IKN #655Premium

The IKN Weekly
Week 655, December 12th 2021
Contents
This Week: Trade heads-up, In Today’s edition, The Fed next week, The Christmas period and
The IKN Weekly.
Fundamental Analysis: The time to own Amerigo Resources (ARG.to) has arrived.
Stocks to Follow: Mene Inc (MENE.v), Great Bear Resources (GBR.v), Argonaut Gold (AR.to),
Minera Alamos (MAI.v), Minera IRL (MIRL.cse), Trilogy Metals (TMQ).
Copper Basket: Overview, Oroco Resources (OCO.v), Regulus Resources (REG.v).
Producer Basket: Overview, Kinross and Barrick (KGC) (GOLD), Newmont (NEM).
Tiny Dogs: Contact Gold (C.v), Antler Gold (ANTL.v), Constantine Metals (CEM.v).
Regional Politics: More on Ecuador’s Constitutional Court ruling, Argentina has a new Mining
Secretary, Argentina: Chubut’s governor tries to ram through “Zonification”, Peru set to raise
taxes on mining, Peru: Las Bambas is big politics and big money, Chile: Polls continue to favour
Boric.
Market Watching: Altiplano Metals (APN.v) and a corporate update, The QC Copper & Gold
(QCCU.v) price rebound, Aldebaran Resources (ALDE.v) and a webinar last week, Coast Copper
(COCO.v) promotes itself, Harte Gold (HRT.to) goes into bankruptcy protection.
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
I’m buying Amerigo Resources (ARG.to), see today’s main Fundamentals section for why this is
set to be a winning trade in 2022.
In Today’s Edition
 It’s copper, copper and more copper today. After obsessing over gold stocks and even
adding a silver name to the portfolio recently, it’s time to bang hard on the table and
get you into the best metal for the 1q22 period. Omicron is turning out to be a mini-me
(see last week and my, how things change fast these days), China is pimping its GDP
and adding liquidity, the scene is set for the overdue rally in copper and there are so
many cheap names to choose from that we’re now spoiled for choice.
 But I still try to choose some , starting with today’s main fundies section on what is
simply a no-brainer trade for the year to come. Not only has Amerigo Resources
(ARG.to) got all its ducks in line, but the corporate games now being played around it
offer we retail grunts a golden opportunity to buy before the fireworks begin. The
sharks now circling this stock will not suppress its stock price forever but they’re doing
it now, so get on before they get fully activist.
 Market Watching and The Copper Basket continue with the “long copper” theme, with
news on the sub-sector and views on some stocks to consider.
 It’s another busy week for the Regional Politics section with an Ecuador outlook that’s
1

worse than even I thought it was last week, Peru playing at drama school (it will blow
over) and Argentina still trying to make itself the go-to for copper, and even silver,
projects in 2022. All in all, IKN655 has turned into a bumper edition with plenty of
bases covered.
The Fed next week
You don’t need my opinion added to the hundreds available on Jay Powell’s much-anticipated
Taper Show next week, a.k.a. the FOMC
December meeting. The house position
remains the same as that of the last few
weeks and reiterated in IKN654, last
weekend, that gold is tougher to call higher
under an accelerated taper and the house
position of “steady at U$1,800/oz under
Biden/Powell/Yellen” has served us well
enough and it’s one thing too see
commentators in the gold space remarking
on gold’s steady price action all year, another
to have called it at the time (see chart right).
However and horn-tooting aside, the
industrial metals (led by copper) and even
the Jekyll and Hyde metal (a.k.a. silver) are
the place to be now and set for higher price decks as inflation outstrips any pre-emptive upside
in the US Dollar.
Come 2022 and the advent of Fed rate hikes, the IKN Weekly house position may need a
review but, until then, it shouldn’t come as a surprise to see this weekend’s edition of The IKN
Weekly packed to the gills with copper names, ideas and trade set-ups.
The Christmas period and The IKN Weekly
It’s that wonderful time of year: Turkey and trimmings, Jack Frost nipping at your toes if you
live in the Northern Hemisphere while I’ll be in shorts and a tee, children roasting by an open
fire and here at The IKN Weekly, it’s time to lay out the coverage you can expect over the
festive period. Today Sunday December 12th sees IKN655, so as for the weeks ahead…
 IKN656 December 19th: Normal edition*
 IKN657 December 26th: A “bare bones” edition that will cover the closing prices for
the week, plus perhaps some abridged features if anything interesting or important
happens.
 IKN658 January 2nd: With December 31st landing neatly on a Friday this year, we’ll
wrap up 2021 in IKN658, close the 2021 Copper, Producer and Tiny Dogs baskets,
then present the new line-ups for each section for 2022. Other sections will be “bare
bones”.
 IKN659 January 9th: Back to normal service (and for the record it’s my sister’s
birthday, too).
I’m also due a vacation week at some point, but what with local travel restrictions we haven’t
made any plans as yet. This may mean you find a weekend in January or February with no
edition, or it may not. I’ll keep you informed on that.
*whatever that means
2

Fundamental Analysis of Mining Stocks
The time to own Amerigo Resources (ARG.to) has arrived
There are three things to know about Amerigo Resources (ARG.to) in late 2021:
1) After a patchy period for ARG that included cost overruns on an expansion program
that has failed to bear fruit, badly executed operations under the former CEO and
significant doubts on water supply, the company is finally in good shape. Its operations
are running smoothly, it is financially strong and doubts about its water supply have
dissipated. With copper priced at today’s levels and its near-indefinite supply of tailings,
the company is now a serious cash cow and, assuming copper prices behave, will stay
that way.
2) There’s the clear potential of a boardroom battle in the first months of 2022. Industry
magnate Ross Beaty is interested and there are other large block holders to tema up
with. Though not a certainty, they may try to force out ARG founder and rather
entrenched Chair, Klaus Zeitler, before the next AGM
3) Price action in the stock suggests something afoot, with the current C$1.30-or-so share
price looking particularly stubborn. This is the type of market action that precedes
boardroom battles, but even if ARG fends off its activist shareholders we expect the
current levels to become past history next year. As such and either way, the time is
right to buy some ARG and enjoy the ride up in the years to come.
Today’s analysis expands on those three points and, for the TL:DR among you, will recommend
Amerigo Resources (ARG.to) as a no-brainer buy and hold at today’s prices.
As for the rest of today’s note, even though the three subjects are related we approach today’s
note in roughly the order above, trying to keep the narrative as straightforward as possible. So
first we consider operational and financial situation at the company, then comes a chronological
history of ARG’s problems, which should lead into a focus on the behind-scenes corporate
moves that may come to a head in 2022. However, as you’ll see even if they don’t ARG at its
current C$1.30-or-so share price is a great entry point for whatever 2022 brings and, what’s
more, with big boys and girls playing corporate games you can get in easily at the current price.
Operational overview
We start with the straightforward part of today’s note, as we look at operational results at
Amerigo Resources (ARG.to) and its wholly-owned subsidiary “MVC”. These days it goes by its
initial instead of the previous ‘Minera Valle Central’, as according to the company and its CEO
Aurora Davidson in any number of corporate presentations and internet segments, it has has
plans to emulate its operations at the foot of El Teniente and would like to set up new
operations on other historic and/or fresh tailings opportunities in other parts of Chile. As such,
“MVC” as a brand name suits them better and doesn’t pigeonhole them by location.
To quote Dylan Thomas and begin at the beginning, here’s an overview chart of production at
MVC that segments by tailings type, per quarter:
ARG: Production breakdown by source, per qtr
3
92.01
404.5
687.9
7.5
695.9
30.6
109.8
903.5
231.9
625.5
309.11
256.5
747.31
587.4
114.8
395.4
322.8
121.5
301.11
589.4
61.11
75.4
717.5
131.5
13.6
66.6
8
86.6
82.9
71.7
74.8
30.7
16.7
73.7
73.7
26.8
26
24
22
20
18
16
14
12 10
8
6
4
2
0
71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3
Mlb Cu
Slag processing
Cauquenes tailings
Fresh tailings
source: company filings

Aside the brief period in 2019 and early 2020 when ARG/MVC processing some high-grade slag
from El Teniente (and didn’t make much money from it), its production comes from re-
processing either “fresh tailings” from the massive El Teniente copper mine owned by Chile’s
State-run mining company Codelco, or re-processing historic tailings from the old and massive
“Cauquenes” tailings dump nearby, which are sumped and sluiced to its processing facility. The
combination of these tailings supply provide ARG with a near-limitless amount of raw material
and while low grade and with low recoveries, they make good margin by keeping operating
cash costs low at its technologically simple processing facility. On top of mine costs, as El
Teniente is owner of the tailings ARG pays a royalty on sliding scale to its big neighbour which
depends on the spot price of copper.
ARG at MVC calls itself a “Copper Factory” these days and that’s a reasonable image to use
(and for more on that, the royalty sliding scale and other interesting tidbits on ARG check out
(1) the latest corporate presentation) and in any given quarter, should recover enough to
produce at least 16m lbs of copper per quarter as well as a useful molybdenum credit product.
In fact, ARG should be able to produce more than 16m lbs copper per quarter as you’ll see
below, but first things first. The above chart shows copper only and the ARG production
numbers per quarter, with for example the latest 3q21 quarter returning 15.99m lbs Cu. This
next chart shows copper deliveries and, in 3q21, those came to 16.9m lbs copper:
ARG.to: Copper sales
4
714.31 571.51 791.61 152.51 482.61 25.41 912.41 595.71 395.71 29.21 568.31 945.91
70.42
28.11 7.31 29.41 9.51 11.51 31.51 9.61
71
81
02
25
22.5
20
17.5
15
12.5
10 7.5
5
2.5
0
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1rtQ.ge 2rtQ.ge
source: company filings
rtq/uC
sblM
This chart is also the first one that includes our estimates for 4q21 and for quarters to come
and, as this is an important point to make as we walk through today’s anal ysis, a few words on
the chart estimates and the columns you see. For most charts to follow, you’ll see results as
from 1q19 for context and discussion, then three estimates columns to the right. They are
 The 4q21 estimate: That the current quarter and in this case, we estimate ARG will
announce a quarterly deliveries/sales of 17m lbs copper.
 The First Example Quarter for 2022: In this case, we estimate ARG will announce a
quarterly deliveries/sales of 18m lbs copper. In fact we don’t know that, but the idea is
to show what happens to ARG results and financials if production and sales improves
modestly from the current rates at the mine _(or “factory”).
 The Second Example Quarter for 2022: In this case, we estimate ARG will
announce a quarterly deliveries/sales of 20m lbs copper. This is a more optimistic
scenario that assumes ARG gets its act together in 2022 and starts producing at the
rates it planned to do when investing in the recent expansion capex. Again, much more
on that below.
In effect the three scenarios of “4q21est”, “e.g QTR1” and e.g.QTR2” are designed to give you
the reader a better idea of what ARG can do today and what it’s capable of doing if it starts
processing more quickly. The overall concept I want to get across is an important one and a
central reason for buying this stock and going long at its current price: THIS COMPANY IS
AN IMPRESSIVE CASH COW and as long as copper prices remain buoyant and the
operations deliver as expected, it will be a nailed-on producer of profitable copper with

revenues that flow with regularity and predictability to its bottom line. Amerigo Resources has
had plenty of issues these last five years (see below) but, now it has its financials and
operations straight, it’s set ot be an impressive an highly reliable source of free cash flow and
financial profits.
So with context duly set for the charts to come, here’s another one (right), the average
received price for copper per quarter. At this
point we should mention that due to the delays
ARG incur between delivering its product to
customers and getting the cheques, the company
has to estimate the revenues it will receive and
make subsequent adjustments to its top line if
the spot price of copper changes in the interim.
For example, you see on this chart that its
received price for copper rose nicely in the late
2020 and early 2021 periods and for those
quarters, ARG benefited from adding extra
income to the quarters that followed. However,
due to the drop in average received price
between 2q21 and 3q21, it took a negative
charge on its 3q21 gross revenues (of U$2.867m to be exact). In the end it’s a small point as
the effects of the positive and negative reconciliations wash through; the net result is neutral,
but it can skew out top line revenues on a quarterly basis and it’s often the reason my model
gets the gross revs number wrong. So, when you multiply the delivered pounds by the average
received price, you get this:
ARG: Cu gross value, per qtr
5
6.83
1.43
7.24 6.34
8.12
8.43
2.05
4.16
7.66 4.17 1.96 0.37 4.77
0.68 100
90 80
70
60
50
40
30
20
10
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.ge 2RTQ.ge
U$m
source: company filings, IKN ests
In 3q21 gross copper value came to U$69.134m (that’s U$72.001m in sales, minus that
U$2.867m negative reconciliation from the previous quarter) and now you see what our three
projected estimates do to gross revenues, assuming all things are equal and copper stays at
U$4.30/lb. From that gross number we start subtracting things, starting here:
ARG: Charges to gross Cu value
35
30
25
20
15
10
5
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.ge 2RTQ.ge
ARG: Average Cu price for MVC
U$m
Transport
smelting/refining
DET royalties
source: company filings, IKN ests
The biggest deduction is the royalty ARG pays to El Teniente (aka DET) and at U$4.30/lb
29.2 76.2 26.2 67.2 53.2 16.2 40.3
25.3 80.4 44.4 32.4 03.4 03.4 03.4
5
4.5
4
3.5
3
2.5 2
1.5
1
0.5
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.ge 2RTQ.ge
U$/lb Cu
source: Company data/IKN ests

