IKN #608Premium

The IKN Weekly
Week 608, January 17th 2021
Contents
This Week: Trade heads-up, In today’s edition, A scrappy week ahead.
Fundamental Analysis: Fiore Gold (F.v) December quarter production and trade decision,
New Gold (NGD) 4q20 production and revised house 2021 guidance, Wesdome (WDO.to) 4q20
production and 2021 guidance.
Stocks to Follow: Fiore Gold (F.v), Pucara Gold (TORO.v), Orezone (ORE.v), Kuya Silver
(KUYA.cse), Rio2 Ltd (RIO.v), Aurelius Resources (AUL.v), The copper juniors (TMQ)
(CMMC.to), MIN.to).
Copper Basket: Overview, C3 Metals (CCCM.v), Crown Mining (CWM.v), Oroco Resources
(OCO.v), Amerigo Resources (ARG.to).
Producer Basket: Overview, Barrick (GOLD, Newmont (NEM), Endeavour (EDV.to).
Tiny Dogs: Overview, Contact Gold (C.v).
Regional Politics: Tracking Chile and Peru Covid-19 cases (week one), Ecuador: Andrés Arauz
and Guillermo Lasso to make the second round run-off, Ecuador: The USA counters China,
Mexico: Resource nationalism alert Guatemala: The Escobal (PAAS) “pre-consultancy” period
starts April 20th (or not) Argentina: Chubut parliament looking debate the mining law, Appian
aims $465m at LatAm.
Market Watching: Bear Creek Mining (BCM.v) rumoured close to a financing deal McEwen
Mining (MUX) and financials Almaden (AAU) (AMM.to) trading on fake news.
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
Two trades to note at the top of the shop:
 I am not a seller tomorrow morning first thing, and if it drops further I’ll be happy to
wait, even if it means not executing for a week or two. However, I’m a seller of Fiore
Gold (F.v) and the reasons are in today’s main Fundamentals section.
 Sticking to plan, with Pucara Gold (TORO.v) now under the target purchase price I plan
to add a few shares in the week ahead. See the notes section of ‘Stocks to Follow’ for
brief details.
In today’s edition
 The decision to sell Fiore Gold (F.v) is also a personal portfolio management call, as it
adds back some cash at the right time. However, the main reason is the mediocre
quarter just filed, plus the likelihood of another couple of flat quarters until the stock’s
production profile picks up again. That’s in today’s fundies section.
 Also in the fundies slot, we check out the New Gold (NGD) 4q20 production numbers
and like them. Then following on, thoughts on the newly cheap Wesdome (WDO.to)
1

and the potential for it to provide us with another (mini) turnaround win this year,
because it could get even cheaper.
 Regional Politics has a lot of stuff. You should be long copper. Newmont and Barrick
performed better than GDX last week. Contact Gold is an interesting Tiny Dog. The
introduction tries to calm nerves about last Friday’s action in gold. ‘Market Watching’ is
light on content this weekend. We begin.
A scrappy week ahead
No pun intended, as despite rumbling threats from some extremist quarters we can at least
expect next week’s political events to go (as) smoothly as circumstances allow. The scrappiness
pertains more to capital markets, as we first see tomorrow Monday close in The USA for Martin
Luther King Day, then on Wednesday the pomp and ceremony of a US Presidential Inauguration
and while markets are open for business as usual, I for one will be watching Jennifer Lopez’s
routine more than the markets. So a scrappy week ahead to digest the chop in gold last week,
the metal finishing closer to U$1,800/oz than U$1,900/oz in trading I did not expect. Also, the
way in which gold sold off late week, first on Wednesday and talk that the Big Bad Cure-All
Biden Rescue Plan wasn’t as big as the $1.9Tn whisper number, then on Friday after Biden had
changed his mind and unveiled a U$1.9Tn package (1)…
“Biden unveiled a $1.9 trillion stimulus package proposal on Thursday designed to
jump-start the economy and speed up the U.S. response to the coronavirus pandemic”
…it had the look of pre-decided sales and large position movements going on somewhere.
Which is where all IKN supposition ends, as the seismic shifts in power we’ve seen in the last
months, culminating in the rupture of The Establishment Right with Trump, mean such
unexpected moves are at least logical. A scrappy market and rough waters around this
inauguration for sure, but assuming tempers in The USA drop to a level that allows normal
things to get done, it’s temporary. In sum, at other moments I’d be concerned about a sudden
and well traded drop in gold bullion as seen last week…
…as well as clear evidence of inventory liquidations before Friday…
GLD gold holdings, Dec'20 and Jan'21 (metric tonnes)
1200
1195
1190
1185
1180
1175
1170
1165
1160
1155
1150
2
02/11/03 02/21/2 02/21/4 02/21/6 02/21/8 02/21/01 02/21/21 02/21/41 02/21/61 02/21/81 02/21/02 02/21/22 02/21/42 02/21/62 02/21/82 02/21/03 12/1/1 12/1/3 12/1/5 12/1/7 12/1/9 12/1/11 12/1/31 12/1/51
mt
source: SPDR GLD data

…but not this time. For starters, the chart above shows (as we focus on the near-term at GLD),
that near-exactly 10 metric tonnes left its vaults on Wednesday and then the same on
Thursday. More indication of pre-programmed sales, but on Friday somebody stepped up and
bought 16.63 metric tonnes back into the ETF. The effect of that is below, in the chart we use
to track institutional interest in gold bullion:
7.20 GLD: Inventory/Price Ratio, Dec'20 and Jan'21
7.10
7.00
6.90
6.80
6.70
6.60
6.50
6.40
6.30
6.20
3
03/11 2/21 4/21 6/21 8/21 01/21 21/21 41/21 61/21 81/21 02/21 22/21 42/21 62/21 82/21 03/21 1/1 3/1 5/1 7/1 9/1 11/1 31/1 51/1
Source: SPDR data, IKN calcs
…which didn’t threaten the lows seen just before the mob at Congress and is back climbing
toward 7X.
The markets are nervous and rightly so, gold is volatile and that’s not so normal, but this isn’t
the time to change course on portfolio that has “long gold” at the very centre of its strategy, as
no matter whether successful or not the rescue package is another large step forward in the
debasement of the currency. Gold bears now point to US GDP as the reason to short the
monetary metal, the reasoning solid but rather simplistic: “When the Biden stimulus kicks in, US
GDP growth strengthens the US Dollar”. These pages will not argue against that, it will also
argue that the Biden plan will get a little more of the money onto Main St and keep it from Wall
St is likely to bring on a honeymoon period for the new administration (though how long that
lasts with Covid-19 infections at new highs in The USA isn’t easy to guess). We do however
argue this next round of direct Keynesianism is nowhere near the last and The USA cannot
continue to be as profligate with future helicopter drops and expect the world not to notice. We
know Trump turned on the debt afterburners and frankly it matters not, but Democrats will not
refuse that particular baton now, a party well versed in spending its way out of trouble. They’ll
use the “Well Trump did it! We can, too!” excuse a dozen times as The USA balloons is debt to
kick start its GDP (Trump’s exit will not vaccinate US politics from stupidity).
The bottom line: There’s no reason to walk from precious metals today and what we saw last
week was an episode of choppy waters, not a tidal change. Adding the upsurge in Covid-19 to
today’s rarefied political and social atmosphere in the North means it’s very easy to keep the
hands away from the controls at this time, gold may be suddenly and unpleasantly volatile and
a negative on the PM sector but it’s still the right macro backdrop to be fully bullish in metals
and miners.
Fundamental Analysis of Mining Stocks
It’s a number crunch day in the fundies section, with three companies and their production
results for the last calendar quarter of 2020.
 We look at Fiore Gold (F.v), which came up light.
 We look at New Gold (NGD), which came in well.
 Finally we look at a company well known at these pages even though we do

not currently own. That’s Wesdome Gold Inc (WDO.to) didn’t have a great
quarter of production and its recent price action may offer a reasonable entry
point, so today is the re-visit.
All that below, so without further ado…
Fiore Gold (F.v) December quarter production and trade decision
Much anticipated at this desk, Fiore Gold (F.v) finally gave us its production NR for the quarter
ended December 2020 (its own fiscal Q1) on Tuesday January 13th (2) and here’s how the
market received the news:
Like a lead balloon, as the saying goes*, the stock already down hard by the time Tuesday
came around and after that, a volume drop-off. However it wasn’t any worse than GDXJ in the
same period and overall, it could have been worse this was a weak quarter and my
expectations were not well-founded. Coming into its fiscal Q1 the house assumption was that
F.v would post the same type of 12,500 oz production quarter as seen in recent months, there
was no production growth expected and indeed, the December quarter does see slightly lower
production due to seasonality. But that is not slightly lower, that’s lower and CEO Warman
explained it this way:
Gold production in Q1 was lower than the prior quarter due to fewer ore tons placed,
lower ore grade and timing of gold recovery. Gold extraction on the leach pad was also
temporarily impacted by a drop in the pH and alkalinity of the leach solution. The issue
was addressed by our operating team through the application of additional lime to the
pad to bring the leach solution pH back within the optimal range.
Lower gold from slower ops is one thing and forgivable, the yellow flag here is a heap leacher
with a history of problems so bad that it did for Midway Gold. So far, Fiore has tamed Pan and
seen regular production return but this is a glitch for the wrong reasons, we’re not given much
information on this, either.
*Over 50 years ago, Jimmy Page chose the name of his new, post-Yardbirds band when Keith Moon of The Who
mocked the proposed line-up by saying it, “…would go down like a lead Zeppelin.”
Therefore, lower production in calendar Q4 at Fiore, but there were more reasons to dislike this
news release. Here is CEO Tim Warman giving forward guidance:
“As guided, 2021 will be a year of significant reinvestment to support the longevity of
the Pan Mine and to continue advancing Gold Rock. We recently announced a two-
year mine life extension at Pan, and we are immediately investing in expanding the
heap leach capacity to support this extension. Per our operating plan, gold production
is weighted to the second half of 2021 as grades increase through the year and
planned recoveries are realized. We look forward to returning to higher production
levels as the year progresses. At Gold Rock, we continued with our resource
expansion drilling and related Feasibility Study work. We are pleased with initial drill
results as they continue to expand the oxide mineralization at Gold Rock.”
4

