IKN #412Premium

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The IKN Weekly
Week 412, April 9th 2017
Contents
This Week: Trade heads-up, In today’s issue, A shortened week, Five Handle Downtime, Gold
still lacks US buyers and that’s not a bad thing.
Fundamental Analysis: NOBS report on Constantine Metal Resources (CEM.v)
Stocks to Follow: Overview, Rye Patch Gold (RPM.v), Amarillo Gold (AGC.v), Red Eagle
Mining (R.to), Regulus (REG.v), Tinka Resources (TK.v), Minera IRL (MIRL.cse), B2Gold
(BTO.to) (BTG), Sandstorm Gold (SAND) (SSL.to), Eros Resource (ERC.v), Atico Mining (ATY.v).
Copper Basket: Overview, Revelo Resources (RVL.v), NGEx Resources (NGQ.to).
Producer Basket: Overview, Barrick (ABX).
Regional Politics: Peru Chile CESCO and copper, Argentina’s general strike, Argentina
Chubut: Ross Beaty BSes the World Economic Forum, Ecuador: Lenín Moreno wins (probably),
Taxes raised by mining and O&G in LatAm.
Market Watching: A meeting with Regulus Resources (REG.v), A meeting with Tinka
Resources (TK.v), Graña y Montero (GRAM) keeps on flying.
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
Trade heads-up
The standard line or three at the top of the Weekly for those of you who can’t stand a minute
longer of my convoluted prose: I’m looking to buy a few shares of Constantine Metal Resources
Ltd (CEM.v) next week, a deep value proposition on zinc and other metals. To make room for
this new position, I’m selling and closing my Rye Patch Gold (RPM.v) trade. See today’s NOBS
report and ‘Stocks to Follow’ for more on those calls.
In today’s edition
• I have no problem admitting that I knew next to nothing about Constantine Metal
Resources (CEM.v) before this week began and I was put onto the idea by one of you
people, a subscriber who mailed in with the idea. That’s today’s NOBS report.
• It was good to meet with happy and active junior mining management teams last
week, namely those of Top Pick Regulus Resources (REG.v) and the sudden star in the
zinc space, Tinka Resources (TK.v). Notes on those meetings in ‘Market Watching’
below.
• I’m starting to like the gold price again, and not just because yet another US President
has decided to drop yet another cache of high explosives on yet another country that
isn’t his own place of birth. When one doesn’t do it, that’s when I’ll be surprised.
A shortened week
It’s Easter week and most of the Western world closes down, either from Thursday to Sunday
(typical at this end of The Americas) or Friday to Monday (places in the North) to celebrate the
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sacrifice and resurrection of Jesus Christ. So keep in mind we have a shortened period of
trading in the next eight days.
Five Handle Downtime
IKN416, scheduled for Sunday May 7th, will be a “bare bones only” edition that updates the
main tables with end week information and only adds minimal commentary on the week’s
events. The reason is purely personal as well; on that week I’m celebrating my 50th birthday
and have decided to take downtime and a short vacation to mark the occasion, which will
involve some travelling. I hope you forgive me for this lapse in normal service to come and rest
assured that the previous (IKN415 scheduled April 30th) and following (IKN417) scheduled
editions will not be affected.
Gold still lacks US buyers and that’s not a bad thing
We like war! We’re a war like people. We like war
because we’re good at it. Do you know why we’re
good at it? Because we get a lot of practice.
George Carlin, 1992
I wrote on this subject at the start of last week’s edition and also stuck something on the blog
last week, but there’s more to say about the way in which gold is being ignored by the self-
appointed Smartest Guys In The Room over on Wall St. We have noticed the way in which gold
bullion inventories at GLD, the financial jocks’ preferred method of playing the gold market,
have done little else but flat-line over the last few weeks. GLD inventories have been in a tight,
830 metric tonne (mt) to 840mt range for a full month except for one day when they dropped
to 825mt and that shows up in the first chart you see below.
2

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But as you also see, I’ve highlighted another time in which GLD holdings did very little recently,
the block of time just before and after the Trump inauguration, even though the holdings at
that point were rather lower at around the 800mt mark. Why that period interests me is in the
second of the chart, that’s the ratio chart I like the GLD inventory/price ratio and the two red
boxed periods show when the ratio has traded at the 7.0X level. As scribbled directly on the
chart there, the tentative theory is that it denotes a period in which gold gets ignored by the
flash financial jocks, bullion goes out of fashion and the higher-speed big money looks for
somewhere else to park. And once that’s understood, the implication is clear; these are good
times to think about gold because when Wall St comes back to the gold market and starts to
buy, it becomes a new cycle of interest for the price and the metal. Once fashionable Gordon
Gekko buyers return the ratio goes up (because GLD isn’t the only buyer of gold out there) but
so does the price and it’s typical to see the gold price pop jump higher after a sustained period
of GLD inaction (e.g. the 4.5% rise in just eight days after the quiet period that ended early
February). With gold now nearly at 2017 high close on Friday, even after the pop and drop it
got on the Syria/US Jobs news and failure on Friday, it’s not going to take an extra catalyst to
get gold up and over at U$1,300/oz any longer. Less than four percent’s worth of move, in fact.
So yes, no matter if I’m mocked as A. N. Other goldbug I’ll say it clearly, I’m more bullish about
gold’s prospects this weekend than for a while and not because those few showman-type
bombs, a measured dose for public flag-waving consumption dropped on some strategically
chosen airstrip which now let all sides say things how right they are without anything changing
much (at this point I’ll add that although I’m no Trump fan, he should be congratulated for
replacing that dubious Flynn guy with the morally upright and undoubtedly smart H.R.
McMaster as National Security Adviser, there’s “smart strategy” written all over last week’s
action). Do NOT be bullish on gold for geopolitical events and repeat the mantra with me:
Geopoliticals have no long-term effect on gold.
Geopoliticals have no long-term effect on gold.
Geopoliticals have no long-term effect on gold.
They might have done before, but the information highway and fly-attention-span news cycle
first brought the half-life down to days, now it’s barely more than hours. Remember the very
last scene in Peter Weir’s somewhat flawed but still darned wonderful ‘The Truman Show’? The
two security guards? Literally the last seconds of the movie? Welcome to 2017. No madam and
no sir it’s not the Tomahawks and its not CNN’s shrill, hand-wringing or Fox’s flag-wrapped
coverage, it’s the economy stupid because gold has quietly slipped away from its TIPS ratio
anchor (that’s still in the ‘New Normal range’) and may be ready to run. My best guess (and it’s
only that, a guess) is the holding pattern period is coming to an end so call me a goldbug, I
don’t care. To da moon, Alice! Audit Fort Knox! Live Free Or Die!
Fundamental Analysis of Mining Stocks
Today we look at Constantine Metal Resources (CEM.v).
NOBS fundamentals report dated April 9th, 2017
Constantine Metal Resources Ltd (CEM.v)
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Company Overview
Constantine Metal Resources Ltd (Canada: CEM.v, USA otc: CNSNF, Frankfurt 3CQ.f) is an
exploration stage junior junior mining company operating in The USA and Canada. Its flagship
asset is its 51% ownership of the Palmer zinc/copper project in Alaska, USA. Current share
structure is as follows:
Shares out: 117.343m
Options: 9.25m
Warrants: zero
Fully diluted shares: 126.593m
Current share price: C$0.135
Market Cap: C$16.1m
Approx working cap per S/O: C$0.04
All prices are in Canadian Dollars unless stated. Forex U$0.75=CAD$1
NB: As Constantine reports in Canadian Dollars that is default currency in this report. When used
or mentioned, United States Dollars are denoted “U$”.
Why this NOBS report exists
Here’s the deal. Since the very beginning of The IKN Weekly, from time to time you nice people
out there have sent in ideas on stocks to own. Last week, reader JB wrote a mail and the
paydirt passage was this:
“I'm talking my book as I own some, but have you taken a look at Constantine Metals
(Venture:CEM)? They've got 51% of the Palmer deposit in Alaska. Last estimate is 9
Million tonnes at 12% ZnEq, underground scenario. Market cap is $15 Million CAD,
plus they have $5M cash and a number of other properties in Ontario which they are
building a prospect developer portfolio with. I can't understand why the valuation is so
low. The property package at Palmer is district scale and has many targets, the area is
on trend with Greens Creek. In my biased opinion someone is going to notice the
potential here as the zinc bull progresses. 27% insider ownership they say.”
When I get such a mail I’ll always check out the stock idea (unless I myself know the company
well and have recently discarded it) and in order to keep it fair to everyone, don’t reply to the
mailer. Even though most of the ideas you people send in are reasonable the typical conclusion
after the first stage of DD is to pass, but in the case of JB’s mail and Constantine Metal
Resources (CEM.v), it immediately stood out:
• A company I knew precious little about. I have no problems admitting these things, I’d
heard its name bandied about once upon a couple of years ago but, not being in a
geographical area I cover closely and with a low promotional profile, I’d never paid it
much attention. I appreciate all mails with stock ideas (so keep em coming please) but
apart from background stuff I’d read from a couple of years ago I truly knew nothing
about CEM.v and that immediately piques my curiosity.
• The right metal(s) at the right time. We can debate whether its zinc or copper
component is the main metal and the reason to like the Palmer deposit but with zinc
being the current flavour of the month, it has something the market wants. The copper
is strong, too.
• Cheap because it’s ignored. After checking out the numbers on a first pass and seeing
their apparent strength it seemed the only logical explanation. Still does, in fact. There
is a trap here of course, the value trap that sees you or I buying into a stock that starts
cheap and stays cheap (or even gets cheaper), but a value-hunter like me cannot
ignore a compelling spreadsheet.
• Catalysts coming into play. Once a stock passes the stage one of DD (people, project,
basic numbers) and you start wondering why it looks cheap, you normally come across
negatives that chip away at initial optimism but in this CEM.v case, positives started
showing up to enhance the idea. Now be clear, no company is perfect, they all have
their weak spots and CEM.v is no exception (see below) but even the main negatives
look manageable to me, while reasons to like this stock got longer as I looked deeper.
4