copper going forward, the above shows out estimates. This next chart gives an idea of the
typical percentage of gross AR owes to DET
which depends on the price of spot copper but
at the current elevated price, a little under 29%
of gross metal value goes to DET. But it’s not
all bad news, as ARG gets to add back revenue
as well. That’s the moly it produces, so a word
or two before we press on because after a
period in which ARG went though tailings at
very low Mo grades and while the market price
for the metal was depressed, 2021 has seen a
turnaround in both variables.
These two price charts (long term and this
year) show one part of the good news, with
ARG: Credit metal revenues
moly now commanding around U$19/lb (or 7
U$40/kg) at market due to China’s newly 6
voracious appetite for high quality stainless 5
steel manufacture (adding molybdenum to 4
your steel mix makes for a higher quality and 3
more sought-after end product). This chart
2
(right) shows the credit received by ARG, plus
1
our estimates for future quarters under our
0
three basic scenarios and we hope you agree
that U$6m or so per quarter is a seriously
useful credit.
So with gross metal value, the DET royalty, smelting/refining costs, transport costs and then
the credit backed in, we can now compare the difference between the gross for copper and trhe
amount of revenue AERG can put on the top line of its P+L in Total Revenues:
6
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.ge 2RTQ.ge
ARG: % DET royalty from gross
40
35
30
25
20
15
10
5
0
U$m
Cu slag revs
Mo revs
source: company filings
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.ge 2RTQ.ge
source: company filings, IKN ests
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uC
ssorg
fo
%
ARG: Gross Cu value vs Total revs, per qtr
637.72
296.22
9.33
474.53
836.51
640.62
555.73
881.74 709.84 305.05 231.84 83.15 84.45
89.06
100
90
80
70
60
50
40
30
20
10
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.ge 2RTQ.ge
U$m
source: company filings, IKN ests

In 3q21 that was U$48.132m but, as you can now appreciate, if ARG manages to up the
rhythm of production to 20m lbs copper per quarter, ceteris paribus sees revenues jump to
nearly U$61m and that’s a big difference to a small company.
It also allows us to leave production matters aside and get to the meat of this financial story,
the ARG operational results as seen on its P+L sheet. We begin with the overview chart:
ARG.to: Quarterly Earnings overview
65
60
55
50
45
40
35
30
25
20
15
10
5
0
-5
-10
7
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.fe 2RTQ.ge
source: company filings
srallod
fo
snoillim
revenues
COGS
Gross profit
We only sample from 1q19 onward (the house database goes way further back, unfortunately
) but even so, we can already see the big difference in financial results between the bad old
days of 2019 and the good times now seen at the company.
One of the reasons for that is the ARG costs profile (right), which was always regular but under
the new stewardship of CEO Davidson has becomes
ARG.to: Costs breakdown
even more predictable. ARG like any other mining
50
company has seen some costs pressure in recent 45
months but, the combination of the weak Chilean 40
35
Peso and the way in which the company has now
30
locked in its main fixed cost of power means we’ll be
25
able to predict its COGS line fairly accurately in 2022. 20
And while on the point, please note that around 30% 15
10
of COGS at the company is its power bill and that
5
these days ARG has franked its already strong image
0
as a sustainable and “green miner” by signing a
contract for 100% renewable power supply with its
electricity supplier. This is the type of marketing
angle that will play well in the years to come and,
alongside the basic fact it uses what is essentially a waste product for its copper production,
may see a different and more loyal investor base than your normal mining company. Once past
the gross profit stage, there are few headwinds to the ARG P+L aside its regular and easily
manageable debt repayments. As a result, this chart shows how gross profit (sky blue bar in
the chart above and below) turns into operating and net profit:
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.fe 2RTQ.ge
U$m
other
G&A+roy
COGS
source: company data, IKN ests
ARG.to: Gross, operating and net profits, per qtr
25
22.5
20
17.5
15
12.5
10
7.5
5
2.5
0
-2.5
-5
-7.5
-10
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.fe 2RTQ.ge
U$m
Gross profit
op profit
Net Income
source: ARG data

The one that matters most in that above chart is operating profit, so here’s that dataset
repeated on its own:
ARG.to: operating profit
8
3.0
3.7-
9.0
1.3
9.4-
3.3-
1.8
4.31
0.61
1.81
6.21
4.51
4.71
5.22
25
20
15
10
5
0
-5
-10
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.fe 2RTQ.ge
$m
source: company filings
As stated above in underlined block capitals, this company really is a cash cow and while its
recent quarter was a little low due to that negative reconciliation, we can expect AERG to
deliver regular dollar profits per quarter going forward, all it needs its to deliver on operations
and enjoy copper prices where they are today.
It’s at this point we need to mention its share
count too, because not only is it low, but the
recent corporate moves (see below) mean its
going to get lower. This chart shows with a
cut-down Y-axis shows the contrast (and not
to deceive your eye) and we’re already down
to 175m shares out. With the current normal
course buyback now in place, ARG could
theoretically get its share count down to 165m
by this time next year. We target 170m but
even so, at its current 175m S/O and C$1.31
share price ARG is a CAD$229.5m market cap
company, or U$183.4m at the house 0.8/1 forex assumption, with the potential to deliver
between U$15m and U$22.5m in operating profits per quarter. Again, that says per quarter.
Here’s a final P+L derivate chart showing net EPS and our estimates for the three forward
scenarios:
ARG.to: Earnings per share, per qtr
0.10
0.09
0.08
0.07
0.06
0.05
0.04
0.03
0.02
0.01
0.00
-0.01
-0.02
-0.03
-0.04
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.fe 2RTQ.ge
ARG.to: Shares Out
190
185 NB CUT DOWN Y-AXIS
180
175
170
165
160
U$
source: company filings, IKN ests
It’s no stretch of the imagination to see ARG delivering 8.2 United States cents to the bottom
line per quarter, which at today’s deck would represent a forward P/E of 3.2X. Even the low
case scenario mapped out in the 4q21 estimates would be a 4.6X P/E so this is not only a real
and regular cash cow going forward, but it’s a very cheap entry point, to boot.
As for balance sheet items, for once they aren’t the most important thing for our argument but
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 TEGRAT
source: company filings, IKN ests
serahs
fo
snoillim

a look at the basic overview of assets and liabilities allows us to see how ARG ahs got its house
in order and is now a steady ship.
ARG.to: Total Assets
300
250
200
150
100
50
0
There is still plenty of debt to pay down, but the schedule is friendly and with the amount of
free cash flow its MVC “copper factory” is now throwing off, it’s a minor issue. Instead, these
balance sheet charts show the real turnaround we’ve seen at the company since CEO Aurora
Davidson took over and sorted it out:
Both cash and working capital are now healthy and due to its ongoing cash cow status, that will
only get better. Both are set to drop in the 4q21 results because ARG has just paid out nearly
C$10m to retire a large lump of shares (see below) and will continue to buy back as from now,
but that’s a temporary issues and as the profits now flow to the bottom line, management will
have to decide what to with its excess treasury (not a bad problem to have). See below for
more on that, but to round off the first part of today’s anal ysis, while ARG went through a
difficult period a combination of prudent management decisions under CEO Aurora Davidson
and improved copper prices mean Amerigo Resources today is in strong financial shape.
We’ll see later how it now plans to return capital to shareholder via a new dividend policy and
significant share buybacks that have already started but before we get there, we take a closer
look at the issues it faced in the 2017 to 2019
period because they may still be important for
what’s about to happen in 2022.
The problem years
In 2015 the then-75 year old founder and CEO of
ARG, Klaus Zeitler decided it was time to move
upstairs, changed his role to executive chair and
handed the CEO job to the company’s COO at the
time, Rob Henderson. As this ten-year chart of
spot copper prices (HG00) shows, the market was
9
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
source: company filings
srallod
fo
snoillim
ARG.to: Liabilities Breakdown per qtr
160
140
120
fixed
other current 100
Inventory
80
Trade/Rec
cash&eq 60
40
20
0
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
source: company filings
srallod
fo
snoillim
LT liab
current liab
ARG.to: Working capital
30
20
10
0
-10
-20
-30
-40
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 1RTQ.fe 2RTQ.ge
U$m ARG.to: Cash and ST
70
65
60
55
50
45
40
35
30
25
20
15
10
5
0
source company filings
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
$m
source: company filings

facing depressed copper prices at the time so the decision at ARG was to combat this by
investing in capital works to expand production, thereby reducing the company’s relatively high
cash cost of production via economies of scale. A reasonable enough plan and when copper
prices picked up in 2017, ARG secured the second of the two financing packages it needed to
move forward and bump up production to a projected 80mlb to 85mlb per annum.
The expansion plan was set for completion in 2018 and though coming in a little late in early
2019, we finally got the NR we were looking for (copypaste here):
And from the same NR:
For the record and for those that remember, that was when stupid me last went long ARG
because stupid me did a stupid thing and took a CEO of a junior miner at his word . Sure
enough, it didn’t take long for bad news to arrive, in ARG’s case a double whammy of supply
being cut off temporarily from El Teniente due to water issues and unscheduled maintenance,
plus a sudden an unexpected drop in grade from the ARG tailings. We learned later that CEO
Henderson had dropped the ball badly by assuming grade at the historic tailings and failing to
drill test adequately before sluicing the material to the plant. Cut to August 2019, when ARG
announced that it planned a refinancing of its debt facility in a transaction that closed a month
later. As part of that, we got this:
There were two credit lines in play, but by that time the one that mattered was the second
U$35.3m facility taken by ARG which it said would cover the completion of its expansion
program. However, the refi announced in mid-2019 telegraphed the reality and in effect, ARG’s
expansion program, designed to get the company to a production schedule of 80m to 85m lbs
copper per year, overshot by at least U$20m. That’s bad enough but let’s go back to the
operations charts to highlight the real problem. Here’s a replay of the data presented above:
ARG.to: Copper sales
10
714.31 571.51 791.61 152.51 482.61 25.41 912.41 595.71 395.71 29.21 568.31
945.91
70.42
28.11 7.31 11.51 31.51 9.61
25
22.5
20
17.5
15
12.5
10 7.5
5
2.5
0
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3
source: company filings
rtq/uC
sblM
In one simple and colloquial question, “Where’s the beef?” Aside the brief period when ARG
took on the El Teniente slag in 3q19 and 4q19 to produce extra and expensive pounds of
copper, the MVC facility has not approached the type of 20mlb/quarter rhythm promised by the
capital program back in 2017. In fact you’d be hard pressed to see any difference in output,
aside perhaps from the latest 3q21 return of 16.90m lbs Cu sold (and even then, production for
the quarter was lower at 15.99m lbs Cu).