Here is a simple rule: When they “guide to higher production in the second half of the year”, a
company is in fact guiding you lower for now. As a result, my previous assumptions for 2021
production have been changed, with the blanket 12,500 oz gold per quarter model replaced as
seen here:
F.v: Gold production and sales, per quarter
5
0593 8383
4466 7646
5968 3768 4699 48501 3998 4698 5679 4479 95701 73701 58611 40511 2829 9009 0578 3909 58021 62021 29721 16721 23421 55421 4029 0129 00011 00011 00511 00511 00021 00021 00521 00521
14000
12000
10000
8000
6000
4000
2000
0
71_pes 71_ced 81_ram 81_nuj 81_pes 81_ced 91_ram 91_nuj 91_pes 91_ced 02_ram 02_nuj 02_pes tse02_ced tse12_ram tse12_nuj tse12_pes tse12_ced
Oz Au
source: company filings
We know December 2020 production and sales, this chart giving a visual idea of the miss. Then
for 2021 we now assume a gradual increase back to 12,500 oz/qtr in Q4, but it’s clear from the
tone of CEO Warman’s message that Fiore considers itself in a transition year at Pan.
Now for the money crunch, we begin by noting average received prices for gold at F.v and add
in our assumptions for this year. At present, we assume U$1,850/oz for the current quarter,
U$1,900/oz for 2q21, then U$2,000/oz going forward.
F.v: Net realized gold price, per qtr
8221 8521 8721 7721 7231 2031 8021 2321 5031 8131 2931 7341 6751
0271 0291 8681 0581 0091 0002 0002
2000
1800
1600
1400
1200
1000
800
600
400
200
0
71_ram 71_nuj 71_pes 71_ced 81_ram 81_nuj 81_pes 81_ced 91_ram 91_nuj 91_pes 91_ced 02_ram 02_nuj 02_pes tse02_ced tse12_ram tse12_nuj tse12_pes tse12_ced
U$/oz
source: company filings
We know sales and we know average price, therefore our $17.2m forecast for calendar 4q20
will be close. As for the quarters of 2021, it’s notable that we’re not scheduled to return to the
revenues of the September 2020 quarter until end 2021:
30 F.v: Calculated vs Reported revenues, per qtr
(calc revs = sales + realized prices )
25
20
15
10
5
0
91_ram 91_nuj 91_pes 91_ced 02_ram 02_nuj 02_pes tse02_ced tse12_ram tse12_nuj tse12_pes tse12_ced
$m
Au rev calc
total actual revs
source: company filings
Our $17.2m becomes a house forecast U$4.1m in Mine Operating Profit for the quarter, a
significant drop.

F.v: Operations overview
6
0.41
3.01
7.3
2.51
1.21
1.3
6.21
4.01
2.2
1.31
7.01
4.2
0.91
7.31
3.5
0.22
7.31
3.8
9.32
0.31
9.01
2.71
2.31
1.4
24
22
20
18
16
14
12
10
8
6
4
2
0
91_ram 91_nuj 91-pes 91-ced 02_ram 02_nuj 02_pes tse02_ced
$m
revenues
total cost of sales
Income from mine ops
source: F filings, IKN ests
With F now accelerating development at Gold Rock and spending some sustaining capital at Pan
in 2021, the attraction of F.v was its similarity to Wesdome and the way it developed Kiena
organically from treasury. The latest cash position, plus the prospects for the next couple of
quarters at least, suggests the Fiore treasury position will be treading water at best and more
likely drop. There’s zero liquidity problems envisaged, the issue is to question whether Gold
Rock can move forward on its timeline without further outside financing.
F.v: Treasury position
1.51
8.6 7.5 2.7 2.6 4.6 3.8 7.9 3.7 5.6 1.9
3.71
2.32
2.91
30
25
20
15
10
5
0
71_pes 71_ced 81_ram 81_nuj 81_pes 81_ced 91_ram 91_nuj 91-pes 91-ced 02_ram 02_nuj 02_pes tse02_ced
$m
source: F filings
If we push out the same model, add a reasonable assumption for modest cost creep through
2021, then our gold price assumptions allow these estimates:
F.v: Operations overview
0.41
3.01
7.3
2.51
1.21
1.3
6.21
4.01
2.2
1.31
7.01
4.2
0.91
7.31
3.5
0.22
7.31
3.8
9.32
0.31
9.01
2.71
2.31
1.4
4.02
8.31
6.6
9.12
9.41
0.7
0.42
0.51
0.9
30
25
20
15
10
5
0
91_ram 91_nuj 91-pes 91-ced 02_ram 02_nuj 02_pes tse02_ced tse12_ram tse12_nuj tse12_pes
$m
revenues
total cost of sales
Income from mine ops
source: F filings, IKN ests
To cut a potentially long paragraph short, I’d prefer to hold F.v shares during calendar 3q21
than during calendar 1q21.
Bottom Line: Fiore Gold (F.v) had a weak quarter of production, which would have been easier
to forgive if it were framed as a one-off. However, as one example the NR guidance for higher
grades in the second half of 2021 means lower grades in the first half and we’re not going back

to the rhythm of production seen in mid 2020 for the next two or three quarters at least. This
implies a few things, not least that my 2021 estimates were overly optimistic on several fronts.
More fool me, but as that means the IKN $2.00 price target won’t be taken out anytime soon,
upside is now limited. To that, we need to add the small but annoying fact that most of the
reason for the Q4 production miss was glitchy leach pad, not something you want from any
heap leach miner, let alone one with “a history”.. I will be honest and state I’m probably
blowing the risk out of all proportions, however it would only take a second operating problem
at Pan for people to become more nervous about their trade. After all, being a coward allows
you the luxury of panicking first .
We are not debating the longer-term prospects at Fiore today, they are as bright as ever and
the pipeline of projects that can be funded to production “a la Wesdome” is one of its most
compelling points. This is about stepping aside and finding a more dynamic place to invest the
funds currently in F.v, we’re set to go through an extended corporate lull that begins with a
December quarter of financials that will not impress the market when they are published. The
glitch thing is minor, the main reason I am selling Fiore Gold (F.v) is the likelihood of a couple
of quarters of lacklustre financials. As for a selling price, as Fiore is still trading along with the
market median I’ll look for a place to sell once F.v has found buyers. Assuming gold rallies,
there’s every reason to expect an out price higher than this weekend’s $1.34.
New Gold (NGD) 4q20 production and revised house 2021 guidance
On the morning of Thursday, January 14th, the Turnaround Stock for 2020 provided its 4q20
production numbers, as well as confirming the date of its year end and 4q20 financial filing at
Feb 19th (3). Our job is to consider the Q4 numbers, adjust our estimates and then look forward
to what we might get from 2021, all with the thought of Wesdome (WDO.to, see below) as a
complement or possible direct replacement if it doesn’t stack up on the comparative. We start
with the main event charts, production and sales for gold and copper at the company. Below
we compare with our previous estimates:
NGD: Gold production vs Sales, Oz per qtr
7
41006 60106 12647 58407 19167 41657 25869 65048 91108 00109 86958 45948 99029 99768 94676 95527 51576 92596 72156 26616 61208 49867 69038 69088
110000
100000 Total Au prod
Total Au sales
90000
80000
70000
60000
50000 40000
30000
20000
10000
0
1q18 2q18 3q18 4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20
source: NGD filings, IKN calcs
NGD: New Afton copper production and sales, per qtr
2.22 3.12 4.02 6.91 7.12 5.02 8.02 7.91 5.91 2.02 6.12 3.81 1.02 6.02 3.81 3.71 5.81 7.71 9.61 3.51 2.81 5.71 5.81 5.71
Mlb Cu
24 Cu prod
22 Cu sales
20
18
16
14
12 10 8
6
4
2
0
1q18 2q18 3q18 4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20
source: NGD filings, IKN ests
Overall a good quarter and a modest beat.

 At Rainy River, NGD produced 66,734oz gold, beating the IKN forecast of 65,000 oz
gold production. It sold a strong 72,279 oz gold that included the small delivery backlog
from Q3.
 At New Afton, NGD produced 16,362oz gold and 18.5m lbs copper, the gold slightly
under our 17,000 oz guesstimate but the copper beat our 17.6 lbs forecast handily,
NGD reporting better grades that will continue through 2021. Sales of 17.5m lbs copper
were on our estimate.
As for sales, gold received price came in at U$1,623/oz as almost exactly as expected, its 2020
hedge giving a final hurrah. As from now NGD is gold hedge free. The big beat was the copper
price, we assumed U$3.00/lb for the quarter, it came in U$3.34/lb. That’s a big difference and
adds around U$6m to top line revenues. The revenues mix as reported looks correct, 71% from
gold and 29% from copper in the quarter matches both previous results and NGD’s trend
toward revenue purity:
NGD: Revenues percentage by metals type
8
2.34
8.65
3.83
7.16
6.73
4.26
0.43
0.66
5.03
5.96
0.92
0.17
0.92
0.17
4.92
6.07
9.03
1.96
5.92
5.07
8.92
2.07
0.92
0.17
100
90 80
70
60
50
40 30
20
10
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4
% rev Cu
% rev Au
source: NGD, IKN calcs
With production and sales known, we estimate earnings:
NGD: Quarterly Earnings Overview
9.761
9.68 2.16 8.91
1.551
1.58 6.35 4.61
4.861
7.49 4.16 3.21
2.931
2.501
4.46 4.03-
3.241
7.98 25 6.0
5.821
2.66 6.04 7.12
7.371
7.68
7.94
3.73
891
201
05 64
225
200
175
150
125
100
75
50 25
0
-25
-50
91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4
$m
revenues
op-ex
deprec/deplet
Mine Op Earnings
source: company filings
Revenues are set to come in tantalisingly close to U$200m and it wouldn’t surprise me to see
NGD get over the line on an extra inventory sale or some such. We are expecting costs higher,
though some of the extras will be non-cash and less of an issue. The result is a Mine Operating
Earnings estimate of $46m, or just over 5c quarterly per share. That’s an acceptable number,
but coming into earnings nobody should expect NGD to deliver a beat. As for 2021, NGD will
likely provide guidance during the filing of its annuals, scheduled for February 19th. In the
meantime, we stick with our previously published estimates for the current year and here are
the charts to remind:

OzAu NGD: Quarterly gold production
140000
130000
120000 Gold NA
110000
100000 Gold RR
90000
80000
70000
60000
50000
40000
30000
20000
10000
0
4q19 1q20 2q20 3q20 4q20 1q21 2q21 3q21 4q21
source: NGD filings, IKN ests
NGD: New Afton copper production and sales, per qtr
9
3.81 3.71 5.81 7.71 9.61 3.51 2.81 5.71 5.81 5.71 81 71 81 71 81 71 81 71
Mlb Cu
24
Cu prod
22
Cu sales
20
18
16
14
12
10 8
6
4
2
0
4q19 1q20 2q20 3q20 4q20 1q21 2q21 3q21 4q21
source: NGD filings, IKN ests
FWIW our estimate for copper production from New Afton is now likely too low, but I prefer to
wait until NGD gives official guidance next month. Gold production growth is set to be driven by
Rainy River as the final pieces of the build-out come online (e.g. the thickener in Q2), along
with better grade control. However, the real difference at NGD in 2021 will be financial and not
operational. With more gold produced and those key gold hedges now fully off, NGD is exposed
to spot gold for the first time in a long time (though it has placed some minor puts on copper
from New Afton for the year, guaranteeing a U$3.10/lb base price). We therefore assume
U$1,850/oz for the average received price this quarter, U$1,900/oz for Q2 and then U$2,000/oz
going forward to model this chart:
NGD: Revenues calcs by metal type
9.06
0.08
0.75
7.19
7.45
7.09
4.35
6.301
7.15
9.711
4.54
9.011
0.94
2.021
3.14
1.99
3.54
4.101
0.93
4.39
3.25
5.321
5.85
0.341
5.95
0.161
5.95
3.481
5.95
0.412
5.95
0.432
350
300
250
200
150
100
50
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
U$m
Cu revs
Au revs*
source: NGD filings, IKN calcs *includes minor Rainy River Ag revs
From nearly U$200m in top line revenues this current quarter, we estimate NGD is knocking on
the door of U$300m quarters as long as gold holds the two handle (as expected by this desk).
Now for what that does to operating earnings per share, ceteris paribus:

NGD: Operating earnings per share
0.18
0.16
0.14
0.12
0.10
0.08
0.06
0.04
0.02
0.00
-0.02
-0.04
-0.06
-0.08
10
91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4 tse12q1 tse12q2 tse12q3
cents
source: company financials/IKNcalcs
That above is the core reason to own NGD in 2021, an earnings acceleration driven by a
combination of correct execution at Rainy River, the gold hedges coming off and better prices
at market. It puts NGD in a sweet spot for organic earnings growth and with only remnants left
to pay on Rainy River capex, the company can then go about improving its balance sheet
position even further by paying down its
(now manageable) debt, or go shopping for
it next project. The heavy lifting is done, it
now begins to enjoy the fruits of its labour.
The bottom line to NGD’s 4q2 production is
the delivery of another solid quarter and
slight beat. We should see incremental
improvement in the financials, but when CEO
Renaud Adams steps up to the mike for the
Q4 and annuals Conference Call, I expect he
will want to talk all about the future at NGD
and its new margins of operations and
profitability. In other words, NGD is a good
hold going into its Year End earnings report,
scheduled pre-opening bell February 19th. I am a happy holder until then.
Wesdome (WDO.to) 4q20 production and 2021 guidance
The clue to the thrust of today’s note on Wesdome Gold (WDO.to), a previous trade that
provided a good profit via a built position and then two sales, is in blog post published (3)
before the WDO 4q20 numbers traded on Friday (4)
the post “Greedy about Wesdome” expected the
stock price to drop that day and in fact it did, but
by no more than the rest of the sector. However,
this weekend’s C$9.25 share price is the lowest
we’ve seen since the post-crash trough and from
the TA gathered by the post, there are plenty of
chartists who see WDO lower in the near term. This
is interesting, because any price weakness from the
at-best unremarkable 4q20 quarter may allow a
cheap entry into suddenly unfashionable WDO. As
its 2021 looks good, the plan is to follow and
potentially purchase WDO as a turnaround story,
looking for 2021 alpha in much the way NGD worked for us in 2020.
Today’s note is split into the Q4 production and what we can expect, then 2021 guidance and
thoughts on that. We begin at the beginning and a visual on the most basic thing mining
companies do, i.e. move dirt around. Tonnages milled at WDO has its story to tell:

WDO: Tonnes milled, per qtr
11
08444 87334 77764 63505
14903 45782
35493 94324 76644 15535
32846 11047
25233 8478
4076 13721 11533
18470 18623
9108
75232
47855
90000
80000
70000
60000 3555
50000 204
40000
30000
20000
10000
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4
mt Mishi
Eagle River
source: company filings
We now have a “normal quarter” of feed around 55kt to 60kt and an increasing percentage
from the Eagle UG operation. This follows the longer-term plans to phase out production from
the open pit Mishi and source 100% of mill feed from underground, now coming to fruition.
There is some production scheduled from Mishi in FY21, but on asking CEO Middlemiss about
this last week he told me any Mishi feed will come from stockpile, that means cheap ounces at
the timing and discretion of the company (e.g. around scheduled lulls in UG tonnages). All
good, we move on to average grade and while Mishi is a minor thing these days grade out of
Eagle UG is a key metric for production and this quarter’s 11.7 g/t was lower than expected.
WDO: Average gold grade, per qtr
30
28.6
23.4
25
23.4
20 18.5 18.1
13.3
15 12.5 11.3 12 6 13.8
10 10.1 10.07 11.5 9.89.71 10.6 14 11.7
8.7 8.2
7.01
5 7 6.6 7.4 4.9
0
41q3 41q4 51q1 51q2 51q3 51q4 61q1 61q2 61q3 61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4
g/t Au
Eagle River
Mishi
source: company filings
For what it’s worth, WDO is guiding higher than this in 2021 so there’s a sensation here that
WDO was mining easy ounces, but not mixing in the higher grade muck as much. With
recoveries their normal very high percentages (WDO typically hits 97%) we get the production
and sales chart:
Ozt Au WDO: Gold production vs sales, per qtr Production
30000 Sales
25000
20000
15000
10000
5000
0
1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20
source: company filings
Production a whisker over 20k oz, sales and 19,890 oz. This was a low-end quarter, the
company reporting six lost time days at the mill due to a breakdown (now fixed) which took
maybe 1,500 oz away from the final total. We’re given a sales revenue figure of C$48.3m from
those ounces (sold at an average of CAD42,430/oz, which makes for handsome gross margins),
so we can now jump to the financials and forecast how the quarter P+L items look. The key
guesstimate is always mine processing costs, which have a high fixed component at Eagle River
but the company isn’t afraid to expense one-time items, either. After reading guidance and

exchanging with CEO Middlemiss a little, C$17m estimate takes into account some cost creep
but also that the company will see lower AISC from now on.
WDO.to: mine processing costs per qtr
30
27.5
25 23.46
21.93
22.5
19.51
20 18.10
17 1 . 5 5 13.55 16.12 12.83 14.90 16.00 14.43 16.44 13.57 14.77 15.02 14.02 17.00
12.5
10
7.5
5
2.5
0
12
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4
$m
source: company filings
Add in the other costs…
WDO.to: Costs overview
40
35
30
25
20
15
10
5
0
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4
CAD$m
mining processing costs depletion
G&A other expenses
Source: WDO.to filings, IKN calcs
…and we expect C$28m total. This allows us to estimate operating income:
WDO.to: Operations overview chart
277.4
823.8
501.6 940.5
53.21
151.31
197.81
479.41
247.91
753.52
426.22
33.02
60
55
50
45
40
35
30
25
20
15
10
5
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4
C$m
revenues
total op expenses
Op earnings
source: company filings, IKN calcs
At just under C$21m, that’s quarterly operating earnings of 14.6c per share:
WDO.to: operating earnings per share
0.20
0.18
0.16
0.14
0.12
0.10
0.08
0.06
0.04
0.02
0.00
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4
$
source: company financials/IKN calcs

Bottom line to the quarter: Nothing special and a sentence that talks of a slight production
miss, slightly lower sales, plus slightly lower received prices is the unsubtle linguistic method of
getting the message across.
Which brings us to the reason I am interested in WDO once more, its 2021 guidance which they
announced using this table:
To begin, seeing WDO set “90k to 102k” for Eagle means its CEO, Duncan Middlemiss, will be
most annoyed if it doesn’t do at least 100k. This is the year Eagle matures as a mine and we
get to see what the company plans have achieved.
For valuation purposes today, I’ve gone the most blatant route possible and assumed WDO
produces and sells 25,000oz gold per quarter in 2021. This leaves a few thousand ounces of
likely comfort, as a final total closer to 110k wouldn’t be a surprise. To that we apply the house
assumptions for gold transferred from USD to CAD which gives this chart:
WDO.to: Revenues
80
70 61.363.065.0
60
57.354.855.0
45.9 48.3
50 42.3 43.2
40
26.2
31.428.929.5 32.5
30
20
10
0
13
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4 tse12q1 tse12q2 tse12q3
CAD$m
source: company filings
Assuming 4q20 was a outlier, as from 1q21 and 25k ounce production we go over C$60m in top
line revenues. This is the first major reason to hold WDO once 2021 is underway, the chart
below is the second one:
WDO: Realized AISC vs realized gold price per qtr
3000
2
2
6
8
0
0
0
0
2365
253224302450250026002600
2400 2162
2200
1957 1954
1 2 8 0 0 0 0 0 1618 1693 1692 15711626 1733 1752
1600
1400
1200
1000
800
600
400
200
0
71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
CAD$/oz Au
Realized price
AISC
source: company filings
Almost without anyone noticing, WDO at Eagle has become a low cash cost operator. Its

remote location and high fixed costs were always the challenge, now with stronger production
the costs are managed more easily and free cash flows. Here’s the same information in the
chart above, cut and sliced in a different way:
WDO: Realized price minus AISC/oz
14
433 153
054 114 624 224 284
316 946
937
7411 7311
0321
0531 0041
0051 0051
1600
1400
1200
1000
800
600
400
200
0
71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
CAD$/oz
source: WDO filings, IKN ests
We expect WDO to make CAD$1,350/oz on gold produced as from today, something that won’t
be fully appreciated by the market until the company files its 1q21 in May. By that time, it may
be making up to CAD$1,500/oz on every ounce
produced and that is serious free cash flow. This is WDO.to: Price / Op. Earnings Ratio
how that affects the admittedly generous price/op 25
earnings ratio run by WDO (right). When shares of
20
WDO are expensive this can spike to almost 20X,
as the market has always been generous with its 15
future valuation of Kiena. At low moments it’s
10
down to 12X, which means that if WDO stays at
its current CAD$9.25 share price, by end 2q21 it
5
will be at the multiple last seen when the stock
traded at four dollars. That price isn’t going to
happen again, but with a big improvement in
earnings a near lock and then Kiena coming
online, this desk firmly believes WDO will go back into fashion.
You will also note we haven’t taken into account the milestone catalyst around mid-year of a
likely construction decision at Kiena, on receipt of its PFS. However, this is a different and
altogether more positive situation than the normal junior with its new PFS, as WDO has all the
money it needs to fund its new mine and estimates as little as six months to get back to
commercial production. The fact that CEO Middlemiss has slated production guidance for Kiena
this year of between 15k and 25k oz assuming a production decision means it should be
working by 4q21.
The bottom line to today’s revisit to Wesdome (WDO.to) is to prepare you for the moment I
jump back in and buy the stock. That won’t be this week, nor is it a guarantee, but with the
stock price in the doldrums and a okay-at-best Q4 left to report, there may be a bargain entry
point In the near future. The prize is clear, WDO will become a cash generation machine this
year thanks to lower AISC, from there Kiena re-starts and the company re-rates. That’s the plan
(and what could possibly go wrong?), the search for an entry point begins once Wesdome
reports its annuals.
Stocks to Follow
The good news: There were two week-over-week winners in the shape of Trilogy Metals (TMQ)
and Orezone (ORE.v), plus Aurelius Resources remained unchanged, buoyed by its decent drill
results. Then a bunch of portfolio stocks were losers but held okay, with minor losses in MIN.to,
91q1 91q2 91q3 91q4 02q1 02q2 02q3 tse02q4 WON tse12q2
P/BV
source: TSX, WDO filings, IKN ests

