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The IKN Weekly
Week 627, May 30th 2021
Contents
This Week: Trade heads-up, In today’s edition, US markets and US jobs, The Fed in control.
Fundamental Analysis: Buying Amarillo Gold (AGC.v).
Stocks to Follow: New Gold (NGD), Aldebaran Resources (ALDE.v), Rio2 Ltd (RIO.v), QC
Copper & Gold (QCCU.v), Orezone (ORE.v), Strategic Metals (SMD.v), Wolfden Resources
(WLF.v), Great Bear (GBR.v).
Copper Basket: Overview, The Peru copper stocks (REG.v, PERU.v, CCCM.v, ECU.v), Western
Copper & Gold (WRN.to).
Producer Basket: Overview, B2Gold (BTG) (BTO.to).
Tiny Dogs: Overview, Red Pine Exploration (RPX.v).
Regional Politics: Ecuador: Guillermo Lasso swears in, Mexico: AMLO and The Economist,
Colombia social protests continue, Peru election polling and commentary.
Market Watching: Norsemont Mining (NOM.cse) reports its quarter, An eye on the Roxgold
(ROXG.to) side bet, A recommended read on silver producers, Alexco Resource Corp (AXU)
1q21 financials.
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
Tomorrow, Monday May 31st, I am a buyer of Amarillo Gold (AGC.v) shares. Please note that
unlike normal circumstances, I also expect tomorrow Monday May 31st to offer the entry point
and will buy accordingly. I plan to begin with a sizeable position and add if things go well.
Please see today’s main Fundamentals section for more.
In order to both partially fund and make space for the new Amarillo Gold position on the ‘Stocks
to Follow’ list, I am my shares in New Gold (NGD) and closing the position. See Market
Watching for more on that.
In Today’s Edition
 I’ve deferred “analysis of McEwen Mining (MUX) (part two of two) due to what I believe
is the time sensitive nature of today AGC trade. I considered finishing the note and
putting it in the ‘Market Watching’ section, but decided against because 1) it deserves
its proper place as a real Part Two, 2) there’s no ticking clock on new trade in MUX.
 Instead, today’s focus is Amarillo Gold (AGC.v), a stock I have traded at a loss on two
previous occasion. However, today’s situation is very different and led by Eric Sprott,
we get to grab his coattails as he positions himself strategically in AGC.
 We also re-open coverage on Alexco Resource Corp (AXU) today, a company without
peer in its sector, to consider its relative valuation to silver as it moves to commercial
production later this year. That’s in today’s ‘Market Watching’, along with a mixed bag
of other news.
1

 Copper had another great week and it’s the place to be, we’re positioned in the small
cap end to gain the best leverage in the second half of the year. The Copper Basket
considers the ongoing supply tightness, those fundies seem to support higher prices.
 Regional politics takes in the final official opinion polls on next week’s key Presidential
election in Peru, with all the main polling companies using the last legal day to publish
their findings. This time next week, we will know.
US markets, US jobs
Please note that US markets will be closed tomorrow Monday for their country’s Memorial Day.
The Canadian markets are open for business as usual.
Also next week from the USA, Friday brings the US BLS jobs report with Bill McBride reporting
current consensus at +650k NFP and a headline rate to drop to 5.9% from last month’s 6.1%.
The Fed in control
Back in the intro of IKN623, dated May 2nd, we floated thoughts on Modern Mone(tar)y Theory,
or MMT and how we expect Jay Powell, Janet
Yellen and all their friends to “…use their
preferred checks and balances (e.g.
jawbone, FOMC, supply tweakings) to keep
the dollar from moving much in either
direction as The USA accelerates out of its
Covid-19 trough. With expansion comes the
impulses for rates and currencies to
strengthen, thereby allowing more leeway
for Keynesian-type injections into the
market, which counters the upward
pressures on USD and everything stays
steady in Goldilocks Land.” From what we’ve
seen since then, the theory fits. Here’s the
USD index (right) sitting at the 90 level
without looking under threat, also we’ve just heard about Joe Biden’s next $6Trillion stimulus
package, which is big enough for anyone’s Keynesian appetite. Indeed IKN623’s intro would
have looked smart today if I hadn’t proceeded to snatch defeat from the jaws of victory by
supposing that a successfully adopted MMT would mean gold did not rise, instead I’ve been
happily mistaken and gold has moved above U$1,900/oz without showing signs of the rally
abating. Which means I was dumb and, on reflection, the error seems to have been missing
that the Fed’s policies also mean gold rises if they are successful. After all, if the plan is to
control the fluctuations in the US Dollar by adjusting liquidity rates, that means opening and
closing them but mostly opening which, in turn, feeds inflation that then manifests in higher
prices, first for basic commodities and then up through the supply chain. With interest rates
kept low by the sheer quantity of dollars
chasing yield, we even have veteran gold GLD gold holdings, 2021 YTD (metric tonnes)
1200
commentator Martin Murenbeeld calling for
1180
U$2,000/oz gold by the end of this year. To
1160
quote the article, he says that, “…as long as 1140
1120
interest rates remain low and weakness in the
1100
U.S. dollar continues, then gold should continue
1080
to climb” but in fact we won’t even need the 1060
second input, all gold requires from now on is a 1040
1020
constant dollar price….and a Fed in control.
1000
Wrapping up the intro with a semi-OT and the
GLD regular charts, inventories at the big
bullion ETF closed at 1043.21 metric tonnes
(mt) Friday, very slightly higher than this time last week but no biggie. Which means gold’s
2
02/21/13 12/1/5 12/1/01 12/1/51 12/1/02 12/1/52 12/1/03 12/2/4 12/2/9 12/2/41 12/2/91 12/2/42 12/3/1 12/3/6 12/3/11 12/3/61 12/3/12 12/3/62 12/3/13 12/4/5 12/4/01 12/4/51 12/4/02 12/4/52 12/4/03 12/5/5 12/5/01 12/5/51 12/5/02 12/5/52
mt
source: SPDR GLD data

move higher gives us a lower reading still on our Inventory/Price ratio, now 5.88X and firmly
under the 6.0X “Wall St washout” level for gold sentiment. This chart of the last three years of
the ratio shows the two previous occasions when this line dipped under6X recently, both
coming before gold price rallies.
7.60 GLD: Inventory/Price Ratio, 2018 to date
7.40
7.20
7.00
6.80
6.60
6.40
6.20
6.00
5.80
5.60
5.40
3
2/1/8102 2/3/8102 2/5/8102 2/7/8102 2/9/8102 2/11/8102 2/1/9102 2/3/9102 2/5/9102 2/7/9102 2/9/9102 2/11/9102 2/1/0202 2/3/0202 2/5/0202 2/7/0202 2/9/0202 2/11/0202 2/1/1202 2/3/1202 2/5/1202
Source: SPDR data, IKN calcs
Fundamental Analysis of Mining Stocks
Buying Amarillo Gold (AGC.v)
Tomorrow Monday, May 31st offers a rare opportunity for we small retail investors to sit at the
same table as Eric Sprott. For one day only, we can enjoy the same type of market influence as
a billionaire gold investor by buying Amarillo Gold (AGC.v) at its current price, almost certainly
pushed under 30c recently by the man himself. The house expectation is that for reasons
explained below, tomorrow Monday will be the last day these low prices for AGC shares can be
guarantees. Indeed, it’s even possible the stock makes a significant move immediately after,
but even if the optimum near-term trading scenario doesn’t comes to pass, this is still an
excellent trade set-up going into the second half of 2021.
As IKN Weekly records show (below), I’ve traded AGC twice and for a loss. On both occasions,
most recently in 2019 and though the first trade was further in the past, both were directly
related to my weakness for a Value Trap. On paper AGC has always looked very cheap
compared to its projects and though it has other assets, these days its risk and therefore full
market valuation rests on the flagship Mara Rosa project, containing the “Posse” mine project.
Mara Rosa falls in the “1m to 2m oz gold heap leach” bracket and according to the latest
corporate presentation (1) it’s now moving toward a financing package and eventual build
decision. That alone makes a change from previous years, as the company seemed to spend
forever doing nothing and a legacy error of taking on a $10m debt position meant it had
difficulty raising cash or getting meaningful working capital together. The last purchase in 2018
did nothing for a year and got little traction or attention the market, at which point I threw in
the towel and deployed the cash elsewhere. However and writing the phrase to tempt fate, this
time is different at Amarillo Gold. Cashed up and inertia bound no longer, AGC is ready for the
type of move a junior can make when all ducks come into line. Not only is the company now
cashed up, but also AGC has just filed its financials and is likely to hit the promo circuit in the
coming weeks. In fact that starts this very week, as on Wednesday June 2nd 11am EST, the
webinar platform 6ix (2) hosts the Amarillo Gold (AGC.v) CEO Mike Mutchler and CFO Hemdat
Sawh for (and we quote the blurb), “…a Company update about the Posse Gold Project on its
Mara Rosa property. They'll also talk about the catalysts on the horizon in this live presentation
with Q&A.”
There are several corners to cover in today’s note, we begin with numbers and take in the main
financials, as there are clues to the envisaged trade as we look back through AGC’s quarters.
This assets chart goes right back to late 2014, as do several of the chosen charts today, as they
are a good reminder of how this company was uneventful and lacking in momentum. It took a

