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The IKN Weekly
Week 663, February 6th 2022
Contents
This Week: In Today’s Edition, Cooler heads prevail on gold, Silver continues to underperform,
US CPI inflation and the Fed jawbone.
Fundamental Analysis: A significant block trade in Amerigo Resources (ARG.to).
Stocks to Follow: Discovery Silver (DSV.v), McEwen Mining (MUX), Palamina Corp (PA.v), QC
Copper & Gold (QCCU.v), Aldebaran Resources (ALDE.v), Minera IRL (MIRL.cse).
Copper Basket: Overview, Meridian (MNO.v), Coast Copper (COCO.v), Hot Chili Ltd (HCH.v).
Producer Basket: Overview, Agnico (AEM), 2021 earnings season.
TinyCaps Basket: Overview, Signature Resources (SGU.v), Infield Minerals (INFD.v).
Regional Politics: Argentina: Funding secured, Ecuador: More on the Quito mining
referendum, Chile: Fade the screaming headlines against mining and water rights, Mexico’s
Supreme Court again postpones its Almaden Minerals (AMM.to) call.
Market Watching: Mene Inc (MENE.v): 4q21 sales and revenues, Altiplano Metals (APN.v)
redux: December delivers, Element 29 (ECU.v) starts drilling at Flor de Cobre.
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
In Today’s Edition
 Our trade on Amerigo Resources (ARG.to) is based partly on the value it offers at
current prices, partly because we envisage an upcoming change in top management
that should invigorate the company and its price prospects. The news from the market
Friday offers another indication that we’re on the right track, that’s today’s main
Fundamentals section.
 However, this week’s main fundies anal ysis is down in ‘Market Watching’ where we run
the slide rule over our only non-miner, even though Mene Inc (MENE.v) is still a serious
precious metals company. The 24k gold jewellery company gave us its 4q21 preliminary
data last week and I’m going to try to get you to buy some of these shares as a long-
term hold. If you do, one day you’ll thank me.
 While today’s intro mainly continues our ongoing conversation on gold (and silver), we
remain more bullish about the prospects for copper. As well as coverage of our open
copper positions, we run an overview of the interesting exploreco Element29 (ECU.v) as
its drill program at Flor de Cobre begins.
 In Regional politics we again bang the drum on the opportunity emerging in Argentina.
The Alberto government has a concerted plan to make mining a central pillar of its
economic future and last week saw new pieces of the jigsaw fit in.
Cooler heads prevail on gold
Two weekends ago in IKN661, gold was pushing higher and goldbug euphoria was in the air,
but this desk couldn’t help but wonder whether it was more about overbuying than trend
1

change. One weekend ago in IKN662, gold had just collapsed to under U$1,800/oz and
goldbugs were shaking their fists at the world, but this desk preached from the same
hymnbook. No need to abandon the “we’re revolving around U$1,800/oz” theory on the back of
such flimsy, near-term evidence. This weekend, a gold price chart:
Please don’t mistake this for crowing, preening, strutting in front of an audience or shouting
toldyaso, nothing could be further from the truth. If required, I will have no problem in
jettisoning the current house working theory of a steady gold price in 2022, which also worked
for us in 2021, if and when evidence accumulates to its contrary. Nothing lasts forever and
even the stalwart gold defender knows any price deck at any given time is only a line in the
sand, capitalism’s truths are not written in stone (aside death and taxes, at least). Instead,
consider “gold 1800” as a call against the incessant noise of a market crammed with
participants who want something to happen, need gold to move up (or down) and justify their
theories, but remain under the illusion that wanting something to be so will make it so.
And there are signs that cooler heads are beginning to prevail on the subject of gold, at least
for the time being. As I begin writing this op-ed intro Saturday morning and scan the last
couple of days gold market commentariat, I note articles appearing that talk of a “boring gold”
market stuck at 1800, or for those with their glasses half full the same gold 1800 shows
“resilience”. There are even calls from pro-gold writers to “embrace the steady gold
performance”, which is something this desk can agree with (though high cost quartile gold
producers might not be as keen, inflation pressures and all that). However, even as our “gold
around 1800” call has provided the best working model for the market for over a year (Gold
Love In The Time of Biden if you would, as I clumsily butcher García-Marquez), this desk’s
growing suspicion is for upside pressure on the price of gold. Nothing certain as yet, but the
way in which our corner of the wider capital markets performed last week was almost normal
and healthy, daring as it sounds to write that about gold stocks.
For example in a healthy market, you’d want gold stocks to rebound in an orderly fashion That’s
what they did with GDX up 3.75% on the week and GDXJ up just 2.83%, the pattern when
quality stocks are bought first and foremost and
GLD gold holdings, Dec'21 to Feb'22 (metric tonnes)
the right signal. Also, as seen in The Producer 1020
1015
Basket segment today Tier 1 goldies performed
1010
best of all, with Barrick and Newmont leading the 1005
1000
GDX revival. You’d also want interest in gold 995
990
bullion trading to increase. We got that too, 985
980
because as well as GLD rising 1.05% on the week, 975
970
ETF inventories saw changes every day. 965
960
Not always to the upside either, we’re not trying
to paint some panacea of Wall St suddenly falling
in love with gold bullion. Instead, inventories rose
from last weekend’s 1014.26 metric tonnes (mt) to 1018.04mt by Wednesday, only to drop
2
12/11/03 12/21/2 12/21/4 12/21/6 12/21/8 12/21/01 12/21/21 12/21/41 12/21/61 12/21/81 12/21/02 12/21/22 12/21/42 12/21/62 12/21/82 12/21/03 22/1/1 22/1/3 22/1/5 22/1/7 22/1/9 22/1/11 22/1/31 22/1/51 22/1/71 22/1/91 22/1/12 22/1/32 22/1/52 22/1/72 22/1/92 22/1/13 22/2/2 22/2/4
mt
source: SPDR GLD data

away to 1011.6mt by Friday’s close. So a small net drop on the week, but gold bullion inventory
totals at GLD changed every single day of last week, daily action that we haven’t seen for a
while that signals a rise in interest among financial player of gold as a trade. Remember, we
track GLD inventories for indications of sentiment among generalists on Wall St, the people who
are agnostic on gold and only look for vehicles with which they can make a few dollars.
Movement of the sort we’ve seen in the last two weeks is different from the drudgery and
boredom of a sector ignored, as for the first time during Biden’s mandate gold is getting
interest from traders. And hey, that may well be precisely because gold is boring, because in
our new world scenario of rising Russian aggression to NATO’s Eastern flank, the choppy broad
markets as Jay Powell works out how to keep the bulls running, and an earnings miss from
Facebook (okay… “Meta”) that sees junior explorecos marked down in price (seriously, I
laughed too) or Bitcoin’s recent near-term reversal starting to look more of a medium-term
thing, boring old gold at U$1,800/oz looks like an attractive parking spot, at least for a while.
Silver continues to underperform
Gold’s stickiness at U$1,800/oz has another beneficial mirror, as those heavily into silver must
also be envious of its stoic performance these past few months:
Silver continues to lag its more illustrious coinage metal neighbour. Using GLD and SLV as our
proxies, now that the stupidities of last year’s “silversqueeze” pump are out of the 12 month
chart we can see how silver kept pace with gold until around June of last year, but has since
fallen out of favour. The drivers behind silver’s underperformance are up for discussion,
something hindered by True Silver Believers who quickly drown out any semblance of
reasonable debate at the first opportunity (abandon hope, all ye who enter into silverbug
chatroom). However, as ruffling feathers is a bit of a house speciality here are two possible
reasons for the above chart:
 Silver is an industrial metal in supply surplus. Yes, I know that short sentence contains two
painful statements for the average silverbug, but truth hurts sometimes. These pages have
been over this subject on several occasions and there’s not going to be a full repeat showing
this time, suffice to say that A) more than half of silver is taken up by industrial uses (which
climbs further if you include fancy worked silver items such as silverware) and its price
dynamics are therefore very different to that of gold. Then B) even the industry-sponsored
overview body The Silver Institute admits to a 23m oz supply surplus for 2021. Another
undeniable fact that annoys silverbugs is how their fetish metal is largely a by-product, with
two-thirds of the world’s silver coming as a credit metal from mines dedicated to copper, gold,
zinc or other metal production. Industrial expansion and growth of industrial metals production
means more silver hitting the market and, as long as porphyry copper mines (etc) continue to
grow and come online, that trend will continue.
 Silverbugs are the problem, not the solution. It doesn’t take much effort to cast one’s mind
back to this time last year and the incessant noise from the dumb end of the metals market,
who promised all sorts of wonderful to trading neophytes if they only bought some silver
exposure. When their tales of “breaking Comex” and “soaring demand” were shown as a
3