NOM.cse, RYR and even Minera Alamos (MAI.v) in that mix. Then there were these:
 Kuya Silver (KUYA.cse) down 15.9%
 Pucara Gold (TORO.v) down 15.1%
 Fiore Gold (F.v) down 12.4%
 Great Bear (GBR.v) down 11.4%
 Rio2 Ltd (RIO.v) down 11.0%
 Minera IRL (MIRL.cse) down 10.3%
 New Gold (NGD) down 9.3%
We didn’t escape the selling Friday, but I’m not expecting gold weakness to follow through for
long and being long gold isn’t a worry under a Biden presidency. Greeting a new President and
admin with optimism is normal, honeymoon periods exist and Biden’s rescue package plan
(along with 100m vaccines in 100 days) will get plenty of feel-good headlines in The USA, not
least for the U$1,400 cheques about to arrive at every US home (apparently). Not going to
repeat the spiel in today’s intro, Instead I’ll simply state I took my Friday hit philosophically.
We currently have 16 open positions in Stocks to Follow, which should be back to 15 this time
next weekend as Fiore Gold (F.v) leaves the list. That will bring us back to our self-imposed
limit, which is good. Just nine are now in the green and now seven are in negative territory, a
Red Shift of another stock from last week and not something I’d like to repeat too often.
company Ticker this week Avg Price Reco date Current PPS Gain/Loss% Notes
TOP PICKS
Minera Alamos MAI.v STR BUY C$0.21 13-Oct-19 C$0.65 209.5% New $1.14 tgt Aug'20 #1 idea
Rio2 Ltd. RIO.v STR BUY C$0.83 22-Apr-18 C$0.81 -2.4% $1.58 tgt, bot again Nov'20
Recommended stocks (In order of preference)
Excelsior Mining MIN.to STR BUY C$0.98 10-Mar-19 C$1.10 12.2% Added again Dec'20, Cu'21
Copper Mountain CMMC.to STR BUY C$1.40 22-Nov-20 C$2.20 57.1% Added Dec'20, trade for FY21
New Gold NGD STR BUY U$0.76 9-Feb-20 U$1.94 155.3% 3q20 tgt $2.80 confirmed
Norsemont Mining NOM.cse STR BUY C$1.55 6-Sep-20 C$0.99 -36.1% bot 3x for 2021 run
Trilogy Metals TMQ STR BUY U$1.84 15-Sep-19 U$2.02 9.8% Added Dec'20, Cu for 2021
Royal Road Min. RYR.v STR BUY C$0.155 17-Mar-19 C$0.315 103.2% Model paying off in Nica
Fiore Gold F.v SELLING C$0.98 21-May-20 C$1.34 36.7% qtr miss, fy21 guidance low
Great Bear Res GBR.v BUY C$15.83 26-Aug-20 C$14.01 -11.5% M&A major tgt, added IKN590
Orezone ORE.v BUY C$0.79 21-Jun-20 C$1.15 45.6% Now in news period, trade buy
Kuya Silver KUYA.cse hold C$1.66 8-Nov-20 C$2.32 39.8% new Peru Ag jr, may take profit
Aurelius Res AUL.v spec buy C$0.075 28-Jun-20 C$0.055 -26.7% 1st assays promising, spec buy
Pucara Gold TORO.v ADDING C$0.80 4-Oct-20 C$0.62 -22.5% Adding this week at under 65c
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.13 -33.3% hold until further news
Long-term non-mining hold
Mene Inc. MENE.v LT Hold C$0.65 6-Dec-20 C$0.63 -3.1% LT bet on jockey&horse,will add
Closed in 2021 closed close price
none
2015 to 2020 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Now for some notes on covered stocks:
Fiore Gold (F.v): SELLING. The quick line to make it seen here too, I am looking to sell my
Fiore Gold position and move on for the reasons stated in today’s ‘Fundamentals’ section. Once
again, please be crystal clear that I’m not going to dump at any price and expect $1.40 or so as
an available out price. If you want to sell lower on any temporary dip, it’s your money.
15

Pucara Gold (TORO.v): ADDING (at last). A personal relief to get this from its “quasi-
papertrade” level, it wouldn’t have been fun to see TORO return a strong set of drill numbers
and fly without any real money on board. Every cloud has a silver lining and the wholesale
selling we saw in PMs on a macro level last week
finally pulled TORO down to a what is just about a
buyable level. This publication has stated since its
IPO that funding at 40c cannot support a share
price at double with no meaningful news from its
projects, Vancouver has been “selling the sizzle” to
a new generation of speculators and getting them
to pay the beginners’ price.
At 62c TORO is still no drop dead bargain and I’m
not wading in first thing Monday, sellers coming out
of escrow can push it lower. Nor too deeply, I’m
looking to add to around 20% full position and
speculate on the upcoming drill numbers. At that
point I’ll either be holding a small winner or a small loser, but with better information on which
to make the next decision.
Orezone (ORE.v): One of only two winners on the week, ORE is now on its countdown for the
financing package expected at the end of the month. The inner trader says this is becoming a
“sell the news” situation, but as ORE stood out from the start when that bunch of speculative
PM juniors last year was traded her at the Weekly its author holds through for the potential
buyout premium. A small position and a winning trade, I let mine ride.
Kuya Silver (KUYA.cse): KUYA’s quick double didn’t appear (again) and the webinar
conference ran by KUYA made it crystal clear the company is going back to market soon in
order to raise working capital. Even before the CSC deal which requires U$4m up front, KUYA’s
treasury didn’t cover the 2021 development budget, now it is obvious. Therefore, we hope
KUYA gets on and runs the raising as soon as possible to get the stock’s likely latent period out
the way while news is still slack. Aside Friday, which hit them all, KUYA’s $2.50 line held well
enough and it’s starting to look like the managed price for the next deal. We shall see, but in
any case I am happy to hold through on any financing announcement, this is one of those
marketed stocks that can run on “financing filled in seconds” chatter. Again for the record, if
this volatile sock shoots over $3 you may consider me a potential seller into the spike.
In other news, via CEO Stein I’m currently arranging a visit to the company offices here in
Lima, in order to meet as many of the team as possible. It was only fair to give the new team
time to set up in a new office, now it’s a case of coinciding dates.
Rio2 Ltd (RIO.v): If you would like to send me mails to vent your frustration about the inertia
in the house Top Pick stock, you are welcome to do so. The only real difference between your
position and mine would be the level patience I offer to RIO, at the same time there’s no
denying “the slog” of holding this stock. However, I do beg to give the team at least its time
window to deliver on the Fenix financing, but if nothing shows by end April things change and
I’ll be first in line with the brickbats.
Aurelius Resources (AUL.v): We got drill results from AUL (6) and, while they still deliver
good proof-of-concept numbers instead of a slam dunk, they were enough to keep the worst of
the macro headwinds away from the stock price and it finished unchanged on the week. As for
the results, we already understood the “saddle” type mineralization that AUL is trying to locate
in size so seeing high grading sniffs over short widths means the results as a standalone were
similar to the first round of results. AUl offered up the results from hole AE-20-004 in its title
line, of 1.6m at 109.5 g/t Au, then 0.5m at Metres at 255 g/t Au. Enough to keep interest high,
but no tonnage yet. The difference this time is in the depth drilled, best illustrated by this
company schematic:
16

That’s real “open at depth”. We remain long our tiny spec gold drillplay, it only takes one hole
for a stock like this to fly. Small bets only, please.
The copper juniors. Trilogy Metals (TMQ): TMQ was up last week, but only because the
previous Friday saw a false close and there was precious little difference between ticker action
in TMQ and our other copper plays Excelsior Mining (MIN.to down a penny) and Copper
Mountain (CMMC.to). Regarding CMMC, last week’s main feature announced Friday it would
give us its 4q20 and YE financials pre-opening bell February 16th, with a conference call on the
results the same (07:30am PST, here’s the webcast link (7). In trading, CMMC did well to battle
back after early week selling (profit taking), but also couldn’t avoid the chop Friday. No real
harm done.
The Copper Basket
After two weeks of 2021, The Copper Basket shows a gain of 2.12% to level stakes.
company ticker price 1/1/21 Shares out Market Cap current pps gain/loss%
1 Solaris Res SLS.v 6.08 104.67 690.82 6.60 8.6%
2 Copper Mtn CMMC.to 1.81 207.5 456.50 2.20 21.5%
3 Oroco Res OCO.v 1.85 185.11 346.16 1.87 1.1%
4 Excelsior Min. MIN.to 1.12 239.063 262.97 1.10 -1.8%
5 Marimaca Cop MARI.to 3.25 64.358 216.89 3.37 3.7%
6 Western Copper WRN.to 1.57 135.6 204.76 1.51 -3.8%
7 Amerigo Res ARG.to 0.80 180.77 164.50 0.91 13.8%
8 Regulus Res. REG.v 1.07 101.85 97.78 0.96 -10.3%
9 C3 Metals CCCM.v 0.115 375.17 58.15 0.155 34.8%
10 Chakana Cop PERU.v 0.60 93.2 55.92 0.60 0.0%
11 Aldebaran Res. ALDE.v 0.455 93.64 41.20 0.44 -3.3%
12 Element 29 Res ECU.v 0.45 66.7 30.35 0.455 1.1%
13 Doré Copper DCMC.v 1.00 37.44 26.21 0.70 -30.0%
14 Crown Mining CWM.v 0.105 87.53 8.32 0.095 -9.5%
15 Chibougamau CBG.v 0.165 46.695 8.17 0.175 6.1%
NB: All stocks in CAD$ Portfolio avg 2.12%
17

The mining sector selling hit copper juniors full in the face, our basket dropping nearly 3% of
the 5% it put on during the first trading week of the year. There were three week-over-week
winners to leaven the mix () and well as one UNCH (ALDE.v) so it wasn’t one-way traffic, but
the eleven losers were typically around the 5% range as the tide went out, out-sized losses
coming from Crown (CWM.v down 20.8%) and Doré (DCMC.v down 15.7%). The biggest
winner by a distance was C3 Metals (CCCM.v up 24.0%).
The weakness in equities wasn’t driven by the copper market, its movements indirect to the
larger currency moves and new assumptions of 2021 demand happening around them.
The same message as today’s intro while talking gold, the action Friday looked knee-jerk and
pre-ordained with Thursday’s run toward U$3.70/lb more indicative of a metal in hot demand
even before The USA comes out of its recession. Time for the regular weekly world copper
inventories section:
 World aggregate inventories continue to flash red warning lights about world supply, all
three official world systems losing tonnages. We closed down 12,571 metric tonnes
(mt) on the week, the world aggregate now at 244,448mt.
 And once again the main story is the SHFE, which should now be adding inventory but
is in fact losing it. Down 8,657mt on the week and at 73,685mt, another week or two
without serious re-stocking of tonnages would ratchet current concern much higher. A
clear bullish signal and in line with our “potential panic buying” call for copper if Covid-
19 affects South America supply (see Regional Politics, below).
 At the LME, the drop was small but significant, as the 2,475mt lost put the total under
100k again, a rare place for LME stocks. We are at 99,950mt this weekend, another
Red Alert Alarm Bell potential moment if the trend continues this week.
 Comex also joined in, stocks down 1,439mt to finish at 70,813mt.
Here is the Shanghai-only inventories chart, this weekend’s number is a new modern era low:
Shanghai Futures Exchange Warehouse Stocks, Dec'15 to date
500000
450000
400000
350000
300000
250000
200000
150000
100000
50000
0
18
ht6ced 6102
dr3naj
ts13 ht82 ht72 ht42 dn22 ht91 ht71 ht41 ht11 ht9 ht6voN ht11 ht8 ht5beF 7102
ht5raM
7102
dn2rpA
ht03 ht82 ht52 dr32 ht02 ht71 ht51 ht21 ht01 8102
ht7naj
ht4bef 8102
ht4ram
8102
ts1rpa
ht92 dr3nuj 8102
ts1yluj
ht92 ht62 dr32 ts12tco ht81 ht61 9102
ht31naj
ht01 ht01 9102
ht7rpa
ht5yam 9102
dn2nuj
ht03 ht82 9102ht52pes dn22 ht02 9102ht71von ht51 0202ht21naj ht9 ht8 ht5rpa 0202dr3yam ht13 ht82 0202ht62luj dr32 ht02 ht81 ht51 0202ht31ced 1202
ht01naj
Mt Cu
source: Cochilco