financial re-working in late 2018, then new capital injections to bring life to these numbers and
therefore the company.
AGC.v: Assets
110
100
90
80
70
60
50
40
30
20
10
0
4
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 12q1
C$m
fixed
other current
cash & eq
source: AGC.v filings
The liabilities chart (right) clearly shows the
moment when AGC’s new management at the
time re-worked a $10m legacy debt position and
got it off the company books. From that moment
and with a cleaner balance sheet, it was able to
attract investment interest. Since that point,
liabilities have been kept very low and we like
that a lot.
This chart (left) separates treasury from other
asset types and shows the two recent injections
of capital, first in 3q19 and then the major
raising in 3q20, both arranged around and for
Eric Sprott. Related, this working capital chart
(below) takes the longer view and gives more
feel for the inertia of the years to 2018, then
how Eric Sprott’s arrival brought new impetus.
The initial cash injection in 3q19, then enough
progress to impress the man and see him raise
the stakes. Though cash has come in from other places, be in no doubt who calls the tune at
AGC today.
AGC.v: Working Capital per qtr
65
60
55
50
45
40
35
30
25
20
15
10
5
0
-5
41q4 51q1 51q2 51q3 51q4 61q1 61q2 61q3 61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
source company filings
srallod
fo
snoillim
AGC.v: Liabilities Breakdown per qtr
18
16
14
12
10
8
6
4
2
0
The share count chart (below) goes way back too, I like the perspective it gives to the recent
raises and big share adds. The visual of a company that has changed direction, this weekend’s
share count stands at 382.071m. For the 3q21 estimated period, plus we add our supposed
50m Eric Sprott warrants made whole (but not the 25m warrants due to lapse tomorrow).
41q4 51q1 51q2 51q3 51q4 61q1 61q2 61q3 61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
C$m
LT liab
current liab
AGC.v: Cash treasury per qtr
60
55
source: company filings
50
45
40
35
30
25
20
15
10
5
0
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
source: company filings
srallod
fo
snoillim

500 AGC.v: Shares Out
450
400
350
300
250
200
150
100
50
0
5
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 12q1 tse12q2 tse12q3
source: company filings
serahs
fo
snoillim
A brief overview of Mara Rosa and as for its resource, the last update came with the June 2000
Definitive Feasibility Study (DFS), which moved the count up a little but was more about turning
as much resource into P+P reserve. This simplified table shows the basics, with the gold hosted
in an open pittable deposit typically grading 1.1 g/t.
The DFS mine plan at Mara Rosa (3) is based on the 902,000 P+P ounces, of which it expects
881k oz to be payable over nine and a half years. This table from company literature shows the
basics and while we can go into the model and give house estimates further down the line the
only issues I have with this DFS-level work in mid-2021 are the financial inputs, as gold price,
costs and forex change the earnings potential of the mine. This table from the DFS is a fair
overview and gives the parameters of Posse and what it can achieve for AGC financially.
This resource has grown slightly in the last couple of years, but not by leaps and bounds and
the company has concentrated on definition drilling more than expansion. The difference these
days is that AGC has its permits from the government of Brazil, plus over C$44m in cash at
bank as at end 1q21, with C$42m of that working capital. This time around, when AGC moves
to promote it will be doing so on a fashionable story; the “…cashed-up junior, on the permitting
track and in the final stages, just waiting for…” That’s an interesting proposition and even
though AGC’s share count has ballooned to 382.1m after its large 3q20 raising, (190.7m shares
sold, basically doubling the count) it came with zero warrants and the continued support of Eric
Sprott, his is already 17.9% of shares out. However, it’s precisely because of Mr. Sprott that

this trade window exists tomorrow, because when the stock price chart tells you there’s some
reason it stops at the 30c line…
…and then you realize that from AGC’s equity raises in 2019, there are currently 76.4m
warrants out with a strike price of 30c about to lapse. The rump of them are the 50m-and-bits
warrants held by Eric Sprott, those expire on August 29th. However, 25m of the 26m expire
tomorrow Monday May 31st and aren’t owned by him. That means Eric Sprott may have a
vested interest in keeping those warrants from becoming whole. And as there’s not just visual
evidence of price suppression in AGC shares but reason for it as well, we can suppose
somebody has been sitting on AGC’s share price, somebody with the chops and the market
ammunition to keep AGC trading where it prefers. We therefore consider the issue from a “cui
bono” standpoint:
 This weekend, AGC has 382.1m shares out and Eric Sprott owns 68.4m of them (17.9%
of shares out).
 Tomorrow Monday, exactly 25,424,435 warrants with a strike of 30c lapse. If they were
to be made whole, they would add C$7.62m of welcome cash to treasury. However, it
would also dilute Eric Sprott’s overall position in the company.
 There are another 958,515 of the 30c warrants expiring on June 14th. Same as above,
but small.
 Lastly, the main warrants block are the 50.025m at 30c owned by Eric Sprott, with a
expiry date of August 29th 2021.
If those 50m warrants were made whole and the others lapse, we would have a company with
432.1m shares out and Eric Sprott owning 118.42m of them, or over 27%. It would also mean
around C$15m of welcome funds arriving to treasury, something the company would appreciate
as they close their financing package for Mara Rosa. With a capex bill of U$133m, current
treasury only gets them so far and according to the latest corporate presentation, negotiations
for the full financing package are ongoing. This desk confidently predicts that as soon as Eric
Sprott is positioned to his own satisfaction with his large holding, the financial deal gets done
and we may even see the right size of equity addition to bring the man at the centre of today’s
trade back down to sub-20% ownership.
This weekend’s 382.1m shares and $0.28m share price makes AGC a market cap of C$107m, or
U$85.6m at the house forex (0.8/1). If we include the 50m warrants held by Eric Sprott, we get
the de facto market cap of Amarillo Gold (AGC.v) 432.1 x C$0.28 = C$121m and even after
normal cash burn, AGC wil carry at least C$50m cash into the construction period and without
going deeply into project economics today, they are robust enough and even under poor
market circumstances, the 811k oz gold over 9.5 years will get net margin of U$400/oz at
today’s market (better than saying “an annual net profit of U$36m”, as growth mining stocks
don’t report to the bottom line, however essentially the same thing). That’s more than enough
to add a financing with a 15% cost of capital and still see the share price rise sharply on the
6

news.
Discussion and conclusion
Put in a simple sentence, this trade offers you the opportunity to buy into Eric Sprott’s next gold
mine operation at a discount, alongside the man himself, before he closes the window.
However in order to do so, you need to take advantage of the prices on offer at market
tomorrow because the man at the centre of this deal will have a vested interest in keeping the
price under 30c (if he can). If he doesn’t manage that, for sure he’s still going to be the 20%
owner of a brand new, profitable gold mine in Brazil soon, but it may cost him more to do so.
As for the company, today’s AGC is a different proposition to the backwater stock I previously
covered, no matter that it has kept a deliberately low market profile up to now. However, in the
last few days we’ve seen it file its quarter, set up public webinars and it even updated its
website last week. All just after the period when 25m warrants not held by Eric Sprott lapsed
and just before his warrant expiry date became due. All signposts point to AGC not only being a
buy, but being one at an unbeatable entry price tomorrow, but even if the house theory is
wrong and Eric Sprott isn’t trying to keep those 25m warrants from becoming whole tomorrow,
it’s only a matter of time before September comes around, Mr. Sprott is fully positioned, AGC
announces financing and begins construction.
This trade is simple: I am a buyer of Amarillo Gold (AGC.v) tomorrow and while extra buying
pressure may change the day’s market, I’m confident of getting on for under 30c. This time
next week, AGC will be part of the ‘Stocks
to Follow’ list and if the trade goes to plan
over the summer, may eventually become
a Top Pick stock. Once tomorrow has
gone, I expect AGC to start making a lot
more marketing noise and with permits
and a fair proportion of cash in hand, it’s
the right story for 2021. This is the trade
I’ve been waiting for this year, one to rival
NGD in 2020 so feel at liberty to come
along for the ride.
Stocks to Follow
A good week for the portfolio, thanks to a balance of nine winners (RIO.v, TMQ, NGD, MIN.to,
WLF.v, GBR.v, ECR.v, AUL.v, MENE.v) and just four losers (MAI.v, SMD.v, QCCU.v, ORE.v),
though they contain two larger week-over-week losers in QC Copper (QCCU.v down 11.9%)
and Orezone (ORE.v). Meanwhile, the winning column gave us double figure percentage gains
in Wolfden (WLF.v up 22.8%) and Great Bear (GBR.v up 14.7%). The three unchanged stocks
make up the numbers (ALDE.v, RYR.v, MIRL.cse) and we move on.
We currently have 16 open positions on our Stocks to Follow list, one over the self-imposed
maximum. Eight of the trades are in the green, seven in the red, one is unchanged.
7