fabrication, the young lads and lasses who fell for their spiel left the market and returned to
Reddit to find a decent Meme Stock to pump, instead of trying to fight a futures market stacked
with reserve metal. The dump of the last six months is as likely to be speculators losing interest
as it is investors not doubling down on their convictions. After all, the truism of how investors
shout most loudly when they are fully positioned isn’t one confined to the silver market.
The second argument holds some weight and may even connect to the first, as net sellers of
silver for speculative purposes provide a stealth supply to the wider market. However, when
push comes to shove the reason silver has under-performed gold is that there’s too much being
produced for the industrial sector to mop up. Indeed, I agree demand will eventually rise, for
example photovoltaics will require more real ounces as technology limits cost input savings,
and industrial demand will start to eat into market reserve inventories (on which the futures
market relies to control prices at turn points). When that happens, there’s no reason why silver
can’t make one of its famously volatile jumps higher and I get another round of “toldyasos”
directed toward me, which is fine as by that time, I’d have made profit from gold trades to buy
enough Kleenex for the tears in my eyes. Until then, I’ll stick with just one silver trade on the
books and hope Discovery Silver does better than it did last week.
US CPI inflation and the Fed jawbone
Readers may have noted that last week’s US BLS jobs report wasn’t flagged by IKN662 and,
despite it being such a blow out number that Joe Biden used it in a triumph speech, markets
shrugged their collective shoulders. That’s because these days we care more about inflation
that jobs and to that end, this Thursday has the real market-mover datapoint from the US BLS.
According to reliable sources (1), US Consumer prices (CPI) is set to come in at +0.5% for the
month of January, with core CPI also at 0.5% CPI. Gold is bound to react to this report as a by-
product of any US Dollar move.
This harks back to the point we made last weekend: The newly aggressive Fed has allowed the
market to suppose, hypothesize or fantasize about five, six or even seven rate rises in 2022,
along with a potential 0.5% basis points rise in March. With the “the toolbox to deal with the
threat” (man, these clichés are useful), Jay Powell can now react to whatever data come to
market and steer the world the way the Fed wants. In other words, the Fed is back in front of
the curve and no longer playing catch-up to sentiment, which in turn allows them to use their
favourite tool, “the jawbone”, to guide market expectations. Therefore, with CPI forecast at
+0.5% as our benchmark this weekend, any reading that come in higher will raise the
likelihood of a half point Fed raise in March which will, in turn, hit the price of gold. So it goes.
Fundamental Analysis of Mining Stocks
A significant block trade in Amerigo Resources (ARG.to)
The fundies note of IKN655 dated December 12th entitled “The time to own Amerigo Resources
(ARG.to) has arrived”, set out the reasons for our buy call on the stock and the trade theory. It
was a long note and covered plenty of angles on the company, so we’re not going to attempt to
touch on all the angles today. Please see IKN655 for more (and the brief update of changes
and addenda the next weekend in IKN656), but in order to frame today’s update note here’s a
re-print of the “…three things to know about Amerigo Resources (ARG.to) in late 2021”, as we
said at the time:
******BELOW FROM IKN655******
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 team up with. Though not a
4

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.
******ABOVE FROM IKN655******
IKN663 back and after eight weeks, some thoughts on the three points:
1) All good and the company’s 4q21 production numbers provided confirmation. Costs
have risen and ARG has guided them somewhat higher for 2022, but copper prices are
holding well (with every sign of going higher), water supply for 2022 is confirmed (from
ARG and from its big partner next door, El Teniente) and we’ve seen that ARG is using
its strong cash flow proactively, paying its first dividend and buying back shares.
2) This week brought more evidence of this being the case.
3) So far at least, the timing of our purchase has worked out. Not long after taking an
initial position, ARG began to climb away from the aforementioned sticky C$1.30 price.
This desk has even taken advantage of the slight retreat from recent C$1.70+ highs to
add to its position as part of the portfolio re-balance announced two weekends ago.
In other words, so far so good and since IKN655, we’ve covered the scheduled Q4 production
report from ARG as well as tracking its share price improvement. However, today’s updated is
different and covers developments in the second of the three points, as the boardroom games
now seem to be afoot. To set the scene we first update on the share count. That has changed
for the better, because ARG wasn’t merely talking the talk about the buyback policy as
announced in 3q21. Instead, and after buying back 7m shares from Michael Luzich in the SIB
(see IKN655) it has continued to buy back shares on the open market. ARG currently has the
right to buy back up to 10.75m shares via its established Normal Course Issuer Bid in the 12
month period to December 2022 and according to the company website this weekend (2):
…shares out were down to 174.16m as at January 31st 2022. This compares to the company-
reported total of 175.06m as at December 10th 2021 as per IKN655. On the dedicated page to
share buybacks, ARG gives this table:
That means ARG purchased just under 100k shares in the second half of December, but in
January the rhythm picked up again and
another 822,500 shares were extinguished at 190 ARG.to: Shares Out
treasury, a decent clip and good to see. At this
185 NB CUT DOWN Y-AXIS rate, our estimated house target of 170m
shares out will arrive sooner rather than later. 180
175
With the baseline of current ARG.to shares out
170
in place, we move to the latest events and
165
5
160
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4 tse22q1 2202
DNE
source: company filings, IKN ests
serahs
fo
snoillim

Friday morning saw two significant insider trade filings at Amerigo Resources:
The two lines can be taken together, as buyer George Ireland is also seller George Ireland. He
is managing partner at his main investment vehicle, Geologic Resource Partners LLC (GRP LLC),
which sold 20,387,838 shares of ARG. At the same time, George Ireland the person picked up
8,678,801 of those shares. As seen above, these transactions leave GRP LLC holding 1,806,429
ARG shares, then the personal holding of George Ireland moves to 10,248,351 shares.
This leaves an outstanding amount of 11,709,037 shares of ARG that went to an unknown third
party, representing a block of 6.72% of current shares out. That’s an interesting number, as
with some artistic licence and leeway it fits with some of the activist moves we saw last year. In
the IKN655 anal ysis we laid out the reasons behind our supposition that ARG and its current
board, headed by Chair Klaus Zeitler, was coming under activist shareholder pressure. That
report was the catalyst and the reason for our new trade in the company, which has worked out
so far and provided a win, plus room to add to the position recently as part of the portfolio re-
balance. Part of our trade theory highlighted how industry magnate Ross Beaty had previously
sold part of his large share position in ARG. On that we have solid information, as he had to file
when his holding dropped to under 10% of ARG, then further supposition when, as part of its
2q21 filings and Conference Call prepared notes, ARG CEO Davidson mentioned further block
sales from two parties, one of whom was almost certainly Ross Beaty and further sales. Once
Beaty dropped under the 10% threshold number and continued to sell it was impossible to put
an accurate figure on the number of shares he had left, but at the time in IKN655 we calculated
“… the Beaty remnant of perhaps 6m to 9m shares…” and this convoluted paragraph now
brings us to the point:
 On Friday, 11.71m shares of ARG, representing 6.72% of total S/O, went to an
unknown third party.
 The bottom end of our estimated range for Ross Beaty’s remnant holding, i.e. 6m
shares, currently represents 3.45% of shares out.
Those totals add up to 10.17% and are close enough to the magic 9.99% number to gain my
attention. Or put another way, if until last Friday Ross Beaty owned 5.68m shares of ARG, a
number very close to our previous guesstimate range, then added the mystery 11.71m shares
as seen on Friday, this weekend he’d still be under the 10% threshold for insider declaration
and wouldn’t have to tip his hand on intentions. In shot, these numbers are close enough to
suppose that GRP LLC sold a precise amount of shares (note GRP LLC keeps a small, 1.8m
share remnant for no particular reason) and that George Ireland bought a precise amount of
shares as part of the disposal, leaving the majority 11.7m bloc for somebody or some institution
with their own specific amount that fits in with their plans.
In other words, we likely saw the first shoe to drop in the scenario we outlined for ARG in 2022,
the planned boardroom takeover by activist shareholders. And even if Ross Beaty wasn’t the
buyer on Friday, there are other candidates for possible buyer who are sympathetic to the Ross
Beaty position. Those include ARG director Michael Luzich, via Luzich Partners LLC (there was
plenty on him in IKN655), or perhaps long-term Beaty business partner Rick Rule, who sold out
of his ARG position completely in 2021 and may be back.
Then there’s the mystery of the company’s latest corporate presentation, which gets recorded
for posterity as this desk strongly suspects it won’t last in its current format for long. On visiting
the ARG website this weekend, then prompted to load its latest corp pres in PDF format from
6

the standard link (3), on opening the PDF all we got is a one page document with this…
…written in the middle, along with a prompt to “Please contact investor relations for more
information.” That’s a change from the normal, as the December 2021 corp pres PDF I have on
file was 18 pages and gave plenty of detail on the company and its operations. So on sending
the requisite mail to ARG adjunct IR Graham Farrell (at third party IR firm Harbor Access, under
contract to ARG, I was told that ARG is updating the investor deck to bring it inline with our
2022 guidance and will be posted to the website this week. IR also told me that GRP LLC “…is
in the process of winding up and has distributed shares of Amerigo which were held by the fund
to the fund’s individual investors.” That’s fair enough and any fund can legitimately wind up and
distribute to its partners and holders. However, seeing a fund that’s been in existence since
2004 decide to liquidate and distribute in the same quarter that we flagged for ARG’s potential
boardroom battle (or friendly change of control) is either a coincidence or is related to the near-
term future of ARG. In the business world, I don’t believe in coincidences.
The bottom line: George Ireland is a long-term backer and supporter of Klaus Zeitler, as well as
being the long-tem major holder in Amerigo Resources (ARG.to) via his investment vehicle, GRP
LLC. Witnessing George Ireland make this substantial move in ARG positioning at this time is
highly significant, coming as it does in the time window this desk predicted for a corporate,
boardroom-level move that would a change in control at the company. We’re now in the run-up
to the 2022 AGM} and with agenda
materials normally published in March, now
is the time for all parties to come to a
negotiated and amicable agreement instead
of seeing some sort of power struggle
going on (that would involve proxy slates,
unnecessary legal expenses, etc).
Stocks to Follow
Last week’s modest relief rally in juniors showed in our Stocks to Follow list, which is just as
well. We saw three losers from our 14 open positions (RIO.v, ARG.to, DSV.v), one stock
remained unchanged (SMD.v) and that leaves 10 winners which I’m not listing. Instead you get
the highlight reel on bigger percentage moves that were confined to the bottom of the list, with
the non-miner Mene Inc (MENE.v up 14.0%) leading the way, followed by Minera IRL (MIRL.cse
up 13.3%, i.e. a penny) and Palamina Corp (PA.v up 11.5%) the small fry that rebounded best.
The result of the carnage also shows up in the colour changes on this week’s Stocks to Follow
table, with just four of the 14 stocks now showing green since inception.
7