Here’s a close-up of the same data for the last two years:
Shanghai Futures Exchange Warehouse Stocks, 2019 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
19
81'ht03ced ht72 ht42 ht42 ts12 ht91 ht61 ht41 ht11 ht8 91'ht6tco dr3von ts1ced ht92 ht62 dr32 dn22 ht91 ht71 ht41 ht21 ht9 ht6pes ht4tco 02'ts1von ht92 ht72
Mt Cu
source: Cochilco
That is a valley of dry bones. Now for a few notes on basket companies:
C3 Metals (CCCM.v): These pages assumed a promo would get underway on this tinycap and
sure enough, CCCM’s up-on-a-down-week had nothing to do with its financials or exploration
potential, everything to do with social media and assurances that this is the Next Big Thing. We
also kind-of penciled in 15c as a near-term place for the stock when first opening soft coverage
in IKN604 dated December 20th 2020. Here’s part of the wrap-up from that note:
With 375.17m shares out and a 9c price this weekend (the marketing has already
begun), CCCM.v is a C$33.8m market cap company and just to begin, this group must
be looking at the $55m market cap currently commanded by Chakana Copper
(PERU.v) as a reasonable first target. That would signal 15c and considering the
derivatives overhang and the history of the stock, that’s a reasonable number for near-
term speculators to shoot for. So yes, I think there’s a reasonable flip trade
opportunity here, as CCCM.v combines the right metal, right time, right price and right
place on the discovery curve for quick profits.
Sure enough, it ran to the PERU.v level of market cap quickly. However, the other part of the
IKN604 message still applies and “…in the longer term I’d try to put you off investing in the
stock”, as it’s only a matter of time before “the distribution phase” begins, to put it as
diplomatically as possible. This team has been craving a win in Peru for years with the mediocre
PPX.v, they are not going to let a large percentage win on early shares slip part them. If you’re
holding a win, don’t forget to cash at least part of your position and lock it in.
Crown Mining (CWM.v): The other big mover of the week, but this one was 20.8% to the
downside. As The Tiny Dogs list also testifies, the end year period saw a few tinycaps get bent
out of shape by speculative holiday trading and stocks such as CWM are more likely moving
back to their true baseline, rather than showing the weakness of a broken stock or failed
company. Another in the same boat is Doré (DCMC.v), which has thrashed around in a wide
trading range.
Oroco Resources (OCO.v): It’s not just me. Among my mailpals is reader J, somebody whose
nose for mining economics I have learned to respect. He seems to have been looking round for
copper ideas, because an unsolicited mail landed last week and included this segment:
“…an amateur investor/newsletter writes it up not fully understanding mining, takes the
management spiel hook line and sinker. Which normally I wouldn't mind because hey, passionate
investor trying to learn and do research, why wreck the enthusiasm...but then I see he has gotten
>600k finders warrants in the last two private placements and I feel more inclined to figure out if
this is actually all BS...”
Largely agreed. FWW I don’t think OCO is a BS company, I do think its share price is way ahead
of itself and bakes in a lot of assumed exploration success and that, as we know, ain’t
necessarily so.

Amerigo Resources (ARG.to): Due to its pleasant change in style, we mentioned the
Amerigo Resources (ARG.to) 4q20 production results and 2021 guidance NR on the blog last
week (8). The main reason was to highlight that due to the amount of information offered in
the NR, we could put together a reasonable framework for ARG financials for the year ahead
without much sweating, as the company offers expected production and costs on a quarterly
basis, then lists its expected capital projects for the year. They have based their budgets on
some-or-other copper price and that’s fine, we can use other prices to gauge the earnings
potential of the company under various scenarios. Overall, if ARG executes and copper prices
deliver on expectations, those buying at under a Loonie will be rewarded (and potentially
handsomely), but there are three reasons I am staying away:
 I am not very good at trading this stock.
 Execution depends on the good graces of exterior forces, i.e. El Teniente but more
importantly, the weather. Another drought bad enough to affect production would bring
any price momentum to a screeching halt.
 ARG is vulnerable to lower copper prices, as even a dip to U$3.00/lb would strip it of
most operating profit (once royalty is paid).
ARG remains a speculative trade on copper, if things go its way I know I’m passing on a
substantial winner, but the fat tail of ongoing Chilean drought conditions keeps me away.
The Producer Basket
After two weeks of 2021, the Producer Basket shows a loss of 5.93% to level stakes.
company ticker price 1/1/20 Shares out Mkt Cap (U$Bn) current pps gain/loss%
1 Newmont NEM 59.89 803.36 49.70 61.86 3.3%
2 Barrick GOLD 22.78 1779.04 41.17 23.14 1.6%
3 Agnico Eagle AEM 70.51 242.99 16.68 68.65 -2.6%
4 Kirkland Lake KL 41.27 272.984 10.73 39.32 -4.7%
5 Kinross Gold KGC 7.34 1260 8.77 6.96 -5.2%
6 Pan American PAAS 34.71 210.17 6.16 29.33 -15.5%
7 Endeavour Min EDV.to 29.62 246.2 5.62 27.39 -7.5%
8 B2Gold BTG 5.60 1064 5.36 5.04 -10.0%
9 Alamos Gold AGI 8.75 392.73 3.09 7.87 -10.1%
10 Pretium Res PVG 11.48 187.254 1.97 10.50 -8.5%
Prices in U$ except EDV.to (share price in CAD$ and mkt cap in approx USD) Port. avg -5.93%
20

Of all the mining sectors and tickers hit by last week’s plug-pull selling, it was the larger
producers of precious metals that felt the most pain but, interestingly, the very largest did okay.
All ten of our basket charges dropped last week and the big down moves came from the Tier II
and senior producers such as Pan American (PAAS down 17.2%) Alamos (AGI down and
Endeavour (EDV.to down 10.1%). The
interesting angle is to note that the two “least
worst” of our ten were Newmont (NEM down
1.5% on the week) and Barrick (GOLD down
3.5%), the two biggest names out there. Indeed,
if we dial up a two day chart of the two
companies against GDX, we see how they all
turned at the same point in time Thursday
midday (Biden’s rescue deal reaction), but the
big caps were treated more gently for a full day
and a half.
At the start of this year, we mentioned the plan
to track a small selection of royalty plays against
the GDX as part of this section’s 2021 coverage, under the theory that royalty/streamers are
going to see their margins crimped by the market’s easier access to capital, which will manifest
in tougher competition for deals from other quarters. That’s going to happen and for what it’s
worth, I’ve selected Franco-Nevada (FNV, big) Sandstorm (SAND, medium) and Metalla (MTA,
now up to c$600m market cap and a fully fledged junior sized company) to be the benchmarks
against GDX. Here’s the chart to date, nothing much to show in it and the same lack of data
which makes us wait a few weeks before firing up the annual tracking charts.
For the record, I expect GDX to do better than all of them.
Endeavour Mining (EDV.to): Far from the madding crowd EDV showed it deserves its new
market cap bandwidth by confirming it will pay its inaugural dividend of U$0.37/share in
February, to holders of record on January 22nd. Despite the news (9) EDV got hit like all others.
Also note that EDV has more news up this week, Thursday being vote day for its acquisition of
Teranga and smooth sailing now expected on that.
Pretium (PVG): Even though it was at the bottom of the market cap range for this sectin
(U$2Bn or above), I eventually chose PVG for this year’s basket because it looked at some sort
of price low and would certainly provide the list with plenty of leverage to higher gold prices as
2021 rolls out. Therefore, it’s slightly disappointing to note PVG is now below the nominal
U$2bn minimum, not a great start.
The Tiny Dogs
After two weeks of 2021, the Tiny Dogs show a gain of 4.90% to level stakes.
21

company ticker price 1/1/21 Shares out Mkt Cap current pps gain/loss%
Antler Gold ANTL.v 0.205 61.348 15.34 0.25 22.0%
Aston Bay BAY.v 0.045 163.975 7.38 0.045 0.0%
Constantine Met CEM.v 0.17 45.4 9.08 0.20 17.6%
Contact Gold C.v 0.115 240.757 27.69 0.115 0.0%
Golden Pursuit GDP.v 0.22 40 8.40 0.21 -4.5%
Manitou Gold MTU.v 0.045 230.79 13.85 0.06 33.3%
Precipitate Gold PRG.v 0.240 106.241 26.03 0.245 2.1%
QC Copper QCCU.v 0.315 105 24.15 0.23 -27.0%
Red Pine Expl RPX.v 0.040 477.22 19.09 0.04 0.0%
Warrior Gold WAR.v 0.090 91.818 8.72 0.095 5.6%
Prices in CAD$, data from TSXV basket avg 4.90%
This section attempts to track the tinycap mining sub-sector of the market, our ten companies
chosen under the following criteria to put together a list that represents what’s going on in the
whole sub-sector of tinycap exploration company stocks.
 Market capitalization of under $20m. They have to be tiny. In two cases I’ve stretched the window a
little and allowed sub-U$20m market capper in that are just over the C$20m level, but the spirit is unaltered.
 A “non broken” stock price and project story. There are literally hundreds of tinycap juniors of the right
size, but it was a particularly depressing exercise to trawl through the whole of the TSXV and find companies
that are small enough, but with life in them. The vast majority of sub-$20m stocks are broken stocks, either
traded to death on the exchange or with projects that are a bust or with entrenched management more
interested in their monthly paycheck than anything else.
 Likelihood of meaningful newsflow in 2020. This connects to the company’s “unbroken” status, as we
want news and potential catalysts from companies with projects that can work.
 Decent management if possible. When you are down among the little guys it doesn’t pay to be too
choosy, but still I preferred companies that have teams or people with good peer reputations.
The Tiny Dogs bucked the market trend and had a decent week, the basket up around 4% with
five winners (BAY.v, CEM.v, C.v, MTU.v, RPX.v) and one unchanged stock (WAR.v) more than
enough for the four losers (ANTL.v, GDO.v, PRG.v, QCCU.v). Biggest percentage winner was
Manitou Gold (MTU.v up 20.0%), but in reality it’s a penny. Better was Contact Gold.
Contact Gold (C.v): The best tiny dog action of the week was here, the stock getting bought
late week after the most interesting webinar of the week. CEO MLK gave a “virtual live tour” of
Green Springs (via 6ix) and I came away more impressed than expected. On a follow-up
exchange, MLK told me that early work on metallurgy is encouraging, as the new areas are
comporting along the same lines as historical
workings. What that means in reality is I’m now
allowing myself to assume reasonable costs on 90%
gold recoveries as the ballpark for Green Springs
develops. Those kind of numbers for (theoretically)
easy stripping mineralization of the grades being
returned from Green Springs makes this project
interesting. C.v now has plenty of long length 1+g/t
and 2+g/t Au assays on the books, for context
consider that at Pan further North on the same
trend, Fiore Gold (F.v) mines profitably at 0.5g/t Au.
The latest Contact Gold corporate presentation, up to
date January 2021, is on this link (10) and worth a
read. The equity position held by Waterton still concerns me.
Precipitate Gold (PRG.v): Much talk last week around GoldQuest (GQC.v), which self-
promoted a visit to its project by the new Minister of Mining and got people buying shares, as
well as interested in Dom Rep as a mining jurisdiction. GQC is not going to get over its fatal
flaw CSR issue no matter how well they spin matters, PRG is a superior risk/reward speculation
for the country.
22