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$0.69 228.6% New $1.14 tgt Aug'20 #1 idea
Rio2 Ltd. RIO.v STR BUY C$0.83 22-Apr-18 C$0.85 2.4% $1.58 tgt, bot again Nov'20
Recommended stocks (In order of preference)
Trilogy Metals TMQ STR BUY U$1.84 15-Sep-19 U$2.79 51.6% Added Dec'20, Cu for 2021
Strategic Metals SMD.v STR BUY C$0.42 31-Jan-21 C$0.42 0.0% Asset $ trade, proj generator
New Gold NGD SELLING U$0.76 9-Feb-20 U$2.13 180.2% Making room for AGC.v
Excelsior Mining MIN.to STR BUY C$0.93 10-Mar-19 C$0.67 -28.0% Delayed, but still great value
Aldebaran Res. ALDE.v BUY C$0.68 16-May-21 C$0.70 2.9% Bet on big copper, pol risk okay
QC Copper &Gold QCCU.v BUY C$0.205 25-Apr-21 C$0.185 -9.8% Cu Jr, fast-tracking resource
Royal Road Min. RYR.v BUY C$0.155 17-Mar-19 C$0.38 145.2% Model paying off in Nica
Wolfden Res. WLF.v BUY C$0.30 11-Apr-21 C$0.35 16.7% near-term Zn trade
Great Bear Res GBR.v BUY C$15.83 26-Ago-20 C$16.81 6.2% Binary M&A trade, wait for print
Cartier Resources ECR.v hold C$0.32 21-Mar-21 C$0.30 -6.3% Binary M&A trade, wait for print
Orezone Gold ORE.v hold C$0.79 21-Jun-20 C$1.22 54.4% Binary M&A trade, wait for print
Aurelius Min. AUL.v spec buy C$0.75 28-Jun-20 C$0.58 -22.7% added 3 times, risky
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.09 -53.8% CEO change will move stock
Long-term non-mining hold
Mene Inc. MENE.v LT Hold C$0.62 6-Dic-20 C$0.59 -4.8% LT bet on jockey&horse,will add
Closed in 2021 closed close price
Fiore Gold F.v jan'21 C$0.98 21-May-20 C$1.17 19.4% closed as part of rebalance
Norsemont Mining NOM.cse feb'21 C$1.55 6-Set-20 C$0.70 -54.8% Cut loser to reduce Au exp.
Element 29 Res ECU.v feb'21 C$0.49 7-Feb-21 C$0.54 10.2% Cut Peru exposure
Kuya Silver KUYA.cse feb'21 C$1.66 8-Nov-20 C$2.51 51.2% Cut Peru exposure
Pucara Gold TORO.v apr'21 C$0.65 4-Oct-20 C$0.26 -60.0% Cut loser, Peru risk call
Copper Mountain CMMC.to apr'21 C$1.40 22-Nov-20 C$4.18 198.6% tgt hit, profit taken
2015 to 2020 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Now for notes on some of our covered stocks:
New Gold (NGD): SELLING. Before getting to the point, the week at NGD went with the flow
on trading, up handily on brisk volumes (and beat out Wesdome by 8% fwiw, clawing back
some of the gap). The company also gave us some minor news about permitting success that
was expected. A solid, 6% gain on the week and no issues.
Now for the sale decision, which requires a little backing-up first: After adding Aldebaran in
IKN625 and now a more substantial trade in Amarillo Gold this weekend, no sales would put us
at 17 open trades and, on due consideration, too many to justify these days, especially when
we note there’s a “side bet” in Roxgold (ROXG.to) also open via the ‘Market Watching’ section.
Therefore, the decision was to “sell something” rather than “sell NGD”, but that’s semantics.
Great Bear (GBR.v) was an option, as even though it’s a “binary trade” and needs the M&A
offer to succeed, selling now would mean getting out with a wash and no bad memories.
Another possible is Wolfden (WLF.v) and, after its nice pop last week (see below), the end of
this near-term trade may come sooner rather than later if it runs on a fashionable moment for
zinc. However, all arrows quickly pointed to NGD as the correct cull decision, here are reasons:
1) We are 30% from the target price, 180% from our cost average and around the time that
the cost price become the difference (or put another way, if NGD moves up another 76c to
U$2.89, my original money doubles). It’s at this point a trade out of a winner and into what you
believe to be a market out-performer makes sense.
8

2) It’s never an outright trade-killer for The IKN Weekly, but companies above a U$1Bn market
cap aren’t really our focus. We do trade and own them over time, tickers such as BTG and
SAND. However, they aren’t our focus, never will be, and NGD’s current U$2.13 close is a
U$1.45Bn market cap that makes it part of the group. We predict success, We predict an NGD
going to a U$2Bn and beyond, but at some point we also draw a line.
3) The NGD trade is larger and has generated a decent profit, more than enough to cover
purchase plans for the week ahead. This a purely practical and personal portfolio management
reason, be clear that I would not sell NGD to buy AGC if I had the available funds and the space
on the Stocks to Follow list. I’m not a bottomless pit.
4) NGD is back from the worst of its early-year drop, selling a U$2 handle is a lot easier than at
the discounted levels of March and April.
Those four are more than enough. The sale comes with some regrets, but not from any sort of
sentiment heavy heart, simply because it would have been good to wait and ping the target
later this year, I’m quite sure NGD will make U$2.80 under a benign gold environment.
Therefore and for straight portfolio management reasons, I sell NGD.
Aldebaran Resources (ALDE.v): Though it traded in the 60s I didn’t buy any more, which I
may regret this coming week considering the move spot copper made on Friday. Still looking to
add, will have to be less cute with myself to do so.
Royal Road (RYR.v): Our successful Nicaragua/Colombia play also reported its quarter last
week, an operating loss of $2.7m (in line) and no surprises. This set of financials came before
the sale of its 50% of Luna Roja to partner company Mineros SA/Hemco, which closed May 21st
and boosts RYR cash by U$20.8m, or C$26m at the house forex and keeps this project at full
speed. That, ladies and gents, is ten cents per share and goes a longway to justify our original
15.5c entry price with just one of its multiple assets. Which reminds this desk that it’s not only
RYR’s focus toward its Nica projects that has changed while we have owned; back at our
purchase price this was a C$35m market capper, now it’s C$99.7m and nudging three figures.
Rio2 Ltd (RIO.v): I haven’t met CEO Alex Black for coffee in the last seven days, he’s been
too busy and that’s a good thing. As for trading, RIO.v the stock had a decent week without
ever busting out of its annoying trading range. As for news, I have a little gossip this weekend
but must be careful, because this did not come from CEO Black or anyone inside the company
but is sensitive enough to make people suspicious of its CEO. In the other hand, it wouldn’t be
right to keep this to myself, so here we go choosing words carefully.
A reliable, long-term contact who I will describe today as A Financial Professional In South
America (AFPISA) contacted this desk with a snippet. Up until now, we’ve understood the
financing package for Fenix was divided among three takers including one bank and two
streamer/royalty companies. Nothing in the meantime from CEO Black has made me think
otherwise, so it was interesting to learn from AFPISA that on the streamer side Wheaton
9

Precious Metals (WPM) has pushed out Metalla Royalty (MTA.v) and Randy Smallwood now
wants all that side of the pie for himself. That’s a good optic for Fenix, though at this point we
remind readers that with stream and royalty deals, the devil is in the details. Another strong
positive is the name of the bank at the head of the queue to provide the senior secured debt
package, I will keep that name to myself to protect AFPISA, suffice to say you too will be
impressed when you find out.
As for real news, on May 27th RIO.v filed its 1q21 financials and, along with SMD.v (below), I
plan to give them a little more time and comment in next weekend’s edition. In the case of RIO,
the numbers are in shape and no surprises.
Strategic Metals (SMD.v): The other 1q21 filing I am deferring until next week, SMD moved
a few of its pieces round and sold some shares to fund treasury and deals. Unlike RIO these
numbers deserve extra scrutiny and will get them next Sunday.
QC Copper & Gold (QCCU.v): As expected, QCCU is giving us plenty of NRs, be they drill
results or other corporate matters. They even do their own in-house web presentations (4) and
there’s a nice marketing angle worthy of comment, as they must save thousands by doing it
themselves and then paying Northern Miner for space on their brand. That video also does a
good job of explaining how the company is “drilling waste into ore” at Opemiska and the
importance of the results out of the saddle zone. We understand there is another drill assay NR
due soon, the company waiting on the lab to make good on their word and if so, expect news
this week. As for trading, QCCU finally found sellers on Friday and closed at recent lows, if it
goes lower I can add a few for the last time and get my average under 20c. That’s the problem
with being newly flush with cash in your portfolio . But more seriously, there’s every reason to
believe this stock will continue to fly largely under the radar of the market until it announces its
resource number, mid-year. I see no reason why
those of you looking to buy/add should have to pay
up, apply some patience and buy more shares for
the same amount of money.
Orezone (ORE.v): At least it didn’t come as a
surprise:
Also and to continue the TA, it would be good to
see the previous $1.20 ceiling turn into a floor price
for the stock. Others may have sold at the recent
peak and good for them, I keep this trade simple
and binary, the M&A offer will come.
Wolfden Resources (WLF.v): We lamented last week’s late trading and the way WLF didn’t
deserve to have 28.5c as its final tick of the week, which was justified:
A nice move, WLF getting traction on the bullish backdrop for zinc with the best action on
10

Friday, too. WLF also delivered its 1q21 financials last week and here’s a run-through of the
main points via the usual suspect charts:
WLF.v: Cash treasury per qtr
10
9
8
7
6
5
4
3
2
1
0
11
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
source: company filings
srallod
fo
snoillim
The main news this quarter is the change in treasury, thanks to the three separate financings
WLF ran in Q1. Starting with the $2m strategic placement with Kinross and Altius, passing by a
small flow through that funds Rice Island work, and finishing with the C$4.07m raising that
closed March 30th. After paying the suits, net cash from the placements came to C$6.552m and
funds WLF for the year.
With liabilities tiny and fixed assets negligible (the company expenses its operations), the above
cash chart is tantamount to working capital.
WLF.v: Liabilities Breakdown per qtr
1.2
1.1 1 0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
The equity raisings bring us to the only other
change of note this quarter, shares out are
now at 151.369m, making WLF a C$53m
market cap junior this weekend. There’s
room to grow that value in 2021 but this
trade also has specific limits, we are here
above all to sell to somebody else when zinc
the metals goes through one of its brief
periods of popularity.
Great Bear (GBR.v): By luck, judgement or faith, my entry in GBR is also the price point
around which its market turns, often for no apparent reason (until the NR show ups the week
after). My small holding of GBR seems set to do this red/green/red act until somebody buys it
and if so, that’s okay. Sooner rather than later for the buyout, though.
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
source: company filings
srallod
fo
snoillim
WLF.v: Assets
10
LT liabs 9 8 current liabs
7
6
5
4
3
2
1
0
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
$m
fixed other current
cash
source: company filings
WLF.v: Shares Out
200
180
160
140
120
100
80
60
40
20
0
71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
source: company filings
serahs
fo
snoillim