Let’s face it, if I were a large shareholder who’d agreed to the plan back in 2017 and held
through diligently, then got hit by a U420m cost overrun, then waited through all 2020 and all
2021 for ARG to show the improvement promised and saw nothing, I’d be fairly annoyed with
the people in charge of this company. The U$99m in total is no small chunk of change and has
made a big difference to the balance sheet and earnings power at the company. We have seen
how the CEO at the time, Rob Henderson, got the blame and was summarily fired in late 2019
due to the mess, but Chair Zeitler is still there and the person in charge of the treasury box
while the expansion project was in execution, Aurora Davidson, managed to get a promotion
instead of suffering any pushback.
December 2019, Rob Henderson left the company and was replaced by then CFO, Aurora
Davidson (2). It’s now time to consider Aurora Davidson and her role more carefully, because
even though she has done a great job of getting ARG out of its financial mess in 2020 and
2021, her past history also counts. CEO Davidson joined ARG back in 2003 and for most of her
time, was CFO and director. These days she’s CEO, she’s also a serious and smart mining head,
speaks perfect and seriously impressive Spanish and English, knows her company backwards
and is an excellent ambassador for ARG at presentations, meetings, webinars etc. However,
she’s also a close confidante and veritable “Right Hands Lady” of Chair Klaus Zeitler, as
witnessed by the way they worked together at Los Andes Copper (LA.v), where Zeitler was also
founder and Chair and Davidson CFO until 2019.
We now spend a little time talking about LA.v, the duo of Zeitler and Davidson, plus that
company’s Vizcachitas project in Chile, as it may provide clues for the possible future of our
subject today, Amerigo Resources. LA.v was set up by Zeitler in 2006 and went public in 2007
after buying 51% of Vizcachitas from none other than Ross Beaty (via his Global Copper entity).
Zeitler then did a deal on the other 49% with a local Chilean businessman and, over the years,
tried to move the project forward but for several reasons (that we need not go into today, but
revolve around land issues and the failure to secure one small but vital concession zone in the
very centre of the mineralized zone) LA.v spent years going nowhere. Zeitler remained Chair of
the company from 2007 until 2019 and in that time, Aurora Davidson was LA.v’s CFO. Then in
May 2019 Zeitler resigned as Chair and took Ms Davidson with him as he left. At that point LA.v
got a new Chair (3) and a new management team, so consider that potted history compared to
this ten-year price chart of Los Andes Copper (LA.v):
It’s difficult to shake the impression Zeitler was entrenched as LA.v Chair and stopping key
transactions from happening. The way LA.v has taken off since 2019 and, Covid-19 dip aside, is
impressive, with smooth progress to its current C$11.65 share price, basically a triple.
The ARG.to corporate structure and evidence of activist shareholders
With LA.v’s history and fate in mind, we turn our attention back to Amerigo Resources, its
corporate share structure and what some stealth activist shareholders have been doing
recently, as well as some obviously defensive moves by ARG management in recent months.
We begin by showing you this frame, from the 2020 Management Information Circular listing
11

shareholders with 10% or more of the company:
At that time, two and a half years ago, there were four parties owning more than 10% of ARG
(and as a sidebar, Chair and founder Klaus Zeitler, now 81 years old, currently owns 5.892m
shares or 3.24% of the company). The two names that need no introduction to this audience
are Rick Rule (via his trust) and Ross Beaty (via Kestrel, one of his holding companies). As for
the others, Luzich Partners LLC is one Michael Luzich, who made his money in the Las Vegas
casino business and these days is an investor, philanthropist, fan of “sustainability”, race car
driver…and on an anecdotal level we hear he’s also a pure-blood hard-nosed capitalist with a
penchant for doing deals and getting his way. The last name on the list is biggest holder
Geologic Resource Partners LLC, a.k.a. George Ireland, the successful mining investor and ally
of Chair Zeitler. That’s the scene set via 2020 numbers, we now jump a year to the 2021 MIC
table, as seen below and filed to SEDAR on April 1st 2021:
We see that Rick Rule is off the list and in his place, Aegis Financial has become a 10+%
holder. Then immediately after the publication of the MIC, we got these filings on SEDAR:
That’s Ross Beaty reducing his position and in early May, he dipped under the 10% barrier and
ceased to become an insider (meaning he could continue selling if without declaring any
further). Let’s now dial up the 12 month chart of ARG (below) and note the spike in ARG’s
share price in May this year price came with a big jump in volume, which eventually petered out
as the stock returned to its C$1.30-or-abouts level. We move swiftly on to our next stop, the
ARG 2q21 earnings of mid-August, as during the Conference Call that day (transcripts of all
ARG CC’s available here (4)), CEO
Davidson’s prepared text included
comments that ARG was “…aware that
there has been selling pressure on our
equity. During this year, approximately 30
million to 33 million shares of Amerigo
held in two significant blocks have been
sold into the market.” She was later
pressed on this comment by one Nick
Toor, an analyst and fund manager closely
connected to Michael Luzich. He may or
may not have known the answers to both
the questions posed, but got CEO
Davidson on the record that Rick Rule was
12

fully sold, but declined to comment on whether Ross Beaty was fully out (5). Which means he
wasn’t, of course . Also the count provided indicates ARG at least believed Beaty still held a
few million shares at that moment. Also during the ConfCall, CEO Davidson was quizzed closely
by an analyst regarding ARG’s dividend policy going forward, who wanted to know all about
whether there was a dividend policy planned, whether it would be annual, or semi-annual (i.e.
the way ARG paid divis way back when), or whether a quarterly dividend was in the cards. CEO
Davidson replied that the board was still in discussions, but ARG would not be limited to semi-
annual for tradition’s sake and a quarterly dividend was possible.
That was August 2021, then on September 28th (i.e. the second last day of the same 3q21
period), ARG announced it was opening a “Substantial Issuer Bid” as well as its intention to
reinstate, yes indeed, a quarterly dividend:
The buyback allowed ARG to buy back up to C$25m in shares that would then extinguished at
treasury. The offer was run as a modified Dutch Auction with offers from shareholders allowed
between C$1.18 and C$1.30 which meant, at the maximum price of the offering, ARG could buy
back up to 19,230,760 shares (10.6% of total shares out). As for the dividend, clearly
something had shifted at board level and an announcement of intention such as this is not one
a CEO and her Chair, both now under pressure from activist shareholders, would be able to
walk back later.
We move on to November 4th (watch those dates) when CEO Davidson elaborated slightly on
the reasons behind the Substantial Issuer Bid (SIB) during the 3q21 earnings conference call,
saying there was one holder who had voiced the intention of selling a 10m share block and the
facility had been set up for that holder. In the end, ARG made the SIB Dutch Auction
substantially larger than the 10m intended block in order to facilitate any other sellers, which
strongly suggests they were fishing to get another large block holder out. The SIB closed on
November 12th and on the 16th, we got the results NR:
In the end the “10m seller” only sold 7m and aside him, just 116,345 other shares were
tendered and extinguished, all at the maximum price of C$1.30. A far cry from the C$25m
13

maximum tender, which suggests ARG didn’t attract the other big fish holder it was trying to
get out. As for the ID of the 7m block seller, insider filings later showed this:
The block seller was director Michael Luzich, but he eventually decided to sell just 7m of his
total holding and not the mooted 10m. Which brings us to the newly declared major holders
table from ARG in its corporate presentation published December 7th (i.e. bang up to date):
Michael Luzich is now under 10% but as a director must declare his stake. We now know that
Luzich Partners has sold 7,411,600 shares since the April 2021 MIC was published, i.e. that 7m
share block plus another 411,600 shares, bringing him just below 10%. Hardly a coincidence.
We know (or assume at least) that Rick Rule is fully out, with around 17.5m shares sold and at
least some of them before the 2021 MIC was published to get him under the 10% insiders
barrier. We also know that by August 21021 he was fully out, according to CEO Davidson. We
know that Michael Luzich was also a seller on the open market, but also used the facility of the
SIB to block sell 7m shares and get under 10%. The incognito remaining is Ross Beaty’s
position, as we know for a fact he sold around 6.8m shares in May 2021 to get under 10%,
then from the 2q21 ConfCall we understand from CEO Davidson that he’d sold another 6m to
9m shares (to get to “30 to 33m via two sellers”). We also know that the SIB was set up not
just for Luzich, but to attract any other block sellers, so this desk assumes ARG was trying a
defensive move to get 10m of Luzich shares out of the way and the Beaty remnant of perhaps
6m to 9m shares at the same time. However, they didn’t get anywhere near the takers they
were looking for and ultimately extinguished 7.116m shares, which means Beaty didn’t bite. We
can therefore assume he still holds a position in ARG under 10%.
Discussion and conclusion
It’s time to put all these jigsaw piece together and try to form the picture of what we are likely
to see in the first half of 2022, because the separate parts of today’s anal ysis all point in the
same direction:
1) We have a company now operating profitably and at a steady state that is now the epitome
of a mining cash cow. At current run rates, profitability is guaranteed and as water supply is
now guaranteed (this from IKN654 last weekend)…
Codelco Assures It Has Water Guaranteed for Next Year's Production
While taking into account the relevance of water resources during the drought facing
the country, the president of the board of directors of Codelco, Juan Benavides,
yesterday stated that the State-run mining company has the water supply it needs
guaranteed for normal operations in 2022, principally in its El Teniente and Andina
divisions. "The studies are done; they guarantee that the water (we have) we be
enough", stated the director.
14

…all operational ducks are in line.
2) However, ARG is also a company with a serious corporate error in its near-term past. The
$35.3m expansion project that was supposed to get production at MVC up to between 80m
and 85m lbs copper per annum ended up costing over U$20m more than expected and what’s
worse, has failed to show any production or sales upside.
3) We have a company Chair who is 81 years old, promoted the wrong person to CEO in 2015
and then failed in his fiduciary duty of oversight, watched an expansion project overrun in price
and then fail, and in response promoted another close ally to CEO.
4) We have a current CEO that’s has done a great job in steadying the financial ship at ARG and
is razor sharp at the corporate side of matters, but is still the Right Hand Lady of the Chair and
has failed to deliver the production growth promised by that overly expensive expansion
project.
5) In Los Andes Copper (LA.v), we have a recent model of a company that was controlled by
the same Chair and with the same CFO that went nowhere for years, but as soon as they left
the share price rocketed. Also in Chile and also a copper play.
6) We have large shareholders who have been acting aggressively and are obviously planning
something. If not, why didn’t Luzich sell 10m shares? Why has Ross Beaty held on to likely 65%
or 8% remnant of his previous large position? Where is long-time Beaty ally Rick Rule in all
this? ARG management are clearly concerned, as the recent corporate moves are all defensive.
They’ve tried to clean the share registry, they’ve finally offer a crowd-pleasing dividend as from
the end of this very quarter and now they continue to buy back shares (which also forces
anyone who’s just below the 10% barrier to sell as well). All these things make ARG more
attractive from an outsiders viewpoint of course, but there’s clearly an ulterior motive and it’s
likely about trying to fend off a boardroom battle.
Therefore it’s time to draw a real world and actionable conclusion and for me, Amerigo
Resources (ARG.to) is a buy this month of December 2021 for three reasons. Firstly, the share
price is obviously being suppressed and when buyers appear, it gets pushed back to the C$1.30
line almost without fail. This means we retail grunts can buy this month and we don’t have to
worry about chasing the price up, because the big boys playing their big games will keep this
stock at its current buyable level. Secondly, I think the 4q21 production report, promised by
CEO Davidson in the first days of January along with production guidance for 2022, will be a
critical moment. I believe the stealth strategy of the activist shareholders are waiting for that
moment to decide what to do because, in the end, what everyone wants is a higher share price.
If ARG delivers a strong 4q21 of production and can than offer guidance that finally delivers on
the “80m lbs to 85m lbs copper per year” that the company promised when embarking on its
capex injection and expansion program, then the current activists may be assuaged enough not
to take the matter any further. Which brings me to point three: If ARG doesn’t deliver in its
January release, particularly on forward guidance, the large block holder will perceive 2022 is
going to go by without anything to show for that overly-expensive fixed asset upgrade. They
will move in for the kill on an 81 year old Chair who gets 1.5c per lb of copper produced at the
mine as his sidebar royalty but had done nothing for equity holders. He and his Left Hand Lady
already know the pattern from their exit of Los Andes Copper, as do the shareholders who then
watched as the LA.v share price tripled.
And that’s the bottom line: You got 14 pages to explain why, as long as copper holds its
course, Amerigo Resources (ARG.to) is a buy today because as from this quarter we get a
quarterly dividend, enjoy the tightening share structure from an aggressive buyback policy and
if CEO Aurora Davidson delivers a strong 4q21 and guidance, we win even more. But if she
doesn’t, we watch a boardroom battle happen, ARG.to “does an LA.v” and we still win. The end.
15