NB: Please be clear that The Tiny Dogs is NOT a list of recommended tinycap stocks. It is a list of companies with
market caps of under $20m offering a reasonable representation of the wider tinycaps market. It is possible that in the
future I may buy shares in one or several of these stocks, but at the moment both my opinion and my wallet are strictly
neutral.
Regional politics
Tracking Chile and Peru Covid-19 cases (week one)
Following on from last week’s note “Copper and its upcoming Covid-19 supply disruption”, the
next few editions of The IKN Weekly will run this feature and we keep a close eye on potential
supply disruption of copper into an already tight world market. To keep it standard, we’ll use
the charts at the well-regarded Worldometers site for the ongoing track (11) and each chart
also comes with its seven day moving average:
Chile: The chart for new daily infections:
Chile: The chart for daily fatalities:
Peru: The chart for new daily infections:
23

Peru: The chart for daily fatalities:
The silver lining is the relatively low upturn in fatalities to date, particularly in Chile (good
hospitals and one year one, the virus is better understood). The bad news is the continued
upturn in new cases and particularly the spike now starting in Peru. Other regional countries
such as Colombia are now seeing the Second Wave in full force and sadly, both Chile and Peru
are not far behind on their infection curve.
As for news, this weekend Chile’s state mining company Codelco announced (12) preventative
measures against Covid-19 including the re-introduction of home working where applicable,
fewer people on shifts, fewer transport hours per worker, etc. They are also in talks with the
main Codelco unions to go back to the previous shift patterns used at the height of last year’s
emergency.
Ecuador: Andrés Arauz and Guillermo Lasso to make the second round run-off
With just three weeks to go before Ecuador votes for its next President, results from the
respected pollster Market Asesores (detailed and methodical, the 52 page PDF is worth a close
look (13) the for the February 7th election (which also includes that mining referendum in the
Cuenca region that is a lock to go against the industry)
According to its own population, By far the most pressing issue in the country is unemployment.
Then come “corruption” the “health crisis caused by Covid”, the “lack of money” (related to
employment, of course) and then comes the ever present South American worry on crime. As
for voter intention, it’s telling that with less than a month to go only 69% of Ecuadorians have
decided how they will vote and of those 69%, here’s the breakdown:
24

Unless there’s a seismic shift among the 31% of undecided voters in the next three weeks, we
are heading for a run-off between Andrés Arauz (the Rafael Correa dauphin) and Guillermo
Lasso (third time of running for this right wing candidate). Thoughts on all three, then the
future scenarios;
 Guillermo Lasso has been losing some ground as late, with his “Panama Papers” connection
unsurprisingly coming back into the debate (a long story but he has been directly connected
to almost 50 offshore companies, most domiciled in the Cayman Islands, through which he
built and profited from his Miami business empire, in sum it’s one of those “corrupt normal”
ways of doing business in LatAm that was uncovered during the heat of the Panama Papers
scandal and now makes him look bad (justifiably or otherwise)).
 Andrés Arauz has been trying hard not to upset anyone, which is probably why he’s been
rising in the polls. Extremely carefully managed, his popularity rating isn’t good but it’s less
worse than the others (60% of the population hate Arauz, 70% for the other two) and will
now likely see him take most votes in round one.
 Yaku Pérez has been running a good campaign and has managed to keep the Pachakutik
political alliance onside and without too many visible cracks, as even though some of the
Pachakutik top table are nothing sort of Marxists, he’s managed to bring the party financial
proposals into the world of reality. He’s never going to avoid accusations of
Lefty/Commie/etc (the haircut is enough) but his economics and fiscal proposals aren’t
radical left For example, he’s a strong proponent of keep the US Dollar as the country
currency and has clear and (must be said) popular opinions on exactly how Ecuador should
re-negotiate its debt with the IMF. Businesses are welcome and his only stipulation is that
“our government’s green policies require funding, so pay your taxes”. Also, the details in
that recent poll show he has strong hard vote among (particularly in his home region of
Cuenca, where he has been the main driving force of the anti-mining referenda) which all
adds up to the likely result of kingmaker being confirmed and a new force to be reckoned
with in Ecuador national level politics.
Regarding the likely ballotage election, polls assuming Arauz vs. Lasso puts the run-off at “too
close to call” and suddenly Yaku Pérez is no longer a theoretical kingmaker but a real one.
There’s no way he’d endorse Lasso (we know that) and he’s a staunch enemy of Rafael Correa,
but not for nothing has the Arauz campaign been more than happy to comply with the Ecuador
electoral body (CNE) rulings and remove all trace of Correa from their advertising and electoral
campaign materials. The pliable Arauz and the “green pragmatic” Pérez are less apart than at
the beginning of this process and while Rafa’s man may have enough in a tight race without the
extra endorsement, we can be quite sure he’ll want it.
25

The bottom line: It’s up for grabs in Ecuador between Arauz and Lasso, with polls now slightly
favouring Arauz in round one. The two big incognitos are 1) the 30% of Ecuador voters who
have not decided and 2) LatAm’s notable recent left shift, something most polls have not picked
up on before an election day. We’ve seen Argentina and Bolivia do it, if it happens here Arauz
will be next President. However Guillermo Lasso is confident of his win despite his general
unpopularity, he expects Ecuador will decide he is the least worst in the run-off. Finally, Yaku
Pérez not only has the near-certain win in his Cuenca anti-mining referendum, but also the
potential to gain tangible political leverage for his party. As for how this affects Ecuador and
mining, any time Yaku Pérez approaches any lever of power is bad news. Andrés Arauz is
almost certainly fudging his position because he wants a growing mining sector under his
eventual government as is too chicken to say it out loud. The best result for the sector will be a
Lasso win, while the style of a Arauz win may be as important as the substance. Finally, for
those of you versed in Spanish here’s excellent source material on the position of the main
2021 Presidential candidates on mining (14) except the Arauz campaign, who said he would
reply and didn’t after multiple prompts. Telling.
Ecuador: The USA counters China
An interesting story out of the London FT last week (15) was rebounded by every newspaper in
Ecuador (e.g. 16), here’s how it begins:
The US International Development Finance Corporation has struck a deal that will help
Ecuador repay billions of dollars in loans to China and boost development in exchange
for excluding Chinese companies from its telecom networks.
Adam Boehler, the chief executive of the US development bank, signed the deal in an
event with Ecuadorean president Lenín Moreno on Thursday, calling it a “novel model”
to eject China from the Latin American nation.
“It is a novel approach that very strongly combines both missions of the DFC. The first
is that we are going to impact development in Ecuador in a very positive way,” Mr
Boehler told the Financial Times. “DFC was created was so that no single authoritarian
country had undue influence over another country and we are addressing that factor
with this agreement.”
In a small series last year The IKN Weekly tracked how the USA’s pick for region’s major
investment vehicle the IDB (Intl Development Bank), Mauricio Clavier-Carone, was promoted as
a new broom and then positioned as a new counterweight to Chinese influence in the region.
The DFC is not the IDB, but it’s no coincidence that Ecuador has now been given a U$3.5Bn line
of credit after years of doing the same type of business with China, but on the specific condition
that China stays away from Ecuador’s telco sector. That’s a clear first card played and if this is
the eventual direction in North/South America relations during a Biden administration, it’s
welcome on the financial front as an obvious counterweight to the growing influence of China in
the region. As for the politics, my reveries about a Biden admin eventually funding ecological
and anti-mining groups earlier this year was not meant to be taken seriously and I doubt The
USA cares much about the Ecuador’s mining sector, result of next month’s election will be far
more influential on the future of mining in the country.
Mexico: Resource nationalism alert
Perhaps inevitable but always a negative when the news hits, last week a representative of the
ruling MORENA party in Mexico submitted a law project to raise more money from mining
operations in the country. Parliamentarian Irán Santiago Manuel wants to change the current
state royalties system for one that a) pays more and b) is easier for the government to oversee
(avoiding payment loopholes). Instead of the current 7.5% on EBIT (plus 0.5% if precious
metals production, he wants a generalized 5% on gross sales which moves to 8% for revenues
from gold, silver and copper. His lengthy discourse was heavy on political spin too, we can
paraphrase his justifications as being fatcat foreign miners enjoying bonanza metals prices,
giving nothing to Mexico and hiding profits via transfer pricing to avoid State royalty payments
on profits (17). The usual in other words, but this law bill is serious and even if committee
stage produces a watered down version, its heavy dosage of resource nationalism (from a left
26