The Copper Basket
After twenty-one weeks of 2021, The Copper Basket shows a gain of 54.04% to level stakes.
company ticker price 1/1/21 Shares out Market Cap current pps gain/loss%
1 Solaris Res SLS.to 6.08 107.53 1344.13 12.50 105.6%
2 Copper Mtn CMMC.to 1.81 207.5 900.55 4.34 139.8%
3 Oroco Res OCO.v 1.85 186.96 622.58 3.33 80.0%
4 Western Copper WRN.to 1.57 135.798 426.41 3.14 100.0%
5 Marimaca Cop MARI.to 3.25 87.737 394.82 4.50 38.5%
6 Amerigo Res ARG.to 0.80 181.79 263.60 1.45 81.3%
7 Excelsior Min. MIN.to 1.12 273.585 183.30 0.67 -40.2%
8 Aldebaran Res. ALDE.v 0.455 125.24 87.67 0.70 53.8%
9 Regulus Res. REG.v 1.07 101.85 75.37 0.74 -30.8%
10 C3 Metals CCCM.v 0.115 438.56 70.17 0.16 39.1%
11 Doré Copper DCMC.v 1.00 53.304 54.37 1.02 2.0%
12 Chakana Cop PERU.v 0.60 111.41 41.78 0.375 -37.5%
13 Element 29 Res ECU.v 0.45 68.281 34.14 0.50 11.1%
14 US Copper USCU.v 0.105 87.53 24.07 0.275 161.9%
15 Chibougamau CBG.v 0.165 53.077 18.05 0.34 106.1%
NB: All stocks in CAD$ Portfolio avg 54.04%
The Copper Basket knows only one The Copper Basket 2021, weekly evolution
70%
direction, despite there being six losers
(OCO.v, MARI.to, REG.v, PERU.v, CCCM.v, 60%
DCMC.v) and one unchanged stock 50%
(ALDE.v). They were no match for the 40%
eight winners, including big moves in 30%
Western Copper & Gold (WRN.to up 20%
27.6%) and Element29 (ECU.v up 22.0%) 10%
, as well as a whole bunch in the +6% to
0%
+8% range.
The stocks took their cue from the metal,
which managed less than a week at its
strong supper 4.50/4.55 level before finding new reasons to move higher.
The market quoted Peru politics and a strike vote in Chile, things that wouldn’t move the
market unless supply was tight. On that subject and as we are at the end of another month,
more macro data showing the real world deficit in our overview inventory trackers:
12
ts1
naJ
ht01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 dn2yam ht9 ht61 dr32 ht03
source: IKN calcs

Copper inventories: percentage held per exchange
80
70
60
50
40
30
20
10
0
13
21.naJ ram yam luj pes von 31.naJ ram yam luj pes von 41.naj ram yam luj pes von 51.naj ram yam luj pes von 61.naj ram yam luj pes von 71.naj ram yam luj pes von 81
naj
ram yam luj pes von 91
naj
ram yam luj pes von 02
naj
ram yam luj pes von 12
naj
ram yam
LME Shanghai Comex source: Cochilco
The percentage breakdown chart gets top billing this month, as 53% of the aggregate is
currently covered by SHFE. As the chart shows, that effect is normally temporary and SHFE’s
share normally drops away. Those drops are reminder of what is to come, as SHFE stocks will
soon start depleting in the normal de-stock cycle of the Chinese primary industry world.
Copper inventories, per month, 2012 to date
1000000
900000
800000
700000
600000
500000
400000
300000
200000
100000
0
21.naJ ram yam luj pes von 31.naJ ram yam luj pes von 41.naj ram yam luj pes von 51.naj ram yam luj pes von 61.naj ram yam luj pes von 71.naj ram yam luj pes von 81
naj
ram yam luj pes von 91
naj
ram yam luj pes von 02
naj
ram yam luj pes von 12
naj
ram yam
Mt Cu source: Cochilco
Comex
Shanghai
LME
The issue with that shows in our second long-term chart as SHFE stocks are nowhere near as
replete as they were in previous years, before the drawdown began. For example, SHFE stocks
are currently 125kmt lower than their 2020 peak. Add in the medium-term trend shown at the
LME with its stocks…
LME copper stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
41.naj ram yam luj pes von 51.naj ram yam luj pes von 61.naj ram yam luj pes von 71.naj ram yam luj pes von 81
naj
ram yam luj pes von 91
naj
ram yam luj pes von 02
naj
ram yam luj pes von 12
naj
ram yam
source: LME data
reppoc
sennot
cirtem
…and this useful fundamentals indicator continues to flash the same strongly bullish message
for the market. We agree and move on, to our regular weekly copper inventories coverage:
 Copper stocks jagged downward once again last week, SHFE the centre of attention.
This weekend, aggregate stocks in the three world systems are down to 386,107mt and
it’s all about physical demand from China.
 The SHFE has re-adjusted after its break and in a big way, stocks dropping a big
21,358mt on the week to close at 207,821mt 229,179mt.

 Another small drawdown of 3,400mt at The LME, which under normal circumstances
would be inconsequential. But 2021’s market counts every tonne bought and sold, the
122,425mt total LME inventory remains historically low.
 The COMEX lost a small 604mt from inventories, this weekend’s total 55,861mt.
Here is the Shanghai-only inventories chart, the adjustment back to 207k tonnes I am told is
more accountancy than physical. Not just SHFE, but total world stocks are now down to 6.2
days of total world consumption and as tight as it’s ever been.
Shanghai Futures Exchange Warehouse Stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
14
ht5naj ht61 ht52 dr3gua ht21 ts12 5102
ts1ram
ht01 ht91 ht72 ht6ced ht41 ht42 6102
dr3luJ
ht11 ht72 ht5beF ht61 ht52 7102
dr3pes
ht21 ts12 8102
ts1rpa
ht71 ht62 8102
ht4von
9102
ht31naj
ht42 9102
dn2nuj
ht11 ht02 ht92 ht8 ht71 0202ht62luj ht4tco 0202ht31ced ts12 1202dn2yam
Mt Cu
|
source: Cochilco
Forget all the jawbone, copper is in high demand in China and will remain that way. Its dollar
price on a day-to-day basis may fluctuate due to other influences such as forex or even
geopolitical moves these days, but the trend is clear and it is set. Choose your own method and
vehicle, but be long copper. Now for some notes on a few basket stocks:
The Peru copper stocks (REG.v, PERU.v, CCCM.v, ECU.v): Another week of mixed
fortunes for the four Peru exposed stocks on our 2021 list, with REG and PERU doing worse
than a perky COPX benchmark, but the others finding buyers:
REG fell on no news (again), PERU.v fell on mediocre drill results. To the positive, Element 29
(ECU.v) was up on news it had received its
permits and would start drilling in 3q21, while
CCM moved up on the receipt of its first drill
results which, as noted on the blog, came on
the precise day its escrowed placement shares
went free trading. The reaction to the news,
the selling, and then the rebound tells us
important information about CCCM the stock.
This 2021 YTD has the trade in bold ink, you
can bid for this stock at 14c. If any news
were about to dislodge its obvious support price

it would have been last week, but those running this trade managed to hold the line fairly
easily. The inference is obvious, the 14.3% gross margin between 14c and 16c, or 21.4% if you
can sell at 17c. This isn’t a trade for me, not least due to the ulterior motives of the people
behind the company and their Heads I Win Tails You Lose corporate set-up. However, I do not
begrudge those who make coin from pennyflippers and, for those so inclined, this has the right
set-up for regular scalps.
Western Copper & Gold (WRN.to): In IKN626 last weekend, we highlighted WRN as having
delivered the best news of the week in what was already a good week for the sub-sector.
Here’s a price chart:
You cannot own them all, but at least I get to tell others about ones I miss .
The Producer Basket
After twenty-one weeks of 2021, the Producer Basket shows a gain of 3.50% to level stakes.
company ticker price 1/1/20 Shares out Mkt Cap (U$Bn) current pps gain/loss%
1 Newmont NEM 59.89 805 59.15 73.48 22.7%
2 Barrick GOLD 22.78 1778.04 42.82 24.08 5.7%
3 Agnico Eagle AEM 70.51 244.187 17.52 71.75 1.8%
4 Kirkland Lake KL 41.27 267.056 11.57 43.33 5.0%
5 Kinross Gold KGC 7.34 1261.07 10.21 8.10 10.4%
6 Pan American PAAS 34.71 210.262 7.07 33.64 -3.1%
7 Endeavour Min EDV.to 29.62 252.568 6.10 29.00 -2.1%
8 B2Gold BTG 5.60 1051.697 5.36 5.10 -8.9%
9 Alamos Gold AGI 8.75 392.739 3.59 9.13 4.3%
10 Pretium Res PVG 11.48 187.833 2.14 11.40 -0.7%
Prices in U$ except EDV.to (share price in CAD$ and mkt cap in approx USD) Port. avg 3.50%
On the week, GDX rose by 0.33% and our basket dropped by 0.56% and that means the gap is
now growing embarrassingly large against our picks for 2021. Our group saw just three winners
(KGC, EDV.to, AGI) with the others all losers, though mostly small drops. The biggest loser was
B2Gold (BTG down 3.6%) having to deal with new political rumblings.
The 2021 Producer Basket: Weekly performance and 20%
comparative to GDX control
15%
10%
5%
0%
-5%
-10%
15
-15%
-20%
ts1
naJ
ht71 ts13 ht41 ht82 ht41 ht82 ht11 ht52 ht9 dr32
The 2021 Producer Basket: Percentage difference between
GDX benchmark and basket (negative = IKN basket ahead) 7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
basket
gdx control 0.0%
source: Google, IKN Calcs
ts1
naJ
ht01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 dn2yam ht9 ht61 dr32 ht03
source: IKN calcs, NYSE/Nasdaq/TSX data