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All those and more, but the upshot is that in less than a week, from opening JB’s mail to writing
these words on a Sunday morning, I’ve been through what for me is the rare experience of
going from near zero on a stock to a decision to buy some shares. The job is to explain why.
Management and shareholders
CEM was founded in 2006 by the pairing of President and CEO Garfield MacVeigh and director
Wayne Livingstone and was done specifically to explore and develop the Palmer project. The
officer’s roster is heavy with geological knowledge (e.g. CEO MacVeigh is a 40 year veteran
rockbanger) including VP Exploration Darwin Green, who also does a lot of the conference
presentation work for CEM (it seems, the Google machine has thrown up plenty of videos and
interviews with Mr. Green for me this week, here’s (1) a good example to recommend).
As for shareholders, the team has plenty of skin in their own game with CEO MacVeigh owning
8.96m shares and director Livingstone owning 4.02m shares, plus the three other directors with
an aggregate of 1.21m shares as per the latest Management Information Circular. We like this,
however the biggest single shareholder is an interesting one too, as it’s John Tognetti of
Haywood, a man who is often an aggressive activist shareholder in junior explorecos and who
has had a lot of success over the years in doing so. Tognetti owns 15.861m shares of CEM.v,
representing a chunky 13.52% of the total.
There is a slight doubt on the number of shares out at the moment, because 1.825m options
expired at the beginning of March and as they had an 11c strike, it’s likely at least some of them
(maybe all?) were made whole but there’s no information on that yet. Therefore I’m going with
the last recorded 117.343m shares until otherwise told but that may be as high as 119.1m.
Properties
CEM has two main properties and a handful of early-stage concession holdings, too.
Palmer: In the Southern corner of Alaska USA and close to the coast, this is a zinc/copper VMS
with decent silver and gold kickers. CEM has a 43-101 compliant resource on the main
discovery there. It’s a JV with Japan’s Dowa Metals & Mining, one of the world’s largest zinc
smelter companies, with Dowa now owning 49% and operator CEM with 51%. It’s also the main
focus of this report today and there’s plenty more below.
Other stuff: CEM has some 800km2 of gold target properties in the Yukon, mostly in JV, plus
some other land holdings in Alaska and the Timmins area. Although interesting, all this is early
stage concessions and not our focus but I will take a few lines to talk about the two main “other”
properties, Munro-Croesus and Golden Mile.
Munro-Croesus and Golden Mile: These are gold projects in Ontario located in the “Timmins
Camp” region that’s been a prolific place to go mining over the years (as seen from this map,
ripped from the CEM website).
They are certainly interesting
concessions and if you check out
the company you’ll soon read
about high grade samples from
the sites, but for the moment
they’re early stage, geologically
interesting but very much
second-string reasons to like this
stock and its prospects.
And that would normally all I
have to say about the company’s
Timmins assets, except that in
late 2016 (closed 2017 (2) we
had a wholly positive
development from CEM when
the company sold a different
land package that does NOT include either Munro-Croesus or Golden Mile to Lake Shore Gold
5

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Corp (i.e. the wholly-owned subsidiary of Tahoe Resources (TAHO) (THO.to) for CAD$4.5m
plus a 1% NSR plus a claim next to Munro-Croesus called Munro. Lake Shore (Tahoe) bought
the land from CEM due to it being contiguous to its own Timmins camp land positions and the
deal has added a very useful chunk of cash to the CEM story, as you’ll see below. What it also
implies is that its ownership of Munro-Croesus and Golden Mile could turn out to be valuable
indeed, because larger companies are clearly interested in snapping up prospective land
around Timmins and Munro-Croesus/Golden Mile are the concessions most valued by CEM (in
their words they...“... collectively represent a rare opportunity to control an extensive, high
potential land position in the prolific Timmins gold camp”). Even though I doubt CEM is a seller
at the moment, what with just closing a deal that funds the company nicely for the indefinite
future, another deal isn’t impossible and I’m sure the team has already been approached by
interested parties.
Collectively, Munro-Croesus and Golden Mile are carried by CEM’s books at C$2.3m approx, or
2c/share. We could add that 2c to any final price target today but to be honest I prefer to price
them at zero and be done because..
1) If CEM ever sells them, they’ll go for a lot more than that
2) The reason I like CEM is Palmer, not the other stuff
...so today’s trade thesis acknowledges the existence of these and then prices them to zero.
From now on it’s all about Palmer, but first some financials.
Financial overview
Here we go with some Usual Suspect charts to give you the financial flavour of CEM. Assets
first and as at the last set of financials, the 1q18 period that ended January 31st 2017 (its
financial year end is October) CEM had $4.69m in cash, $2.606m in “other current” and
$11.989m in fixed assets for a total asset value of $19.294m. All three of those components are
worth considering.
CEM: assets
25
20
15
10
5
0
6
EY_41.tcO 51.naJ 51.rpA 51.luJ EY_51.tcO 61.naJ 61.rpA 61.luJ EY_61.tcO 71.naJ tse71.rpA tse71.luJ EY_71.tcO
tse
$m
fixed
other current
cash&ST
CEM filings, IKN ests
• Cash just got a big boost from the sale of those Timmins assets to TAHO, very clear
even on this overview chart that the cash component had been bouncing around at
close to zero for many quarters but now it’s suddenly flush.
• “Other Current” is mostly $2.565m in restricted cash. That’s the amount paid into CEM
by its JV partner Dowa in order to complete the terms of its earn-in deal on Palmer.
That was a four year dela in which Dowa had to spend U$22m, it got to within U$2m or
so and cut CEM a cheque for the rest. This is good news, because this C$2.565m can
now be assigned to CEM’s pro-rata share of exploration costs in the year ahead. The
JV is currently working on its exploration plan and budget for 2017 so we don’t have an
exact figure yet, but as Dowa spent around U$3.7m on the earn-in last year and it could
accelerate a little this year, I’ve made rough guesstimates in the chart above on how I
see the assets positions developing.
• The fixed assets number is mostly Palmer (carried at $9.33m) then the other bits and
pieces. As CEM is the 51% owner/operator of Palmer it gets to put a dollar number

,
here, but it’s nobody’s idea of an inflated carry for such a deposit and prospect.
Next up is the liabilities chart which at first sight CEM: Liabilities
seems to have taken a worrying jump, but it’s 3
really nothing. What you see there is the equal- 2.5
and-opposite line item of the restricted cash 2
added by Dowa and as that gets burned this
1.5
year, liabilities will return to their standard
1
position for this company, basically nothing at
all. It’s an optimum situation for an exploreco 0.5
such as this. 0
Working capital looks like this below left, with
the big change being the injection of cash from
the sale of its land assets to Lake Shore
(Tahoe) that saw things bump up to very
healthy levels as at January 2017. What I’m expecting is that CEM burns through the restricted
cash for the JV and will only need to cover its own minimal burn for most of the year to come,
which is why the model predicts CEM leaving FY17 with $4m in working capital still. I’d expect
CEM’s current cash position to be enough to get it to 2019 without problems, even if they need
to fund their 51% of a PEA for Palmer. In short, this is a financially well funded and healthy
company.
As you can see from the operating expenditures breakdown chart below right, this company
normally sips at cash with only the occasional legal bill to cover while Dowa was earning into
Palmer.
Now that it’s a JV we shouldn’t expect its parsimonious attitude to change much as the
restricted cash should cover most of its budget needs this year, items such as officer salaries
here are as low as they come in the business (geologists love rocks more than money...I’ve
never really understood them).
The share structure (right) shows a company
dead set against diluting its holders and with
27% of those being insiders, this skin in the
game effect is a positive one. Throughout the
course of the Dowa earn-in, late 2012 to end
2016, CEM got a free ride and didn’t need to go
to market to raise working capital. As noted
above this number may get a bump to 119.2m
come April 2017 but it’s still as tight as a drum.
A final chart here below, that of book value
(defined as total assets minus total liabilities)
per share , a visual that really impressed me
and my value-digging bones. After checking out the modest carry value of its assets and
7
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tse
$m
source: CEM, IKN ests
CEM: Working capital
5
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
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tse
$m CEM: Expenditures breakdown
0.5
0.45
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
CEM filings, IKN ests
51.naJ 51.rpA 51.luJ EY_51.tcO 61.naJ 61.rpA 61.luJ EY_61.tcO 71.naJ
$m G&A
legal
other
consulting
source: CEM filings, IKN ests
CEM: Shares outstanding
160
140
120
100
80
60
40
20
0
EY_41.tcO 51.naJ 51.rpA 51.luJ EY_51.tcO 61.naJ 61.rpA 61.luJ EY_61.tcO 71.naJ
m S/O
source: CEM, IKN ests

,
considering that a decent slug of its total assets is in cold. Hard cash that’s set to survive mostly
intact through 2017, to see the BV/share at 14c for an equity priced below that, at 13.5c,
underscores the solid corporate value of owning CEM at these current prices.
CEM: Book value per share, per qtr
0.20
0.18
0.16
0.14
0.12
0.10
0.08
0.06
0.04
0.02
0.00
8
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$
IKN calcs from CEM data
And that’s enough on the financials, I hope I’ve made my point that CEM is a model of good
corporate management and governance and can attack 2017 with plenty of cash, no debt and a
share structure that will allow any success or market interest to be reflected directly in higher
share prices, a list of attributes that work in favour of retail grunts such as you and I.
The Palmer project
We get to the central point of why I like this company. I’d like to be as on-point and concise as
possible for this section, so rather than me it padding out with a lot of background, location and
setting information, what I’d like to do is aim you towards the decent and informative corporate
presentation over at the CEM website (right here (3)) and get you to read that. When you do
you’ll be able to get more detail on these main points:
• Palmer is located in the South corner of Alaska, some 60km from a sea port with direct
road connection to the property. There’s a small town nearby and down-road there are
other working mines, so people know what the industry is about here.
• Its JV partner, Dowa Metals of Japan, spent four years and U$22m earning into its 49%
of the project. That earn-in was completed at the end of 2016 and from this point on the
51/49 partners will pay for development pro-rata. This does man of course that CEM’s
burn rate is set to climb from the minimal levels of the last few years, but I think it’s also
going to bring more market visibility and interest as well.
• Palmer a VMS deposit and the main discovery and most advanced resources is only
one of many targets on its property. Mineralization of type of VMS geology usually come
in groups, so as well as the current 43-101 resource there’s a lot of potential upside.
• The theoretical mine plan would make for straightforward and cost-effective mining, also
metallurgy is reportedly very good.
That’s the quickest overview imaginable as as stated, please check out at least the latest
corporate presentation for more details (and preferably if you’re like me and wonky the 43-101
technical report on Palmer, available on SEDAR). I want to get straight to the numbers, starting
with the current 43-101 resource for the project. Notes below:

,
• This is an inferred resource and that lower level of 43-101 defined confidence needs to
be taken into account, but inside the official designations this is one of those I get to call
a “good inferred”. The mineralization is clear, defined and importantly it’s been tracked
geologically as one continuous body that makes for efficient and cost-effective mining.
Also these VMS systems don’t tend to have wild fluctuations in grade inside the body
(an example being the lenses Atico (ATY.v) mines in Colombia), so it’s not necessary to
swiss-cheese this deposit to get a reasonable understanding of what’s there.
• The company uses the U$75/tonne NSR cut-off for most of its presentations. That
sounds fair and conservative, I’ve taken my cue from that. This means that even though
CEM is confident of finding other bodies of mineralization in the vicinity, the most
advanced deposit has just over 8.1m tonnes and grades at a zinc equivalent of 12.61%,
thanks to its four payable metals. Straight zinc accounts for less than half the ZnEq
total, this is a polymetallic proposition.
• The assumed metals prices for the above are U$2.75/lb for copper, U$1.00/lb for zinc,
U$1200/oz for gold and U$18/oz for silver. Those are reasonable for this stage of
development and with the main revenue metal zinc at a spot of U$1.22/lb this weekend,
leaves more than enough breathing space for my taste even with that U$30/oz
assumption for the minor silver component.
• Metallurgy is reportedly a strong point for the project, with clean and straightforward
recovery techniques and estimated metal recoveries of 89.6% for Cu, 84.9% for Zn
zinc, 75% for Au and 89.7% for Au as determined from metallurgical locked cycle
flotation tests. The 43-101 technical report has more info on this and though at some
point in these early stages of economics testing of a deposit you have to take a bit of a
leap of faith, it is good that CEM and Dowa have cared enough to do some serious met
work already and I’m good about using their assumptions.
So far so fair, but when we start running a few economic tests on that rock it starts to get really
good. This is the thing that grabbed my attention when JB suggested I look at CEM and I’ve
tried and failed to pick holes in the numbers since then. Let’s begin by doing a straight and
simple “What’s That Rock Worth” calculation to figure out the valued of metal contained in one
tonne of Palmer mineralization. Here’s a table that does the job for you
CEM at Palmer: Rock worth for average tonne at baseline NSR cut-off prices
Metal Copper Zinc Gold Silver
Grade (% or g/t) 1.41% 5.25% 0.3 30.2
Recovery 89.60% 84.90% 75% 89.70%
Metal price (U$/lb or oz) 2.75 1.00 1200 20
gross metal revenue (U$/tonne) 76.59 98.27 8.68 17.42
Grand Total $/tonne U$200.96
source: CEM data, IKN calcs and ests
By using the company’s grades, recoveries and the baseline metals prices, we see that one
tonne of Palmer with a NSR cut-off of U$75/tonne is worth a cool U$200.96. Now that’s what I
call a healthy margin, especially for a baseline study using more than reasonable price
assumptions. The main payer is zinc, closely followed by copper, then the precious metals
kickers help a bit too. We can of course play around with the price inputs on that model all day
and night so for another example, here’s the same grades and recoveries using this weekend’s
spot prices for the four metals:
CEM at Palmer: Rock worth for average tonne at baseline NSR cut-off prices
Metal Copper Zinc Gold Silver
Grade (% or g/t) 1.41% 5.25% 0.3 30.2
Recovery 89.60% 84.90% 75% 89.70%
Metal price (U$/lb or oz) 2.64 1.22 1254 17.96
gross metal revenue 73.53 119.88 9.07 15.64
Grand Total $/tonne U$218.13
source: CEM data, IKN calcs and ests
9

,
We’re now at U$218 and bits per tonne with the extra in zinc countering the slightly lower spot
numbers for copper and silver today. Put simply, this one works and it does so with a big margin
of error, too. Therefore, with the general idea of “this rock gives great looking margins” in place
we can then take it a couple of steps further and put together an average year in the life of a
working mine at the 8.1m tonnes of Palmer as stands today. To do that:
• We run numbers for an eventual mine at Palmer on a 100% basis (CEM owns 51%)
• We assume a 2000 tonnes per day throughput, which puts us at 720,000 tonnes per
year and an approximate 11 year mine life for its 8.1m tonne resource.
• We go with the average grades and recoveries as per above
• We then run the economics using four different price assumptions:
1) Stress Test (U$0.90/lb Zn, U$2.25/lb Cu, U$1k/oz Au, U$15/oz Ag) to see if things
work at market problem level low prices.
2) Baseline (U$1.00/lb Zn, U$2.50/lb Cu, U$1,200k/oz Au, U$17/oz Ag) for a
reasonable lowball set of price assumptions
3) Realist (U$1.20/lb Zn, U$2.75/lb Cu, U$1,300k/oz Au, U$18/oz Ag) to reflect
roughly what we have today and can assume as reasonable for current economics
4) Blue Sky (U$1.50/lb Zn, U$3.50/lb Cu, U$1,500k/oz Au, U$25/oz Ag) because it’s
nice to dream.
Finally we assume a best guess 15% TC/RC charge (which we can debate if you like, I’m trying
to get in the ballpark here, not throw a no-hitter) and that brings up a revenues model which
looks like this:
Palmer on 100% basis: Annual model revs by metal type (U$m)
model stress test baseline realist blue sky
zinc (Mlbs) 70.8 70.8 70.8 70.8
$/lb 0.90 1.00 1.20 1.50
zinc revs (U$m) 63.7 70.8 84.9 106.1
Cu Mlbs 20.1 20.1 20.1 20.1
$/lb 2.25 2.50 2.75 3.50
Cu revs (U$m) 45.1 50.1 55.1 70.2
Ag Oz 627150 627150 627,150 627150
$/oz 15.0 17.0 18.0 25.0
Ag revs (U$m) 9.4 10.7 11.3 15.7
Au Oz 5209 5209 5,209 5209
$/oz 1000 1200 1,300 1500
Au revs (U$m) 5.2 6.3 6.8 7.8
Mining revs (U$m) 123.4 137.8 158.1 199.8
TC/RC/Royalty 15% 18.5 20.7 23.7 30.0
Net sales (U$m) 104.9 117.1 134.4 169.8
Source: CEM data, IKN ests
I’ve bold-typed the “realist” column as the best to follow for guidance today. That one shows that
Palmer, on a 100% basis, is capable of returning U$158.1m in revenues and U$134.4m in net
sales after TCRC.
Next step, a concise income items for the same model year, again on a Palmer 100% basis.
The assumptions are going to have to be ballpark at this stage, we’re still a way off from even a
PEA for Palmer, but using the U$75/tonne NSR cut off as our COGS assumption is as good a
place as any to begin. Then come some standard level guesstimates for DD&A, G&A, interest
on a financing loan etc etc. I’ve kept with the 120m shares out of CEM on this 100% basis level
10

,
just to give an idea of the EPS made whole, it’s not that important.
Palmer: Income items for model year (100% basis) (all U$m)
At 2k tpd thruput stress test baseline realist blue sky
Sales (U$m) 104.9 117.1 134.4 169.8
Cash COGS 54.0 54.0 54.0 54.0
Depreciation 8.0 8.0 8.0 8.0
SGA 3.6 3.6 3.6 3.6
Op income 39.3 51.5 68.8 104.2
Interest 10.0 10.0 10.0 10.0
Workers Part. 3.1 4.1 5.5 8.3
Tax 7.8 11.2 16.0 25.8
Net income 18.3 26.2 37.3 60.1
Shares out (m) 120 120 120 120
EPS 0.15 0.22 0.31 0.50
Sust capex (5) (5) (5) (5)
FCF/sh 0.18 0.24 0.34 0.53
Source: CEM data, IKN ests
In other words, a mine at Palmer, using reasonable and standard price and cost assumptions,
could net U$37.3m per year on an 11 year Life of Mine average.
As for what that would mean for the 51% owned by CEM.v today, be clear that I don’t think this
last table below is particularly serious, what with any mine being years off into the future, but if
we take the above and then...
• Take just the 51% owned by CEM.v
• Assume a CAD$1 = U$ 0.75 forex
• Assume CEM stays at just 120m shares out (unlikely, but this is a math model for
context and not much else)
• Assume the “Realist” metals price model
• Then use a modest 4X price/earnings multiple on the projected EPS
...we get to this type of target box:
CEM: Sales and earnings Target price & valuation data on 51% ownership of
Metals Price stress baseline realist blue sky Palmer only, using four different metals price cases
Sales ($m) 104.9 117.1 134.4 169.8 LT target $0.79 (on 4x fwd EPS at 51% JV
Upside to target 487% owner and CEM realist case)
EPS 0.15 0.22 0.31 0.50 Mkt cap ($m) $16 Enterprise value $14
Cash flow 0.22 0.28 0.38 0.57 P/sales (stress) 0.14 EV/sales (stress) 0.12
P/E (stress) 0.9 EV/EBITDA (stress) 0.3
P/E (baseline) 0.6 EV/EBITDA (baseline) 0.2
P/E (realist) 0.4 EV/EBITDA (realist) 0.2
cash flow defined simply as EPS + depreciation
Yup, that says 487% upside. As expressed clearly, I’m not taking that as any sort of serious
target rice but what it does show, on a pure numerical basis, is that even if CEM.v dilutes the
share count to double or takes out a big whack of debt financing or any other permutation,
there’s a very solid and profitable mine to be built on top of this deposit (well in fact physically
below it, check the corp presentation for more on that) and they own 51% of it, with the other
49% owned by serious, long-term partners with a clear and active interest in making it a real live
mine. And again, this is just on the 8.1m tonnes of rock already delineated, according to the
company and VP Expl Green there could easily be other resources that would add up to a total
of 50m tonnes of VMS rock of the same ilk. For more on that angle (which I’m not going to push
11