Stocks to Follow
Although the sector and the wider market generated plenty of noise last week, come Friday’s
close the macro-level view hadn’t changed that much, For sure Great Bear was up and Kinross
was down, but changes in the barometer ETFs were smaller than you’d imagine. GDX fared the
worst, down 0.7% week-over-week, while GDXJ dropped by just two cents and GLD by five
cents, rounding errors level changes for both. Our “Stocks to Follow” list did a little better than
those numbers and of the 15 open positions, we saw eight winners (RIO.v, TMQ, QCCU.v,
SMD.v, ALDE.v, APN.v, GBR.v, MENE.v) and seven losers (MAI.v, CMMC.to, AR.to, DSV.v, PA.v,
AUL.v, MIRL.cse). The difference was in the details, as most of the losers were small and inside
trading ranges and Palamina the only significant loser (PA.v down 11.1%), while three double
figure percentage winners in Great Bear (GBR.v up 36.9%), Aldebaran (ALDE.v up 21.8%) and
QC Copper & Gold (QCCU.v up 17.6%) made it a clear winning week. What’s more, with GBR
now under offer I have a print and realized gains in the near future, never a bad thing.
We currently have at 15 open positions, our self-imposed maximum of stocks held and covered
at any given time. Just four are in the green and I felt sick when seeing that on Friday.
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$0.52 147.6% $1.14 tgt Aug'20, #1 idea
Rio2 Ltd. RIO.v STR BUY C$0.83 22-Apr-18 C$0.62 -25.3% $1.30 1st tgt, building now
Recommended stocks (In order of preference)
Copper Mountain CMMC.to STR BUY C$3.42 18-Jun-21 C$3.34 -2.3% Top value Cu play, overweight
Argonaut Gold AR.to STR BUY C$2.95 25-Jun-21 C$3.14 6.4% Magino is upside,frustrating
Discovery Silver DSV.v STR BUY C$1.77 24-Oct-21 C$1.73 -2.3% Serious Ag play, big&cheap
Trilogy Metals TMQ BUY U$1.84 15-Sep-19 U$1.70 -7.6% S32 suitor, stalled
QC Copper&Gold QCCU.v STR BUY C$0.26 25-Apr-21 C$0.30 15.4% Now drilling. Easy hold
Palamina Corp PA.v SPEC BUY C$0.295 21-Nov-21 C$0.24 -18.6% New, gold expl in S.Peru
Strategic Metals SMD.v BUY C$0.42 31-Jan-21 C$0.34 -19.0% Canada land bet+Zn in FY22
Aldebaran Res. ALDE.v SPEC BUY C$0.68 16-May-21 C$0.73 -7.4% Waiting on drill assays
Altiplano Metals APN.v SPEC BUY C$0.31 17-Sep-21 C$0.26 -16.1% Cheap entry, 1q22 re-rate
Great Bear Res GBR.v hold C$15.83 26-Aug-20 C$28.55 80.4% Under offer, possible counter
Aurelius Min. AUL.v hold C$0.75 28-Jun-20 C$0.24 -68.0% has until 43-101 to improve
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.075 -61.5% CEO change will move stock
Long-term non-mining hold
Mene Inc. MENE.v adding C$0.66 6-Dec-20 C$0.59 -10.6% LT bet, adding slowly
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 Min NOM.cse feb'21 C$1.55 6-Sep-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
New Gold NGD may'21 U$0.76 9-Feb-20 U$2.14 181.6% Sold to buy AGC, nice win
Orezone Gold ORE.v jun'21 C$0.79 21-Jun-20 C$1.61 103.8% sold on pop, leaky boat
Wolfden Res. WLF.v sep'21 C$0.30 11-Apr-21 C$0.19 -36.7% Failed spec trade, cut loss
Cartier Res ECR.v sep'21 C$0.32 21-Mar-21 C$0.235 -26.6% Failed spec trade, cut loss
Amarillo Gold AGC.v sep'21 C$0.31 30-May-21 C$0.30 -3.2% Capex story changed: Out
Excelsior Mining MIN.to oct'21 C$0.93 10-Mar-19 C$0.53 -43.0% May return in 2022
Royal Road Min. RYR.v nov'21 C$0.155 17-Mar-19 C$0.275 77.4% Closed on Nica pol risk
2015 to 2020 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
16

Now for notes on a few of our covered stocks but please note that today’s ‘Market Watching’
does the heavy lifting on copper names.
Mene Inc (MENE.v): ADDED AGAIN. What with feeling flush after the GBR news and MENE
still without interest, I bid for another small tranche of MENE and was happy to see it fill at 60c
on Friday. Frankly, it seemed rude not to . As a result, the cost average gets marked at 66c
(it’s a couple of tenths higher, but we don’t do decimals). We’re about one month away from
what I expect to be a major catalyst moment, i.e. the 4q21 preliminary sales NR.
Great Bear Resources (GBR.v): A good week for the stock price . The arrival of the offer
from Kinross (KGC) means the end is nigh for this position on the Stocks to Follow list, which in
turn (just about, at a squeeze) allows me to add Amerigo (ARG.to) in the days ahead without
feeling guilty about going over the 15 stock maximum again.
The plan from here is simple (and simple is good): There’s no reason to accept the C$28.50-or-
so arb when C$29 is on the table and mostly in cash, we have the room to wait and see if
Barrick (GOLD) or other comes back with a counter-bid for GBR or even perhaps and offer for
KGC, as noted on the blog last week (8) and in this weekend’s Producer Basket section, below.
Considering all the pieces of this story and how GOLD was reportedly “silver medallist” (as one
contact aptly put it) in the ostensible contest for GBR, I’d rate the chances of a contest for GBR
this weekend at 50/50. Or put another way, I’d be reasonably content to walk away with my
80% gain but there’s enough reason to stick around to see whether the market (or perhaps
“The Mark”) offers up a bonus prize.
Argonaut Gold (AR.to): Down another 13c to C$3.14 and without mincing words…UGH!
Here’s a price chart:
So here the thing: I can handle the choppy and weird trading that comes with every Tax Loss
Selling season (and by the way, the last day this year is Wednesday December 29th though its
effects should be done with by Thursday 23rd). I can handle the drudge of the Top Picks
through 2021 (RIO.v, MAI.v) because I know they are long-term winners, bought them for the
long-term and a plan is a plan. I can handle the slow start we’ve seen in the Discovery Silver
(DSV.v) trade because I’m eyes-wide-open about its underlying metal. I can even handle the
selling in Copper Mountain that has bought it back down into the red on my list because buying
at $1.40 this time last year and selling at over $4 allows breathing space. But this trade has
become a most frustrating hold, despite it still showing green ink, because it’s doing what I
expected it to do operationally but failing to gain any traction at market. So even though it¿’s
out-performed GDX/J since purchase and even though a couple of adds at the right time got my
cost average under C$3.00, it’s been a frustrating trade to date and made all the worse by the
steepness of the sell-off since you had me crowing about the “breakout” of less than a month
ago (more fool me).
17

In last week’s webinar (see IKN654) CEO Dougherty gave another upbeat update on progress
at Magino, with construction on-time and on-budget. This continues to be the major catalyst at
AR and if the selling seen last week was connected with the official refusal of permit at its Cerro
de Gallo project in Mexico AR was sold for the wrong reasons, as the rest of us had written off
that bad purchase a long time ago. Since then AR has pivoted successfully into North America
and is a different beast (if it weren’t I wouldn’t be an owner).
Minera Alamos (MAI.v): Three things in today’s notes the house Top Pick and biggest single
position
1) The share price still being iceberged by Jabba the Hutt. We’re now at the point where
market psychology is enough and Osisko Development Corp doesn’t even have to dump shares
on the open market to keep the price suppressed, as everyone knows Roosen is a seller now
and as such, any rally is an exercise in paying too much for your entry point.
2) Secondly, we had a “We are here” update from MAI last week (6) and the contents of the
release looks fine, with four main points and suitably reassuring words from CEO Koningen, as
hands-on a CEO as they come in a mining company. Here are the bullet points:
Operational highlights through November 30th, 2021
 Gold inventory on the leach pad (7,330 oz) has exceeded original year-end target levels
 Cumulative gold recovery from mineralization under leach for more than 30 days is approaching
70% (additional recovery ongoing)
 Total area of stacked mineralization under active leaching continues to expand and is currently in
excess of 50%
 Reagent consumptions remain low and in line with previous test pad results (<0.2 kg/t NaCN and
<2 kg/t lime)
Those operational results are the type we want from early stage Santana and the NR came with
photos of the Nicho Norte zone that look very different than the day I visited the site. Mining is
well underway, the top of the hill is now coming off and perhaps the most important message
of those bullet points is about the kinetics of the leaching and how 70% recoveries are showing
from the pad with the low reagent use expected by the company. That’s the right track for a
technologically straightforward operation like this heapleacher, as once any glitches are ironed
out they tend to run on rails.
3) The last point is fundamentally based, as word arrives at this desk that MAI won’t necessarily
declare commercial production on January 1st 2022 as previously guesstimated by this desk. I
hasten to add that this is not an issue and with no reason for concern, MAI shouldn’t attempt to
push too hard to make what is ultimately an artificial date limit. However, MAI as Santana will
probably (not definitely) need a few more weeks before being absolutely confident of declaring
commercial production and guaranteeing it does so with correct positive free cash flow from its
mine. It makes for slightly skewed 1q22 financials, but no big deal.
Bottom line: The near-term headwind on the MAI stock price is still ODEV (which takes the
money and pours it down the moneypit called Caribou, but that’s their problem and not mine).
But that seller will eventually run out of shares and when it does, the commercial production
announcement will combine (and perhaps at approximately the same time by coincidence) and
that’s when MAI will start to rock higher. Fundamentally dirt cheap, this is the one to own into
early 2021 above all others.
Minera IRL (MIRL.cse): This Tuesday December 14th at 10am Vancouver time (1pm EST)
sees the Minera IRL AGM, being held at 900–885 West Georgia Street, Vancouver.
Unsurprisingly, due to Covid-19 “…the Company encourages Shareholders to vote prior to the
Meeting and not to attend the Meeting in person”, but also unsurprisingly MIRL doesn’t offer
any sort of alternative video or web link for shareholders.
18

The shareholder rebellion we are attempting is quite different from any other; no slate offered,
merely scorch the earth and draw attention to the total lack of governance at the company.
Next week will include MIRL talk, but I’ll make sure it’s limited to one section of Market
Watching. The two-faced liars heading this company don’t deserve the column inches they get,
so those of you in this stock with your author are better served by watching the dedicated
bullboard (7).
Trilogy Metals (TMQ): I’m not featuring that three-year chart we’ve run over the previous
two editions today, suffice to say that TMQ bounced when it should have bounced and added
10c on the week. Instead we dial in the ten day chart to see how TMQ’s action would have
really pleased those chartists who were paying attention, as the early Monday low of U$1.57 (or
even U$1.56 right at the bell) was snapped up and by Wednesday, TMQ was a U$1,77 stock.
That was a 12.7% move and though sellers arrived Thursday, it was still a stock that acted in a
way that would satisfy any technical anal yst.
After last week’s brief note on TMQ, subscriber “MM” mailed in to ask for comment on the
November 29th drill assay NR, which went without comment on these pages.
Those are solid numbers, particularly the highlighted assays that were framed by TMQ as “the
third best hole ever from Arctic”, but the fact of the matter is that TMQ is now in resource
definition mode, drilling infills and not showing the world anything utterly new. Infill drill results
rarely move the market and even great ones are normally met with a shrug from a market that
replies “Well, that’s what you were supposed to do”.
The audience for this year’s drilling at Arctic isn’t we retail grunts, it’s the serious mining people
who want to buy Trilogy and that means South32. If you prefer, consider the way Great Bear
delivered hole after impressive hole at Dixie in 2021, only to stay bouncing around the $14 to
$16 price range for the first three quarters of 2021. It took M&A action to truly move GBR stock
in 4q21 and that’s the likely case here, the job is to ignore the day-to-day noise and hold until
the moment South 32 bites. And they will.
The Copper Basket
After forty-nine weeks of 2021, The Copper Basket shows a gain of 20.79% to level stakes:
19

company ticker price 1/1/21 Shares out Market Cap current pps gain/loss%
1 Solaris Res SLS.to 6.08 107.53 1481.76 13.78 126.6%
2 Copper Mtn CMMC.to 1.81 207.5 693.05 3.34 84.5%
3 Oroco Res OCO.v 1.85 192.584 435.24 2.26 22.2%
4 Marimaca Cop MARI.to 3.25 87.737 329.01 3.75 15.4%
5 Amerigo Res ARG.to 0.80 181.79 238.14 1.31 63.8%
6 Western Copper WRN.to 1.57 135.798 237.65 1.75 11.5%
7 Excelsior Min. MIN.to 1.12 273.585 127.22 0.465 -58.5%
8 Regulus Res. REG.v 1.07 101.85 111.02 1.09 1.9%
9 Aldebaran Res. ALDE.v 0.455 125.24 91.43 0.73 60.4%
10 C3 Metals CCCM.v 0.115 438.56 65.78 0.15 30.4%
11 Element 29 Res ECU.v 0.45 68.281 40.97 0.60 33.3%
12 Doré Copper DCMC.v 1.00 53.304 36.25 0.68 -32.0%
13 Chakana Cop PERU.v 0.60 111.41 31.75 0.285 -52.5%
14 Chibougamau CBG.v 0.165 53.077 11.68 0.22 33.3%
15 US Copper USCU.v 0.105 87.53 6.56 0.075 -28.6%
NB: All stocks in CAD$ Portfolio avg 20.79%
Once a mixed week for The Copper Basket 60% The Copper Basket 2021, weekly evolution
had closed, we ended with a modest 2.5% 55%
50%
rise in the basket average on the back of a 45%
roughly even split of eight winners (SLS.to, 40%
35%
MIN.to, WRN.to, MARI.to, ARG.to, REG.v, 30%
ALDE.v, ECU.v) and seven losers (CMMC.to, 25%
20%
OCO.v, PERU.v, CCCM.v, DCMC.v, USCU.v,
15%
CBG.v) though notably and with a few 10%
5%
exceptions the larger caps performed better
0%
than the smaller caps on our list. The only
double figure percentage loser was C3
Metals (CCCM.v down 11.8%), though
Oroco Resources (OCO.v down 9.2%) got
close. As for the winners, we saw strong percentage improvements in Aldebaran (ALDE.v up
21.7%), Regulus (REG.v up 21.1%) and Excelsior (MIN.to up 20.8%), three juniors all in need
of the relief rally they duly received so good for them (and may that ALDE rally continue).
The basket added a couple of points but got precious little help from the metal, as seen here:
The week saw the futures contract bouncing in a 20c (approx 5%) range, which would normally
be a volatile range for such a widely traded fungible commodity but…
20
ts1
naJ
t01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 n2yam ht9 ht61 dr32 ht03 ht6nuj ht31 ht02 ht72 ht4luj ht11 ht81 ht52 ts1gua ht8 ht51 dn22 ht92 ht5pes ht21 ht91 ht62 dr3tco ht01 ht71 ht42 ts13 ht7von ht41 ts12 ht82 ht5ced ht21
source: IKN calcs