B2Gold (BTG) (BTO.to): The comparative chart to GDX shows how BTG dropped on the
news of yet another coup in Mali, host to its crown jewel Fekola mine, the second coup in nine
months that apparently replaces the people who replaced the elected government. The
company must be used to it, but equally the market reaction is justified.
I’m no expert on West Africa, but the coup seems to be relatively peaceful and reports have the
leader promising to appoint a Prime Minister this week (5), so I assume calm will prevail. For a
few weeks, anyway.
The Tiny Dogs
After twenty-one weeks of 2021, the Tiny Dogs show a gain of 4.67% to level stakes.
company ticker price 1/1/21 Shares out Mkt Cap current pps gain/loss%
Antler Gold ANTL.v 0.205 61.348 8.59 0.14 -31.7%
Aston Bay BAY.v 0.045 163.975 7.38 0.045 0.0%
Constantine Met CEM.v 0.17 45.4 11.80 0.26 52.9%
Contact Gold C.v 0.115 240.757 21.67 0.09 -21.7%
Golden Pursuit GDP.v 0.22 40 5.00 0.125 -43.2%
Manitou Gold MTU.v 0.045 230.79 20.77 0.09 100.0%
Precipitate Gold PRG.v 0.240 106.241 14.87 0.14 -41.7%
QC Copper QCCU.v 0.315 105 19.43 0.185 -41.3%
Red Pine Expl RPX.v 0.400 95.806 72.81 0.76 90.0%
Warrior Gold WAR.v 0.090 91.818 6.89 0.075 -16.7%
Prices in CAD$, data from TSXV basket avg 4.67%
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 representing the state of play in the
sub-sector of tinycap exploration company stocks. At least, that’s the plan.
 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 20% Tiny Dogs, 2021 weekly tracker
down among the little guys it doesn’t pay to be too 18%
choosy, but still I preferred companies that have 16%
14%
teams or people with good peer reputations.
12%
10%
An odd week for the list, with just two winners
8%
(ANTL.v, RPX.v) and only one of them of size, 6%
4%
16
2%
0%
ts1
naJ
ht01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 dn2yam ht9 ht61 dr32 ht03
source: IKN calcs, TSX data

Antler Gold (ANTL.v up 12.0%) rebounding from its hit of the week before. There were two
UNCH stocks (CEM.v, WAR.v) and the other six were losers (), but nothing very large and the
effect of ANTL moving means the overall basket managed tot move up, rather than down. All
rather odd, but the lack of volume in tinycaps remains the main story and until that changes,
there pennycrappers are going to trade as a haphazard group.
Now for notes on just one stock this weekend:
Red Pine Exploration (RPX.v): Previously, this desk heard that Pierre Vaillancourt of
Haywood had opened coverage on Red Pine (RPX.v) on May 21st without reading the note, so
when reader D kindly sent over the official public link this weekend (6) (no IP stolen) it was
gratefully received. Here’s how his note begins:
"We are initiating coverage of Red Pine Exploration with with a BUY rating and target
price of $1.40. The Company recently consolidated 100% ownership of the Wawa Gold
Project and is sufficiently funded to develop its resource."
Their “with with” and not mine this time, by the
way. Overall, the note is a fair summery of RPX and
the price target is not stupidly high, either.
However, it does show how the sum is often
greater than its parts, RPX needed to get 100%
control of Wawa GP before it could attract the
attention of the wider market. Now with cash in
treasury, a tighter share count and the size of
market cap that attracts a different audience, RPX
is on the corporate track for growth as much as the
exploration track.
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
Ecuador: Guillermo Lasso swears in
Much fanfare from the right wing in South America last week as Guillermo Lasso was sworn in
as President of Ecuador on Monday. He made a conciliatory sounding first official speech, not
going into many policy details but certainly aware he has a job of negotiation to do in order to
have a workable country. I was suitably impressed and others were too, he’ll get his
honeymoon period.
Mining news is less conciliatory, however, his supporters haven’t got the message that his
presidency doesn’t come with a popular mandate. Over the years, one of the sure signs of CSR
problems and heightened political risk for mining companies is to note the use of the “If you
don’t want mining, stop using metal products” argument*, trotted out by pro-mining advocates
when they are faced with local resistance or opposition. Wherever it shows in the op-ed pages
or TV interviews of a LatAm country, be it Dominican Republic, Honduras, Chubut Argentina,
the Páramos of Colombia etc ad infinitum, you can wager money there’s trouble ahead and sure
enough, Ecuador’s newspaper of record has suddenly taken up the cause again, this title
(translated) (7), “If You Don’t Desire Mining, Don’t Use Its Products” an almost comic cliché,
there is nothing new on show there, aside from newly emboldened supporters of mining. The
reality of mining’s future in Ecuador under Lasso is not contained in the ages of his plan of
government, he doesn’t get free policy on this subject at all. We’ll begin to see the problems as
its Congress reconvenes, but your author expects the Pachakutik party to make a significant
17

stand. It’s difficult to approach this upcoming legislature with any confidence on mining issues,
but we are certainly a long way from the type of “New Best Mining Country” status Ecuador’s
proponents imagine. We shall observe and report back.
*If you like eating meat, you must let me build an abattoir next to your house.
Mexico: AMLO and The Economist
The cover of this week’s edition of The Economist (right) annoyed the
President of Mexico, as did the content of its main piece, accusing
him of a litany of political crimes. On reading through, he may have a
point. The Economist goes out of his way to frank his populist
credentials, telling the reader that AMLO he is pro-gay and has no
problems with any type of religious order, all are welcome. The
article also says he “…speaks out loudly and often for Mexico’s have-
nots, and he is not personally corrupt.” All good, you’d imagine, but
the next line “ Nonetheless, he is a danger to Mexican democracy”
opens the screed and a list of apparent attacks on democracy itself.
It’s worth reading the note as well as some of the pushback from the
AMLO government and from Mexico, once you do you realize The
Economist is coming from a strictly economic standpoint (hence the
title of the publication) and misses the social attraction of AMLO’s
government almost wilfully. The litmus test is the question of
corruption, recognized as an issue by The Economist but then shuffled down the order of
importance, whereas AMLO’s position makes it a central thrust. Whether or not AMLO is good at
tabckling corrupt officials in his country is another matter, but it shows the cleavage point. In
any case, the op-ed was enough to get Mexico’s foreign minister to write a strongly worded
reply, accusing The Economist in turn of all types of sins under its neoliberal banner.
In Mexico mining news, its Chamber of Mining (Camimex) took its turn in criticizing AMLO at a
press conference, where they explain that (8) (translated), “…in the past seven years,
exploration investment by mining companies in Mexico has dropped by 63%”. Taking 2012 as
its benchmark, Camimex noted that year saw U$1.165Bn of pure exploration activity, but last
year 2020 saw just U$339m of the same. If we take Covid-19 into account and consider 2019
instead, that saw U$536m of mining exploration activity and still a big drop. According to
Camimex president Fernando Alanís, the problems date back to 2014 and when the Peña Nieto
government stopped allowing exploration as a tax deductable. It’s not just the lefties, you see.
Colombia social protests continue
We are keeping an eye on the ongoing social protests against the Duque government in
Colombia, but as they haven’t affected the mining industry much and are more urban-based, as
far as I’m aware there are no direct issues for these pages, either. Set off by his tax reform bill
plans, it quickly evolved into widespread social condemnation protests on a range of issues and
when the security forces cracked down things got worse, rather than better (not a god sign).
Things are bad, for example the reported 13 dead in the city of Calí yesterday Saturday due to
“repression by the forces of security”, but we also need to be hard-nosed about our focus.
Colombia has seen worse and carries on regardless, we on the outside are FDI-centric and the
dangers only start when society spirals out of control. Any eventual pressure on Colombia’s
government or even President would concern our investment, domestic issues are less likely to
move the dial.
Peru election polling and commentary
Today Sunday is the last Big Event day in the Peru election campaign, with this morning the
final raft of voter intention surveys from the known pollsters, then this evening (I have had an
eye on it while finishing this edition), the final head-to-head Presidential debate, coming from
the Southern city of Arequipa. First, we update our poll tracking chart and show its evolution:
18