company Ticker this week Avg Price Reco date Current PPS Gain/Loss% Notes
TOP PICKS
Minera Alamos MAI.v STR BUY C$0.21 13-Oct-19 C$0.50 138.1% $1.14 tgt Aug'20, #1 idea
Rio2 Ltd. RIO.v STR BUY C$0.83 22-Apr-18 C$0.59 -28.9% $1.30 1st tgt, building now
Recommended stocks (In order of preference)
Amerigo Res ARG.to STR BUY C$1.36 12-Dec-21 C$1.58 16.2% 2022 Cu bet, mgmt change?
McEwen Mining MUX BUY U$0.89 2-Jan-22 U$0.845 -5.1% 1q22 trade, turnaround story
Copper Mountain CMMC.to hold C$3.40 18-Jun-21 C$3.76 10.6% Sold 1/2 Jan'22 port rebalance
Discovery Silver DSV.v STR BUY C$1.77 24-Oct-21 C$1.63 -7.9% Serious Ag play, 1st tgt $2.75
QC Copper&Gold QCCU.v STR BUY C$0.275 25-Apr-21 C$0.275 0.0% Now drilling. Easy hold
Aldebaran Res. ALDE.v SPEC BUY C$0.68 16-May-21 C$1.03 51.5% Waiting on drill assays
Trilogy Metals TMQ BUY U$1.84 15-Sep-19 U$1.47 -20.4% S32 suitor, stalled
Strategic Metals SMD.v BUY C$0.42 31-Jan-21 C$0.33 -21.4% Canada land bet+Zn in FY22
Altiplano Metals APN.v SPEC BUY C$0.31 17-Sep-21 C$0.285 -8.1% Cheap entry, 1q22 re-rate
Palamina Corp PA.v SPEC BUY C$0.295 21-Nov-21 C$0.145 -50.8% Au expl in S.Peru, early dusters
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.085 -56.4% CEO change will move stock
Long-term non-mining hold
Mene Inc. MENE.v adding C$0.67 6-Dec-20 C$0.65 -3.0% LT bet, adding slowly
Closed in 2022 closed close price
Great Bear Res GBR.v Jan'22 C$15.83 26-Aug-20 C$28.58 80.5% Bought out by Kinross, print
Copper Mountain CMMC.to Jan'22 C$3.40 18-Jun-21 C$3.78 15.9% Sold 1/2 position in rebalance
2015 to 2021 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Now for notes on a few of our covered stocks:
Discovery Silver (DSV.v): A second bad week for the stock and while it’s not the first time
we’ve seen this type of high volatility from our only silver position, on this occasion there’s
substance behind the negative price performance. The reason is the NR out form the company
last Tuesday Feb 1st (4), which contained mostly expected news. The three main items are:
1) Treasury covers 2022 budget. This was fully expected and DSV framed the subject with, “We
ended 2021 with a cash balance of approximately $70 million and no debt. Our planned work
program at Cordero in 2022 is budgeted at $25 million”, as well as a couple of other references
to its strong cash position in the NR. That’s all good and as the company has to date been
efficient in its use of capital, spending outside the
Cordero work program should be onerous. DSV will
get deep into 2023 without any treasury issues.
2) The drill program set at 55,000m for FY22. This is
good, as while we expected DSV to budget more
drilling than required for just the Pre-Feasibility study
(PFS), 55,000m is aggressive and has multiple
objectives. The easy way forward is to include the
small table DSV put in its NR and here it is (right).
The 25km planned for PFS purposes fits with the PEA
recommendations. After that, DSV has 14,000m
planned for resource growth at Cordero, which we
like. Then the potential value-add for the company, a
large 16,000m aimed at other targets around its
large property. There are details of those targets in
the NR so click through to check those out, here we
limit to saying that we approve of this strategy.
Cordero is the reason a buyer will pick up DSV, but extra resource potential from another target
8

is exactly the type of gravy that turns a theoretical acquisition into reality. The 2022 campaign
wouldn’t need to end in a new 43-101 compliant resource on a “non-Cordero” resource at the
same concession, just offering the buyer a free extra is enough.
3) The timing of the PFS, which is the negative. DSV stated, “We expect to complete the PFS on
Cordero in the fourth quarter of 2022”, which means we are now a long way from its first
guidance of 2q22, then the revised timeline of at some point in 3q22. This is not good, not least
because there was no need in the first place to promise a short timeline between PEA and PFS.
When inquiring on this issue, DSV told me that the problem comes from the sulphide
metallurgy. The company wants to be thorough (that’s good) and understands that its full suite
of met tests for sulphides will take 28 weeks. They’ve just kicked off the program and will
include four rock types, four mining phases and a range of representative silver equivalent
grades, from 20g AgEq to 200g AgEq, which means the testing will be thorough and offer
plenty of detail. However, the 28 weeks will be 28 weeks, it’s the critical path item for the PFS
and means the final PFS report gets pushed back into 4q22.
These things are understandable and, in the end, I much prefer a good job done than a rush
job. However, as I put it to DSV (and I quote myself), “With a CEO that mentions his
metallurgist’s background at the drop of a hat, you should have known that (the testing would
take that amount of time) already. And it would have been possible to deliver in Q3 if you’d
started the testing before now. This makes
the “brief lapse” selling point between the PEA
and PFS look insipid.”
Indeed, that’s the issue here, a question of yet
another junior promising one thing and then
delivering another. In my estimation, DSV is a
cut above the average junior exploreco in
several factors, including its management
team and work ethic, however it doesn’t take
much to lose a good reputation and the way
the PFS has been shuffled from mid-2022 to
end-2022 doesn’t sit well. The company gets a
pass this time, but any more broken promises
would indicate something amiss.
McEwen Mining (MUX): MUX rebounded slightly, but as this ten-day chart shows it also saw
sellers in Thursday/Friday trading that meant it lagged the PM market leaders.
The next scheduled catalyst is its 4q21 earnings, but before then any resolution on Los Azules
funding would be a positive for the stock. As noted last weekend, the NR on Fox Complex was
almost “too bad to be true” and if it did mark the end of all the bad news, any NR from now
should be a positive influence on the stock price. We don’t expect perfection from a company in
turnaround phase, we simply expect it to show signs of turning around and let market
9

expectations do the rest.
Palamina Corp (PA.v): Bargain hunters moved in and bought the stock up to 15.5c midweek,
with some modest volume on Tuesday and Wednesday, before apathy and one tiny trade on
Friday knocked it to its 14.5c finish. The recovery after it shellacking has to start somewhere
and this was okay, but PA can float higher without news and still stay very cheap. As noted last
weekend I thought about adding a few but eventually didn’t. At 13c I could add a few.
QC Copper & Gold (QCCU.v): Daytraders may have already cottoned on to the way QCCU
trades up early week and then closes out at the same levels come Friday. As seen in the
slightly-too-busy chart here, while last week’s midweek hump may not have been as
exaggerated as others, it still happened and the pattern is clear enough.
It wouldn’t surprise to see this pattern continue as we wait for 2022 drill assay news to start.
That’s okay, at least it means the market is interested and the stock is on its radar. I’m here for
the real value proposition, not for the trading, though I should have realized before making a
slightly-too-expensive add a couple of weeks ago that cheaper prices were available.
Aldebaran Resources (ALDE.v): The molasses-type liquidity in ALDE trading did for me
again and I still haven’t managed to add to the position. While it hasn’t been to get a
reasonable market in the stock for a while, it’s useful to make a quick revisit to May 2021 when
this desk decided to return to the stock and buy some shares, via this 12-month price chart
(right) pitting ALDE against its sister company, Regulus Resources (REG.v). Two things:
 Of the two, we picked the right horse. That’s less about ALDE and more the way REG is
still stuck in its Cajamarca mud, even though it now has a drill turning on Anta Norte.
With that assay likely to show in March REG may see some new interest, but even if
they cut an excellent hole the project still has the manifold problems listed in previous
editions.
 ALDE does have moments when it can be traded. For sure I’m the first person to say
that a purchase of ALDE would have been better in the first week of May 2021 rather
than the third, but the stock needed news at the time in order to trade volume. It then
traded okay-ish until July, when
through another quiet period over the
Northern summer, before trading small
bits and piece in October before making
its recent price move.
You need patience to trade these John
Black/Kevin Heather companies and once in,
you’ll often find the wait for real news is longer
than the companies promise. Here we are today
in ALDE, but its past also indicates that when
ALDE wakes up it can offer a liquidity window
10

for both buyers and sellers. This quick note finishes by reminding readers that even though I’d
like to add a few more at current levels ALDE is very much the 4th string in the recent re-
balancing of copper trades and the purchases of ARG.to, QCCU.v and MUX were of higher
priority. I’m not going to accept the first price offered in ALDE because, depending on the drill
news and how the company plays its near-inevitable financing round, I may end up taking
profits on this trade.
Minera IRL (MIRL.cse): We have three piece of news from Minera IRL, all three are
ostensibly positive and in a normal company, would be enough to see the stock price move
higher. However, until such time as its thief of a CEO leaves, no person in their right mind
would confuse this price for a buying opportunity. We start with that very subject, as one
person without a right mind is its CEO, Diego Benavides, who bought 300k shares in the
company on the open market last week. Normally this would be a good thing, here we’re forced
to wonder who Benavides was buying from and what the motives of both buyer and seller
might be. Interestingly, the purchases weren’t made via Haywood or Canaccord but through
Echelon Wealth Partners.
Second, we got a NR from the company telling us information we already knew, i.e. the
production data from Corihuarmi for 2021. The slight beat on production was no big deal and
not a surprise, as MIRL is obliged to give production data via its monthly CSE submissions.
Indeed, we also got the monthly report that included January 2022 gold shipments from
Corihuarmi this week (5) which let’s us update the tracking chart to date:
MIRL: 2019/21 Corihuarmi gold shipments, per month
4500
4000
3500
3000
2500
2000
1500
1000
500
0
11
91naj bef ram rpa yam nuj luj gua pes tco von ced 02naj bef ram rpa yam nuj luj gua pes tco von ced 12naj bef ram rpa yam nuj luj gua pes tco von ced 22naj
Oz Au
source: MIRL filings
In December 2021 MIRL shipped 1,932 oz gold, and in January 2022 it shipped 1,898 oz gold.
Third, we can confirm that two companies have now conducted site visits to Ollachea with a
view to doing a deal with MIRL. We previously identified the private mining company Pilar Gold
as a visitor in late November, we can also confirm that Kirungu Corp, the private mining
company which runs the El Mochito zinc mine in Honduras, visited Ollachea in January. The MD
of Kirungu is “Twitter Star” Neil Ringdahl, so maybe he can give more flavour on how he sees
the asset, however this desk recognizes that the recent decision by Michael Iannacone to quit
as directors (see IKN662 last weekend) is clearly more important. That alone signals the low
probability of Kirungu or Pilar Gold reaching a deal with MIRL.
The Copper Basket
After five weeks of 2022, The Copper Basket shows a loss of 2.55% to level stakes:

company ticker price 1/1/22 Shares out Market Cap current pps gain/loss%
1 Copper Mtn CMMC.to 3.42 210.166 790.22 3.76 9.9%
2 Oroco Res OCO.v 2.04 192.689 385.38 2.00 -2.0%
3 Marimaca Cop MARI.to 3.77 88.028 322.18 3.66 -2.9%
4 Nevada Copper NCU.to 0.71 448.437 309.42 0.69 -2.8%
5 Western Copper WRN.to 2.00 151.426 283.17 1.87 -6.5%
6 Hot Chili HCH.v 1.53 109.223 174.76 1.60 4.6%
7 Meridian Min MNO.v 1.18 153.735 153.74 1.00 -15.3%
8 Aldebaran Res. ALDE.v 0.84 114.495 117.93 1.03 22.6%
9 Regulus Res. REG.v 1.06 101.845 103.88 1.02 -3.8%
10 Kutcho Copper KC.v 0.88 103.94 93.55 0.90 2.3%
11 C3 Metals CCCM.v 0.16 645.379 77.45 0.12 -25.0%
12 Element 29 Res ECU.v 0.58 79.24 47.54 0.60 3.4%
13 Doré Copper DCMC.v 0.79 66.123 46.29 0.70 -11.4%
14 QC Copper QCCU.v 0.34 129.06 35.49 0.275 -19.1%
15 Coast Copper COCO.v 0.13 41.335 5.79 0.14 7.7%
NB: All stocks in CAD$ Portfolio avg -2.55%
A better week for The Copper Basket, clawing back 4.6% thanks to the net positive headcount
of 13 winners and just two losers (CCCM.v, KC.v) so you only get the losers and no stock
stayed unchanged on the week, either. Most moves were modest in either direction, the two
exceptions were both to the upside in the shape of Coast Copper (COCO.v up 40.0%) and
Element 29 (ECU.v up 13.2%), with the latter more impressive than the former. See below for
more on that. Overall for junior copper companies, a week we can succinctly sum up with
“healthy rebound”.
Moving to the metal, copper also had a good
rebound week and quickly shook off thoughts of
further weakness as bargain-hunters moved in.
The market Friday’s close above U$4.50/lb is
bullish for the metal, for operating mining
companies and for any exploreco with a live
prospect. It’s that simple. We’re at that rollover
moment in the futures market when the near-
dated contract’s open interest rolls over to the
next expiry, in this case March’22 is now going
out of fashion and May’22 is showing its volume
increase. The barchart dot com metals futures
contracts page (6) gives a useful overview, the
basic info without numerical overload in details.
On examination of Friday’s close we could argue 1) the market is in slight backwardation if
pushed, but aside cash (HGY00), prices have generally flattened the curve. Then 2) as from
next week, we too will flip to the May contract to follow the money in the copper market.
12

In macro news, for once China wasn’t the main driver of copper prices and most news out of
the world’s biggest consumer of the metal (by a long way) was benign. The most important
datapoint of the week was a 50.1 reading on industrial manufacturing for the month of January,
down two ticks from the 50.3 of December’21 but still above the 50 line, which indicates
expansion. Instead, The US of A took control of the copper market as the USD dropped hard
after its recent run, most commodities reacted in mirror image and copper was no exception.
We offer two piece of curated macro copper news this weekend, the first a straightforward
commentary on the market from Reuters (7) which begins like this:
LONDON, Feb 4 (Reuters) - Copper and aluminium prices rose on Friday, supported
by thin inventories, but worries that central bank rate hikes would curb growth and
metal demand capped gains.
In other words, confirmation of the two main price drivers. Your second link is also from
Reuters (8) but its headline as seen Thursday morning caught my eye:
Global copper smelting surges in January, satellite data shows
And for once, the cat-like curiosity wasn’t beneficial. Here’s and here’s an extended excerpt
from the note:
The number of inactive smelters fell to the lowest level since February 2018, according
to a statement on Thursday from commodities broker Marex and SAVANT, a satellite
analytics service it launched with Earth-i in 2019.
"The strong start to the year in the SAVANT measures of copper smelting activity
corroborate our own observations from the physical markets, which is an industry
supply chain that is ramping up to meet strong downstream demand," said Guy Wolf,
Marex global head of analytics
Earth-i, which specialises in geospatial data, tracks 94 smelters representing 80% to
90% of global production. It sells data to fund managers, traders and miners and
publishes a free monthly index of global copper smelter activity.
Its global dispersion index rose in January to 55.1, up from 51.6 a month earlier.
Under the dispersion index, 50 points indicate smelters are operating at the average
level of the last 12 months. It also has a second index showing the percentage of
active smelters.
Only about a dozen smelters were inactive in January and activity was detected since
the middle of January at BHP's Olympic Dam smelter after a maintenance shutdown,
the statement said.
Along with the script Reuters supplies the
requisite chart (right) and your author adds an
arrow. The theory of how China has managed
to keep a lid on copper prices in the last nine
to 12 months is based around its excess
smelter capacity. We know China has more
copper smelters than anywhere else (natch),
but this may have included the country
deliberately over-building capacity, which has
created a highly competitive TC/RC (treatment
and refining charges) market. The resulting
low TC/RC levels are good for producing
mining companies, but prohibit other places from building their own smelter complexes to
compete with China (e.g. Chile or Peru, two countries that would like to build their own
smelters and add value to the local product, but low world TC/RC prices mean the numbers
don’t add up). In other words China gains control of the copper market, but rather than at raw
material level it takes charge of the supply bottleneck coming out of smelters and going to end-
users. This is turn has allowed China to turn around ands say “We’re not paying that price”
when copper ran too high, as it is able to refuse shipments and disrupt the market with near-
immediate effect.
13

This works, right up to the moment when the excess smelter capacity gets taken up and if the
world has less than 10% of its copper smelters idled, that’s effectively where we are today.
Suddenly, end-user demand becomes the overriding price driver and that’s also what we are
seeing in the inventories data for the last six months, dwindling reserves in the three official
systems tell us that the even with the smelting part of the supply chain de-bottlenecked, supply
is having a hard time keeping up. At this point we invoke Adam Smith and Economics 101, you
know what happens next.
That segues neatly into our regular weekly look at copper inventories, data as always supplied
by Chile’s reliable beancounter people at Cochilco (9):
 For the second week running we have a counter-cyclical drop in overall copper stocks,
highly unusual for this time of year and another clearly bullish signal sent to market by
the real worlds of supply and demand. Aggregate stocks dropped by 9,172 metric
tonnes (mt) and closed the week at 195,346mt, the same remarkable headline as last
week. Bears beware.
 The Shanghai SHFE was closed for business last week as the Year of the Tiger moved
into play (and China fixed its eyes on the Winter Olympics). Stocks at SHFE remain at
40,359mt.
 The main change came from the LME, losing another 7,900mt from stocks even as
cancelled warrants remained largely unchanged at 25,650mt, signifying there’s
probably more to come out soon (see last weekend’s note). LME stocks this weekend
total 82,225mt and 2022 has seen the 100k line quickly lost. The drawdowns came
from European warehouses. Bears be very ware.
 The Comex went against its own tide for a change and joined in the stocks drawdown,
losing 1,272mt to close the week at 72,762mt.
Here’s the dedicated SHFE inventory chart, unchanged for Chinese New Year:
Shanghai Futures Exchange Warehouse Stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
14
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 ht03
Mt Cu
|
source: Cochilco
Now for notes on a few of the stocks in our 2022 basket:
Meridian Mining (MNO.v): A quick mention in passing, after last week’s note on MNO that
ended, “…those of you who like this trade idea more than I do have a reasonably good entry
point at these sub-$1 levels.” I claim zero insight of special knowledge, but MNO traded well
every day except Wednesday and in particular, note the improved volume Friday that pushed
the stock back to close at exactly C$1.00. The catalyst for the news was a NR Friday with the
title “Meridian reports highest grade gold-in-soil result in the Cabaçal Mine Corridor” and while
it’s worth your time to read the full NR (link (10) below), I’m going to give you the four bullet
points as seen in the NR:
Highlights of today's announcement:
 Meridian reports gold assays up to 8.4 g/t from soil survey, 1.8km Southeast of Cabaçal;

 Meridian's defines new copper-gold and zinc trend extending over 3,500m in strike length;
 Strong and extensive surface gold anomaly remains open;
 Prospectivity of Cabaçal's extensive and near surface copper-gold anomalies further confirmed.
Also, the top of the CEO comment:
Dr Adrian McArthur, CEO and President comments: "These latest gold-in-soil results
from Meridian's ongoing geochemical programs, confirm that our Cabaçal copper-gold
project has great potential for future discoveries.
Those NR excerpts because, good results or not,
it’s usual to get a significant market move on
volume from in-soil assay results. As good as they
are (not under dispute), Friday’s price action tells
me more about the effective promotion campaign
behind this stock than the chances of this area of
Cabaçal ever being mined. That’s not a problem,
but it’s worth having eyes wide open about the
amount of promo behind MNO as, when its aimed
at retail in this way, it can become a double-edged
sword.
Coast Copper (COCO.v): Despite the drop we saw to 10c last weekend, this was classed as
“nobody’s idea of a lost cause in IKN662 and assumed it “wouldn’t take much to see it revalue”
if more news came along. And we only needed to wait a week, as the NR out pre-open Tuesday
saw COCO rebound to its previous trading level has the look of a retail crowd-pleaser, rather
than the start of a new resource of significance.
Announced under a trading halt and entitled “Coast Copper Makes New Copper-Gold Discovery
at Empire: 7.18 g/t Gold and 3.17% Copper over 16.3 m at Raven Bluff Target”, (11) the news
made up for the disappointing first assay results from the company with strong grades and
widths on show. The issue here is that its Empire
project was always going to be capable of returning
individual drill hits of this type, as historic holes have
been sunk by previous operators and the data is
available. The sequence of 1) ho-hum result than 2)
splashy NR title and result from known zone (see the
map provided in the NR for more) is the thing that
raises my suspicions, plus of course the fact that this
exploreco and its backers were always going to “sell
the sizzle” to the market. This didn’t need a trading
halt, either.
The place to look for signals about COCO’s next move
(or moves) isn’t on these pages, instead we remind readers that 1) Scott Gibson is a director of
COCO.v, 2) whenever possible, Scott Gibson keeps his name from appearing on COCO.v
literature and 3) the newsletter writers Gwen Preston and Eric Coffin work for Scott Gibson, so
look no further for your cues on this trade if you care enough. Personally, these days I have
better things to do with my time than coattail corrupt writers with hidden agendas.
Hot Chili Ltd (HCH.v): Interesting trading in the newly listed Canadian stock on Friday:
15