wing government to boot) will not go down well.
Guatemala: The Escobal (PAAS) “pre-consultancy” period starts April 20th (or not)
Maybe this is what Simon Ridgway meant by “the time is now” in Guatemala, as this week its
mining minister announced that the “pre-consultancy period” between locals and
company/government for the Escobal silver mine in Guatemala is set to begin on April 20th (18).
However, when legal representatives of the Xinca peoples were asked about this they said that
there was still no firm agreement to start talks on that date, only a commitment to start of April
20th made last year before the Covid-19 pandemic started. As the last 12 months have seen
Xincas complain constantly about government interference in the process, your guess is as
good as mine on whether formal talks finally begin, but even in a best-case situation the
government expects than to take between 11 and 13 months to get to agreement. Don’t hold
your breath on Guatemala.
Argentina: Chubut parliament looking debate the mining law
After the pressurized atmosphere at the end of 2020 when the law project to decide whether
part of its province should be “zonificated” to allow Pan American Silver (PAAS) Navidad mine
project to go ahead, the heat is off because there’s little chance of a debate before parliament
reconvenes in March. Nevertheless, the pro-mining argument is still being put forward in
Chubut, South Argentina by those loyal to governor Arcioni and last week saw two moves. First
was the turn of the member of provincial congress Carlos Gómez, who in a deposition probably
did more harm than good with the odd argument that the “Zonification” plan “guarantees all
aspects of the current 5,001 law over the medium and long-term”, as it’s that very law which
prohibits mining and must change for Navidad to happen. However, the reason for his mention
today is his comment further into his discourse last week that as 2021 is a provincial election
year with some seats up for election (five lower house and three upper house seats are up for
grabs on October 24th) “either by an extraordinary debate (i.e. out of normal house business
days) or in March, the debate has to go ahead (19).”
The other side to the Chubut push for Navidad is a series of 15 online virtual workshops
happening this week and organized by Arcioni (20). The workshop is aimed at all groups in
Chubut society, including universities, unions and even the clergy and main religious groups
and is all about the Navidad mine, with presenters including the mining secretary, Alberto
Hensel (so hot). The plan is to use the strong suit of the mining industry, facts and examples of
good mining practices instead of having to defend anti-mining rhetoric on a constant basis and
is long overdue, as people tend to warm to modern mining when they hear the details. There
is more than a little urgency around the pro-mining camp in Chubut now, as both national
executive and provincial governor are pushing to get the law past a determined anti-mining
camp that has successfully resisted all efforts of mining companies to develop in the province
for over two decades (begin the count with Yamana’s Suyai project, back then owned by
Meridian and called Esquel). The anti-mining people will likely adjust their strategies
accordingly. This is still the best opportunity PAAS will have to get Navidad out of the penalty
box, however it’s still nigh-on impossible to call the winning side.
Appian aims $465m at LatAm
The oversubscribed closure of Appian Capital’s new Fund II that raised U$775m also raised
plenty of eyebrows recently. As for Founder/CEO Michael Scherb’s plans for the money, we
know from this interview with BN Americas (21) that 40% of the cash is already
deployed/reserved in five investments in Brazil, Canada and Australia. We also know Appian
expects to deploy most of the U$465m balance in 2021 due to “the large pipeline built up”, in
other words they are looking to fund a project or projects into production. We also know their
target jurisdictions are Mexico, Peru and Chile and that while they are not interested in lithium,
they are looking to play both precious metals and the “infrastructure boom post Covid-19”.
Finally, strong ESG and “making a difference” is part of the Appian agenda, as noted in this
reply given by CEO Scherb on the subject:
“ESG is a hugely important thematic from our investors down to our portfolio
companies. As mentioned, smart LPs (limited partners) which have done the analysis
27

realize that mining is in everything around us and won’t be substituted away so the
question is how best to invest into the sector? In our way, we can control the ESG
dynamic as we control the assets so have a positive benefit to the communities around
us. Through our investments and our Appian Way Charitable Foundation, Appian has
created 11,000 jobs indirectly in parts of the world which need that support.”
You may now place your bets as to exactly where Appian decides to deploy that capital, though
we can also assume from the “we control the assets” comment above that they will continue
with their normal M.O. and buy into companies via equity, rather than debt financing. As a
result, I offer up my one and only guess below, in the first note of ‘Market Watching’.
Market Watching
Bear Creek Mining (BCM.v) rumoured close to a financing deal
This week we segue seamlessly from one section to another. It’s one of those “streets of Lima”
things that can be double-edged swords, however there was a small side-incident late week
that makes a difference. Since the re-start of community relations contact at Bear Creek
Mining’s (BCM.v) Corani project in Puno, South Peru, there has been recurring talk of a
financing deal being put together by CEO Tony Hawkshaw and the team. The rumblings have
been on and off since before Christmas and if it were just street noise, this note wouldn’t exist
(there’s way too much to report, most is junk). However, last week Peru’s Minister for Energy
and Mining Jaime Galvez held a press conference to promote and inform on the investments
happening in mining this year. The big ones that capture the local headlines and Mina Justa,
which is due to start producing copper in April, then Quellaveco which should get to 50%
complete on its build-out, then large projects such as the Toromocho growth project and the
Yanacocha Sulphides project, with build decisions on the hands of their respective companies.
However, after listing the big projects to the assembled journalists he then mentioned two
medium scale projects due to start, namely San
Gabriel (Buenaventura BVN) and Corani
(BCM.v) and almost as an afterthought said
about Corani that is (22) (translated) “…and
Corani, which is about to complete its
financing.”
That’s all you are getting on the subject
because it’s all I have. I’m not planning on
buying any BCM.v shares, but the raising at
Appian, the timing and its general focus (as
well as their commitment to ESG in places that
make a difference) all fit their taking at least a
part of any finance package now being put
together for Bear Creek (BCM.v) and Corani. As
a final aside, I know for a fact that CEO Hawkshaw didn’t take the job in order to flip the
company to the highest bidder, his desire and brief has always been to take Corani into
production.
McEwen Mining (MUX) and financials
After last week’s note pointing to the clear hints of financial stress at the company, this week
saw just one piece of news from MUX, on January 13th:
On January 7, 2021, McEwen Mining Inc. (the “Company”) received notice that Andrew
Iaboni, Vice President of Finance of the Company, decided to resign his position with
the Company to pursue other business opportunities. It is anticipated that his
resignation will be effective January 22, 2021.
Again, not a strong financial signal from a company with a negative history of revolving door
management. MUX is once again under the NASDAQ minimum trading requirement of U$1.00+
for its share price and if the exchange decides to review the listing, it would be the third time of
28

asking.
Almaden (AAU) (AMM.to) trading on fake news
Maybe the phrase “fake news” will proceed to go out of fashion in 2021, but for the time being
it suits to sum up the trading action in Almaden Minerals (AAU) (AMM.to), the company which
recently saw its share price hit hard by Mexico’s refusal to grant an EIA permit for its Ixtaca
project (the community dead set against it).
Last week and for unknown reasons, AAU rebounded hard as talk went round the company was
going to get “a win in the courts”. To its
credit, AAU also heard the talk and saw the
trading action in its shares and issued a NR
to the effect on Tuesday, but that didn’t stop
this pump from running to Wednesday
evening when a court did indeed “rule in its
favour”.
However, the court ruling was not on any
aspect of Almaden’s project or permitting, it
was due to the locals having filed a court
case against the whole of Mexico’s mining
law, which they say is unjust. In other
words, it’s a protest case at the margin of
the real issues around Ixtaca, because the
Mexico Supreme Court was always going to throw this case out (else invalidate the whole of its
organic mining law for the whole of the country (23). However, as you can see somebody tried
and partially succeeded in telling people this was a massive win for AAU, in all likelihood a
rumour started by somebody trapped in a bagholder position in the stock. Avoid like the
veritable plague.
Conclusion
IKN608 is done, we end with bullet points:
 The numbers make the decision to sell Fiore Gold (F.v) straightforward, there’s always
the opportunity to return. As for the other trade this week, Steve Zucker will be pleased
we’re finally adding TORO.v at the right price, I’m sure.
 Regarding returns, Wesdome (WDO.to) is back on my active radar. We’re in a nervous
market that does illogical things, seeing this high quality sold down before the company
gets back into full stride wouldn’t be a shock, we search for a bargain entry point from
today. Meanwhile, New Gold (NGD) nailed another good quarter, no reason to sell this
in order to buy WDO.
 Said it before and I’ll ay it again: Wonderful people an unbeatable scenery, but avoid
29