60% Peru: Evolution of Peru second round polls
55%
50%
45%
40%
35%
30%
25%
20%
15%
10%
19
rpa
81
rpa
22
rpa
52
rpa
52
rpa
52
rpa
92
yam.2 yam.2 yam.7 yam.9 yam.01 yam.11 yam.41 yam.61 yam.02 yam.12 yam.22 yam.32 yam.82 yam.03 yam.03
Pedro
Keiko
source: encuestas.com.pe
This weekend’s message from the collective of pollsters is “It’s getting tighter, but Pedro
Castillo retains his lead.” We again underscore the general unreliability of Peru polls, but as we
now have three recent results from Peru’s flagship pollster IPSOS, let’s separate them out.
Above is the total of emitted votes, when “valid votes” are polled here are the results:
IPSOS poll May 14th: Pedro Castillo 51.1%, Keiko Fujimori 48.9%
IPSOS poll May 21st: Pedro Castillo 52.6%, Keiko Fujimori 47.4%
IPSOS poll May 28th: Pedro Castillo 51.1%, Keiko Fujimori 48.9%
This chart (right) updates last week’s “Datum 60% Peru: Evolution of Datum-only second round polls
Only” data with their 6th and final poll, same 55%
story. The newspaper carrying the IPSOS 50%
results, the right wing El Comercio, frames 45%
today’s numbers as “Keiko tightening the gap” 40%
but when we consider the three IPSOS polls as
35%
a group, the relative fluctuations are well inside
30% Pedro
any statistical margin of error and the image is
25% Keiko
of one that backs up the overriding influence in
20%
this second round, that of the “Keiko Antivote”.
22 apr 29 apr 7.may 14.may 21.may 28.may
This desk repeats, any other candidate against source: encuestas.com.pe
Castillo in Round Two and this whole election
would be far lesser influence on the prices of mining stocks.
This evening’s debate has been framed as decisive by those who believe the polls and their “it’s
getting closer” message. The polished political image and delivery of Keiko Fujimori isn’t going
to be personally challenged by the less experienced (and less pugnacious when speaking)
Castillo, so there’s little doubt who the newspapers and media channels will say “won the
debate” today. However, the low expectations of Castillo make his job easier and in real terms,
all he has to do is keep his message on policy and the Plan of Government that has evolved
around his candidacy during round two. We knew he would move to the centre to capture votes
and he has done so, e.g. removing references to Marxism in his plan and insisting on his
democratic values. Or this (9), one of the left wing economists from the Verónika Mendoza
party who latched onto Castillo, looking for the FinMin job. Pedro Francke reassures Peru that,
“We don’t want to nationalize the mining industry.” It was all too easy to predict, the toning
down talk of swathing nationalizations has morphed into Perú Libre (PL) focus on specific cases,
such as guaranteed water supply as a human right, or vague (and almost certainly unworkable)
plans to nationalize the current private pension funds system.
As for economic effects on Peru, there would be many under the change of direction proposed
by Castillo and most of them bad news. However, we now set aside the political and economic
effects of other areas and turn to our focus subject of mining. In an interview in September
2020, the head of Moody’s defended his entity’s decision not to change Peru’s credit rating to a
negative outlook in light of the worsening political backdrop at the time, which ended with dead
protesters and an interim President, you may recall. At that time, Moody’s “gave the benefit of

the doubt” to Peru, which means this week’s decision to lower Peru to A3 with a negative
outlook (10) shouldn’t come as any surprise. As an illustration, Moody’s outlined the situations
at Volcan (BVL: VOLCABC1) and Buenaventura (BVN), who planned to emit U$499m and
U$550m in debt this year in order to continue their business plans. Those are already delayed,
the risk premium they’ll need to pay after a Castillo win may see wholesale changes in future
plans (assuming there are still willing lenders, that is).Moody’s highlights issues for the mining
industry in particular, now almost certain to bear the brunt of fiscal changes no matter which
candidate wins, but surely worse under Castillo. Along with immediate tax hikes, they see
changes possible for mining in concessioning and ownership rules, higher royalties, delayed
projects, higher operating costs and lower profitability. In other words, no surprises to readers
of these pages and while on the point, I’m sure you too have heard warning shots from mining
CEOs exposed to Peru, telling the world they have long-term fiscal stability agreements and any
new tax is illegal (and will be contested). That’s fair enough, ladies and gents, but those same
companies will still have to make provisions in their financial statements while disputes continue
so, like it or not, any new laws or rule changes in Peru shows on your company balance sheet.
As for next weekend and the vote, polls may have it close but there’s no mistaking the sense of
pessimism on the streets of Lima and among the political catering class, most sense polls
skewed toward Keiko and “la realidad sera otra” next Sunday. My personal opinion hasn’t
budged an inch and while I’ll be watching the debate tonight for reasons to change my mind, it
all becomes moot by the next edition of The IKN Weekly, anyway. [EDIT: The debate went
much as expected].
There is a growing argument (10) that even under a Castillo government, there won’t be much
room for meaningful change and the country’s Congress will act as a counterweight. We hear of
“real limitations” and how “Covid-19 will slow any reform”, particularly Castillo’s doubled-down
push for a Constitutional reform (a la Chile), which the Whore Left have promoted strongly.
That sounds fine in theory, but this desk doesn’t buy it that easily. For one, recall that behind
this potential President is no ordinary political party, these are self-named, self-confessed and
proud Communists who adhere to Marx and with a political doctrine I personally pigeonhole as
“Latino-Maoist with Catholicism”, they will not think twice about closing down Congress and
ruling by executive decree. Or at least attempting to, until the violence begins.
Finally, we must mention the potential trade in mining companies next week being fully aware
that, by guiding this readership toward a Castillo win, if Keiko upsets the odds next weekend
every single mining company exposed to Peru is going to fly higher without me. That’s my call
and risk, however I will re-state that no matter who wins next Sunday, Peru will remain a sell.
This is not the same as the situation in Ecuador, where two distinct ideologies squared off and
the right wing won out, as Lasso is a far more palatable person than Keiko Fujimori. This isn’t
lost on 87% of Peruvians and yes, I agree that Castillo win will be an economic disaster, but
under Keiko the divisions that made Castillo and have seen the Left rise will only get worse. Be
careful what you wish for, it may come true.
Market Watching
Norsemont Mining (NOM.cse) reports its quarter
The IKN Weekly is unafraid to rake over painful losers when required. We have seen a little life
return to the trading of this failed trade from
earlier this year, a rally popping the stock above
80c before profit taking (?) roughly it back to
76c at the close on Friday.
Last week also saw NOM report its 1q21
financials for the period to March 31st 2021, and
NOM clearly battened down the hatches for a
quarter. Total cash burn was less than C$1m,
which means NOM and its treasury of over
20

C$6.7m (working capital similar) has room to breathe. However, its MD&A states clearly the
need to finance again in order to maintain operations, which prompts today’s brief note. I may
be out, but some of you still in or with a remnant may want to consider last week’s rebound as
an opportunity to close out at a less painful level.
An eye on the Roxgold (ROXG.to) side bet
The side-bet trade we called in IKN623 and opened in IOKM624 at C$2.07 had a very positive
week. We are now at C$2.33 and a 12.6% gross profit, with strong buying action all week as
ROXG coattails the GDX/J listed stocks by trading par to Fortuna (FVI.to) (FSM):
The chart shows there is still no implication of a third party offer coming in, therefore I’m going
to stick with the plan and give this one more Monday. Unless something significant happens
between now and next week, expect me to call sell next weekend in IKN628 and then sell the
side bet, hopefully for profit.
A recommended read on silver producers
This weekend I chanced upon this (11) note entitled “Silver Miners' Q1 2021 Fundamentals”
dated May 28th by Adam Hamilton of Zeal and on two read-thrus, would like to draw your
attention to it. Its primary focus is the silver miners’ ETF SIL, which means you get a general
overview of the sector. It provides solid basic information for the newcomer or casual observer
to the sector, but doesn’t stop at first base and cranks up the gears on occasion with sharp
insights into the supply and demand side of the metal’s market, plus their implications Example:
The SIL top 15's collective output peaked at 77,432k ounces way back in
Q2'17. The last quarter where these major silver miners grew their silver
production year-over-year was a slight positive blip in Q2'19. For the last
seven quarters in a row, their silver mined has relentlessly shrunk. Relatively-
pure silver deposits supporting primary silver mines are getting rarer, and they
are challenging to operate profitably.
The best-available fundamental data on global silver supply and demand is
published once a year by the venerable Silver Institute. The latest World Silver
Survey covering 2020 was just released about a month ago. It revealed that
only 27% of all the silver mined worldwide last year came from primary silver
mines. Nearly 3/4ths of all the silver produced was merely the byproduct of
lead/zinc, copper, and gold mines!
The major silver miners continued turning yellow last quarter, increasingly
diversifying into gold with its superior economics. The SIL top 15's total gold
production surged 8.3% higher YoY to 1,454k ounces! That is on the higher
side, ranking as 6th out of the last 20 quarters. Most of the production growth
these major silver miners saw in Q1 came on the gold side.
I wholly agree with the connection made by Mr. Hamilton, who then goes on to give necessarily
brief but reasonable outlines of some of the main weighted companies held in SIL andn adds
op-ed on its composition as well. Just one example of many:
The SIL ETF itself remains problematic too. Without many major silver miners
21

to pick from, there's not a lot of options for this ETF's managers. Yet some of
SIL's bigger positions are confounding. Russia's Polymetal was this ETF's
second-largest holding at 11.5% in mid-May. Yet silver accounted for just
20.3% of its sales last quarter. And that's high for this company, as POLY's
silver purity ran just 13.6% in Q4'20.
And Korea Zinc at 5.1% should be booted from this silver-stock ETF
posthaste. It is a large base-metals smelter that has nothing to do with mining
silver! While it does smelt silver, that is still a relatively-small fraction of its
business. Global X named their ETF the "Silver Miners ETF", so having a non-
miner like Korea Zinc in it with a high weighting really hurts its credibility. SIL
is really another gold miners' ETF in disguise.
This is one of those pieces you open with low expectations, looking to glean something, and
end chastising yourself for not reading the author more often. It’s rare I come away from an
note on silver without clearly disagreeing with at least one of the points made, in this case
there are a couple of minor things but my only real issue is the way he spelled post-haste and
by-product. This note is several cuts above the norm precious metals commentary world and is
recommended as such, all market abilities will get something from it, which very much includes
this author as he continues to look for a silver trade to satisfy his bullish outlook on the metal.
Alexco Resource Corp (AXU) 1q21 financials
On the subject, step forward the candidate at the top of our list: Alexco Resource Corp (AXU)
filed its 1q21 financials last week and, with the company on the veritable cusp of production
(copyright Doug Ramshaw) in that now-fashionable corner for mining, the Canadian Yukon (Rio
Tinto has blasted near neighbour’s Western Copper shares higher, see above), today is the day
The IKN Weekly re-opens coverage on arguably the best silver junior company out there.
Preamble and catch-up on AXU: Today’s is mainly on the financial background to AXU, as we
consider how the company has changed since last owning the stock and covering the company.
For one thing, its price has changed as this weekend our benchmark for today’s note, US listed
Alexco (AXU), is a U$3.20 stock. That makes my sale of AXU at U$1.69 in April 2020 look dumb
on a prima facie basis and for sure, I was always aware I was selling a financially solid company
run in exemplary fashion delivering on its plan in fair style, aside from that annoyingly extended
permitting drag in Yukon. Therefore, in mitigation for the sale of AXU and coverage to date,
three things:
First, I was bearish silver coming out of the Covid-19 crash and for many of the same reasons
as I was bearish copper. That was the wrong side of the trade at the time, but since silver has
traded in its current and obstinate U$25 to U$28 price range I’ve been neutral on the metal,
only very recently turning bullish (and long after going bullish on copper). Under that macro
call, selling AXU was a logical step, as was not returning to look seriously until now. I have a
portfolio to run, after all. Second defence, this chart:
AXU has been the epitome of “market perform”, all-but lockstep with SIL on the other side of
22