The dual listed HCH has its established Australian main listing with the majority of traded
volume, then the newly-established Canadian listing as seen above. Normally no issue, but as
Australia is firmly closed for the weekend before Canadian trading happens it means the
Canadian-listed stock can do different things than the more representative Australian listing. We
see that in this 2-day chart and considering some of the backers of HCH, the tape-painting in
the Canada stock is both blatant and worth a mention.
The Producer Basket
After five weeks of 2022, the Producer Basket shows a loss of 6.02% to level stakes:
company ticker price 1/1/22 Shares out MktCap(U$Bn) current pps gain/loss%
1 Newmont NEM 62.02 797.44 48.59 60.93 -1.8%
2 Barrick GOLD 19.00 1779 34.14 19.19 1.0%
3 Franco-Nevada FNV 138.29 191.192 25.61 133.97 -3.1%
4 Agnico Eagle AEM 53.14 453.5 21.86 48.20 -9.3%
5 Wheaton PM WPM 42.93 450.3 18.04 40.07 -6.7%
6 Gold Fields GFI 10.99 887.72 9.27 10.44 -5.0%
7 Kinross Gold KGC 5.81 1320 7.13 5.40 -7.1%
8 B2Gold BTG 3.93 1055.6 3.77 3.57 -9.2%
9 Alamos Gold AGI 7.69 392.503 2.60 6.63 -13.8%
10 Sandstorm SAND 6.20 191.4 1.12 5.87 -5.3%
All prices and stock quotes in U$ Port. avg -6.02%
The rebound came and very it was welcome too, with GDX up 3.75% and GDXJ lagging its big
brother slightly, up 2.83%. As mentioned in today’s intro, that smacks of a market buying the
quality end of the spectrum first, a statement also borne out by the Producer Basket
performance on the week. We had nine winners and one loser, as Alamos (AGI down 1.5%)
failed to join the party. Also, the lower market
cappers tended to be the worst performers with
Sandstorm up 0.7% and both KGC and BTG up
2.9%. They lagged the biggest movers, with GFI
and AEM both up 4.4% on the week and up at
the top, we even have our first “green shoot”
showing, as good ol’ Barrick (GOLD) is now
positive on the year. Here’s hoping other stocks
follow that lead.
This ten-day chart (right) also demonstrates how
the rich get richer, or at least don’t get as poor
as quickly as the Tier 2 companies. Both industry
leaders NEM and GOLD have out-performed GDX
16

over the ten days with the drop we fixated on last weekend as centre stage.
Agnico Eagle (AEM): Assuming no shocks, AEM consummates its fusion with Kirkland Lake
(KL) this Tuesday February 8th and our pro-forma market cap as seen in the chart above
becomes reality.
2021 earnings season is almost upon us and, while some smaller companies will start
showing their numbers first, the big boys mostly report in the second and third weeks of
February. We’ll take the biggest producers as our examples, with Barrick scheduled to report on
February 16th, Agnico on Feb 23rd and Newmont Feb 24th (though the royalty boys are a little
later, with FNV up on March 3rd and WPM March 9th). Of them all, Barrick and its previously
flagged cash cost beat will be the most interesting release and as it’s the first of the Tier 1’s
that’s good. As noted previously, the close correlation between GOLD and NEM at its shared
operations these days mean the GOLD earnings are likely to move the NEM share perice as
well.
The TinyCaps List
After five weeks of 2022, the TinyCaps show a gain of 2.15% to level stakes:
company ticker price 1/1/22 Shares out Mkt Cap current pps gain/loss%
Aurelius Min AUL.v 0.24 37.134 10.77 0.29 20.8%
Golden Pursuit GDP.v 0.13 34.638 4.50 0.13 0.0%
Infield Min INFD.v 0.06 48.276 2.90 0.06 0.0%
Kingfisher Met KFR.v 0.30 84.57 19.45 0.23 -23.3%
Latin Metals LMS.v 0.12 57.296 6.02 0.105 -12.5%
Manitou Gold MTU.v 0.06 344.47 20.67 0.06 0.0%
Melkior Res MKR.v 0.295 24.011 7.92 0.33 11.9%
Precipitate Gold PRG.v 0.105 129.322 16.17 0.125 19.0%
Signature Res SGU.v 0.07 238.4 15.50 0.065 -7.1%
Winshear Gold WINS.v 0.08 61.585 5.54 0.09 12.5%
Prices in CAD$, data from TSXV basket avg 2.15%
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 tinycaps were again quiet with just two winners (KFR.v, MKR.v), four unchanged on the
week (GDP.v, INFD.v, MTU.v, PRG.v) and four losers (AUL.v, LMS.v, SGU.v, WINS.v). Of the
ten, the only stock making any real moves in these first weeks of 2022 is Aurelius (AUL.v),
which was down 14.7% this week and the only move of any size one way or the other.
As from next week we’ll start running the annual tracking charts, here and also the Copper and
Producer baskets. Six weeks is just about enough for a sample.
Signature Resources (SGU.v) and Infield Minerals (INFD.v) are two companies that
17

have done precisely nothing in the first five weeks of 2022. No news, no updated presentation
in 2022, no appearances on exploreco promotion channels or social media and between them
only one price move as SGU is down half a cent. This is bound to change and both should offer
up work programs soon after which they get their fair chance of impressing us.
One of the reasons to follow explorecos of this type is to note what they don’t do in the public
realm, as much as what they do. This desk now considers over-exposure of a “junior and its
story” via a wide range of pay-to-play channels a net negative rather than a positive, the sign
of a company more interested in moving share papers than testing projects. The lack of news
from SGU ansd INFD is not necessarily a bad thing during 1q22, but there are limits and a team
needs to show action at some point. The quiet periods shouldn’t go on for too long.
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
Argentina: Funding secured
Apologies for ripping off Elon Musk and his infamous tweet, but this week saw real money
announced to back up Argentina’s grand “Renewable Cluster” macro investment plan. We had
two announcements on lithium projects, an important diplomatic meeting between Argentina
and China, as well as hints and suggestions that San Juan’s copper projects are a target for
future investment announcements.
Starting with the main news, as Reuters reports (12) on Argentina President Alberto
Fernández’s three day trip to China and multi-billion dollar heads-up agreements with his
counterpart, President Xi of China:
BEIJING, Feb 6 (Reuters) - China and Argentina pledged on Sunday to deepen
strategic cooperation on trade, currency and the infrastructure-focused Belt and Road
Initiative, the government and state media said after a meeting of presidents Xi Jinping
and Alberto Fernandez.
The two signed a range of agreements on investment plans that will also include Argentina in
China’s Belt and Road strategy. While most investment plans were in other areas and there
were no concrete investment announcements in our focus sector, it was clearly part of the
conversation:
In a 40-minute meeting, Xi and Fernandez agreed to cooperate and invest in areas
such as green and sustainable development, as well as digital economy.
China is willing to share development opportunities with Argentina and help it expand
exports and upgrade its industries, China's foreign ministry quoted Xi as saying.
He was quoted as saying the two countries should deepen cooperation in trade,
agriculture, energy and mining, infrastructure, investment and financing, anti-epidemic
efforts, the digital economy, green development and other areas.
Meanwhile and back in Argentina, Argentina’s “superminister” of Production, Matrias Kulfas, got
headlines when announcing the confirmation of two lithium mining projects (13). First China’s
Zijin is to invest U$380m in the Tres Quebradas project (from its buyout of Neo Lithium last
year) with construction to begin this year and “production by the end of 2023," according to
the official Argentine government statement. While at the ceremony, Kulfas added that Zijin
“plans other large investments in Argentine gold and copper” projects, without mentioning
specific project names. On the back of that announcement. Kulfas accompanied Rio Tinto (RTZ)
who announced its own U$100m investment plan for 2022 alone at its wholly-owned Rincón
lithium Project, also in Salta province. This project was set to come online “in three to five
years” for an estimated total capex of U$850m and when fully operational, would produce
around 50,000 tonnes of lithium carbonate per year. At the presser, Minister Kulfas said
(translated) (14):
18

“This investment announcement demonstrates the interest of companies to back the
country and the potential Argentina has in respect to the development of lithium. We
want to add value to the lithium (produced) and at the same time develop science and
technology so that Argentina contributes to the green revolution that brings real
solutions to climate change.”
Once again, the on-point political position designed to run rings around the anti-mining
environmental groups in the country (Greenpeace etc). Finally in copper news, a less reported
meeting between the new mining secretary (i.e. Minister under Kulfas) and the mining minister
for the province of San Juan, Carlos Astudillo. Here’s a part translation of this report (15):
During the meeting that lasted an hour, the two functionaries conversed on mining
development in the province (of San Juan) and the development of mining projectys
that could come on line in the medium and near-term.
With a focus on copper projects in development and close to starting construction,
such as Josemaria, Los Azules, Pachón or Altar, both Ávila and Astudillo were
satisfied and willing to work in development policies that would boost and promote the
arrival of mining investment in the region.”
Ecuador: More on the Quito mining referendum
The Green light given to the “Popular Consultation” (i.e. binding local referendum) on whether
to allow mining in six regions of Quito, including Ecuador’s capital city, as reported last
weekend in IKN662 now has some reasonably firm dates and numbers attached. There may be
some minor delays here and there, but this is what we can now expect:
 The Ecuador electoral body (CNE) should officially sanction the petition and signature
collecting period as from this coming Thursday, February 10th
 The six communities, including Quito, then have 180 days from the date of the official
sanction to collect at least 197,424 signatures.
 Once complete, the CNE has a maximum of 15 days to verify the signatures and
declare whether the vote will go ahead.
 The likely date for the referendum would therefore be February 5th 2023, as that day
would coincide with other regional elections
When asked about the number of signatures required, the advisor to the anti-mining petition
group said they would make sure to get more than the minimum amount “not to have any
problems with the CNE” and said their team would be trained in efficient petitioning (16).
Chile: Fade the screaming headlines against mining and water rights
We have kept tabs on both these subjects as they reached first passage in Chile’s Constitutional
Convention, but last week the projects to end private water rights in Chile and to nationalize the
country’s mining industry made bigger headlines (17) when both were passed by their
respective committee, the “Commission of the Environment and Economic Model”. The two
motions as approved by the commission are as drastic as they sound as if ratified, all water
rights in Chile held by private individuals or companies would be reverted to the State, then all
mining operations would also be nationalized and the country would become one big Codelco.
It didn’t take long for casual observers to pick up on the news and make shock-horror
headlines, even in Spanish speaking media such as Peru’s major daily La Republica which
screamed “Miners and Agro Exporters in Chile Are Left with No Water” (18) due to the
Constitutional law reform. The Stupid wasn’t confined to the English-speaking North, but up
there ignorance abounded in poorly written reports and on social media shrieks and laments
about how The Commies are taking over Chile. Your author rolls his eyes in pity. As noted
previously, it pays to fade the foolish on Chile’s new direction which certainly is a shift to the
Left wing, but is not what the Prophets of Doom reading from their Bibles of Capitalism would
have you believe:
 Last week’s approval was always going to happen, as that particular committee has
19