…as the longer-term copper chart shows, we’ve kind of got used to this trading range in 2021.
It’s one of those things that continues right up to the moment it doesn’t and, if you needed
reminding, I’m fully expecting copper to break higher rather than lower one of these days.
That’s me and the Vampire Squid in the same boat and hopefully you’ll come along too, no
lifejacket required.
The macro comment this week bring Chinese good news for copper longs. You may remember
how bears screamed about the low levels of copper imports into China for the month of
October, so it wasn’t that surprising to get their roaring silence last week when finished copper
imports (refined/anode/products) saw a 24.3% rise month-over-month and copper concentrate
imports rose by 21.6%, also month-over-month. That much-signalled electricity power shortage
is now behind the country and industry didn’t waste a moment in playing catch up. Meanwhile
in macroeconomic news, the Chinese Central Bank cut its base lending rate by 0.5% in order to
boost GDP. The beancounters who follow such things estimate this frees up 190Bn Yuan, and
all on the cusp of an expected hawk move form the US Fed.
Macro comment done, we move to the regular weekly inventories section, numbers by Cochilco:
 World copper stocks seem to have finally found their bottom and not a moment before
time. Last week saw 8,205 11,504 metric tonnes (mt) added and marks the fourth
week without a massive drawdown of “last resort” stocks, with Friday’s aggregate total
for the three official systems coming to 175,891mt.
 At Shanghai’s SHFE we saw 5,270mt added which was almost the amount lost in the
previous week. Total stocks come to 41,380mt which is still extremely low, but there’s
little left to come out now and the year-end ordering season for Chinese end-users has
just about run its course.
 The LME added 3,425mt and is bouncing around its modern-day minimum levels, with
this weekend’s grand total at 81,778mt.
 The only net inventory loss came from Comex warehouses and it wasn’t that much, a
total of 490mt leaving for a Friday close of 52,736mt. As usual, no biggie.
Here’s the Shanghai-only inventories chart, the bottoming pattern happening at its very low
level, but it’s happening all right:
Shanghai Futures Exchange Warehouse Stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
21
50000
0
31'13ceD ht9 ht81 ht72 ht5tco ht41 dn22 dr3yam ht21 ht02 ht92 ht7bef ht71 ht62 ht4peS ht31 ht92 ht9 ht81 ht72 ht5von ht41 ht52 ht01 ht91 ht82 ht6naJ ht71 ht62 ht4gua ht31 dn22 202ts1ram ht01 ht91 ht72 0202ht6ced ht41 ht52 1202ht4luj ht21 ts12
Mt Cu
|
source: Cochilco

What’s left to know is when the traditional New Year’s re-stock begins and its overall strength.
Last year’s re-stock period from January to May added around 140,000mt, that’s a benchmark
which needs beating, because it obviously wasn’t enough
Now for notes on a couple of our basket stocks:
Oroco Resource Corp (OCO.v): Up to now, Oroco Resource Corp (OCO.v) has been a
successful speculative stock play, certainly one that this desk has called badly. I’m not stupid
enough to short these vehicles, but there’s a clear opportunity cost of calling “avoid” on a stock
that moves from under a Loonie to well over C$3 and I’m the first to admit that. However, the
dump we saw last week on receipt of its first drill holes out of Santo Tomas in the latest stage
of its development program didn’t come as a surprise, even though the company largely
delivered on what was expected of it.
The NR out pre-open Thursday December 9th (8) returned assays from the first three holes of
its campaign and the headline, “” was completely fair. Then if we cut to the assay table (your
author’s red ink added)…
…again there’s very little to complain about. Three holes cut the widths the company was
looking for compared to the working model of Santo Tomas, all largely at expected grades. The
company didn’t try to throw sequins by adding in what would ultimately be unpayable silver at
those grades, the CuEq numbers stack up and they use sober and correct ratios for copper,
moly and the minor gold credit. Around 80% of presumed economic metal is straight copper
and there’s no issue at this stage with not factoring in a recovery percentage.
All in all, a decent set of results from a promising project, the issue here is that OCO needs to
return good results from now on to justify what is already an expensive stock. That’s because
up to now it’s been a speculative vehicle driven by plenty of online promotion and as a result,
has become a bit of a True Believer stock story. That works up to a point, but from here on
OCO has the real heavy lifting to do. The tone and manner of last week’s NR was spot-on, it
22

wants to be taken seriously as a junior exploreco with a decent project and that’s the way I
read the news. Good for them, but a look up at The IKN Weekly ‘Copper Basket’ list above gives
a salutary reminder that, even after the 9.2% drop of last week, it’s still expensive compared to
peers at a similar stage of development.
In real terms, OCO has plenty of drilling to do just to get to PEA stage and I wouldn’t expect
that document to appear before 2023. In the meantime, it has to defend a market cap of
around U$350m for roughly 75% ownership of Santo Tomas (give or take a percentage point
and depending where you draw boundary lines). It may be off to a good start on its new
“serious” phase of development after being a spec vehicle fopr a couple of years, but it0s
around now that it stops having the luxury of living in a vacuum and starts getting compared to
other stocks with the same copper mega-mine potential, names such as Regulus and Aldebaran
on the above list that trade at substantially lower multiples for the same point in the
development cycle.
I’d agree OCO comes with less discovery risk than some, I’d also agree its path to a PEA and an
economically robust project isn’t difficult to envisage, but it’s still a couple of years away from
that point and the cruel reality is, internet flights of fancy or not, majors don’t buy projects until
they’ve at leasat got to PEA stage and they nearly always need a PFS (even you’re your
author’s lucky poster child trade Antares was on the verge of producing a PFS when First
Quantum bought it out). As I mentioned to an OCO long who wrote in on Thursday, I cannot
get round the impression that OCO is expensive for what it has today, late 2021. I’m not trying
to rain on anyone's parade and I'm not saying it doesn’t have a shot, I'm saying that for a
project without a meaningful technical report it is priced close to perfection. OCCO will definitely
remain a component of our Copper Basket in 2022 as it’s a stock and a company I’m keen onn
watching, but until we get closer to a PEA and unless the drillbit hits something surprising and
special, it will be from the sidelines.
Regulus Resources (REG.v): It’s a little like queuing at a bus-stop in London; you wait for
what seems like hours, check your watch too many times, then suddenly two arrive at once and
to add insult to injury, the second is nearly empty and sails right past. After 238 days without a
peep from the company, we get two NRs in a single week with the flurry starting on Monday
December 6th (9) the NR getting straight to the main news:; “The Company has restarted
drilling activity at the Anta Norte target area of the project, with one drill rig currently on site
and plans for a second rig to be added in January 2022.”
As noted on the blog Monday (10), that was carefully worded and knowing the way Coimolache
SA works, having a drill rig on site and having it staffed and running are two separate events
for different days. However the post wasn’t critical about the minor details and nitpicking is for
others, the mere fact REG has a drill up and has clearly improved its community relations after
dropping the ball makes for clearly positive news from the project. I wouldn’t hold your breath
for the assay results and best guess would be
March, but that’s not the end of the world, either
and, if the second rig is reported up and turning
early 2022, that works. Also in Monday’s post on
the open blog, this small map segment which noted
the location of the rig and planned hole. For me
that underscores the improvement in CSR at
AntaKori because if they only had the option of
putting in a hole that didn’t upset irate locals, it
would have been a quasi-twin hole on the border of
the REG property with Coimolache, protected by
topography and away from easy access. Instead
that drill is right by the dirt track road running along
the valley floor, easily accessed by workers and
community alike. It’s also going to be a “real” hole
that tests interesting geology, so REG will be
23

looking for a long mineralized intersection, with acceptable copper grades and low arsenic count
(unlike the high sulphidation mineralization close to the working mine).
Then four days later, the second NR (11) which
announced the proposed extension of the C$1.70
warrants that will almost certainly be accepted by
the relevant market authorities (if only for Covid-
19, a catch-all other companies will surely use). I
shrug, I don’t really care either way, I am
reminded how easy it is to move goalposts on the
Canadian markets, I wonder why these companies
put time limits on their warrants in the first place,
all of the above. It certainly did suit REG to
announce the Monday news before they had to
announce the Friday news, however.
As for trading, this ten-day hourlies chart shows how REG responded well to the Monday news
and did reasonable volume on Tuesday too, but those volumes faded as the week wore on and
that’s been a perennial issue for the company stock and its trading. Time will tell on whether
they can improve this weakness.
The Producer Basket
After forty-nine weeks of 2021, the Producer Basket shows a loss of 17.25% to level stakes:
company ticker price 1/1/20 Shares out MktCap(U$Bn) current pps gain/loss%
1 Newmont NEM 59.89 805 45.16 56.10 -6.3%
2 Barrick GOLD 22.78 1778.04 31.92 17.95 -21.2%
3 Agnico Eagle AEM 70.51 244.187 11.64 47.67 -32.4%
4 Kirkland Lake KL 41.27 267.056 10.11 37.85 -8.3%
5 Kinross Gold KGC 7.34 1261.07 6.72 5.33 -27.4%
6 Endeavour Min EDV.to 29.62 252.568 5.70 27.08 -8.6%
7 Pan American PAAS 34.71 210.262 4.92 23.40 -32.6%
8 B2Gold BTG 5.60 1051.697 3.91 3.72 -33.6%
9 Alamos Gold AGI 8.75 392.739 2.81 7.15 -18.3%
10 Pretium Res PVG 11.48 187.833 2.50 13.33 16.1%
Prices in U$ except EDV.to (share price in CAD$ and mkt cap in approx USD) Port. avg -17.25%
With GDX down 0.7% on the week and Kinross (KGC) as an equal-weighting in our ten, no
crystal ball required to predict that with just three weeks left on the year, the GDX benchmark
will beat the IKN Producer Basket for the second time in two years. And yes that sucks, even
though it’s more theory than practice. The real damage was in the first half of 2021 and that
due to the house assumption of leaving in smaller and leveraged companies such as Pan
American (PAAS) and B2Gold (BTG), which both had a decent 2020 on the post-lockdown
rebound, would continue to out-perform. That was the basic error and though my picks made a
strong comeback in the second half of the year, the last couple of weeks decided the race.
The 2021 Producer Basket: Weekly performance and
20%
comparative to GDX control
15%
10%
5%
0%
-5%
-10%
-15%
-20%
24 -25%
ts1
naJ
t01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 n2yam ht9 ht61 dr32 ht03 ht6nuj ht31 ht02 ht72 ht4luj ht11 ht81 ht52 ts1gua ht8 ht51 dn22 ht92 ht5pes ht21 ht91 ht62 dr3tcO ht01 ht71 ht42 ts13 ht7voN ht41 ts12 ht82 ht5ceD ht21
The 2021 Producer Basket: Percentage difference between
GDX benchmark and basket (negative = IKN basket ahead)
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
-1.0%
ikn -2.0%
gdx control source: Google, IKN Calcs ts1
naJ
t01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 n2yam ht9 ht61 dr32 ht03 ht6nuj ht31 ht02 ht72 ht4luj ht11 ht81 ht52 ts1gua ht8 ht51 dn22 ht92 ht5pes ht21 ht91 ht62 dr3tcO ht01 ht71 ht42 ts13 ht7voN ht41 ts12 ht82 ht5ceD ht21
source: IKN calcs, NYSE/Nasdaq/TSX data

