IKN #672Premium

The IKN Weekly
Week 672, April 3rd 2022
Contents
This Week: Trade heads-up, In Today’s Edition, Typos and Crisis Fatigue, A extra thought on
The Five Trade Ideas From IKN670.
Fundamental Analysis: A fundamental analysis of Superior Gold (SGI.v).
Stocks to Follow: Element 29 (ECU.v), McEwen Mining (MUX), The five IKN670 trade ideas,
Rio2 Ltd (RIO.v), QC Copper & Gold (QCCU.v), Discovery Silver (DSV.v).
Copper Basket: Overview, Nevada Copper (NCU.to), Regulus Resources (REG.v), Copper
Mountain (CMMC.to).
Producer Basket: Overview, Is Kinross Gold (KGC) in-play? Would Barrick (GOLD) buy Kinross
(KGC)?
TinyCaps Basket: Overview, Melkior Resources (MKR.v), Manitou Gold (MTU.v), Kingfisher
Metals (KFR.v).
Regional Politics: Chile: The politics of CESCO Week 2022, Ecuador’s road to new social
protests, Ecuador: The anti-mining petition in the Quito region begins, Peru: The President
survives and his FinMin wants to raise taxes on miners, Colombia: A new poll sees Fico close
the gap on Petro, Brazil: Jair Bolsonaro a little closer to Lula.
Market Watching: Deferred.
I remind subscribers that no part of this newsletter can be copied, reproduced or
given to any third party without the express permission of the author.
This Week
Trade heads-up
I plan to buy some Superior Gold (SGI.v) in the coming week. The main reason is that I’ve run
out of reasons not to own it. The plan also involves starting with a modest long position and, if
all goes well, scaling up in over the coming weeks.
In Today’s Edition
 Today’s main fundies note expands on my enthusiasm for Superior Gold (SGI.v) in our
new and changing market circumstances. We run the numbers and show how 2022 is
looking good for this high cash cost gold producer.
 Today’s other major focus is in Regional Politics, in which we report on the week in
Chile and what the mining sector took away from the country’s CESCO Copper Week
conference. Then we change take tack and consider the brewing political storm in
Ecuador, try to encapsulate what’s going on in as few words as possible and then
consider what it means to its mining sector. Also the latest polls from the key
Presidential races in Colombia and Brazil and of the two, Colombia is beginning to look
like a tight race.
 We’re in a dynamic moment for capital markets and it’s not use getting granular on
gold stocks if the big picture view is wrong. Today’s intro takes another stab at making
sense of the geopolitical situation and its effect on capital markets but, instead of
making it bullion-centric for once, this weekend we focus on gold stocks and the
miners.
1

 Lots more besides, including a thinkpiece in the Producer Basket that makes the case
for Kinross (KGC) (K.to) as an upcoming M&A target.
Typos and Crisis Fatigue
“O, how this spring of love resembleth
The uncertain glory of an April day,
Which now shows all the beauty of the sun,
And by and by a cloud takes all away!”
The Two Gentlemen of Verona
Some things are easier to spot than others Let’s start with a clear statement: I feel bad about
the number of typos that appear in The IKN Weekly and when you send over flak about them, I
have no excuses to offer; you critics are right, I am wrong and all I have is an apology for the
lack of respect they convey. It’s not as if I don’t try to weed them out as I go along either; the
red lines appear under the badly spelled words and I’ll re-read and correct on an ongoing basis,
as well as doing a proofread before sending every Sunday evening. However, I’m fully aware
typos slip through on an all-too regular basis and, believe it or not, they bug the pernickety
English language geek in me greatly. I don’t want to spend a lot of time on this minor, lead-in
subject, but there are two issues causing this chronic problem. The minor cause is the nature of
the subject matter, as a publication with ticker symbols, business terminology, mining slang,
strange geology words and a smattering of Spanish language ends up showing a lot of red lines
come Sunday evening and confuses “real red lines” from false positives. However, the major
cause is something shared by the world of publications: Ask anyone with experience of writing
regularly for a living how easy it is to spot the typos of others, compared to your own mistakes.
Mistakes of others stick out like sore thumbs, but your eyes can gloss over the same error in
your own work multiple times before you finally see it (often the day after publication…ugh).
Because some things are easier to spot than others, here’s another.
Around Thursday evening last week I spotted how, for the first time since late February, I’d not
thought about the ongoing war* in Ukraine for a couple of days. Sadly and after a quick check,
it didn’t take long to see that the carnage hadn’t stopped as Mariupol was still being shelled in
barbaric fashion, military hardware and infrastructure was still destroying and being destroyed,
coffins of dead soldiers were on display and there were also photos of mother-and-child-
refugee photos on show to make me feel suitably guilty for letting the story slip my mind. But
that’s how Crisis Fatigue (or News Fatigue) works, we upright sentient monkeys have survival
mechanisms and in order to get on with life, our brains change The Shock Of The New into The
New Normal at some point. That’s also how capital markets work, they reflect society and so it’s
no surprise to see the rise of financial Crisis Fatigue and the way the new normal is now being
baked into the markets. And on that, here’s a two-month chart:
This two month timeline of gold begins on February 2nd and we could choose other timeframes
but this one works because, to quote the news that day (1), “…(Russian Foreign Minister
Sergey) Lavrov responded that the escalation that the US was claiming was not occurring, the
official said, but that it was merely Russia moving troops within its own borders.” We now know
more about Russia’s doublespeak (but for some reason continue to take its official public
2