,
too hard today) check out this company map (4).
The environmental opposition
All too good to be true? Yep I agree, so it’s time to tell you about why you might want to pass on
this trade idea. Here are the links to a couple of newspaper reports (5) (6) on the opposition to
an eventual mine at Palmer. They’re fair enough articles and the reporters have done the right
thing by quoting and putting forward the ideas of both sides of the argument. They also point out
that for every opponent of a mine here there seems to be a supporter and those in favour
include the local mayor and political dignitaries, but all the same there’s obviously some deeply
felt environmental opposition to this project that, so say the environmentalists, could threaten
the river salmon stocks and even that paragon of American symbolism, the Bald Eagle. At the
current level of exploration and development environmental impact has been virtually zero and
we won’t really know much about the footprint until a PFS stage, so the fact that we’re at least a
year away from even a PEA means it’s not yet a hot issue, but enviro battle lines have already
been drawn and it’s going to be a risk factor in the development of any Palmer mine, be aware.
On this subject however, it’s worth once again bringing up The Trump Factor because Palmer is
in Alaska. This whole “mining will be easier to permit now” argument got people pumping
Northern Dynasty hard a few months ago and I myself have mentioned that Trilogy (TMQ.to)
might get a boost at some point when people start talking road construction permits in the US
portion of the GWN. I do think the enviro risk needs to be taken into consideration by anyone
thinking of buying this stock, even on a near-term/mid-term basis as is my own plan. And even
though it’s not a major plus, the advent of Trump and his shake-up of the US EPA could be a
secondary plus factor for this trade in 2017. As always, you need to do your own DD on this
point and make up your own mind, for me it’s not a riskless trade (no 13.5c stock ever is) but
the potential rewards due to the compelling rock economics more than make up for the risk at
this point in the cycle.
Discussion and conclusion
This is an unusual case, one where I’ve gone from knowing close to nothing about a stock
through to making a buy call in the space of a few days, all on the back of a friendly suggestion
from a smart subscriber. It’s not my normal M.O. but exceptions to rules are welcome, not at all
illegal and I’m certainly not going to try and BS you about my in-depth previous knowledge and
how I’ve been quietly tracking the stock for months and years. This is a special case because:
• It fits in with other parts of my current portfolio. Mentally I’ve framed it as my “third string
zinc play” that sits behind the successful Tinka (TK.v) and the new Solitario (XPL), both
of which I am willing to give the necessary time and patience to mature as trades.
• This CEM.v proposal is more speculative and risky, it’s going to need to gain market
radar in order to realize its full potential and with a “very geologist” management team
who are by no means promotional and what amounts to a four year quiet period while
Dowa earned in, that’s not a given. However I like them cheap and under-radar, even
though such stocks can frustrate me at times.
• Buying a stock like this “on spec” isn’t the best way of going about things and the
normal peer comparative thoughts are missing. But in this case I couldn’t get away from
what are compelling numbers, from the metal grades of the VMS to the economic
potential of Palmer to the rock solid corporate financials, it’s the type under-radar that
has me sitting up and taking notice from the beginning.
There’s several moving parts to this company and as always, for a new story there’s a lot to
learning curve to take in while trying to find the fatal flaw. I’m not trying to make this out as
anything but a speculative trade on zinc, but in the end the trade theory is simplicity itself:
Constantine Metal Resources (CEM.v) is a screamingly cheap and cashed up zinc (and copper)
play with a story that may get more traction now Dowa's earn-in is complete and as such, The
IKN Weekly recommends the stock as a speculative buy. As for a price target, I’m loathe to
stick a number on what it could do because in this zinc market, anything can happen. So there
is no real target here but on a rational, serious, stick-a-market-cap-on-a-deposit basis I don’t
see why 51% of Palmer shouldn’t be worth CAD$40m in the middle distance (less than U$60m
12

,
for the whole thing) and that would make CEM.v a 33c stock, 144% higher than it is this
weekend. Thanks for the mail, JB.
End of Report
Stocks to Follow
Eight of our 15 open positions on the Stocks to Follow list gave us weekly wins last week
(REG.v, SAND, TK.v, XPL, EXN.to, MIRL.cse, AGC.v, SAM.to), there was one unchanged position
(ERC.v) and six were losers (BTO.to, CDB.v, ATY.v, R.to, RPM.v, RRI.v). There was just one
double figure percentage loser in the shape of Riverside Resources (RRI.v down 12.6%) but
three big winners, namely Tinka Resources (TK.v up 32.1%), Regulus Resources (REG.v up
13.3%) and Minera IRL (MIRL.cse up 10.3%). Those three, plus the decent 6.9% move from
Excellon, compensated for the continued sluggish B2Gold with plenty of room to spare, beat out
the GDXJ (+0.6%) and GDX (+3.0%) ETFs and made it an out-perform week for the portfolio.
We currently have 15 open positions on the ‘Stocks to Follow’ list, our self-imposed maximum at
any given time. Eleven of the positions are in the green, one is unchanged since inception,
three are in the red.
company Ticker this week Avg Price Reco date Current PPS Gain/Loss% Notes
TOP PICKS
B2Gold BTO.to STR buy C$2.11 12-sep-14 C$3.70 75.4% tgt $5.30 Top Pick prod.
Regulus Res REG.v buy C$0.64 06-apr-15 C$1.79 179.7% LT exploreco top pick
Long positions (in current order of preference)
Sandstorm Gold SAND STR buy U$3.87 17-apr-16 U$4.41 14.0% $7 tgt, cheap and v solid
Cordoba Min. CDB.v buy C$0.73 15-sep-16 C$1.23 68.5% $1.50 tgt hit, waiting for news
Atico Mining ATY.v STR buy C$0.54 24-jul-16 C$0.77 42.6% tgt $1.10, Cu play
Tinka Res TK.v buy C$0.195 19-apr-16 C$0.74 279.5% Will run over $1
Solitario XPL buy U$0.80 19-mar-17 U$0.822 2.8% new Zn trade. Deep value.
Excellon Res EXN.to STR buy C$1.71 09-oct-16 C$1.71 0.0% $3.13 tgt, Ag growth story
Minera IRL MIRL.cse buy C$0.195 22-jul-12 C$0.16 -17.9% tgt 53c, risk + much reward
Red Eagle Min. R.to buy C$0.71 13-dec-16 C$0.74 4.2% Ramping up, great March buy
Amarillo Gold AGC.v buy C$0.38 24-mar-17 C$0.415 9.2% new position, value gold
Starcore Intl SAM.to hold C$0.61 10-jan-15 C$0.53 -13.1% ex-Top Pick, reduced, holding
Rye Patch Gold RPM.v selling C$0.31 02-sep-16 C$0.335 8.1% cutting for doubts & new stock
Eros Res ERC.v spec buy C$0.18 01-mar-17 C$0.175 -2.8% Deep value
Riverside Res RRI.v spec buy C$0.39 27-jun-16 C$0.435 11.5% Will take profits at 60c tgt
13

,
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
Belo Sun BSX.to Mar'17 C$0.90 30-jan-17 C$0.90 0.0% failed near-term flip trade
Lara Expl. LRA.v Mar'17 C$1.15 08-apr-12 C$1.05 -8.7% sold to make room
2009 to 2016 annual closed positions in appendices below
Now for notes on some of the current basket stocks:
Rye Patch Gold (RPM.v): SELLING: The short story; to make way for the new position in
CEM.v and to maintain the integrity of the “15 positions maximum” philosophy* here at The
IKN Weekly (though I have bent the rules a couple of times over the eight years) something
has to give. That’s RPM.v and so I’m going to sell this position in the next five days and close
the position.
The slightly longer story; Even after running the numbers last week and summing up by writing
a conclusion along the lines of...
• Good news about the permit arrival
• I’m holding on the numbers and its potential
• But financials and cash position now look tight
• And if they decide to run a placement it will be a bridge too far and I’m out
...as the week wore on that uncomfortable feeling about the corporate balance sheet came
back again. I want to believe in this story because, if it goes to plan, RPM has a great looking
operation at Florida Canyon that’s currently heavily discounted. The problem is, my wanting to
believe ended in me deciding to ignore the risk that RPM dilutes my shares in a final, top-up
placement which would deliver my profits to somebody else. And on re-consideration it’s more
like a probability than a possibility, plus rumours about things not going as well as we on the
outside would like at Florida Canyon have not gone away and keep coming around. If things
had run more smoothly on the permitting track it would be much easier for me to brush off the
chatter-talk and have more confidence in RPM, but where we are today and how we’ve got here
means that I don’t. It’s at the stage where I’m worrying about this trade and it floats back into
my brain at nighttime...not a good sign at all. I’m a long-term fan of Paul van Eeden’s “Better
Sleep Principle” and here’s an excerpt from one of the times he’s written about the concept (8):
“This is where the Better Sleep Principle comes to play. I had not really thought about it
but I have for many years now subconsciously followed the Better Sleep Principle in
my own investing. It works like this:
If I start worrying about something when I go to bed at night I fix it the next morning.
For example, if I own too much of a stock and am concerned about what would happen
if the price falls, I sell some. If I don’t own a particular stock and I lie in bed worrying
that the price would go up before I get a chance to buy it, I buy some. I do whatever it
takes to make me sleep better at night.
Here’s why you should follow your own instincts to make sure you sleep well at night: it
doesn’t help if you follow someone else’s advice and they sleep well while you lie
awake. Investing is a very personal endeavor; only you know what you need to do.”
Result: When I made the decision to buy some CEM.v last week it was easy to choose which
company to drop from the ‘Stocks to Follow’. It means it’s likely to be a booked as a small profit
of little consequence, but even if the price dives next week and it is closed at a minor loss it’s
still nothing much more than a failed breakeven trade, 10% either side is not why I buy junior
mining stocks. So, rack it up as another IKN Weekly failure, not the first and won’t be the last.
14