So be it (and with GBR doing what it did last week I’m not crying too much about KGC on this
list), let’s move to the week-over-week action and three of our ten returned gains (NEM, BTG,
PVG) while seven were losers (GOLD, AEM, KL, KGC, PAAS, EDV.to, AGI). Most were in line with
the GDX, but the two outliers were both losers in Kinross (KGC down 8.7%...natch) anf
Endeavour (EDV.to down 4.9%). Less of the bureaucracy, let’s talk M&A:
Kinross (KGC) and Barrick (GOLD): The reason Barrick (GOLD) can and in fact should come
over Kinross (KGC) and outbid them for Great Bear Resources (GBR.v) is in this chart because,
with the dust now settling on an important week for precious metals stocks, we can leave the
chatter, rumours, suppositions, guesswork and hearsay aside. We go with hard numbers, folks:
Above you have the squiggly lines over the last three market days for KGC, GOLD and for
context, the best ETF proxy for bullion (GLD) to make sure the largely neutral backdrop for the
metal is understood.
 First the Kinross (KGC) trading pattern and I for one was surprised it got hit as hard as
it did on Thursday morning, but as Thursday lunch turned into Friday’s close Special K
inched back on decent volume and, come the close, was approximately 9% lower than
before the deal was announced.
 As for Barrick (GOLD), that too adjusted down at the open Thursday but, unlike its
direct rival Newmont (NEM, see below) and even Kinross, saw further selling as we
moved into Friday and nigh on its worst prices of the week at the close. Without
arguing the tenths, GOLD lost around 3.5% since the GBR/KGC deal was announced.
Now the pay dirt because, as noted in the chart above, the loss of market cap in Barrick was
worse than that of Kinross, despite GOLD not getting any prize for its efforts! Also notably, even
if you factor in the break fee of U$85m that GOLD would theoretically have to pay, the
percentage loss drops to 74% of the ticket price. The glaring gap between the market caps
drops signal things and, while not going to every little angle (chatter on this is for others or for
the open blog), here are instead two things:
Thing One: GOLD just can’t seem to catch a break. We saw the same type of action when
Agnico picked up Kirkland Lake. Back then Barrick had been exclusive with KL but decided to
walk on price, then AEM accepted at the price Makuch wanted and (perhaps to GOLD’s
25

surprise), wasn’t unduly punished by Mr. Market. Here we see GOLD in “silver medal position”
buy still whacked harder in absolute market cap terms than the winner!
Thing Two: The IKN Weekly opines that the difference between the market cap drops is roughly
equivalent to the width Mark Bristow now has to come over Kinross and outbid the smaller
company without being punished any further. Barrick may feel hard done by this weekend (and
in my opinion probably has been to a certain extent), but that nice Mr. Market is also sending
an implied message to Barrick of “Hey! If you don’t buy this one we know you have to buy
something else eventually!” Now, that may be presented in a slightly flippant way but do not
underestimate the message; This time, not only is the market telling Bristow he’s wrong not to
buy GBR, but the market has gone quant on him and given him a number to tell him by how
much he’s wrong and the amount he has to play with, to boot. In effect, Mr. Market is forcing
Bristow’s arm and offers him three choices: Either a) swallow some pride, b) unveil his master
plan to buy GBR or GBR/KGC (which could be why he reportedly stepped back from the final
round with GBR), or 3) stay wrong in the eyes of Mr. Market (and let time be the judge).
So to the price GOLD could pay for GBR under the new scenario and, if we back out the U$85m
break fee (which is small for a U$1.4Bn deal, let’s face facts) it leaves GOLD with around
U$350m to play with. That’s a fair chunk of change and GOLD is in the position to make a
strong cash+shares offer as well, something KGC would be hard-pressed to counter. However,
if the big plan is to wait for KGC to consummate the deal with GBR and then buy the whole lot,
as I supposed possible on the blog last week (8), then there would be even less front-end risk
to Barrick than today (and nobody would consider Barrick to be in a weak-flank position the
way Kinross finds itself in this weekend).
The bottom line: With up to U$350m to play with according to the market, Barrick could signal
that it’s not going to counter, wish KGC/GBR good luck and see a modest recovery in its share
price next week. Alternatively, with at least $10 for each GBR share to play with without its
share price being hit any harder than last week, it could offer up to $5 of that and the market
would be happy. So on balance I think it’s a 50/50 chance we’ll see Barrick coming over the top
of Kinross in the days to come and a bid of perhaps C$31 or C$32, using a similar percentage of
cash and shares as Kinross, would make numerical sense.
Newmont (NEM): Instead of obsessing too much over the question “What Will Bristow Do?”
as regards Great Bear (GBR.v), today’s notes also take in the flipside of the Tier 1 story and a
subject broached only last weekend. In retrospect, the necessarily brief strategy note on NEM
in IKN654 was well-timed, because last week’s price action underscored just how well the
world’s largest publicly-traded gold miner is faring against its rivals, with first among equals
being the #2 player Barrick (GOLD):
What’s more, I’d argue that last week’s positive divergence in NEM was due to the reasons
outlined last weekend, too (so pardon me for tooting the horn a little). The above chart
compares NEM to GOLD, the main PM ETF (GDX) and the useful gold bullion proxy (GLD) and
26

setting aside the week before last, the stock lines traded in rough lockstep until Thursday
morning. Then came the news of the Kinross (KGC) friendly bid for GBR.v and down went the
Tier 1 stocks, with GOLD worse than the average as expectations grew that it would try to
counter Special K and win GBR through competition.
Not so NEM, which found support and more support at the GLD line and has managed to finish
1% up over the last two weeks, despite the general carnage and market upheaval we’ve seen
in PM stocks this December. Quite simply a remarkable achievement and (I say) it’s all due ton
the fact that NEM is cashed up with a rock-solid balance sheet and already has all the pipeline it
needs to perform strongly and grow its reserves and production going forward. So remember
that Bloomie journalist from last weekend and realize, once and for all, that he simply did not
know what he is talking about. Go long balance sheets, go short clickbait reporting.
The Tiny Dogs
After forty-nine weeks of 2021, the Tiny Dogs show a gain of 11.46% to level stakes:
company ticker price 1/1/21 Shares out Mkt Cap current pps gain/loss%
Antler Gold ANTL.v 0.205 66.365 9.95 0.15 -26.8%
Aston Bay BAY.v 0.045 163.975 9.84 0.06 33.3%
Constantine Met CEM.v 0.17 45.4 26.33 0.58 241.2%
Contact Gold C.v 0.115 240.757 9.63 0.04 -65.2%
Golden Pursuit GDP.v 0.22 40 5.40 0.135 -38.6%
Manitou Gold MTU.v 0.045 230.79 13.85 0.06 33.3%
Precipitate Gold PRG.v 0.240 106.241 9.56 0.09 -62.5%
QC Copper QCCU.v 0.315 105 31.50 0.30 -4.8%
Red Pine Expl RPX.v 0.400 95.806 50.78 0.53 32.5%
Warrior Gold WAR.v 0.090 91.818 5.97 0.065 -27.8%
Prices in CAD$, data from TSXV basket avg 11.46%
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 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 count on the week saw three stocks rise (CEM.v, MTU.v, QCCU.v), five stocks drop
(ANTL.v, C.v, GDP.v, RPX.v, WAR.v) and two
24% Tiny Dogs, 2021 weekly tracker
others remain unchanged (BAY.v, PRG.v). ANTL
20%
dropped biggest of all, Contact wasn’t far behind
16%
but the big ups in CEM and QCCU were enough
12%
to deliver the modest improvement.
8%
4%
Contact Gold (C.v): Down 20% on the week, 0%
but this drop saw it break through the long-term -4%
floor price after announcing ho-hum results from -8%
its flagship Green Springs property in NV USA. -12%
Once upon a time Contact claimed Green Springs
27
ts1
naJ
t01naJ ht71 ht42 ts13 ht7bef ht41 ts12 ht82 ht7ram ht41 ts12 ht82 ht4rpa ht11 ht81 ht52 n2yam ht9 ht61 dr32 ht03 ht6nuj ht31 ht02 ht72 ht4luj ht11 ht81 ht52 ts1gua ht8 ht51 dn22 ht92 ht5pes ht21 ht91 ht62 dr3tcO ht01 ht71 ht42 ts13 ht7voN ht41 ts12 ht82 ht5ced ht21
source: IKN calcs, TSX data

as an add-on and Pony Creek (on the South Carlin trend) as its number one project, but we
note that the company hasn’t put a metre into Pony Creek since mid-2020 and last week
announced more of the same, with 1q22 set for more drilling at Green Springs. Pro-tip to MLK:
Building good shareholder relationships starts with being honest about weaknesses, rather than
trying to cover them up or ignore them. See your own share price for further details.
Antler Gold (ANTL.v) and Constantine Metals (CEM.v)
Here’s the five day comparative chart of both mentioned companies, with CEM up 13.7% on the
week and ANTLK down 31,8% on the week, the volume section featuring ANTL and the
damage done to its share price by trades totalling a little over 40k shares.
What’s notable is that neither stock had news out last week. In fact, the last news from both
stocks came at the end of November, with an incentive options award at 20.5c for ANTL officers
and news that CEM has hired a third party marketing firm to get their story out. Thus is the way
of the Tiny Dog.
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’s possible in the future
I may buy shares in one or several of these stocks, at the moment both my opinion and wallet aretrictly neutral.
Regional politics
More on Ecuador’s Constitutional Court ruling
Last Wednesday, Ecuador’s Chamber of Mining led the pushback against the now infamous
Constitutional Court (CC) ruling at the beginning of this month. At a press conference with most
national and some international media channels present, they laid into the ruling, called parts of
it unconstitutional, accused the CC of ruling beyond its station and made several points against
the five-point decision. As noted on the blog last week (12), Reuters was present and published
this quote:
“This industry is now seriously threatened by judicial insecurity from this ruling,” and “In
this decision, the court ignored the state’s licensee’s rights”
But there was plenty more at that presser, as this El Universo (a leading Ecuador daily) report
attests (13) (translated):
The Chamber (of Mining) protests, as the sentence prohibits extractive activities in
locations where the State has granted concessions, arbitrarily widening zones where
this type of activity (i.e. mining exploration or exploitation/operation) that is specifically
state in article 407 of the Constitution. “This is a dangerous precedent which
overreaches the faculties of the Constitutional Court, tacitly reforming the contents of
the Magna Carta, affects the universal principle of judicial security and exposes the
State to serious international consequences.”
The presser people also pushed back on the CC judgement by saying, “Without having
specialized knowledge in the subject, some of the judges of the Constitutional Court have tried
to impose anti-technical and premature requirements for initial exploration.” However, those
28

