile-con-huelga-minera-dice-sindicalista/
(15) http://adelanto24.com/2017/02/17/el-mito-del-impulso-minero-se-perdieron-casi-5-000-empleos-y-las-inversiones-
son-una-rareza/
(16) http://incakolanews.blogspot.pe/2017/02/banana-republic-mining-news.html
(17) http://www.corrienteshoy.com/inicio/basicamovil/165745
(17a) http://www.telesurtv.net/news/resultados-elecciones-ecuador-2017-20170219-0057.html
(18) http://finance.yahoo.com/news/starcore-announces-3rd-quarter-production-232800435.html
(19) http://yancuic.com/durango/sindicato-minero-estalla-huelga-en-durango-por-revision-del-cct
Stocks To Follow Closed Positions 2016
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-ago-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-ene-15 U$1.20 10.1% sold due to lack of value
Lake Shore Gold LSG.to feb-16 C$1.10 07-abr-15 C$1.69 53.6% bot out, sold early in process
Atacama Pacific ATM.v feb-16 C$0.19 26-abr-15 C$0.40 110.5% sold for a double on big pop
New Gold NGD feb-16 U$2.06 24-ene-16 U$2.96 43.7% closed good near-term trade
Sandspring Res SSP.v mar-16 C$0.195 18-oct-15 C$0.32 64.1% Hit tgt, took profit
Teranga Gold TGZ.to mar-16 C$0.54 15-feb-15 C$0.60 11.1% disappointing trade
B2Gold BTG mar-16 U$0.85 13-ene-16 U$1.30 52.9% Separate trade on B2, hit tgt
Dalradian Res DNA.to mar-16 C$0.67 27-oct-13 C$1.00 49.3% Hit target, sold, good win
HudBay Min. HBM may-16 U$4.10 03-abr-16 U$4.36 -6.3% Short trade, poor timing
Nevada Sunrise NEV.v may-16 C$0.185 28-feb-16 C$0.23 24.3% V. small, no big deal either way
Richmont RIC jun-16 U$7.60 01-may-16 U$9.30 22.4% near-term trade, profit taken
INV Metals INV.to jul-16 C$0.25 03-abr-16 C$0.95 280.0% Trade closed on time
HudBay Min. HBM aug16 U$4.98 09-jun-16 U$4.80 3.6% short trade covered, no big deal
Miranda Gold MAD.v oct-16 C$0.125 03-jul-16 C$0.10 -20.0% tiny spec trade, didn't work
Avino G & S ASM nov-16 U$2.00 21-oct-16 U$1.40 -30.0% Abandon trade on bad bot deal
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
22

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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
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
23

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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
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
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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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