,
*Perhaps a bit too grand, it’s an idea.
Amarillo Gold (AGC.v): Position opened. Volume dropped off last week after the previous
week’s decent buying spree, but it wasn’t
desperately bad either and we did get
two of the five days over 100k volume.
The share price went the right way too,
but more than one charty person among
this audience has pointed out to me that
AGC needs to break 40c meaningfully,
not just play around at its edges. That’s
if you believe in TA, of course.
Red Eagle Mining (R.to): A roaring
silence, which wasn’t what I was
expecting. No news from R.to about
commercial production or its financials,
so if we don’t hear anything in the next
couple of days there may be cause for
concern about this newly expanded position. I know that ramp-up months and the moves
through the commissioning gears to full production status come with datasets and numbers
that take time to collate and understand so that might be the internal issue here, I’m willing to
give R.to a little extra wriggle room, but without panicking or unfurling red flags I am looking
over towards the yellow flag this evening.
Regulus Resources (REG.v): See ‘Market Watching’ below for a few notes on my meeting
last week with REG.v CEO John Black and President Fernando Pickmann. Here in the trading
notes, we applaud the strong percentage raise but again let’s not get too excited about it, the
volume continues to be thin and it wouldn’t take much of a profit-taking seller to reverse the
gains quicktime.
Tinka Resources (TK.v): We do a longer note on the meeting I had with TK’s CEO Graham
Carman and VP Exploration Alvaro Fernández-Baca in ‘Market Watching’ below today, so here
just a few words about trading. As expected, TK came out of the Friday-long halt pre-open
Monday with a news release on the latest drill results (7) and as suspected in IKN411 they were
good. In fact that’s a serious understatement, they were great and the stock deserved every
pip of its +32.1% of last week on excellent volume. All that’s good, high-fives for all holders
and love is all around but I want to point out one extra thing about last week’s trading patterns.
The big move was welcome and deserved, but under normal circumstances you’d often expect
a re-trace as the excitement wears off and the market picks a point where it thinks the stock
has overshot in the near-term, but that simply didn’t happen to TK last week because...
15

,
...as the week wore on and Monday changed into Thursday and Friday there was a house,
namely GMP, that sat firmly on the bid at 73c and mopped up any shares that those looking to
lock in profits were willing to sell. I definitely have no issue with the sellers, a win is a win and
thanks to that Joe Mazumdar/Brent Cook Exploration Insights buy call on PDAC Monday, I’m
sure there were some bigger pocketed speculators very happy to take 100% wins off the table
in time-honoured style. But to see GMP buying anything that moved on the week was the
strongest of market signals, it’s that of an insto wanting in and with a standing order to build a
decent position via its brokerage of choice. The tape had a tale to tell last week and it’s not all
about percentage gains in the past but what Vancouver and Toronto are now seeing in the
future of TK at Ayawilca. Quite right too, I’m not selling a single share of mine yet because this
is one of those examples that can just keep running and running. Ducks in line.
Minera IRL (MIRL.cse): Although up over 10% last week there’s not that much to report
here, because trading remains light and the price is only bouncing inside its established near-
term trading range. We need fundies news to move it forward and that’s going to be all about
Ollachea. It could be that Cofide is good about rolling over the bridge loan (a near-certainty on
a political level, but until it’s official won’t be able to breathe a word to the market), or the re-
worked mine plan (that we expect to show sparkling economics) or a deal to fund the capex but
whatever the next catalyst may be, until such time the only thing to do is hit the patience
button and wait.
B2Gold (BTO.to) (BTG): Am I actively worried about BTO’s slow selling grind of the weeks
since its financials? Nope not at all, quality will out in the end. Am I bored watching the BTO
squiggly line as it fails to catch a bid and gets any rally squashed by a fairly large seller? Yes,
that’s what I am. BTO can’t get no respect and deserves better.
Sandstorm Gold (SAND): We got the 1q17 “production” (really it’s sales) report from SAND
in god time early last week and it came as a real blowout number:
SAND: AuEq sales per qtr (1q17 prelim.)
16000 15500
14000 12460 12901 12517 12588 13245
12000 10424 10834 11381
10000 8951
8000
6000
4000
2000
0
16
41q4 51q1 51q2 51q3 51q4 61q1 61q2 61q3 61q4 71q1
AuEq Oz
source: company filings
That’s a record production quarter by quite some distance for SAND and thought the stock rose
by 3.3% on the week, I couldn’t help but feel slightly disappointed that it only got a little more
love than the GDX benchmark, it should have got a lot more on that kind of number.
Atico Mining (ATY.v): With Easter falling the way it does, we might have to wait until early
next week for the eagerly anticipated (by me, I’ve been licking my lips on these for weeks)
ATY.v numbers, but we’re most likely to get them this week coming and that’s a good thing. As
noted previously, not only do I think that the financials for 2016 will be a blowout of the scale
that will finally put any market doubts about debt repayment firmly in the past tense, but I’m
looking for strong FY17 guidance from the company as well. Anything under 80c is a great
bargain here.
Eros Resource Corp (ERC.v): We’re now close to the next set of financials from ERC and at

,
that point we’ll find out if there have been any adjustments in its marketable securities position
(i.e. the shares in other companies it holds that gives ERC its rock solid asset backbone). But
until then I continue to assume the last stated share positions and if so, here’s what cash +
shares looks like:
Marketable securities held by ERC.v
ticker company shares held* current pps value C$m
HRT.to Harte Gold 2.12 0.700 1.48
SKE.v Skeena 48.69 0.060 2.92
SBW.v Strongbow Expl 1.60 0.150 0.24
TIM.v Toachi 1.00 0.395 0.40
TKU.v Tarku 3.30 0.060 0.20
WTR.v Westcore 4.00 0.180 0.72
Canamex debent. 0.25
WTR.v Westcore 10% of prod 1.60
Other 0.20
Subtotal C$m 8.01
approx ERC cash C$m 2.20
total liquid assets C$m 10.21
As for ERC, at 18c here’s its market cap:
ERC valuation data (C$m)
Shares out Share price Market Cap
41.87 0.180 7.54
In a nutshell, you’re getting $10.21m of value for $7.54m And that means there’s a 35.45%
gap between its current market ca and “fair value”, or if you prefer, each share would cost
24.4c if they were fully valued to those assets. All that makes ERC the same top value small
spec that it was before.
The Copper Basket
After fourteen weeks of 2017, The Copper Basket shows a 12.84% gain to level stakes.
company ticker price 1/1/17 Shares out Market Cap current pps gain/loss%
1 Imperial Metals III.to 6.06 93.587 561.52 6.00 -1.0%
2 Capstone Min. CS.to 1.26 382.04 485.19 1.27 0.8%
3 NGEx Resources NGQ.to 1.20 205.06 207.11 1.01 -15.8%
4 Western Copper WRN.to 1.86 94.19 163.89 1.74 -6.5%
5 Excelsior Min. MIN.to 0.63 167.364 137.24 0.82 30.2%
6 Regulus Res. REG.v 1.20 68.368 122.38 1.79 49.2%
7 Copper Mtn CMMC.to 0.94 118.8 122.36 1.03 9.6%
8 Amerigo Res ARG.to 0.345 173.61 121.53 0.70 102.9%
9 Cordoba Min. CDB.v 0.73 88.6 108.98 1.23 68.5%
10 Trilogy Metals TMQ.to 0.66 104.33 78.25 0.75 13.6%
11 Atico Mining ATY.v 0.95 97.59 75.14 0.77 -18.9%
12 Coro Mining COP.to 0.15 483.425 74.93 0.155 3.3%
13 Copper Fox CUU.v 0.125 417.64 56.38 0.135 8.0%
14 Nevada Copper NCU.to 0.77 80.5 52.33 0.65 -15.6%
15 Revelo Res. RVL.v 0.070 128.486 5.78 0.045 -35.7%
NB: All stocks priced in CAD$ Portfolio avg 12.84%
17

,
Just six companies in The Copper Basket 15 giving week-over-week gains (NGQ.to, MIN.to,
REG.v, COP.to, TMQ.to, ARG.to) and one
remaining unchanged (CMMC.to). The other The Copper Basket 2017, weekly evolution
eight were losers (II.to, CS.to, WRN.to, ATY.v,
30%
CDB.v, NCU.to, CUU.v, RVL.v) and there was a
25%
big percentage dropper among them in Revelo
20%
(RVL.v down 18.2%) as well, on the back of 15%
its financing news, but even that didn’t stop 10%
the week from being a modestly positive one 5%
(average up 0.37%) and that’s thanks to the 0%
bigger moves in Regulus (REG.v up 13.3%)
and Amerigo (ARG.to up 7.7%), even though
it’s still beyond my ken as to why anyone
would want to own ARG at these prices.
As for the copper metals market, we were stuck again
inside the $2.60/lb to $2.70/lb new normal range and
as nothing much changed there, I thought I’d featured
the daily chart of the last six months or so instead of
the hourlies of just the last week. It makes the trading
range clear, nobody’s seems to know which way copper
will break or when, so on we go.
To macro market news, that mostly came out of the big
CESCO conference and bash in Chile last week and that
gets coverage in ‘Regional Poliics’ below. So moving
straight on and getting to the the regular weekly copper
warehouse inventory bullets:
• World copper inventories dropped last week
with de-stocking based around the LME. The
aggregate of the three official systems went down 16,575 metric tonnes (mt) last week
(-2.3%) to finish at 712,043mt.
• SHFE Shanghai stocks put in a slightly surprising rise, something that goes against the
nascent de-stock period a little but if it’s only one week it’s not a trend setting in.
Stocks rose 7,434mt (-2.4%) to close at 314,810mt. Watching brief for next week’s
data here, I’m still expecting it to go under 300k in the days ahead.
• At the LME 20k+ drops are becoming quite the fashion. This was the third week of the
same and stocks this time dropped by 25,850mt (-8.9%) the close at 265,325mt.
• Comex did its normal “up around 2k” thing, this week’s exact number being 1,841mt
added (+1.4%) to bring the total to 131,908mt. Par for the course, Sergio.
Here’s the Shanghai-only chart, which shows that uptick on the right that goes against the
topping pattern of March.
18
ts1naJ ht8naj ht51 dn22 ht92 ht5bef ht21 ht91 ht62 ht5 ht21 ht91 ht62 dn2rpa ht9
source: IKN calcs