present didn’t elaborate or give details on what sounded to these ears like some serious
legalese and that pricked my curiosity.
Something was worrying the mining people present, but at the same time they didn’t want to
elaborate. That’s when a guy like me becomes curious and that’s not necessarily a good thing,
what with the way it kills cats. At this point I must admit that before the Wednesday presser I
hadn’t reads all 119 pages of the CC ruling but, when the Chamber of Mining accused its own
CC judges of not “…having specialized knowledge in the subject…” but failing to give details I
decided to give my PDF copy of the ruling a careful read-through (find yours here (14)). What I
read in the details is worse for mining companies than even I imagined and, as a result, this
weekend The IKN Weekly makes a strong reiteration of its “Avoid Ecuador” call. Of the five
rulings, the final one is administrative and gives instructions on what must happen in the case
of Los Cedros (i.e. its permits annulled and all machinery removed from the zone). Then three
of the others are still important and cover environmental issues, such as the somewhat
controversial “Rights of Nature” ruling that has captured the attention of player on both sides of
the story. Instead, the real bad news for the mining in Ecuador is the ruling on “Prior
Consultancy” (consulta previa) and what that should constitute in the country.
In effect, the CC has defined what the State and any mining company (note BOTH entities)
must do in order to get permits to operate at both exploration and development/operation
stages. Previously, Ecuador had its laws that were supposed to guarantee the so-called “prior
consultation” of local peoples and communities around any civil works project in rural zones,
mining included of course. However, they were regularly flouted and with the government’s
Environmental Body (the Ministerio de Ambiente, Agua y Transición Ecológica, or MAATE)
typically turning a blind eye when companies cut corners. This was the case in Los Cedros,
which may turn out to be the reason the mining industry learns to curse the name
“Cornerstone” in the future. Instead of running a prior consultancy to the letter of the law, in
which locals were allowed time to consider the proposal and then form an opinion,
Cornerstones Capital Resources (CGP.v) ran two “public socialization” meetings with locals
around the Los Cedros concession. They did what most companies do in South America (and
not just Ecuador) by showing up at the meeting, telling the locals what they were going to
explore and how, then duly picking up an exploration permit from a complicit MAATE. That,
says the CC, isn’t nearly enough. What the ruling states is nothing short of a nightmare for
mining companies, saying that before even an exploration license is granted in the future both
the company and MAATE must seek out and inform all communities and people living in the
zone, landowners or not. They cannot just call a meeting or two and hope word gets out,
instead all directly affected locals must be consulted, allowed time to consider the facts and
allowed to give their pronouncement. It states that MAATE must be actively involved (i.e. not
just wait for the mining company to come back to them and say it’s done and all this has to
happen before even exploration-stage permit is awarded on a concession. In short, the CC has
looked at the law on the books in Ecuador and said “this must be applied”.
That’s what the Ecuador Chamber of Mining is complaining about when it says that the CC is
naïve about mining and is trying to impose “anti-technical and premature requirements for
initial exploration.” That may be so, but they have a big problem because it’s also the law. It
means that in the future, any locality in Ecuador can turn around and say to both company and
government, “Okay they granted you this concession but, if you want to set foot on it, you
must consult us and get our agreement first." It’s also retroactive, so any permit previously
granted by MAATE can be challenged in the courtrooms and will come up against a precedent
ruled at the highest level in the land.
The amount of red tape this ruling adds to the simplest of exploration permit will make mining
companies' lives in Ecuador near-impossible in practical terms and by making MAAE an active
part of the prior consultancy process, locals that oppose mining activity have been handed a
powerful tool to that could adds literally years to the simplest of early exploration permit
awards. In short, this is a bureaucratic nightmare and could quickly make Ecuador unworkable
as a mining jurisdiction in practical terms. All this aside from later court claims that locals could
29

make under the separate “Rights of Nature” rulings in the same document if they don’t like
what’s happening to their “Protected Forest” location.
The number of concessions affected by this ruling is also substantial, as another report on the
ruling from the on-the-ball newspaper Primicias explained (15), with this table from the note:
Ecuador: Mine concessions in "Protected Forest" zones
Category Surface area (Ha) % in Prot. Forest
Large Scale 446,733 67.8%
Medium Scale 34,587 79.0%
Small Scale 75,027 63.1%
source: Primicias
That shows the amount of concessions granted to mining companies in Ecuador, split into three
categories. The so-called “large scale” are the lion’s share, but overall the percentage of all land
under concession doesn’t change that much and we can see that at least two-thirds of
concessions in Ecuador include protected forest areas.
All this probably explains why the anti-mining and enviro groups in Ecuador are so pleased
about this CC ruling and why the other side we quoted on the blog last week, the spokesperson
from the “Mining, Environmental, and Social Observatory of Northern Ecuador”, could tell
Reuters that, “The decision establishes a good precedent for the whole nation for the protection
of forests.” The well-organized, politically powerful anti-mining brigade has been handed a
powerful weapon that will tie mining companies up in red tape for what will seem like an
eternity, all because Cornerstone/Enami decided to appeal and litigate to get access to one
concession for early-stage exploration. This publication predicts that among mining companies,
their name will be mud in due course.
Bottom line: Ecuador was already difficult before this ruling, it becomes even worse now and
calling “avoid” on the jurisdiction is an easy decision. What’s more, it’s even easier at present
while major LatAm mining countries with the right attitude and which give solid legal backing to
the industry (i.e. Chile, Mexico, Peru) are getting undeserved bad press at the moment. Avoid
Ecuador mining risk and find a better place for your money than the Mini Basket Case.
Argentina has a new Mining Secretary
Up to last week Argentina’s “Mining Secretary”, basically the vice-minister in charge of mining
and reporting to “Superminister” of Productive Development Matías Kulfas, was Alberto Hensel.
That has now changed, as Hensel handed in his resignation (16) to take up the post of
provincial Minister of Government in his home province of San Juan, which is basically the
number two job and right-hand man to current San Juan governor, Sergio Uñac.
Then on Thursday, his replacement at national level was announced when Kulfas told a press
conference (translated) (17), “The President Alberto Fernández has made the decision to
designate Doctor Fernanda Ávila as the new Secretary of Mining of the Nation.” Fernanda Ávila
arrives at her new job from Catamarca, where she was provincial Minister of Mining. She is 33
years old, a lawyer and after her stint in the mining world at provincial level will know what
she’s letting herself in for. She will also be the second female National Secretary of Mining
appointed in Argentina, all those are good things. However, she’ll also have to get over the
innate machismo in Argentine national politics and in its mining sector that won’t be helped by
her relatively young age (it took about 30 seconds of trawling comments sections regarding her
appointment to have ample examples, none of which get re-printed here), so those are bad
things. We wish her well and fully expect she is aware of the challenges faced, as Argentine
politics is no place for the timid. She may be a lawyer by education but having come from
Catamarca, will be keenly aware of the industry’s potential as well as its detractors, finally we
also know she doesn’t use her LinkedIn page much because as of this weekend and four days
after being named to an important, national level ministerial role she’s still Catamarca’s mining
minister according to her own biography.
30

As for Hensel, he’s turning into quite the political operator. With his PEDMA project largely
complete and about to roll out, he’s chosen this moment to pick up a politically important role
in his home province of San Juan that will serve as a platform for an eventual run for governor
of the province. Also, by resigning the national role now he gets to watch as his successor picks
up all the flak from opponents of next year’s major initiative to promote Argentine mining at a
national and international level. If he makes it to the top job in San Juan, you can be sure he’ll
frank his own pro-mining credentials in Argentina’s most miner-friendly jurisdiction, too. He’s so
hot right now.
Argentina: Chubut’s governor tries to ram through “Zonification”
There is now deep intrigue and political maneuvers going on in Chubut around the so-called
“Zonification” project that would allow mining to develop in the central Meseta region of the
province (Pan American Silver at Navidad, et al). We’ve seen 1) three new parliamentarians be
sworn in to the provincial parliament and with their arrival, political pressure put on them by
governor Mariano Arcioni to fall in line and vote passage of the Zonification bill, 2) moves by
the judiciary to block the normal roads of appeal against any eventual passage if the bill (it gets
complicated, but basically any appeal could only be made once and most probably at a court
which favours the governor’s position) and 3) rumours that parliamentarians who previously
promised to vote down the bill would end up abstaining. All in all, the anti-mining side has been
calling “foul” and “unfair!” all week on these three matters and protest moves are beginning to
get hot (e.g. one member of congress almost came to blows with a group of anti-miners
outside his house).
Governor Arcioni is pro-Zonification and has been frustrated by anti-mine pressure groups for
years (as well as the yoke around his neck that the majority position of Chubut voters are
against mining). He has also likely received clear instructions from the national level to get the
law passed recently, so if it happens by political force instead of argument it would hardly be
the first time we see a law rammed through a provincial Argentine parliament against the will of
the majority. Frankly, I don’t think Arcioni, President Fernández or even PAAS would complain
about the method, as long as the result suits their cause.
Peru set to raise taxes on mining
Here’s what Peru’s FinMin told national daily La Republica on Thursday (18) (translated):
Francke on new tax on mining: “If it’s not now, we will miss the opportunity”
The Minister of Economy and Finances, Pedro Francke, said that mining companies (in
Peru) have been able to earn U$13.5Bn since the rally in metals price in the post-
pandemic period, including copper, the main export in our country.
“Metals prices are at a very good level. More than U$13.5Bn have come in to mining
companies since the start of the price rise and we think that this wealth should be
shared fairly, while safeguarding sector competitiveness.”
Then later in the same note:
“We already have a preliminary report from the IMF which says Peru has the possibility
to raise taxes a little on the mining sector while maintaining its competitiveness and we
can achieve that”, he said.
He also warned that if the reform doesn’t happen this year, it would only apply as from
2023 at a time when there may not be the current rally in world metals prices. Referring
to income tax and taxes on mining, if we don’t approve the reforms now they would
apply as from 2023 and we lose an opportunity”, he said.
“The requirements for the education and health (sectors) and investments in the
regions, we will not be able to improve them if we don’t have money. The Congress
has these faculties, the key is consensus politics and we will insist on dialogue
because there’s a lot at stake”, he said.
And now we translate that into the need-to-know: There are two tax reforms being pushed
31

through by this government. The main one is a change to the personal income tax for
Peruvians which would bring around 2.5m workers out of “the black market” and see them pay
a modest amount of income tax on billed work (a big change on Peru, where around 70% of
jobs are still black market), which is expected to bring S/1,800Bn (approx U$450m) into the
national treasury. The second change is aimed at the mining companies to pay more tax, with
the overall annual increment estimated at S/1,200Bn (U$300m approx). These figures compare
to the current estimates of S/9,000Bn (U$2.25Bn) brought in via the two methods at present,
so in effect Pedro Franke is looking for 33% more in aggregate from these two channels. The
executive wants Congress to approve these tax adjustments mining tax hikes but if not, expect
some sort of tax increases by executive decree before December 31st (and if that happens,
expect the mining companies to use legal recourse and try not to pay).
Peru: Las Bambas is big politics and big money
With MMG’s December 15th date to suspend operations looming (i.e this Wednesday coming),
the three actors in this issue sat down in the city of Cusco last Tuesday December 7th to try and
sort out the mess and failed miserably. We know that the company’s reps were there, we know
the community reps were there and we know Peru’s Ministry of Energy and Mining’s (MINEM)
reps were there, we also know it ended with zero agreements and MMG walking out of the
meeting. Now for the two sides to the story:
In the blue corner we have MMG and Peru’s larger mining sector: As soon as the meeting broke
down the main mining chamber of commerce in the country, the SNMPE Sociedad Nacional de
Minería, Petróleo y Energía had declarations hitting friendly media channels (19) and by
Wednesday morning this desk saw virtually the same report from at least six media channels,
with no attempt to get the other side of the story. The SNMPE criticized the local communities
(of course), but its main barbs were reserved for the government and MINEJM and its “erratic
actuation”. They questioned why the Minister himself wasn’t present and accused MINEM of
bias toward the local communities in no uncertain terms:
“During the meeting Tuesday, unfortunately the intervention of Mr. Marco Sipán (the
MINEM rep) was deplorable as, far from intervening as a representative of State and
mediating between the two sides, acted in an absolutely biased way, exacerbating the
mood and worsening the conflict.”
They also said that Sipán approved the locals “blackmail” of the company, hard talk indeed
about a public servant and in another country, would get the company into hot water.
Meanwhile in the red corner we have the local community and now also MINEM: The official
note from the meeting (20) stated that “MINEM rejects the attitude of the Las Bambas Mining
Company in refusing to improve its offer and to attend the needs of the communities, as it had
previously proposed in coordination meetings.” The implication being that MINEM had talked
with MMG before the official meeting began, got some sort of concession from them but at the
moment the real talks began the company didn’t offer anything substantive. Apparently and
according to the official notes, the communities had first asked that they had the contract for
20% of the trucks used by MMG to transport concentrate out of the mine but had dropped their
position to 5%, along with 50 4x4 vehicles and contracts for roadway servicing (watering
trucks, maintenance crews etc). That wasn’t to MMG’s liking and the mining company didn’t
come back with a counter-offer that suited the communities, so the end of the meeting came
and the media blasts began, including Lima hard right wing accusing President Castillo of
wanting to end all mining in all the country forever. So be it, the show is the show after all and
their visceral hatred of the man is on-record.
However MMG and the mining sector has its own “people power” card to play and, as from
tomorrow December 13th (21) a speedily organized protest against the government position and
for the Las Bambas mine remaining open headed by the Federación Nacional de Trabajadores
Mineros union (“trabajadores”=“workers”, the rest isn’t difficult) will see protests hit the streets
of several cities across the country, including the most affected by an eventual suspension at
Las Bambas such as Cuzco and Arequipa. The FNTM union normally protests against the acts of
companies (e.g. the way workers were laid off by several companies during the pandemic of
32