indeed been packed with hard Left reactionaries. However, anything passed at this
committee stage has a long journey before it makes it to law.
 First the 155 seat assembly of the Constitutional Convention, i.e. the real
representatives as chosen last year (not a biased committee) can question the
resolution as stands and present their own addenda, directives or alterations to the
initiative as stands. In other words, it gets watered down.
 Then the adapted bill is sent to the Constitutional Convention for debate and vote. In
order to pass, the bill must gain at least two thirds of the vote.
 It is then incorporated into the new draft constitution that is drawn up later this year
and sent for up/down vote to the citizens of Chile.
This system ensures that a Far Left agenda isn’t going to make it to the draft constitution. The
current stage includes the type of theoretical Utopia politics that Lefties love dearly, but at the
realpolitik stage these measures will be either voted down or watered down into oblivion. The
Constitutional Convention came into being due to the major issues facing Chile today, the ones
about which people protested in the streets two years ago and were shot at by police for their
efforts. Those elected to the Convention care most about reforms in hot-button subjects like
education, pension reform and healthcare. Those are the hills on which they will happily die and
they aren’t going to waste their bullets by including radical measures on minor issues and
unpopular matters such as water rights, as chosen by small committees with pet peeves. Chile
as a nation isn’t about to strip mining concessions away from miners, or take water rights away
from farmers, because if those measures made the draft constitution the nation would vote the
whole document down and the real reforms on schools and hospitals would be lost. So the
current committee stage can make its noise and reactionary headlines will get written, but
when the real vote comes, items around concession grabbing from miners won’t get the 2/3
majority required because those wanting to change Chile’s universities or hospital systems
won’t put their key reforms at risk.
This is why, once the screaming headlines had died down, you had people such as Diego
Hernandez of Chile’s National Mining Society (SONAMI) saying the proposal as stands is “hardly
realistic.” Or the president of Chile’s National Agriculture Society, one Christian Allendes, saying
(translated) (19), “…this cannot be approved in the full assembly and at the very least, would
have to be greatly altered to that which is proposed today (in order to prosper).”
Those on the outside looking in would be better served by considering the draft proposals
currently coming out of the Constitutional Convention committees as negotiating positions at
best, the type of early stance taken by union leaders who might ask for a 20% pay rise but
settle for 4% down the line. Summing up, perhaps the best report on the two committee
decisions last week came from BNAmericas in Spanish, whose title line asked ““Should Chilean
Mining Be Worried About The Constitutional Proposals?” and, after an extended note that
included relevant quotes and decent analysis got to its clear inference, of “No, Chile shouldn’t
be worried”. And neither should you.
Mexico’s Supreme Court again postpones its Almaden Minerals (AMM.to) call
For the second time in two weeks, the judge on Mexico’s Supreme Court in charge of the case
between local landowners and Almaden Minerals (AMM.to) (AAU) at its Ixtaca project (21)
suspended the audience and eventual judgment on the case, booting it forward one more
week. It’s now scheduled to be heard this Wednesday February 9th but as the court is clearly
having a problem in reaching a decision without gutting the current Mining Law, we may be in
for a series of further postponements until some sort of solution is found. If there’s resolution
this week, expect news either here next Sunday or on the blog but if not, we may have to
suspend our active coverage of this issue until further notice. There’s not point in wasting space
with the same message every weekend.
20

Market Watching
Mene Inc (MENE.v): 4q21 sales and revenues (in CAD$ unless stated)
On Thursday February 3rd, the only non mining stock covered at The IKN Weekly, Mene Inc,
the online jewelry concern selling proprietary designed pieces made almost entirely of 24kt
gold, announced its “Preliminary Key Performance Indicators for Fourth Quarter and Fiscal Year
2021.” In other words, we got its preliminary sales numbers but as well as the basics, MENE
offered up a range of information as well as
strategic guidance parameters for 2022, in fact
more than enough to come to some firm
conclusions about the company for the year
ahead without having to wait for its 4q21 and
2021 year-end financials, due to be reported in
April. But before any house charts and anal ysis,
here’s a look at the MENE price chart (right):
I’ve chosen the 12 month version for a good
reason, as a look to the right-hand side shows
that the NR didn’t do much for the share price.
Yes MENE rose on the week, but from an already
low level and on minor volumes, certainly
nothing compared to the periods of 50k and 100k daily trade periods we saw in 2021.
Therefore, we can say that last week’s news went largely unnoticed by the market and it’s now
my job to explain why that doesn’t do the company or its stock price any justice. Also before
diving into the charts, we note the other NR out of MENE last week as on Monday Jan 31st, the
company announced a change in the board of directors.
Tommaso Chiabra has resigned as an independent director of the Company, effective
immediately. The Company wishes to sincerely thank Mr. Chiabra for his contributions during
his tenure.
The Company also announced that effective immediately, Mr. Andres Finkielsztain has been
appointed as an independent director.
On inquiring to CEO Roy Sebag on this change, I was told that Mr. Chiabra has a new business
development that is preparing to raise financing (in the food business, no further details), he
has decided to concentrate his efforts on that and his departure from MENE was both voluntary
and amicable. All fair enough, though we should also recognize that Tommy Chiabra is a well-
known person on the socialite scene and was probably more useful to MENE during its initial
start-up phase to open doors to celebrity circles and HNE individuals. Also, we note MENE had
no problem in finding a replacement independent director in Andres Finkielsztain, with a CV
more suited to a serious growth company. The connection to MENE is via Goldmoney, Roy
Sebag’s other main business concern. Long story short, this dsk fully approves of the change at
boardroom level and the addition of Andres Finkielsztain is the type you want from a company
looking to expand operations and become a larger financial entity.
Enough preamble, we get down with the results charts starting with top-line revenues:
MENE: Revenues per qtr
21
930.1 393.1 689.1 15.3 337.2 754.2 812.3
456.4 751.5
934.3
324.5
11.7 302.7
457.5 813.5
894.8
9
8
7
6
5
4
3
2
1
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
C$m
source: company filings

MENE offers an alternate set of non-IFRS financials that may, or may not, offer a better idea of
the cash flow and gross margins at the company. For our purposes we’re going to stick with the
official IFRS numbers and to that end, sales in 4q21 came to CAD$8.498m. That’s a new record
but also expected, what with Q4 being the key Holiday sales period. In fact, the official sales
number was slightly shy of the IKN estimate of C$9m for 4q21, but that’s not a big issue as
we’ll discuss below.
MENE.v: Gross profit
2.4
2.2
2
1.8
1.6
1.4
1.2
1
0.8
0.6
0.4
0.2
0
22
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
$m
source: MENE filings, IKN ests
With revenues, MENE also gave its preliminary gross profit of C$2.009m which look like this on
the chart (right). But with those two numbers, we can also give a close estimate for COGS costs
and also, when adding in a best guess for operating expenses, the MENE overall cost
breakdown for 4q21:
MENE.v: Costs breakdown
976.8168.0 424.3161.1
998.1777.1
757.1
725.2
255.2
450.2
38.1
159.1
867.1
465.2
997.2
557.3
127.1
441.4
582.1125.2
133.1
548.3
319.1
914.5
35.1
664.5
34.1
422.4
614.1
270.4
2
5.6
9
8
7
6
5
4
3
2
1
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
$m
COGS operating exp
source: company filings,IKN ests
As a reminder, MENE has two cost inputs, first COGS which covers its raw material and then
“operating expenses” that covers the rest. MENE gives “gross profit” by simply subtracting
COGS, but adding our estimated $2m for
operating expenses gives a more accurate
1 MENE.v: Operating income, per qtr
view of the company’s financials and its
0.5
overall profitability (right). In other words,
we’re expecting yet another “around 0
breakeven” quarter from the company. -0.5
-1
On digesting the MENE preliminary results NR,
-1.5
plugging in the new numbers, adjusting the
house model accordingly and coming to see -2
MENE is about to report another “around -2.5
breakeven” quarter to market, it has finally
occurred to your author what’s going on at the
company and why my vision of its business
has been wrong until now. Perhaps “wrong” is too strong, but after covering only mining stocks
for too many years I’m now faced with a different beast, a renewable resource company that’s
still young and in growth mode. That’s a different business model and not one that requires
strong operating margins form an early stage to compensate for its finite resource with fixed
asset depletion.
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
C$m
source: company filings