,
Shanghai Futures Exchange Warehouse Stocks, Dec'13 to date
400000
350000
300000
250000
200000
150000
100000
50000
19
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 ht7guA ht11 ht61 ht72 ts1naJ ht5beF ht21
Mt Cu
source: Cochilco
Now for notes on a couple of basket stocks:
Revelo Resources (RVL.v): Our tiniest cap on the list was beaten down even further after its
announcement on April 7th (8) that it was raising $2m by selling 40m units in a placement (1
unit = 1 share + full warrant priced at 11c). This is a very expensive and dilutive placement
which has the fingerprints and cold hand of
Rick Rule all over it. A cheap stock yes, but
also very avoidable until/unless it makes a
real discovery on its big (and expensive to
maintain) land package in Chile.
NGEx Resources (NGQ.to): Mentioned
last weekend too, this one continues with
high volatility around the $1.00 as what
looks like one seller continues liquidating.
Risky looking patterns and there are
definitely better Lundin vehicles in his stable
right now.
The Producer Basket
After 14 weeks of 2017, the Producer Basket shows a gain of 13.38% to level stakes.
company ticker price 1/1/17 Shares out Mkt Cap (Bn) current pps gain/loss%
1 Barrick ABX 15.98 1165.33 22.30 19.14 19.8%
2 Newmont NEM 34.07 530.595 18.20 34.31 0.7%
3 Goldcorp GG 13.60 832.381 12.28 14.75 8.5%
4 Franco Nevada FNV 59.76 178.01 11.96 67.19 12.4%
5 Agnico Eagle AEM 42.00 223.475 9.96 44.59 6.2%
6 Ang/Ashanti AU 10.51 405.27 4.84 11.94 13.6%
7 Royal Gold RGLD 63.35 65.281 4.70 72.07 13.8%
8 Kinross Gold KGC 3.11 1245 4.46 3.58 15.1%
9 Buenaventura BVN 11.28 254.19 3.07 12.08 7.1%
10 Sibanye Gold SBGL 7.06 228.71 2.21 9.65 36.7%
Prices in U$, NYSE or NASDAQ tickers Portfolio avg 13.38%
The basket average rose 3.3% on the week with all ten components giving weekly wins. Top of
the shop in gains were “The South Africans” AngloGold Ashanti (AU up 10.9%) and Sibanye
(SBGL up 9.5%), with both getting equity boosts from the weakness in the Rand. At the other

,
end of the scale Barrick (ABX up 0.8%) underperformed the GDX benchmark (GDX up 3.0%)
due to the perception of its deal with China’s
Shandong on its Argentina and Chile assets The 2017 Producer Basket: Weekly performance and
comparative to GDX control
(see below). All that means our ten pick 25%
basket is still very slightly ahead of the 20%
benchmark, though in real terms there’s
nothing in it. 15%
10%
5%
Barrick Gold (ABX): Last week’s big deal in
the mining space went to ABX, which 0%
announced on Wednesday pre-open (9) that
Barrick and Shandong, a 1.2m oz per year
producer in China, were going into JV in a
three step deal that ABX announced like this:
Under the Agreement, Barrick and Shandong will leverage their respective strengths to
optimize and enhance the value of the Veladero mine, in line with step one of the
partnership. As step two, Shandong will work with Barrick to explore the potential of
investing in and jointly developing the Pascua-Lama deposit. To advance this,
Shandong will embed a team of underground mining engineers and project
development specialists with Barrick’s Pascua-Lama project team.
As step three, the companies have also agreed to work together to explore additional
investment and development opportunities on the El Indio Belt, including the Alturas
project, in addition to other global opportunities.
There has, of course, been a mountain of script written about this deal already by anal ysts of
all stripes and the trade press, with opinions formed and a market reaction (here ABX tracked
over five days against the XAU index)...
...that saw the announcement put a dent into ABX’s share price performance (though 1.5% to
2% down against peers really isn’t that bad). So even though I’m going to add to the noise
here I’m not going to bore you (and the IKN Weekly remit isn’t about the big caps anyway) so
just a few simple bullet points to cover the house opinion.
• This deal isn’t anyway nearly as bad as the Goldcorp (GG) purchase of low grade
Guanaco Pasture in Chile the week before, one of the reasons why I’m not going to
dwell on it in the same way.
• Getting U$960m for 50% of Veladero is good for ABX. The mine is mature, but its life
has been extended significantly and it was attractive enough for the Chinese company
to make it the only solid part of the deal. Meanwhile, ABX gets to lessen its exposure to
Argentina at a critical moment for the country, just over six months from the acid test
20
ts1naJ ht8 ht51 dn22 ht92 ht5bef ht21 ht91 ht62 ht5 ht21 ht91 ht62 dn2rpa ht9
basket
gdx control
source: Google, IKN calcs

,
mid-term elections that will go a long way to deciding whether the Macri government
economic reforms are going to stick or fail.
• Though the Pascua Lama and El Indio (Alturas) parts of the deal aren’t much more
than Letters of Intention, there must be a backroom framework between the two sides
on how to put together an eventual JV and it would be a serious embarrassment to
both sides if it fell apart.
• At Pascua Lama, though ABX wants to move the Argentine “Lama” side forward without
the environmentally halted ‘Pascua’ side in Chile, the real world situation is that one
cannot really work without the other. Getting Shandong as a (potential) partner affords
ABX time and I think the market reaction last week overlooked this longer-term
positive.
• At El Indio, I’ve read a couple of anal ysts who said that offering Shandong a piece of
the very good looking Alturas project may be a bridge too far, but my call is that
without offering this tasty bait the Chinese company wouldn’t have committed (nor
have written a U$960m cheque for half of a mine in The Basket Case Country). The
whole “affects the pipeline” argument has logic, but the way forward in the future of
big projects is going to be JVs anyway, so why not pact them sooner rather than later?
Overall it’s a good deal for ABX. Once again they turn land into cash and get to pay down debt,
plus this deal now offers real hope that they’ll be able to get the priced-down-to-zero Pascua
Lama project back and running. Though I understand why the market pegged ABX down a
couple of percent on the news I don’t think that effect will last long. What’s more, it might not
be the last deal up ABX’s sleeve during this current part of the cycle.
Regional politics
Peru Chile CESCO and copper
Last week’s CESCO copper conference in Santiago Chile was an unusual affair, because for once
the best and most popular headlines were about Peru and its rising copper star, compared of
course with the relative inertia seen recently in the Chilean scene. For example, this report (10)
and here’s an excerpt:
Peru, fresh off a sharp rise in copper output, is upstaging top producer Chile as a prime place to
hunt for new supplies as the historic rivals race to usher in new mines.
Chile, long the world leader in copper production, has struggled recently with slipping productivity
and lackluster exploration. At the annual CRU World Copper Conference that the country hosted
in Santiago this week, many pointed to Peru as an example for Chile to follow.
"In Chile for many, many years there has been no incentive for anything in terms of national
policy. Peru on the other hand is making a special effort," said Diego Hernandez, an industry
veteran who heads trade body Sonami in Chile.
Now the world's second biggest producer, Peru has benefited from lower production costs and
untapped reserves, while Chile's output has stagnated due to falling copper grades, thorny labor
relations and high energy costs. The Fraser Institute's annual survey had Peru leapfrogging its
more developed neighbor as the best place for miners to do business in Latin America.
But as always seems to be the case, Peru’s political bigwigs can’t help but over-egg the pudding
and throw out claims and promises that they won’t be able to keep. For example here’s another
report (11) quoting Peru’s Minister of Energy and Mining, Gonzalo Tamayo, at the U$350 per
head gala dinner that was attended by an eye-popping 1,850 dignitaries (if that’s the right word
for mining people)
Peru will likely gradually increase its copper production to 3.1 million tonnes in 2021 from an
annual 2.35 million tonnes expected for both this year and next, the country's energy and mines
minister told the CRU World Copper Conference in Chile.
Peru surpassed China as the world's No. 2 copper producer last year on the back of a surge in
production from MMG Ltd's Las Bambas project and an expansion at Freeport-McMoRan Inc's
Cerro Verde mine.
21

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He bases that call on some more solid projects coming on line, such as the green-lighting of the
Anglo Quellaveco project in South Peru, with the company expected to make a build decision in
the first half of next year. But to get to that 2.35m tonnes by 2021 he also needs, nay expects,
the tough ones such as the socially hot Tia Maria or the economically margin Mina Justa
projects to be part of the mix and that, as they say, is another kettle of fish. I’ll be sitting back
and watching from a safe distance as these projects roll out (or not), but I will remind this
audience of the default position on South American politicians (not just Peruvian) when listening
to people like Tamayo promise the earth of PPK on Friday say that Tia Maria is possible; you
can only make it to the top of the region’s political trees by being liars.
Argentina’s general strike
Thursday April 6th saw a one day national strike in Argentina, led by the main CGT union. There
was a lot of journalistic coverage of the strike, not least because the date coincided with the
World Economic Forum (WEF) conference in Buenos Aires that same day (e.g. here’s Bloomie’s
version (12)) but despite the “first world” general disapproval of the strike action and the Macri
government’s minimization of the strike and its effects (Macri’s people called “not fair” on the
way the unions shut down transport systems and stopped people who wanted to work from
commuting, plus claims of “80% of shops in the capital are open” don’t jive well when most of
them only opened late afternoon and there were few people around to buy anything) and that
it was an impressive show of force by the still-powerful union forces of the country and a clear
measure of disapproval against the Macri economic and austerity policies that get world
applause but have seen his approval ratings drop sharply in recent months. Another report from
Germany’s Die Welt (13) was more perceptive than the average in the English language pres
and included this section, a counter to the recent claims of “green shoots” in the Argentine
economy and 1.1% YoY GDP growth in January:
"But our wages aren't increasing that fast." She is surprised by all the poor people in her
neighborhood. "More and more people sleep in the street. We didn't have that before."
Time-consuming process
It is clear to many Argentinians that the Macri administration cannot implement many things as
quickly as planned and that the legacy of 12 years under Kirchner is worse than expected. But the
turn for the better still has not come, especially among the common people.
In the business world, the mood is completely different. Barbara Konner, vice president of the
German-Argentinian Chamber of Commerce and Industry (AHK) can barely handle all the
requests she is getting these days. Visits by delegations from Germany have increased by 30
percent. Entrepreneurs want to see where they can invest.
"The pie has gotten bigger and everyone wants a slice," Konner says with a smile and sees
positive trends. "The economy will grow by 3 percent this year. That is probably just the
beginning. There are investments again, including in energy efficiency, in the agricultural sector,
logistics and transport. Things are moving."
But she addresses the gap between rich and poor. "Real wages have shrunk by 6 to 8 percent
this past year because inflation is so high."
As others point out, the so-called “green shoots” growth in January isn’t about country
reactivation, as the government’s own figures show it’s all due to the financial sector (+10.0%
due to profits on debt paper) and agro (+2.9% due to better export prices) than anything the
rank and file get to enjoy. But it also has to be said that the strike (as well as being a
throwback to a different age in world politics) is a typical move by the powerful unions against
non-Peronist governments. For sure they eventually stage protests against them all but they
always show more patience with Peronist/PJ Party governments, even when they move away
from the mainstream of Peronist policies. Here’s a little list of governments in the post-
Dictatorship era and the length of time each President had before suffering a Union-sponsored
national strike against their policies:
• Alfonsín government (non-Peronist): 9 months
• Men_m government (Peronist): 40 months
• De La Rua government (non-Peronist): 3 months
• Néstor Kirchner government (Peronist): 47 months
• Cristina Fernández de Kirchner government (Peronist) 59 months
• Mauricio Macri government (non-Peronist): 15 months
22