last year), so seeing them march in favour of Las Bambas and against the Pedro Castillo
government’s position will be quickly and happily picked up by the anti-Castillo sides of the
dispute. It’s bound to set a fire under MINEM, all the more reason to see the two sides back at
the table and trying to reach a solution before midnight Wednesday 15th.
Therefore the Las Bambas stand-off is going down to the wire, but we’re bound to get another
round of meetings in the days to come and this desk still expects some sort of agreement, be it
temporary or more permanent, before December 15th and not least because of this:
That’s the MMG share price as traded in Hong Kong (ticker 1028 HKG), valuing it at a little
under U$3Bn this weekend, though perhaps more on-point is the one-month comparative of
MMG versus the main copper producer’s ETF (COPX):
Looking at that chart gives 300 million reasons to expect a deal. Behind MMG’s intransigence is
a larger issue of provincial emancipation, as Lima’s mining elite simply does not want to cede
an inch, hence the aggressive tone of the SNMPE. However, MMG at some point needs to
decide between share price and Peru’s mining status quo and its shareholders will run out of
patience if management continues to play hardball. Put in the nicest way possible (because the
undercurrents are ugly), what the SNMPE fears most of all is “losing control of the provincials”.
Meanwhile the community leaders still hold plenty of cards, but theirs is a longer game. The
way they played the victim last week and claimed to be open to further dialogue is standard
and not just in this month’s rarefied atmosphere. But don’t be under any illusions, they will try
to look innocent, talk up the environmental clean air angle and play to their grassroots
supporters, but this is all about the money on their side, too. Local mayors and community
business leaders are looking to fill their own pockets and will use their own bully pit, albeit a
more passive one, to grab as much of the pie as possible. They are also playing their game,
past masters of manipulating long-term bad blood felt by communities along the “Mining
Corridor” looking for some sort of revenge for perceived sleights and insults they’ve received
from Las Bambas over the years, via the dust kicked up in their faces from the incessant truck
convoys. The locals may be upset, but the people at the top of the community hierarchy are no
33

angels and use local sentiment to their own advantage. Cynical yes, because most of any new
money extracted from MMG in any new agreement will fail to trickle down to grassroots level,
instead going on fancy parties, new cars, expensive vacations at destinations “where the rich
people go”, or properties in Lima’s exclusive zones. No one is innocent in this story and what’s
more, the political Left and Right in Lima understand that Peru is currently under a government
that won’t use the tried and tested method of sending in police or army to bang heads and
dismantle roadblocks (which in the case of this current dispute, only halt company trucks and
allow private vehicles to cross unhindered). That one side shouts “Justice!” while the other
shouts “Commies!” is for the consumption of spectators (i.e. you and me). So the world turns.
The bottom line is that The IKN Weekly makes the same call as last weekend; We are likely to
see an interim agreement reached before Las Bambas shutters, with both sides claiming victory
and a Christmas of production in and around the mine. The alternative would be the local
community leaders losing public opinion and, while the hardcore opposition to the mine might
be willing to go that route, those who care for their back pockets more than the air they
breathe are likely to get a sudden dose of pragmatism, what with it being Christmas and all
that, too. As for those of you on the outside looking in and perhaps wanting to be as capitalist
as the protagonists, going long MMG Monday is a reasonable bet on a risk/reward and a near-
term flip for a quick return. As for the longer-term, local leaders always have the “the company
broke its agreement with us” card that will start the next round of roadblocks, a few months
down the line. Sic transit gloria mundi.
Chile: Polls continue to favour Boric
There is some tightening in the latest polls out of Chile but even the pro-right wing pollsters
give Lefty candidate Gabriel Boric an advantage of between two and six points over the Right
wing José Antonio Kast, while the left-leaning pollsters put Boric up to a 20 points ahead (22).
Friday saw a live debate between the two candidates that was best described as “tense” and
featured Kast asking Boric to apologize to a woman he say he sexually molested, with Boric
afterward saying he may file charges for defamation against his rival for the accusation. In
other words, it’s the mud-slinging final week and with one more debate to go, Kast may try a
similar strategy. The bottom line is that Boric remains hot favourite for next weekend’s run-off
and I’ll stick with my original 55/45 valid votes guesstimate.
Market Watching
Today’s ‘Market Watching’ section, while somewhat brief goes thematic as we collect together
interesting copper stories and plays that we either own already, or have recently mentioned
here at The IKN Weekly.
Altiplano Metals (APN.v) and a corporate update
We haven’t made much mention of this stock since buying our small starter position, but that’s
mostly due to the strategy of allowing APN 2021 to prepare for its growth push as from next
year. With that in mind, the news last week (23) that is ploughing the early and small-scale free
cash flow from Farellon into the development and upgrades required for the move into
commercial production. APN.v reported development work with 14m of the 60m of tunnelling
required to open up new mining faces, plus the required ventilation machinery now installed to
allow deeper mining. The CEO comment also fits well with the company strategy:
“Increased operational efficiencies generated from the upgraded ventilation and further
expansion underground are part of the ongoing development and sustainability
activities at Farellon. With our mill construction on pace to be completed in Q1 2022,
this work is designed in advance to maximize the output and grade from our mining
activities at Farellon in preparation of the facility’s completion.”
These people are serious miners and not throwers of sequins into the eyes of the market and
the 2c improvement on the week helped to relieve the tedium of my first foot purchase of
shares. However, this is one of those stories which I plan to scale into as long as they deliver on
34

promised milestones, so seeing it down early isn’t such a bad thing. Current cash exposure is
small, but with luck 1q22 will see me deploying more as they get Farellon into gear. Happy
enough holder and good NR to read last week.
The QC Copper & Gold (QCCU.v) price rebound
It took longer than I expected and the rebound was probably helped along by good results from
sister company Baselode (FIND.v), but QCCU.v finally shook off the detractors talking ill-
informed stupidities about the stock and reverted higher.
That’s more like it and even at 30c, this stock is woefully undervalued compared to its potential.
Also good to see the town of Chapais coming out in support of the company and its plan,
directly contradicting the FUD and trolls who said otherwise.
Aldebaran Resources (ALDE.v) and a webinar last week
Despite a somewhat glitchy connection at John Black’s end and the obsequious style of Gerardo
del Real (who couldn’t advertise “play-to-play pumper” more clearly if the words had been
tattooed on his forehead), the 6IX-hosted webinar from Aldebaran (ALDE.v) last week was
useful, because we now know “The Regulus Team” is going to be hitting the presentation circuit
hard as 2021 becomes 2022. We also know the drills are turning,, that the new access road
means they will have a longer drilling season to play with (i.e. more results next year) and that,
with around $6m at bank, ALDE will look to raise money in the first quarter of 2022. That last
point is probably the reason why the share price can’t break through its current level so, if we
see a breakout on drill assay results and volume, I’m probably going to take the opportunity to
sell and wait for the instos to set the price at which they’d like to buy their blocks of shares. At
that point, ALDE would have a clearer run to blue sky price levels.
Coast Copper (COCO.v) promotes itself
The sizzle stock is already cashed up, already drilling and now is happy to applaud its
neighbours…basically anything to get a BNR out in the public realm. CEO Travis is doing what
was expected of him and this is now setting up as a clear promo play for early 2022. With Scott
Gibson behind the scenes, you can bet Eric Coffin will reco this to his list at some point.
35

Personally I’m now going to wait and see what the first week of January brings before making a
buy decision and prefer to deploy my cahs in a more serious play such as Amerigo (ARG.to )
this month, but the set-up now seems obvious.
Harte Gold (HRT.to) goes into bankruptcy protection
And the stock is at 1c this weekend, which means my small side bet trade has taken a real
bath. But despite being in intensive care and extremely unlikely to bounce back to anywhere
near my buy-in price, which was low to begin with, I’m going to hold through because for one
thing, the bet was small and the type which you have to be willing to lose from the start, for
another the returns on a penny are hardly worth my time but most of all, Silver Lake still isn’t
the only game in town and HRT’s mention of a ‘Stalking Horse’ position at least allows others to
kick tires and consider another future for this company. However, I’m not going to disguise the
failure in this trade and, small amounts in real cash or not, a fail is a fail which is why I’ve made
sure it comes at the end of this edition, rather than burying it amidships.
Conclusion
IKN655 is done, we end with bullet points:
 Be long copper. You choose the way, but be long copper. Period.
 One obvious way to be long copper in 2022 is via a long position in Amerigo Resources
(ARG.to), because if the current management team deliver a strong Q4 and 2022
guidance, we win. If they don’t, their activist shareholders will make sure they
lose…and then we win.
 The Great Bear (GBR.v) friendly deal with Kinross is a welcome end to the year, but the
potential of a counter, from Barrick or other, is definitely there. For me it’s a 50/50 with
precious little downside risk, therefore GBR is a hold.
 Tuesday sees the Minera IRL (MIRKL.cse) AGM and while I’m not expecting a sudden
and pleasing conclusion to this ongoing story of sleaze, corporate collusion and
conspiracy to the detriment of shareholders, we do at least have the opportunity to
hear the voices of the people who refuse to speak to us. Sadly this is bound to run into
2022, whatever happens at the AGM.
 However, by this time MIRL should be a minor part of your investment life, as there are
so many more companies out there worth your time, DD effort and investment funds.
While they still don’t get much mention in this edition, start with Rio2 (RIO.v) and
Minera Alamos (MAI.v), two companies that have their shareholders’ best interests ront
and centre and with world class mining stories to tell, as well.
 This was a long edition of The IKN Weekly, covered plenty of different bases and I
don’t mind telling you it took plenty of typing. So a message for new subscribers,; they
aren’t all like this one .
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
36

Footnotes, appendices, references, disclaimer
(1) http://www.amerigoresources.com/_resources/presentations/corporate-presentation.pdf?v=0.751
(2) https://www.juniorminingnetwork.com/junior-miner-news/press-releases/1282-tsx/arg/70752-amerigo-reports-senior-
management-changes.html
(3) https://www.losandescopper.com/news/2019/fernando-porcile-joins-the-board-of-directors-of-los-andes-copper-ltd-
as-executive-chairman/
(4) http://www.amerigoresources.com/investors/earnings-calls/
(5) http://www.amerigoresources.com/_resources/media/ARG-Q2-2021-Conference-Call-August-12-2021.pdf
(6) https://mineraalamos.com/news/2021/santana-mine-operations-update/
(7) https://www.siliconinvestor.com/subject.aspx?subjectid=58319
(8) https://www.orocoresourcecorp.com/news/initial-drilling-at-santo-tomas-confirms-gradeshell-model
(9) https://regulusresources.com/news/2021/regulus-provides-update-on-the-antakori-project-1/
(10) https://iknnews.com/regulus-speaks-reg-v/
(11) https://regulusresources.com/news/2021/regulus-announces-extension-of-warrants-1/
(12) https://iknnews.com/ecuador-mining-and-that-court-ruling-the-pro-anti-mining-views/
(13) https://www.eluniverso.com/noticias/economia/camara-denuncia-inseguridad-juridica-por-parte-de-la-corte-
consitucional-en-caso-los-cedros-en-imbabura-nota/
(14) https://www.corteconstitucional.gob.ec/index.php/boletines-de-prensa/item/1262-caso-nro-1149-19-jp-21-
revisi%C3%B3n-de-sentencia-de-acci%C3%B3n-de-protecci%C3%B3n-bosque-protector-los-cedros.html
(15) https://www.primicias.ec/noticias/economia/sentencia-corte-derechos-mineros-bosques-ecuador/
(16) https://econojournal.com.ar/2021/12/hensel-deja-la-secretaria-de-mineria-y-vuelve-a-san-juan-como-jefe-de-
gabinete-de-unac/
(17) https://www.ambito.com/economia/designan-fernanda-avila-como-secretaria-mineria-n5332653
https://ar.linkedin.com/in/mar%C3%ADa-fernanda-%C3%A1vila-82ab8b182?trk=people-guest_people_search-card
(18) https://larepublica.pe/economia/2021/12/09/francke-sobre-nuevo-impuesto-a-la-mineria-si-no-es-ahora-
perderemos-la-oportunidad/
(19) https://peru21.pe/economia/las-bambas-snmpe-rechaza-postura-del-gobierno-noticia/
(20) https://rpp.pe/peru/cusco/apurimac-el-minem-rechaza-la-actitud-de-la-empresa-minera-las-bambas-esto-dice-el-
acta-tras-reunion-para-resolver-el-conflicto-social-noticia-1373750?ref=rpp
(21) https://rpp.pe/peru/actualidad/federacion-nacional-de-trabajadores-mineros-anuncia-marcha-nacional-para-el-
lunes-13-por-cierre-de-minas-noticia-1374328?ref=rpp
(22) https://elpais.com/internacional/2021-12-11/las-encuestas-en-chile-anticipan-una-victoria-incierta-del-izquierdista-
boric-frente-a-kast.html
(23)http://www.apnmetals.com/news/altiplano-begins-advance-to-the-352-m-level-at-farellon-and-completes-ventilation-
upgrades
37

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
38

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
39

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.
40