Put another way, this is not a junior miner by any means, it’s more akin to a junior Amazon and
not only that, it’s part the critical stage when it’s still fracturing cash and prone to collapse.
MENE has now passed the milestone of being financially stable and, as a business model that
doesn’t need to produce massive operating or net profits, can concentrate its cash flow
internally, grow operations and increase turnover. This is the Amazon model, the one that
confounded its critics for years on end by not returning bottom line profits but instead
expanding and expanding until suddenly, Jeff Bezos had stopped selling “books and a few other
things” and had taken over the retail world as we know it. For MENE, like Amazon before it, top
line revenues increase is important and gross margin matters. After that, growing sales means
improving liquidity and better cash flow, which creates the virtuous circle. There’s no need to
impress a mining anal yst by returning a bottom line profit, or even operating margins for that
matter. They can be neutral from here to eternity, as long as cash flow velocity increases.
We get strong indications of this model in the CEO comments that accompanied last week’s NR
and two of CEO Sebag stand out: Firstly, the company now has second UK-based shipping
centre and has started payment processing in Euros “…in preparation for our plans to reach the
European markets with the establishment of a European distribution facility in Fiscal Year
2022.” That’s a clear commitment to growth in what is arguably the second most important
wealth centre in the world (and may China and Japan forgive me). Then the second and most
important upcoming change to the company, in this quote:
“…towards the end of (2021) we reached an agreement with a US-based jewelry
manufacturing facility to acquire their operations with an expected closing date in 2022.
We strongly believe that this facility will allow us to scale operations to $75 million in
annual run rate without the need for additional capex. The purchase price will be
funded primarily from shareholder equity.”
While share-Based acquisition of fixed asset means share base dilution, it’s also the way
forward for the next phase of growth (and ultimately, is akin to a funding round of equity but
on more efficient terms). More importantly, it infers a doubling of manufacturing and sales
capacity (in fact slightly more) and addresses the natural bottleneck caused by as a company
expands sales; at some point, the people in the shop can’t make enough to keep up.
With this perspective in mind, this week I revisited the other metrics supplied by MENE and
considered them in a new light, beginning with gross margins per quarter:
MENE: Gross profit margin, per qtr
23
%61 %61
%01
%32 %52 %42 %13
%01
%02
%72 %92 %42 %42 %72 %32 %42
40%
35%
30%
25%
20%
15%
10%
5%
0%
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
source: MENE filings
During its start-up phase, MENE experimented with different sales avenues included
advertising, events sponsorship etc. These days it
MENE: Customer orders and units sold, per qtr
has its established business model, with sales 11000
10000
growth coming from luxury HNW circles such as
9000
word-of-mouth in HNW circles and features in 8000
7000
luxury publications. It is cost effective, predictable
6000
and allows the company to grow sales while 5000
4000
maintaining this specific gross margin percentage.
3000
Meanwhile, incremental sales growth of both 2000
1000
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
customer orders
units sold
source: MENE filings

customer orders (4q21 6,584)and units sold (4q21 10,143) means more cash flows through the
business per year. Dividing the above metrics gives units sold per order, one way MENE can
track its progress (and is surely a metric it would like to improve upon over time). Even at this
early stage of MENE’s life, there’s a tendency toward lower levels during the holiday season and
in Q1, perhaps Christmas and St Valentine’s gifts bring larger sales volume with smaller sized
orders.
MENE: Units sold per order
24
48.1 93.1 27.1 95.1 06.1 67.1 27.1 85.1 55.1 46.1 25.1 45.1
2.0
1.8
1.6
1.4
1.2
1.0 0.8
0.6
0.4
0.2
0.0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
source: MENE data
Another place where sales growth shines through is on quantity of gold (or gold equivalent, as
MENE also sells a minor amount of items made of platinum). We also get a feel for how Covid-
19 hit the company in 2q20 at what was, in hindsight at least, a critical moment in its start-up
trajectory but the business got over its disruption and the model allowed it to recover quickly.
In turn, another derivate chart from the data is “grams per unit”. We see the potential of
seasonal factors (Q1 figures suggest clients spend more per unit on something special for
Valentine’s Day) as well as incremental growth on a per gram basis.
MENE: Precious metals sales in Kg, per qtr
Overall, the impression from sales figures is that of a company in healthy growth mode, but it
also points toward the reasons MENE is looking to expand its manufacturing base. With margins
and a business model now established, volume is the way forward for business growth as it will
also allow the model better flexibility, as better sellers can see faster stock replacement.
Clearly, the important metric (aside dollars sales) is the amount of gold/precious metal sold, as
that flow aligned with the fixed gross margins target (around 24%) will cause the business to
grow, no matter what the gold price does. Kilos of gold moved depend on unit sales, but seeing
the incremental growth in grams per unit gives insight on the MENE business model. This
dovetails with the high quality product and clear customer satisfaction, as sales to Returning
Customers attributed to 67% of total sales in 2021. MENE has recognized this and, by building
in higher grams per unit into its pieces (by design or by range) its cash flow increases again.
This week’s preliminary results release was more than enough to recognize that MENE is a
highly successful growth story in the making and this desk agrees with CEO Sebag when he
stated that FY21 “…was the year in which Menē transitioned from a start-up to a sustainable
business.” The company is seemingly on a firm financial footing, negative cash flow is no longer
a problem and with a proven business model set for further growth. It’s a no-brainer to add
production volume and more efficient distribution to new markets, which is the direction the
company is taking this year.
61 32
53
15
34 24 44
56 96
93
65
67 97
66 26
89
110
100
90
80
70
60 50 40
30
20
10
0
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
source: MENE filings
)tP
ronim
htiw(
uA
gK
MENE: Avg grams Au per unit sold
62.5 58.5
25.8 00.9 93.01 39.7 04.9 08.8 60.01 71.9 18.9 66.9
11
10
9
8
7
6 5 4
3
2
1
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
source: MENE filings
uA
smarg

As for the upcoming 2021 year-end financials, aside from more information on 2022 guidance I
will be looking at two areas. Firstly the balance sheet items, to make sure MENE is indeed as
financially stable as last week’s numbers indicate and secondly, the next set of inventory
numbers:
MENE: Inventories per qtr
25
294.7
186.01
939.21 814.11
165.11
981.8
533.7
709.01
708.21
07.2
754.21
20.4
990.31
51.3
489.41
92.5
24 C$m
22 Supplies
20 Finished Goods
18 Work in Prog
16 Raw Mat.
14
12
10
8
6
4
2
0
4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20 1q21 2q21 3q21
source: company filings
The higher COGS levels seen in this week’s preliminary numbers, especially when compared to
non-IFRS sales, suggest MENE may have kept gold inventory levels high. Confirmation of that
would go a long way to confirming the “growth over profit” assumption we are using about this
company from now on, as in the same way Mr. Bezos used cash flow to build his warehouses
MENE should use top-line revenues to buy and hold as much gold as it can before its production
base expands.
The bottom line: Another quarter to underscore how this novel company is on the road to
disrupt the retail jewellery business. While the prospect of an equity dilution to pay for
manufacturing growth may not sit well with the average junior mine investor, that’s due to the
way the companies we normally cover here own fixed assets with finite resource lives. This
business is different and isn’t behest to the draconian power of fast depreciation and
amortization suffered by a metals deposit as it gets mined out. MENE the business sells a high-
value, high quality product that customers like so much that they come back, time and again.
Now financially stable and with established gross margins of operation that allow it to make
money and sell its increasingly popular product it has no need for capital raises or injections to
keep a loss-maker from going under. Instead, it can use equity to add meaningful production
and sales growth. This company has “winner” written all over it and, as such, we reiterate our
“buy” call on Mene Inc (MENE.v) without a moment’s hesitation. There’s no price target and no
timeframe either, the plan here is to keep adding small tranches at opportune moments. As for
holding time, that’s the Warren Buffett “forever” and while it may become boring to read the
same last sentence every quarter or so, I still suspect that one fine day The IKN Weekly may
eventually be best remembered for covering this stock, rather than any of the dozens of mining
companies hat have graced it pages. Unlike most stocks covered, this company would fit into
nearly all portfolios and it would be good to think all readers own at least a few of these shares.
Altiplano Metals (APN.v) redux: December delivers
Last weekend’s update on Altiplano Metals (APN.v) needs a new update, as just one day after
on Monday January 31st, APN supplied preliminary 4q21 production data (22), adding its
December data to the numbers previously provided for October and November. So today we
update a couple of the charts used
APN: Farellon tonnages mined and sold, 2020 and 2021
last week, as well as noting the
most significant news for 2022 at
Farellon. First the tonnages mined
and processed/sold, and mined
tonnes at 11,189mt were
somewhat lower than our 12kmt
estimate. As for processed tonnes,
the result of 7,254mt were also
lower than the house 8,000mt
7555
9844
5709
8296
0669 59701 58611 3119 0779
5508
09001
7407
42611
5367
98111
4527
14000
12000
10000
8000
6000
4000
2000
0
02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
source: company filings
retrauq/sennot
cirtem
mined tonnes
sold/processed tonnes

estimate, but we get to cut a little slack because APN has held back 600mt in stockpile.
However, a combo of slightly better copper grades and good prices saw copper pound sold
holding up and overall revenues at C$0.779m
APN: Avg received U$/lb Cu
period U$ revs Cu Lbs sold Avg/lb
1q20 0.321 188670 1.70
2q20 0.478 310255 1.54
3q20 0.827 460385 1.80
4q20 0.579 322130 1.80
1q21 0.544 277520 1.96
2q21 0.599 220660 2.71
3q21 0.561 221660 2.53
4q21 0.779 267927 2.91
Our previous estimate of $0.8m from the equivalent of this chart in last week’s edition is close
enough. After all, APN is still in its first stage of the bootstrap operation to increase production.
APN: Exploration recoveries (i.e Farellon revenues proxy), per qtr
26
04.0
36.0
18.0 88.0
55.0 55.0 15.0
87.0
1.2
1.0
0.8
0.6
0.4
0.2
0.0
02q1 02q2 02q3 02q4 12q1 12q2 12q3 tse12q4
C$m
source: company filings
Meanwhile, last week’s NR also gave the significant future guidance of tunnelling to the new
352 level and estimates when it should come into production. We quote:
The decline advance to reach the level 352 m level has begun, with the target
production date for this level set for early March.
Therefore, with the iron ore circuit now under installation, we should expect one more quarter
of the current low production and revenues levels before APN cranks up to the next level. Or in
effect, we on the outside have our current quarter to position as desired before the company
starts delivering on its promises for 2022.
Element 29 (ECU.v) starts drilling at Flor de Cobre
We begin with a quick review of price action and, like bookends on its week, ECU saw
something over 150k shares sold on Monday at a low price, then something over 150k shares
traded on Friday at the highest price of the week to see the stock close in positive territory for
the year.