exposure to Ecuador in your mining portfolio because it’s also a basket case of a
country.
 Another week with scant mention of the two Top Picks. That will change soon enough,
and they are still the best trade ideas these pages have to offer.
I thank you in advance for any feedback. Our Top Pick stocks are Minera Alamos (MAI.v) and
Rio2 Ltd (RIO.v). Flash updates will be sent if required by events.
I wish you good trading fortune, ladies and gentlemen.
Mark
Footnotes, appendices, references, disclaimer
(1) https://www.reuters.com/article/global-precious/precious-gold-edges-up-on-bidens-stimulus-proposal-
idUSL4N2JQ07T
(2) https://fioregold.com/fiore-gold-reports-fiscal-q1-2021-production/
(3) https://www.newgold.com/investors/news-releases/news-details/2021/New-Gold-Reports-Fourth-Quarter-and-
Annual-Operational-Results-Achieves-Annual-Production-Guidance/default.aspx
(4) https://iknnews.com/greedy-about-wesdome-wdo-to/
(5) https://www.wesdome.com/news/press-releases/index.php?content_id=394
(6) https://finance.yahoo.com/news/aurelius-minerals-discovers-mineralized-zones-120000993.html
(7) https://produceredition.webcasts.com/starthere.jsp?ei=1421305&tp_key=1996d72c1d
(8) https://iknnews.com/thursday-thoughts/
(9) https://finance.yahoo.com/news/endeavour-announces-first-dividend-record-123000239.html
(10) http://www.contactgold.com/_resources/presentations/corporate-presentation.pdf
(11) https://www.worldometers.info/coronavirus/country/peru/
(12) https://holanews.com/la-estatal-chilena-codelco-anuncia-nuevas-medidas-por-la-segunda-ola-de-covid-19/
(13) http://www.pichinchacomunicaciones.com.ec/wp-content/uploads/2021/01/ELECCIONES-
2021_Preferencia_electoral.pdf
(14) http://www.minergiaec.com/elecciones-ecuador-2021-mineria/
(15) https://www.ft.com/content/affcc432-03c4-459d-a6b8-922ca8346c14
(16) https://www.eluniverso.com/noticias/2021/01/15/nota/9582415/prestamo-estados-unidos-ecuador-expulsar-china-
latinoamerica#cxrecs_s
(17) https://pulsoslp.com.mx/valores/presenta-morena-iniciativa-para-aumentar-impuestos-a-mineras/1243692
(18) https://www.prensalibre.com/economia/tras-casi-4-anos-suspendida-inicia-proceso-de-preconsulta-a-comunidades-
por-mina-san-rafael/
(19) https://www.adnsur.com.ar/politica/-el-proyecto-de-zonificacion-minera-garantiza-a-mediano-y-largo-plazo-
preservar-todos-los-alcances-de-la-ley-5-001-_a6000a2d7041d7e49a3e3c46b
(20) https://www.elchubut.com.ar/nota/2021-1-15-19-19-0-el-gobierno-convocara-diversos-sectores-para-debatir-sobre-
el-proyecto-minero
(21) https://www.bnamericas.com/en/interviews/appian-eyes-compelling-opportunities-in-latam-mining-sector
(22) https://larepublica.pe/economia/2021/01/15/minem-promovera-que-la-ejecucion-de-proyectos-mineros-no-se-
postergue/?ref=lre
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(23) https://actualidad.rt.com/actualidad/380171-corte-mexico-ley-minera-indigenas-reves
Stocks To Follow Closed Positions 2020
Closed in 2020 closed close price
TMAC Resources TMR.to Jan'20 C$3.41 20-Dec-19 C$3.61 5.9% TLS flip play, sold new year
Regulus Res REG.v Jan'20 C$1.10 20-Dec-19 C$1.30 18.2% TLS flip play, profit taken
Bonterra Res BTR.v Jan'20 C$1.90 9-Dec-19 C$1.66 -12.6% TLS flip play, loss taken
McEwen Mining MUX Jan'20 U$1.12 2-Dec-19 U$1.18 5.4% TLS flip play, profit taken
Core Gold CGLD.v Jan'20 C$0.255 7-Apr-19 C$0.305 19.6% arb trade, profit taken
HudBay Min HBM Jan'20 U$3.56 9-Dec-19 U$3.36 -5.6% TLS flip play, loss taken
Midas Gold MAX.to Feb'20 C$0.71 5-Jan-20 C$0.57 -19.7% sm & silly trade
Warrior Gold WAR.v Feb'20 C$0.08 3-Aug-18 C$0.05 -31.3% clean out non-perf sm stocks
Contact Gold C.v Feb'20 C$0.40 19-Aug-18 C$0.18 -55.0% clean out non-perf sm stocks
Sandstorm Gold SAND Feb'20 U$3.73 17-Apr-16 U$7.21 93.3% Sold during port rebalance
NexGen Energy NXE Feb'20 U$1.20 2-Dec-19 U$1.06 -11.7% TLS flip play, loss taken
MAG Silver MAG Apr'20 U$8.95 1-Mar-20 U$10.07 12.5% Sold to cut silver exposure
Alexco Res AXU Apr'20 U$1.69 7-Sep-17 U$1.69 0.0% sold to close Ag exp. in FY20
Bonterra Res BTR.v Jun'20 C$1.62 2-Feb-20 C$1.10 -32.1% under-performer cash moved
Regulus Res REG.v Jun'20 C$0.64 6-Apr-15 C$0.79 23.4% moved $ TMQ/MIN & Au stocks
Great Panther GPR.to Aug'20 C$0.60 21-Jun-20 C$1.10 83.3% Profit taken, good trade
Jaguar Mining JAG.v Aug'20 C$0.42 21-Jun-20 C$0.65 54.8% Profit taken, good trade
Sandstorm Gold SAND Aug'20 U$7.76 10-May-20 U$9.37 20.7% Profit taken, good trade
Integra Resources ITR.v Aug'20 C$2.23 13-Aug-18 C$5.40 142.2% Profit taken, good trade
Wesdome Gold WDO.to Aug'20 C$2.37 14-Oct-17 C$14.82 525.3% last 1/2 of big win closed
INV Metals INV.to Sep'20 C$0.40 17-May-20 C$0.45 12.5% Cut all Ecuador exposure
Cartier Resources ECR.v Nov'20 C$0.155 3-Aug-18 C$0.25 67.7% Exact close price TBA
Tinka Res TK.v Dec'20 C$0.195 19-Apr-16 C$0.195 0.0% Closed on a round trip fail
2015 to 2019 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Stocks To Follow Closed Positions 2019
Closed in 2019 closed close price
Atico Mining ATY.v jan'19 C$0.55 24-Jul-16 C$0.32 41.8% patience ran out, made room
Candente Copper DNT.to jan'19 C$0.075 3-Ago-18 C$0.05 -33.3% tiny trade, made room for new
B2Gold BTO.to feb'19 C$2.11 12-Set-14 C$4.05 91.9% Took 1/2 profits, reduce size
Western Copper WRN.to mar'19 C$0.80 20-Ene-19 C$0.81 1.3% Spec trade that didn't work
B2Gold BTO.to mar'19 C$2.11 12-Set-14 C$4.15 96.7% Took rest of profit.
GT Gold GTT.v mar'19 C$1.17 10-Oct-18 C$0.90 -23.1% Took loss. Story changed
NovaGold NG apr'19 U$3.84 13-Ene-19 U$4.15 -8.1% Short that didn't work, sm loss
Zinc One Z.v jun'19 C$0.47 14-Set-17 C$0.025 -94.7% clearing out dead trade
Amarillo Gold AGC.v jun'19 C$0.24 22-Ago-18 C$0.20 -16.7% clearing out dead trade
New Gold NGD aug'19 U$1.44 31-Jul-19 U$1.23 14.6% ST short win thru Q2 earnings
IMPACT Silver IPT.v aug'19 C$0.39 21-Jul-19 C$0.46 18.0% took a quick profit
Fiore Gold F.v aug'19 C$0.34 26-May-19 C$0.56 64.7% Took profit, 2q19 avg
Chakana Copper PERU.v oct'19 C$0.84 22-Mar-18 C$0.16 -81.0% Exploreco trade fail. Want space
Wesdome Gold WDO.to oct'19 C$2.37 14-Oct-17 C$7.57 219.4% Sold half, profit taking
Superior Gold SGI.v oct'19 C$1.46 8-Abr-18 C$0.47 -67.8% Failed sm spec on Au. Moved on
Amerigo Res ARG.to nov'19 C$0.91 23-Set-18 C$0.50 -45.1% worst trade of year, hefty loss
Guyana Goldfields GUY.to dec'19 C$0.94 14-Abr-19 C$0.56 -40.4% taking the loss, financials weak
Tethyan Res TETH.v dec'19 C$0.30 8-Set-19 C$0.16 -46.7% tiny trade, word of probs in co
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Stocks To Follow Closed Positions 2018
Closed in 2018 closed close price
Amarillo Gold AGC.v jan'18 C$0.38 24-Mar-17 C$0.31 -18.4% Cut away losing trade
Riverside Res RRI.v jan'18 C$0.39 27-Jun-16 C$0.31 -20.5% Cut away losing trade
Eros Res ERC.v jan'18 C$0.175 1-Mar-17 C$0.16 -8.6% CEO sudden exit, not good
Excellon Res EXN.to jan'18 C$1.54 9-Oct-16 C$1.66 7.8% 4q17 poor, one too many bad qtrs
Wesdome Gold WDO.to jan'18 C$1.68 15-Dec-17 C$2.06 22.6% Near-term trade block, took profit
Sabina G&S SBB.to apr'18 C$2.06 17-Dec-17 C$1.77 -14.1% Near-term trade, bad timing, small
B2Gold BTO.to May'18 C$2.11 12-Sep-14 C$3.67 73.9% sold 25% to reduce exposure
Lara Expl. LRA.v May'18 C$0.65 11-Feb-18 C$0.58 -13.8% Spec on Brazil didn't work
Solitario XPL June'18 U$0.72 19-Mar-17 U$0.41 -43.1% Failed trade, may return in 4q18
SolGold plc SOLG.to July'18 C$0.475 19-Nov-17 C$0.415 -12.6% cut, trade didn't perform
Pan American PAAS July'18 U$17.90 1-Jun-18 U$16.30 8.9% modest win on short position
NGEx Res NGQ.to Sep'18 C$1.01 22-Oct-17 C$1.00 -1.0% Closed to reduce Argentina exp
Sandstorm Gold SAND Oct'18 U$3.73 17-Apr-16 U$4.13 10.7% partial sale to raise cash for GTT
Aldebaran Res ALDE.v Nov'18 n/a n/a n/a n/a liquidate spin out of REG
Stocks To Follow Closed Positions 2017
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 1-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 8-Apr-12 C$1.05 -8.7% cut to make room for new trade
Rye Patch Gold RPM.v Apr'17 C$0.31 2-Sep-16 C$0.32 3.2% cut for doubts & new stock
Cordoba Min. CDB.v Jun'17 C$0.75 15-Sep-16 C$0.63 -16.0% closed
Constantine Metal CEM.v Aug'17 C$0.135 9-Apr-17 C$0.28 107.4% spec trade closed, good win
Red Eagle Min. R.to Sep'17 C$0.67 13-Dec-16 C$0.27 -59.7% IKN's biggest failure in years
Starcore Intl SAM.to Sep'17 C$0.61 10-Jan-15 C$0.31 -49.2% Patience ran out
B2Gold BTO.to Dec'17 C$2.11 12-Sep-14 C$3.39 60.7% sold small portion for liquidity
Stocks To Follow Closed Positions 2016
Closed in 2016 closed close price
Phoscan Chem FOS.to jan16 C$0.28 29-mar-15 C$0.265 -5.4% Buyout trade, bot but poor deal
True Gold TGM.v jan16 C$0.18 23-ago-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-ene-15 U$1.20 10.1% sold due to lack of value
Lake Shore Gold LSG.to feb-16 C$1.10 07-abr-15 C$1.69 53.6% bot out, sold early in process
Atacama Pacific ATM.v feb-16 C$0.19 26-abr-15 C$0.40 110.5% sold for a double on big pop
New Gold NGD feb-16 U$2.06 24-ene-16 U$2.96 43.7% closed good near-term trade
Sandspring Res SSP.v mar-16 C$0.195 18-oct-15 C$0.32 64.1% Hit tgt, took profit
Teranga Gold TGZ.to mar-16 C$0.54 15-feb-15 C$0.60 11.1% disappointing trade
B2Gold BTG mar-16 U$0.85 13-ene-16 U$1.30 52.9% Separate trade on B2, hit tgt
Dalradian Res DNA.to mar-16 C$0.67 27-oct-13 C$1.00 49.3% Hit target, sold, good win
HudBay Min. HBM may-16 U$4.10 03-abr-16 U$4.36 -6.3% Short trade, poor timing
Nevada Sunrise NEV.v may-16 C$0.185 28-feb-16 C$0.23 24.3% V. small, no big deal either way
Richmont RIC jun-16 U$7.60 01-may-16 U$9.30 22.4% near-term trade, profit taken
INV Metals INV.to jul-16 C$0.25 03-abr-16 C$0.95 280.0% Trade closed on time
HudBay Min. HBM aug16 U$4.98 09-jun-16 U$4.80 3.6% short trade covered, no big deal
Miranda Gold MAD.v oct-16 C$0.125 03-jul-16 C$0.10 -20.0% tiny spec trade, didn't work
Avino G & S ASM nov-16 U$2.00 21-oct-16 U$1.40 -30.0% Abandon trade on bad bot deal
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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
Please note that due to space considerations closed positions 2009 to 2014 are now
available on request, or were published in any edition to IKN553 (end 2019).
Important Disclosure
The information and opinions contained within this report reflect the personal views of the author and therefore all
material within should not be construed as accurate or reliable or be utilized as advice for investment or business
purposes. Independent due diligence and discussions with ones own investment and business advisor is strongly
recommended. Accordingly, nothing in this report should be construed as offering a guarantee of the accuracy or
completeness of the information contained herein, as an offer or solicitation with respect to the purchase or sale of any
security or as an endorsement of any product or service. All opinions and estimates included in this report are subject to
change without notice. It is prohibited to copy or redistribute this report to any type of third party without the express
permission of the author.
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