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So in historical context, you could even say the unions have cut Macri a lot of slack.
Argentina Chubut: Ross Beaty BSes the World Economic Forum
As noted above, Buenos Aires hosted the one-day World Economic Forum summit on the same
day as the Argentina general strike and as you’d expect, there was a totally different
atmosphere to the streets of the capital that day (not least because there were a reported
2,000 police officers guarding the hotel of the gig and the protesters wisely steered clear of
direct confrontations), with orthodox economic policies to the fore and plenty of encouragement
from the World Big Money for Macri to fight the good fight against the scourge of left wing
populism, etc etc.
So far so normal, but back to our focus sector and reports of what Pan American Silver’s
chairman Ross Beaty said to those assembled about that company’s stalled ‘Navidad’
silver/zinc/lead project in Chubut province. We’ve covered this case extensively on these pages
and know without a shadow of a doubt that the Chubut governor Mario Das Neves is not going
to greenlight it while in office (he’s there until end 2019 minimum) nor will his party, so hearing
Ross Beaty tell the business chiefs at the WEF according to Reuters (14) that...
"I remain optimistic that we will find a solution that works for the government of Chubut," Beaty
told Reuters on the sidelines of a meeting of the World Economic Forum in Buenos Aires.
"I would like to see that they give us the benefit of the doubt, let us proceed and if we have
problems, if we really are hurting the water or the air or the people, shut us down, close the mine.
If that happens I understand, but it's not going to happen," he added.
...was a bit rich. But even more BS came from Spanish language wires (15) of his opinions and
though I need to point out that he probably spoke in English and I’m translating the following
from a Spanish text, the words are straightforward and there’s unlikely to be much “telephone
game” here:
“We have been in dialogue (with Chubut authorities) since we bought the mine seven
years ago...I would say that we have been close to an approval which would make this
mine a reality, but u to now we haven’t been successful in reaching a roposal that
works for both (sides).”
I’d call a statement of this manner naive, except that Ross Beaty isn’t naive. It therefore must
be called for what it is, total bullshit. Beaty and anyone else in the Argentina mining sphere
knows that Navidad is stuck not only behind Governor Das Neves, but the laws of Chubut and
even its provincial constitution that simply do not allow such a mine to operate unless there is
significant legislative change there, the type of move that takes years. It’s long past the time
PAAS admitted its crass business error in buying into Chubut exposure and writing down its
project to its true value, which is zero.
Ecuador: Lenín Moreno wins (probably)
As noted on the blog last weekend at the time of the official result (16) Lenin Moreno, the
current Alianza Pais (AP) government candidate and Rafael Correa ally, won the run-off election
51/49 against CREO party challenger Guillermo Lasso and is now President Elect of Ecuador.
This is good news for mining projects above 2,800masl in the country, e.g. INV Metals (INV.to)
at Loma Larga, that were facing an automatic ban if Lasso had prevailed.
But it might not be quite over yet, because the loser Lasso has made an official objection, is
crying ‘Fraud’ to the four winds and has launched a legal challenge to the result, saying he has
proof of widespread irregularities and strange goings on. Here’s an excerpt from this English
language report (17) on Lasso’s plans to overturn the result:
“...the CREO Movement presented documentation that shows that 82.2% of the official
records coincide the ones in their possession. These were obtained thanks to the
control and hard work of party observers at the polling stations.
And with that 82.2% of the voting records held by the Lasso campaign, Lasso would
have a 50.5% voting share compared to Lenin Moreno’s 49.5% . The remaining
percentage is inconsistent.
23

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In addition, the president of CREO, Cesar Monge, reported on Wednesday, April 5th,
that on election day, 4.7% of polling stations were found to have “unusual” behavior.
According to Monge, there was a trend in favor of Lenin Moreno in some areas, 80-20
over Lasso. However, the “socio-economic” conditions in the area suggest
irregularities.”
For what it’s worth, I’m pretty sure Lasso is going to continue kicking up a fuss and up to 49%
(or 51%?) of his fellow citizens may believe him too, but it’s going to be very difficult to prove
fraud in this election (even if it did happen) and Moreno will get ot be President and stay there.
Taxes raised by mining and O&G in LatAm
Here below is an interesting chart, ripped from this report in the Dominican Republic’s
newspaper “Hoy” (18) that compares the total percentage of taxes raised by LatAm countries
from the mining and hydrocarbons sectors against the other inputs of ‘General Taxes’ (e.g. corp
tax, income tax, sales taxes etc) and ‘Social Security’ (e.g. public pension funds and
healthcare). Although written by and for a Dom Rep audience it makes a good overview of the
whole region and the contribution from its hole-digging industries (for your convenience I’ve re-
written the title and labels in English):
The visual results, compiled from 2015 data by economics studio CREES (Centro Regional de
Estrategia Sostenibles, or Regional Centre of Sustainable Strategies) show that only five
countries get moe than 10% of their tax income from O&G/Mining and they’re all hydrocarbon-
based ones (Bolivia gas, Mexico oil and gas, Ecuador oil, Venezuela oil). As for the hard rock
mining countries, for sure the Mexico total has some effect from our focus industry as well but
the other classics, Peru (7.5%) and Chile (6.2%) really don’t benefit that much in direct tax
terms from mining (though we should definitely take into account the Foreign Trade angle from
metals exports that allows them strong balance of payments numbers and keeps local
currencies strong).
Market Watching
A meeting with Regulus Resources (REG.v)
Just a few hours after the news release from REG on Monday (19) which announced that the
final deal to sew up the whole Joint-Venture-That-Isn’t deal with its neighbours around AntaKori
was sealed and closed, I met up with company CEO John Black and company president
Fernando Pickmann and got the latest news and developments from our Top Pick company,
24

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straight from the horse’s mouth. Here are a few bullet points to try and get things done as
succinctly as possible.
• REG is pleased with the way the Quasi-JV (it’s really an agreement for the companies to
work together and share data, not a true JV and we’ve been through all this before so
no repeat today) is shaping up. All sides are cooperating and doing things the right
way.
• They have suffered delays due to the heavy rains just like every other company
working the centre and North of Peru, but that now seems to be over the worst and the
first drill rig should now be on sit, with others to follow soon. On the day we spoke rig
one had arrived in the city of Cajamarca, it then needed to go through a safety
inspection, then go u to site, then get anothr inspection and an induction course from
the Coimolache people, then it could deploy and start work. The advantages of doing
everything by the book with a big mining company (Coimolache is operated by
Buenaventura (BVN) outweigh the disadvantages, but there are both.
• REG expects to have multiple rigs on site soon, but here’s a point that needs to be
made. Due to the nature of the co-operation deal with Coimolache (and other partners)
they’re not allowed to publish details of what their partners are doing and when. What
they will be able to do internally is swap all data, but it’s not all going to be for us on
the outside. That will show up in the case of the rigs, as REG will only be able to tell us
how many rigs it has on its land at any given moment. As they’re sharing the rig deal, it
means that the REG drill rig count is likely to fluctuate higher and lower (1, 3, 5, 4, 2, 4
etc) and the pattern will be weird, but it just means the whole rig team are moving
from one piece of land to another. Bottom line; don’t worry about the rig count, the
agreement and the companies have a good plan and they’re going to move it forward.
• We talked about the timing of things for 2017 and one of the most interesting items is
that REG expects to have a 43-resource for AntaKori (the whole thing, not just their
bits) by the end of the year. When pressed, CEO Black said that Q4 was the most likely
period, which is fair enough.
• They’ll make an exploration cut-off on holes at some point later year and calculate a
resource from that date but the rigs are not going to stop turning. This is an important
point folks, this isn’t a short period drill program, this is a full scale, bigtime, long-
duration program that will systematically explore a big deposit and we’re talking years
to get the full picture, not a few months. Due to that, we may get a first NR from REG
when the first hole or two return assays, but after that it’s more likely to get long
lapses and then batches of multiple holes published.
• As for treasury, REG has plenty to work with today but it’s clear that at some point they
go back to market and run the next round of financing. The timing on this isn’t so
important (from my point of view) and we should also consider the cash they’ll be able
to reap from all their way-in-the-money warrants. Instos like this team, they’ve made
them money before and REG won’t have a problem in raising the sufficient, as long as
they find what they expect to find at AntaKori.
Overall a good and positive meeting. The REG team is obviously happy and buzzing about
getting out of the corporate/legal phase of the co-operation agreement and into the thing they
do the best, geology and exploration. This year is set to be a transformative one for REG and
we’re long for the long-term ride here. Top Pick, staying that way.
A meeting with Tinka Resources (TK.v)
On Friday I met up with Tinka Resources President and CEO Graham Carman along with the
man who does the real work, VP Exploration Alvaro Fernández-Baca. The meet-up came on the
heels of its NR last Monday (20) in which TK once again blew the proverbial socks off the
25