This good week was centred the webinar presentation ECU.v made on Thursday, one of the
better I’ve seen on recent weeks (and also done and dusted in under 40 minutes, a refreshing
change). A recording of the gig is now available on this link (23) (or this is an alternative route
(24)) and I recommend readers check it out. That same morning also saw the company
announce (25) that its drill program had begun
on Flor de Cobre, so they had plenty of
background info on which to build their talk.
The 3,700m drill program is designed to twin
nine historic holes sunk by Rio Amarillo/Phelps
Dodge in the 1990s in the small zone of Flor de
Cobre with drill permits in place, called
Candelaria. This map from the webinar
presentation shows the location of the 127
hectare Candelaria, which long with the larger
1,800 hectare Atravezado. While ECU waits on its
drill permits, they drill where drills have gone
before. That means ECU is nigh-on guaranteed to
hit good lengths and grades of copper in this
initial program and that’s an advantage for those
of us watching from the outside. While the
project will fly or fall once the larger Atrevezado
(the Candelaria historic resource is 57.4m tonnes
at 0.67% copper and not big enough for a
remote copper open-pitter, ECU may or may not
gain traction in the period these “guaranteed”
holes return their assays depending on market
sentiment.
As for the rest of 2022, the cashed-up ECU has plans for both Flor de Cobre and its other
project, the interesting and very prospective Elida in the North of Peru (and frankly, to date the
one I prefer). This work program timeline chart that came in last week’s presentation doe a
good job in explaining the company plans, with the drills moving to Elida once Candelaria is
done, but we can expect newsflow from both projects as the year goes on.
With its current C$47.5m market cap, Element29 (ECU.v) offers better value than most copper
explorecos at this point, I’d certainly pick it above other copper explorecos working Peru such
as Regulus (REG.v), Chakana (PERU.v) or C3 (CCCM.v). The high risk of betting on a drill play is
never going away and at this market cap, there is room to see the share price drop
substantially on disappointing results. On the other hand, ECU has two live prospects that have
already shown good copper mineralization at the grades required in 2022 to become a mine.
Either Elida or Flor de Cobre could become big news given a slice of geological luck.
As for its trade potential, I’m certainly considering a foothold position but the strategy at Flor de
Cobre allows time to make a decision, one that would be based as much on market conditions
as the company’s likely assay results. Come the second half of 2022 and the phase 2 program
27

at Elida, we’ll be in a better position to know whether ECU has a real porphyry monster on its
hands and barring that, it would then fall presumably to 2023 and the initial drilling at the
Atravezado zone of Flor de Cobre.
PS: While “flor de cobre” translates literally as “flower of copper”, the verb “florecer” is used in Spanish for a mineral
trend, showing or outcrop, so the best translation is almost certainly, “Copper Outcrop”
Conclusion
IKN663 is done, we end with bullet points:
 Amerigo Resources (ARG.to) looks set to go through its bout of boardroom intrigue.
How much of that gets aired in public depends on how the talks between parties go,
but the plan is to hold through and benefit as the company enters a new phase of life.
 Mene Inc (MENE.v) is a different company now, ready to grow its production base
meaningfully and expand its clearly successful business model. Still a very cheap srtock
compared to its potential.
 Be long copper. Be long Argentina copper.
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. And be long copper.
I wish you good trading fortune, ladies and gentlemen.
Best, Mark
Footnotes, appendices, references, disclaimer
(1) https://www.calculatedriskblog.com/2022/02/schedule-for-week-of-february-6-2022.html
(2) http://www.amerigoresources.com/investors/stock_information/
(3) http://www.amerigoresources.com/_resources/presentations/corporate-presentation.pdf?v=0.841
(4) https://discoverysilver.com/news/discovery-announces-2022-work-program-budget-for-cordero/
(5) https://thecse.com/en/listings/mining/minera-irl-limited
(6) https://www.barchart.com/futures/quotes/HGH22/futures-prices
(7) https://www.reuters.com/markets/europe/copper-set-weekly-gain-weaker-dollar-low-inventory-2022-02-04/
(8) https://www.reuters.com/world/china/global-copper-smelting-surges-january-satellite-data-shows-2022-02-03/
(9)
https://www.cochilco.cl/Paginas/Estudios/Mercados%20de%20metales%20e%20insumos%20estrat%C3%A9gicos/Infor
mes-Semanales-2015.aspx
(10) https://finance.yahoo.com/news/meridian-reports-highest-grade-gold-123000579.html
(11) https://finance.yahoo.com/news/coast-copper-makes-copper-gold-130500921.html
(12) https://www.reuters.com/world/china-argentina-pledge-deepen-partnership-expand-trade-2022-02-06/
(13) https://www.kitco.com/news/2022-02-04/China-apos-s-Zijin-Mining-to-invest-380-mln-in-Argentina-lithium-plant.html
(14) https://www.iprofesional.com/negocios/356890-litio-minera-internacional-invertira-usd-100-millones-en-el-pais
(15) https://www.argentina.gob.ar/noticias/fernanda-avila-recibio-al-ministro-de-mineria-de-san-juan
(16) https://www.primicias.ec/noticias/economia/firmas-consulta-minera-choco-andino-quito/
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(17) https://www.biobiochile.cl/noticias/nacional/chile/2022/02/04/la-comision-que-aprobo-nacionalizar-empresas-
mineras-y-caducar-derechos-de-aprovechamiento-de-agua.shtml
(18) https://larepublica.pe/economia/2022/02/04/mineras-y-agrexportadoras-se-quedan-sin-agua-en-chile-reforma-del-
codigo-de-aguas-en-ciernes/
(19) https://www.cnnchile.com/programas-completos/cristian-allende-derechos-de-agua-no-aprobarlo-pleno_20220205/
(20) https://www.bnamericas.com/es/analisis/debe-la-mineria-chilena-preocuparse-por-las-propuestas-constitucionales
(21) https://lacoperacha.org.mx/ley-minera-violenta-nuestros-derechos-colectivos-asamblea-chontal-oaxaca/
(22) http://www.apnmetals.com/news/2022/altiplano-reports-on-q4-2021-results-at-farellon
(23) https://mailchi.mp/e29copper.com/event-invite-element-29-resources-drills-38375-meters-of-071-cueq-
13614384?e=11f69919cd
(24) https://6ix.com/event/flor-de-cobre-copper-project-exploring-in-the-land-of-giants/
(25) https://www.e29copper.com/news/element-29-commences-drilling-at-its--flor-de-cobre-copper-project-per
Stocks To Follow Closed Positions 2021
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-Set-20 C$0.70 -54.8% Cut loser to reduce Au exp.
Element 29 Res ECU.v feb'21 C$0.49 7-Feb-21 C$0.54 10.2% Cut Peru exposure
Kuya Silver KUYA.cse feb'21 C$1.66 8-Nov-20 C$2.51 51.2% Cut Peru exposure
Pucara Gold TORO.v apr'21 C$0.65 4-Oct-20 C$0.26 -60.0% Cut loser, Peru risk call
Copper Mountain CMMC.to apr'21 C$1.40 22-Nov-20 C$4.18 198.6% tgt hit, profit taken
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-Abr-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
Aurelius Min. AUL.v dec'21 C$0.75 28-Jun-20 0.24 -68.0% cut end 2021, failed trade
Argonaut Gold AR.to dec'21 C$2.95 25-Jun-21 C$2.15 -27.1% cut on capex blowout
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
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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
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
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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
Stocks To Follow Closed Positions 2015
Closed in 2015 closed close price
Argonaut Gold AR.to jan'15 C$1.47 14-dec-14 C$2.53 72.1% Big gain small time, profit taken
Amerigo Res ARG.to jan'15 C$0.405 20-jul-14 C$0.285 -29.6% Given up on weak Cu prices
Reservoir Min. RMC.v jan'15 C$6.05 18-jun-14 C$4.12 -31.9% sold on Cu downturn
Coro Mining COP.to jan'15 C$0.075 26-jan-14 C$0.035 -53.3% sm, sold on Cu downturn
Fortuna Silver FSM mar'15 U$4.12 10-nov-14 U$3.75 9.0% Short used as hedge
GoldQuest Min. GQC.v mar'15 C$0.26 27-oct-13 C$0.085 -67.3% given up ghost
Rio Alto Mining RIO.to apr'15 C$2.30 07-apr-11 C$3.57 55.2% Top pick, bot out, big win
Timmins Gold TGD jun'15 U$0.60 19-apr-15 U$0.62 3.3% near-term trade, out of time
First Majestic AG jul'15 U$10.51 10-aug-14 U$4.55 56.7% horrible failed trade
NovaCopper NCQ.to jul'15 C$1.05 09-apr-14 C$0.50 -52.4% no more Cu exposure, sm sell
McEwen Mining MUX aug'15 U$0.695 21-jul-15 U$0.92 32.4% Closed nearterm flip for win
Midas Gold MAX.to sep'15 C$0.39 21-sep-15 C$0.35 -10.3% Sm. trade idea that didn't work
New Gold NGD oct'15 U$2.18 23-aug-15 U$3.05 39.9% trade closed, profit taken
Legend Gold LGN.v nov'15 C$0.085 01-mar-15 C$0.035 -58.8% tiny "land grab" idea, failed
Timmins Gold TGD nov'15 U$0.245 20-sep-15 U$0.15 -38.8% small near-term loser
Please note that due to space considerations closed positions 2009 to 2014 are now
available on request, or were published in any edition to IKN553 (end 2019).
Important Disclosure
The information and opinions contained within this report reflect the personal views of the author and therefore all
material within should not be construed as accurate or reliable or be utilized as advice for investment or business
purposes. Independent due diligence and discussions with ones own investment and business advisor is strongly
recommended. Accordingly, nothing in this report should be construed as offering a guarantee of the accuracy or
completeness of the information contained herein, as an offer or solicitation with respect to the purchase or sale of any
security or as an endorsement of any product or service. All opinions and estimates included in this report are subject to
change without notice. It is prohibited to copy or redistribute this report to any type of third party without the express
permission of the author.
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