the Covid-19 crash. The third and final brief defence is semi-related, as even after a near-
double in the stock, there was opportunity cost in leaving the cash in AXU. Treasury cash is
fungible of course, but without an AXU sale it’s at least fair to say my size in CMMC.to trade
would have been smaller. An example of how not pretending to be a bottomless pit of cash
works against The IKN Weekly, but that’s for another day. And with that, we are up to date.
You author is newly bullish on silver, as its price action looks constructive and there’s obvious
demand backbone. We’re not going back under U$20/oz until there are sea changes in the
market, the risk of U$30/oz and higher prices is more obvious. Under the circumstances,
getting long silver is the right call and revisiting one of the best juniors in the space is overdue.
AXU Financials and latest results: We begin by getting up to date on the usual suspect charts,
starting with assets and AXU has been beefing up as it moves into production:
AXU: Assets
200
180
160
140
120
100
80
60
40
20
0
Liabilities also show the same expansion of activities (no end of deals go into building out a new
mine, many of them with 30/60/90 day credit). This is the shape of chart we want to see, with
long-term obligations small and totally under control and currents expanding.
Here’s a tighter focus on liquidity at AXU, the company kept coffers in shape with prudent small
placements. Plus a larger one in early 2020. In total, AXU added 24m shares to its count in
2019 and 2020, plus another 4.5m this year. The share count stands at 142.1m and while we
don’t expect any further placements before gong cash flow positive, the count will creep up
slowly due to options and warrants exercises (paper in the money).
23
41q4 51q1 51q2 51q3 51q4 61q1 61q2 61q3 61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
C$m AXU: Liabilities Breakdown per qtr
fixed 50
other current 45
cash & eq 40
35
30
25
20
15
10
5
0
source: AXU filings
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 12q1
C$m
LT liab
current liab
source: company filings
AXU: Cash treasury per qtr 30
25
20
15
10
5
0
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 12q1
source: company filings
srallod
fo
snoillim
50 AXU: Working Capital per qtr
45
40
35
30
25
20
15
10
5
0
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 12q1
source company filings/IKN ests
srallod
fo
snoillim
AXU: Shares Out
3.96 3.96 5.96 5.96 5.96 2.77 3.77
2.98 5.29 0.39 7.39
2.101 2.101 3.101 6.101 0.801 0.801 0.801 6.801 0.711 6.811 2.911 7.421 1.521
1.731 5.731 1.241
160
140
120
100
80
60
40
20
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 12q1
source: company filings
serahs
fo
snoillim

The bottom line to AXU financials show how the company has navigated the period from
development to (nearly) first production. Not included in our quick comments today are
comments on the sale of AEG, the enviro clean-up arm that made it useful cash flow but has
now been spun out, leaving AXU a clean silver machine. The construction timeline stretched
since we were away as well, which was probably boring for long-term investors. Instead of that
we offer the general conclusion that AXU is in good financial shape as it moves to production
this year. Perhaps the clearest numerical tell on AXU’s development is found in these charts on
book value and BV per share. Below left AXU has added plenty of asset value in real Canadian
dollar terms but in per-share terms (below right), the company valuation has remained
constant.
AXU: Book Value
The above is the visual of a company beefing up for production and executing on their capex
plan. However, AXU’s BV/share only covers a third of its current stock price, which means good
will and, by implication, guaranteed profits baked in.
Moving to this year and the KHSD start-up, last week also saw AXU file its updated 43-101 as
we approach real production and, presumably, a free cash flowing and profitable mine for many
years. Regarding the timeline to production, starting Keno Hill is not a matter of throwing one
switch or starting to mine a single face, so rather than a paragraph of my words this slide from
its latest corporate presentation (12) does a good job of explaining how AXU is now in the final
stages of its build-out, concentrate shipments have begun and as the various UG mines come
online in stages, AXU should leave this year running at 400tpd and free cash flow positive.
Which brings us to an attempt to ballpark a valuation for AXU today. With the data supplied by
the new 43-101, we have fresh and updated input to help model a financial target. The
following assumptions often err to the conservative side, but to value AXU today we assume the
following:
 A 400tpd throughput, as per the current company target for end 2021
 Metals grades/recoveries as per the latest 43-101, silver, lead, zinc and gold all payable
24
4.37
7.88 7.19 7.09 7.19 0.401 1.201 0.411 2.111 4.911 0.811 6.611 2.911 8.821 9.921 7.621 8.641 0.831 8.851 3.541 8.951
180
160
140
120
100
80 60
40
20
0
61q1 61q2 61q3 61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1
$m
1.40 AXU: Book Value per share
1.20
1.00
0.80 0.60
0.40
0.20
0.00
source: company filings
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 12q1
source: TSX, AXU filings

 A low TC/RD of 8%, low thanks to its prized Pb conc
 Mine cash costs of U$270/tonne, to the conservative side
 Forex of CAD1/USD0.8
 Yukon royalty of 1.5%
 Other small adjustments
 The WPM stream adjustment
That final item needs details, as on August 5th 2020 (and since we last covered AXU) the
companies re-jigged the deal. First we check official terms, as per the AXU filings, and after the
preamble come the two terms of the new agreement:
1. During the earlier of the initial two years ending August 4, 2022, or eight million ounces of
payable Ag production (the Initial Period), the Amended Production Payment from Wheaton to
Alexco will be adjusted on a curve.
The Amended Production Payment formula during the Initial Period is a linear equation that pays
90% of spot price at US$15 per ounce Ag (and below) and 10% of spot price at US$23 per ounce
Ag (and above); and
2. Following the Initial Period, the Amended Production Payment formula remains a linear
equation and will pay 90% of spot price at US$13 per ounce Ag (and below) and 10% of spot
price at US$23 per ounce Ag (and above).
AXU then gives little table to explain that, here it is:
But do not fear, as with just a little math we give straightforward examples:
 If market price is U$15/oz: 90 – ((15-15)x10). That’s 90 – 0, which is 90%. Therefore
AXU gets U$13.50/oz for its metal
 If market price is U$20/oz: 90 – ((20-15)x10) = That’s 90 – 50, which is 40%.
Therefore AXU gets U$8/oz for its metal
 If market price is U$25/oz: 90 – ((25-15)x10) = That’s 90 -100 which is negative ten,
but the minimum payment now kicks in at 10% of spot. Therefore AXU gets U$2.50/oz
for its metal.
Finally, once the first 8m ounces are delivered, the formula’s “15” changes to “13”, which
means AXU only gets 70% of spot at the lower end of the sliding scale, but there’s no real
change at the upper end and with silver prices strong we aren’t likely to notice. Long story
short, the WPM agreement means that as long as silver spot prices stay above U$23/oz AXU
gets 10% of spot price for the 25% of its silver it sells to WPM.
To wrap this sidebar issue before today’s the ballpark valuation for AXU, let’s take a moment to
see how the WPM stream affects top line revenues in real terms. All done on an average annual
basis and please recall this chart is only for silver, none of the by-product metals here:
KHSD: Annual gross avg Ag revs, at 4.2m oz Ag sold (U$m)
Ag (U$/oz) 75% revs spot 25% revs WPM total AXU revs diff.100% spot
25 78.75 0.63 79.38 25.63
26 81.90 0.65 82.55 26.65
27 85.05 0.68 85.73 27.68
28 88.20 0.70 88.90 28.70
29 91.35 0.73 92.08 29.73
30 94.50 0.75 95.25 30.75
35 110.25 0.88 111.13 35.88
source: AXU data, IKN calcs
As you can probably appreciate, WPM is about to get a handsome payout for the sponsorship
and patience it has afforded to AXU, as for the next few years they get 25% of the silver from a
25