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market by announcing sparkling results once again from its 2017 Ayawilca drill program that
afforded the title line...
Tinka drills 52 metres at 10 % zinc and 15 metres at 20 % zinc at South Ayawilca
...and even that wasn’t the end of the good news, because once you looked at where they’ve
found these wonderful hits (how good? A tonne of
20% Zn rock is worth U$500, just the zinc) and seen
they came from a big step-out, then checked out the
smell of the impressive by-product credits that came
with them, it was clear that the company deserved
every percentage point of the 32% upside it got
week-over-week.
With that as a backdrop it was certainly a happy
meeting, it’s fair to say the company is stoked at the
prospect of what they can work with now in 2017
and they’re now full steam ahead on accelerating the
program. That starts right now as a third rig is
currently being added to the drill program (those
extremely heavy Peru rains have delayed things, but
the rig should have arrived by today and be in
business in the next 48 to 72 hours) and a fourth one
should be on site by May. Burn rate will go up
accordingly, but with $10m in treasury at present
and a lot of money now ready to come from the
warrants already out, CEO Carman is very happy
about the financial position of TK and we can say
“fully funded for current program” safely. On that
subject, we all agreed that the best way to value
TK.v nowadays was with its 248.8m fully diluted
number, rather than the smaller shares out number.
That implies TK.v is worth C$184.1m this weekend and that’s a long way from the C$21.7m
market cap it had when The IKN Weekly first called but on the stock on April 19th 2016, nearly
a full year ago.
We talked about the geology theory they’re developing for the project and when asked “is it a
chimney or a manto?” the answer was “likely both”. What they’re seeing is a manto structure
being fed by several chimney systems (that are unlikely to be the single big “Feeder System”
too often used as a bait for speculators) and though it’s too soon to tell, theoretically this could
make the manto parts of what they’ve found extend much further than originally expected.
System strength (e.g. the 10% and 20% Zn assays) surprised even them but in the nicest way
possible and cost of the mag survey which they ran in 2016 has turned out to be worth every
penny (and a lot more) it’s turning out to be a reliable indicator of where to drill. The
excitement of the team is palpable about what’s to come, even when taking in the general
terms they couldn’t expand upon with outsider yours truly.
We talked institutional support and I asked CEO Carman about about main holders Sentient,
and the IFC as well as the other big holder JP Morgan. All three are very happy with the way TK
is progressing, they're not sellers and according to what I consider to be reliable information
they’re all taking a long-term outlook. This is important, these big holders are now tight hands.
They also know another thing that CEO Carman and VP Expl Fernández-Baca were keen to
point out, that now they have a hotpot deposit to drill out TK isn't going to try and BS anyone
with "guaranteed holes" this year. We’re still in early stages at Ayawilca and though it would be
reasonably easy to drill spots close to the recently reported holes and keep on giving us flashy
numbers, the company is going to do serious exploration and delineation work, which will
include trying to find the limits of the Ayawilca mineralization as soon as possible. This means
26

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that, at some point in 2017, TK is going to hit dusters as contact zones and limits are
discovered. When that happens you might get "oh well, good run, that's it I suppose"
comments from the Peanut Gallery, trotted out by people who’d just love you to get nervy and
sell, but the big boys won't be fazed and neither should we. The serious money understand
what's going on at Ayawilca now, there's a world class zinc deposit in the making and they're in
for the long haul. So from now on it’s going to be full steam ahead for TK. Quite rightly they
wouldn’t give me details on the timing for the next set of drill results, but quite frankly I don’t
care much about that. TK and we know that they have a real tiger by the tail at Ayawilca and
one thing is for sure, there’s going to be plenty of holes reported from the project in 2017.
Finally and to round off, I’ve been asked for a target opinion on the stock from several quarters
with one of the most repeated questions being “Is it too late to buy TK?”. The answer to that
one is “No” because I think it’s going higher still, but of course I can’t ut that into the context of
your own portfolio needs/limitations/strategy/etc so the final call is going to have to be yours.
To expand a little, we need to be clear that TK is still an early stage development and with the
arrival of two sets of knockout drill result NRs, there’s now a lot of assumed resource upside
baked into that $184m F/D market cap. A lot. However I think it’s deserved and every time the
company manages to step out in these big 100m or 150m leaps, there will be more expectation
put on top of the high hopes already in place today. It’s not an easy call and at some point
there will be a near-term top, but we’re not likely to know what that is until after the fact.
So I do NOT want you to hold me to this as some sort of Biblical Truth that I handed down to
you from atop a high mountain in early
April, equally I’m not going to crow and
say “toldyaso” if it reaches the number.
This is a snapshot for today only, my
feeling and the smell of the market move,
the next set of drill results could change
my opinion and just imagine if they start
finding the same stuff on the same kind of
out-steps to the North and East of the
current 43-101 compliant resource, not
just to the South. But as things stand
today and assuming some more good drill
news, I see no reason why TK.v can’t get
to a $300m market cap on its current
momentum move, which implies a share
price of around $1.20. That’s my guess for the mid-term (a quarter or two), what’s yours?
Graña y Montero (GRAM) keeps on flying
This will be the final coverage of this company and near-term trade idea, unless something
radically different happens to it in the future. We noted it in IKN411 last weekend and also on
the blog during the week (21) but even since
then the rally in Graña y Montero (GRAM)
hasn’t stopped. GRAM stock closed at U$4.450
in heavy trading all week on the NYSE and is
up 77.9% in the ten trading days since
suggested in IKN410.
That’s an impressive two week rebound by
any standards and it’s now a given the
company isn’t about to collapse under the
weight of the corruption scandal, or the class
action suits that have latched onto the big
drop. However, a look at the Year-To-Date
chart of GRAM shows that the price is now
close to the U$5-or-abouts that its stock commanded before the big Odebrecht revelation of
27

,
GRAM’s direct involvement in the bribes in Peru was revealed and there’s plenty of talk on the
streets of Lima about how its run is likely coming to an end. Those of you who took a part of
this trade (and I know there are a few of you, thanks for the mails but don’t thank me, it was
your trade and mine was a mere heads-up for your further DD) may want to consider locking in
profits soon. As noted last week, I really don’t think we’re going to challenge to 2016 prices
immediately.
Finally and in semi-related news, the Odebrecht bribery scandal has just seen its latest victim
(22) as the Mayor of Callao (not the country’s capital but right next door and the smaller part of
the Lima/Callao conurbation, you may know it as the location of Lima’s airport), one Félix
Moreno, has just been arrested and given 18 months of remand in prison for receiving a
millionaire bribe in exchange for the contract to build the new coast road joining Lima to Callao.
Conclusion
IKN412 is done, we end with bullet points:
• As soon as I’d made the decision to dump Rye Patch Gold (RPM.v) and said it out loud
to somebody else (Friday afternoon, but the sales happen next week) I felt more
relaxed about my portfolio. Sleeping well is an important thing.
• I’m new to the Constantine (CEM.v) story and can’t help but see the compelling value it
offers, so although it’s going to start as a smaller-end spec position I do wonder what I
might be missing. The enviro angle and the lack of marketing oomph are the obvious
ones, neither of those get close to putting me off its impressive numbers
• I’m looking forward to seeing the results out of Atico Mining (ATY.v) and sure hope
they file them this week. If they do, expect plenty on the subject in IKN412 next
weekend.
• The laggard feeling of B2Gold is only annoying in the near-term, this is a stock which
gets all the time and patience in the world. Because it’s worth a lot more.
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
28

,
Footnotes, appendices, references, disclaimer
(1) http://www.gowebcasting.com/events/precious-metals-summit-conferences-llc/2016/09/15/constantine-metal-
resources/play/stream/20135
(2) http://constantinemetals.com/news/2017/index.php?&content_id=245
(3) http://constantinemetals.com/investors/presentations/
(4) http://constantinemetals.com/_resources/projects/palmer/DistrictScalePotential_figure-tn.jpg
(5) https://news.vice.com/article/a-canadian-company-wants-to-open-a-mine-upstream-from-an-alaskan-bald-eagle-
preserve
(6) http://vancouversun.com/opinion/columnists/stephen-hume-alaskans-gear-up-to-fight-b-c-companys-mine-plans
(7) http://finance.yahoo.com/news/tinka-drills-52-metres-10-110000544.html
(8) http://www.marketwired.com/press-release/revelo-announces-private-placement-tsx-venture-rvl-2208498.htm
(9) http://www.barrick.com/investors/news/news-details/2017/Barrick-Announces-Strategic-Cooperation-Agreement-
with-Shandong-Gold/default.aspx
(10) http://www.reuters.com/article/chile-copper-peru-idUSL1N1HF1ZP
(11) http://www.reuters.com/article/chile-copper-peru-idUSS0N1H7004
(12) https://www.bloomberg.com/politics/articles/2017-04-06/argentina-shuts-down-as-macri-faces-first-general-strike
(13) http://www.dw.com/en/argentinas-dilapidated-charm-and-big-pies/a-38304134
(14) http://www.reuters.com/article/us-argentina-pan-amer-silver-mine-idUSKBN1782U7
(15) http://lta.reuters.com/article/domesticNews/idLTAKBN1782UQ-OUSLD
(16) http://incakolanews.blogspot.pe/2017/04/the-ecuador-presidential-election-its.html
(17) https://panampost.com/orlando-avendano/2017/04/07/case-recount-ecuador-presidential-election/
(18) http://hoy.com.do/dicen-es-poco-aportes-seguridad-social-y-mineria-a-recaudaciones-fiscales-en-rd/
(19)http://finance.yahoo.com/news/regulus-resources-completes-colquirrumi-definitive-140902575.html
(20) http://finance.yahoo.com/news/tinka-drills-52-metres-10-110000544.html
(21) http://incakolanews.blogspot.pe/2017/04/grana-y-montero-gram-continue-to-rally.html
(22) http://elcomercio.pe/politica/justicia/juez-resuelve-hoy-pedido-prision-contra-felix-moreno-noticia-1982396?flsm=1
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
29

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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
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
30

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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
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
31

,
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.
32