4m oz per year mine at less than a dollar per ounce. Good for them, but we need to know
whether the deal allows enough headroom for a retail to buy in so, with standard criteria taken
into account and the newly filed 43-110 as numerical guide, we run a model using four different
price decks, to reflect a base case, real world cases and a blue-sky pside case:
 Base case: Ag U$20/oz, Zn, U$1.00/lb, Pb U$0.90/lb, Au U$1,500/oz
 Real world case: Ag U$25/oz, Zn, U$1.10/lb, Pb U$1.00/lb, Au U$1,700/oz
 Upside case: Ag U$28/oz, Zn, U$1.30/lb, Pb U$1.10/lb, Au U$1,800/oz
 Blue sky case: Ag U$30/oz, Zn, U$1.50/lb, Pb U$01.30/lb, Au U$2,000/oz
Here’s a chart:
Alexco: Model year revenues by metal type (U$m)
Ag price decks U$20oz U$25oz U$28oz U$30oz
Gold prod (oz) 400 400 400 400
U$/oz 1,500 1,700 1,800 2,000
Au revs (U$m) 0.6 0.7 0.7 0.8
zinc (Mlb) 9.1 9.1 9.1 9.1
U$/lb 1.00 1.10 1.30 1.50
Zn revs (U$m) 9.1 10.0 11.8 13.6
lead (mln lbs) 8.2 8.2 8.2 8.2
U$/lb 0.90 1.00 1.10 1.30
Pb revs (U$m) 7.4 8.2 9.0 10.7
silver Moz 4.20 4.20 4.20 4.20
U$/oz 20.0 25.0 28.0 30.0
Ag revs (U$m) 71.5 79.5 89.0 95.4
Gross sales (US$) $168 $188 $211 $230
TC/RC (7.1) (7.9) (8.8) (9.6)
Net sales(U$m) 81.5 90.5 101.7 110.8
Sources: AXU data, IKN calcs and ests
Using the “$28/oz silver” model, net sales for our model year come to U$101.7m. That runs
though a model condensed incomes statement this way:
Alexco: Condensed income statement (U$m)
U$20oz U$25oz U$28oz U$30oz
Sales (U$m) 81.5 90.5 101.7 110.8
Cash COGS 37.8 37.8 37.8 37.8
Depreciation 8.8 8.8 8.8 8.8
G&A 9.8 9.8 9.8 9.8
fin. Costs 0.0 0.0 0.0 0.0
royalty 1.2 1.4 1.5 1.7
Op income 22.6 31.4 42.3 51.1
Exploration 6.0 6.0 6.0 6.0
Tax 4.2 6.3 9.1 11.3
Net income 12.5 19.0 27.2 33.8
Shares out (m) 142 142 142 142
EPS 0.09 0.13 0.19 0.24
Capex 6 6 6 6
FCF 0.19 0.24 0.30 0.34
Sources: AXU data, IKN estimates
26

And from that, a price target:
Sales & earnings model U$/oz Au prices Target price & valuation data for AXU (USD) based on
Ag spot (U$) $20/oz $25/oz $28/oz $30/oz 4.2m oz Ag/annum model year economics
Sales (U$m) 80.2 89.1 100.2 109.2 12-month target $3.06 based on 16x EPS
Upside to target -4% and U$28/oz Ag
EPS 0.09 0.13 0.19 0.24 Mkt cap (U$m) $464 Enterprise value $470
FCF 0.19 0.24 0.30 0.34 P/sales ($20/oz) 5.21 EV/sales ($20/oz) 5.28
P/E ($20/oz) 36.5 EV/EBITDA ($20/oz) 15.0
P/E ($25/oz) 23.9 EV/EBITDA ($25/oz) 11.7
P/E ($28/oz) 16.7 EV/EBITDA ($28/oz) 9.2
A lot depends on what the investor is willing to pay for exposure to a quality silver company.
The sector tends to demand higher price/earnings ratios (PE) than goldies so even my 16X
assumption may be low, though it looks high enough to me. That’s because one of my failings
around trading silver companies is allowing them the type of 20X and 24X valuations they can
reach at times, which is why AXU is still of interest this weekend, even with a price target that
doesn’t flatter today’s share price. In the case of AXU, a 20X PE pushes the price target to
U$3.83 and a 20% upside, which is reasonable under the circumstances.
Discussion and conclusion: As I’m not a buyer of AXU today it’s going to be brief, but re-
opening coverage on AXU means it’s now primed for purchase if an opportune moment comes
along. Wile the above price target, or even the
mooted U$3.83 on a better PE multiple, isn’t
going to attract those readers searching for the
next ten-bagger, AXU is still an attractive
company to follow and to illustrate, here’s a
plain vanilla 12 month price chart (right). AXU is
now back nudging at its ATHs, which is the
right time as it moves into production. Even
with plenty of valuation baked into its price
today, that re-rate moment can easily bring
momentum buying and another silver company
that moves goes very overbought. While by the
same token, AXU and SIL (see chart at top) are
currently at the top of their well-defined trading
range. No need to buy AXU at U$3.20 if we can predict U$3.00 available soon. There is also the
potential for another silver bullion price disappointment (those sneaky price manipulators), so a
return to anything close to U$2.50 would make a potential purchase into a real one.
Conclusion
IKN627 is done, we end with brief bullet points:
 Amarillo Gold (AGC.v) will be back as a Stock to Follow as from next weekend, all
thanks to Eric Sprott.
 Alexco (AXU) is not at a value entry point today, that can change quickly. Meanwhile,
it’s something of a pity to see New Gold (NGD) leave earlier than planned, but the
money is required.
 One more week for the end of the election in Peru and the start of the nightmare.
 McEwen Mining (MUX) is still a very interesting proposition into a gold bull upwave, we
go detailed on the company next weekend instead of this.
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. Best, Mark
27

Footnotes, appendices, references, disclaimer
(1) https://s27.q4cdn.com/811900961/files/doc_presentations/2021/04/Amarillo-Gold-Presentation-April-1st-2021.pdf
(2) https://6ix.com/
(3) https://amarillogold.com/investors/news/news-details/2020/Positive-feasibility-study-on-Amarillos-Posse-Gold-
Project-supports-10-year-mine-life-at-AISC-of-738-per-ounce-of-gold-2020-6-2/default.aspx
(4) https://www.youtube.com/watch?v=nN6XCi_mVzY
(5) https://www.aljazeera.com/news/2021/5/28/mali-coup-leader-says-new-pm-to-be-appointed-within-days
(6) https://clients.haywood.com/uploadfiles/secured_reports/RPXMay212021.pdf
(7) https://www.elcomercio.com/cartas/mineria-productos-cartas-opinion-direccion.html
(8) https://www.jornada.com.mx/notas/2021/05/27/economia/en-siete-anos-cayo-65-la-inversion-para-exploracion-
minera-en-el-pais/
(9) https://www.atv.pe/noticia/pedro-francke-no-queremos-estatizar-la-mineria
(10) https://www.larepublica.co/globoeconomia/cambios-en-politica-economica-de-peru-afectarian-principalmente-a-
sector-minero-3178209
(11) https://www.bnamericas.com/es/analisis/elecciones-presidenciales-en-peru-no-darian-lugar-a-cambio-economico-
radical
(12) https://seekingalpha.com/article/4431969-silver-miners-q121-fundamentals
(13) https://www.alexcoresource.com/site/assets/files/4502/may-2021_corporate-presentation-compressed.pdf
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
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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
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
29

Stocks To Follow Closed Positions 2016
Closed in 2016 closed close price
Phoscan Chem FOS.to jan16 C$0.28 29-mar-15 C$0.265 -5.4% Buyout trade, bot but poor deal
True Gold TGM.v jan16 C$0.18 23-ago-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-ene-15 U$1.20 10.1% sold due to lack of value
Lake Shore Gold LSG.to feb-16 C$1.10 07-abr-15 C$1.69 53.6% bot out, sold early in process
Atacama Pacific ATM.v feb-16 C$0.19 26-abr-15 C$0.40 110.5% sold for a double on big pop
New Gold NGD feb-16 U$2.06 24-ene-16 U$2.96 43.7% closed good near-term trade
Sandspring Res SSP.v mar-16 C$0.195 18-oct-15 C$0.32 64.1% Hit tgt, took profit
Teranga Gold TGZ.to mar-16 C$0.54 15-feb-15 C$0.60 11.1% disappointing trade
B2Gold BTG mar-16 U$0.85 13-ene-16 U$1.30 52.9% Separate trade on B2, hit tgt
Dalradian Res DNA.to mar-16 C$0.67 27-oct-13 C$1.00 49.3% Hit target, sold, good win
HudBay Min. HBM may-16 U$4.10 03-abr-16 U$4.36 -6.3% Short trade, poor timing
Nevada Sunrise NEV.v may-16 C$0.185 28-feb-16 C$0.23 24.3% V. small, no big deal either way
Richmont RIC jun-16 U$7.60 01-may-16 U$9.30 22.4% near-term trade, profit taken
INV Metals INV.to jul-16 C$0.25 03-abr-16 C$0.95 280.0% Trade closed on time
HudBay Min. HBM aug16 U$4.98 09-jun-16 U$4.80 3.6% short trade covered, no big deal
Miranda Gold MAD.v oct-16 C$0.125 03-jul-16 C$0.10 -20.0% tiny spec trade, didn't work
Avino G & S ASM nov-16 U$2.00 21-oct-16 U$1.40 -30.0% Abandon trade on bad bot deal
Stocks To Follow Closed Positions 2015
Closed in 2015 closed close price
Argonaut Gold AR.to jan'15 C$1.47 14-dec-14 C$2.53 72.1% Big gain small time, profit taken
Amerigo Res ARG.to jan'15 C$0.405 20-jul-14 C$0.285 -29.6% Given up on weak Cu prices
Reservoir Min. RMC.v jan'15 C$6.05 18-jun-14 C$4.12 -31.9% sold on Cu downturn
Coro Mining COP.to jan'15 C$0.075 26-jan-14 C$0.035 -53.3% sm, sold on Cu downturn
Fortuna Silver FSM mar'15 U$4.12 10-nov-14 U$3.75 9.0% Short used as hedge
GoldQuest Min. GQC.v mar'15 C$0.26 27-oct-13 C$0.085 -67.3% given up ghost
Rio Alto Mining RIO.to apr'15 C$2.30 07-apr-11 C$3.57 55.2% Top pick, bot out, big win
Timmins Gold TGD jun'15 U$0.60 19-apr-15 U$0.62 3.3% near-term trade, out of time
First Majestic AG jul'15 U$10.51 10-aug-14 U$4.55 56.7% horrible failed trade
NovaCopper NCQ.to jul'15 C$1.05 09-apr-14 C$0.50 -52.4% no more Cu exposure, sm sell
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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