statements seriously; that’s another story for another day). The dogs of war were let slipped
and gold duly ran hard on volume but as Crisis Fatigue has kicked in, recent weeks have seen
gold in a new trading range. Certainly more turbulent than the smooth passage periods in
which $10/oz either way would catch a headline (in just the last 10 days you could have paid
U$1,965/oz or U$1,890/oz for your ounce) but the above chart in both price and the calming of
traded are indicative of a market getting used to watching a country being torn apart. And as a
final digression, there’s no need to look too far back in to find another prime example of News
Fatigue, with Covid-19 cases on the rise again but now in a world increasingly shrugging its
shoulders (and getting its shot). Again I’m as guilty as any other, for example when my 15 year
old daughter caught Covid-19 two weeks ago I was as concerned as any father would be when
their kid one gets sick, but I also recognize my reaction would have been very different if she’d
gone down with it in, let’s say, May or July 2020. It is the way it is. However this time, our new
normal of Ukraine shelling and death turns out to be conducive to the precious metals mining
sector, the Crisis Fatigue seems to suit our sector. Here’s another chart:
The same two months and the same gold continuous contract (GC00) squiggly line, but this
time we have the broad markets as represented by the S&P500 index and as seen, in recent
recovery mode. However and most interestingly, the main precious metals ETF (GDX) is now at
new highs, even better than when gold traded at U$2,050/oz and U$2,080/oz a month ago.
This miners over metals pattern is now apparently accelerating, as noted on the blog on a
couple of occasions (2) last week and come Friday’s close, GLD’s w-o-w drop of 1.58%
juxtaposes to GDX’s 2.0% rise in the same period. PM miners are suddenly the place to be.
With rising worldwide commodities demand and a Fed vowing to tackle inflation (watch out for
thr Fed minutes this week), the rise of Crisis Fatigue and the return to equities (risk–on) is the
the right cocktail of ingredients to see the miners, rather than metals, rally. Up to now, the best
gains have been largely confined to the top tier of metals miners and for the easy example,
look no further than the way the world’s number one precious metals mining company,
Newmont (NEM) hit an all-time high on Friday. But as long as the rally continues the money
should rotate into the lower tiers of the sector and with the extra leverage to gold provided as
we move down the scale, (Tier 2, mid-caps, junior producers, junior developers, explorecos,
tinycaps etc), we impatient junior traders now have “neutral gold” on our side.
However it’s not all good for equities and sadly, our previous thoughts on the likelihood of
conflict acceleration are still valid. We gold proponents shouldn’t take two or three weeks of
Ukraine New Normal as anything permanent and this desk still believes gold price risk remains
to the upside and a return to U$2,000/oz+ Au is likely [EDIT: This Sunday’s stomach-churning
revelations form the town of Bucha outside Kiev may see a new level of indignation against
Russia and another level of potential real world consequences]. However, we also have the
status quo on our side, as GDX demonstrates a (relatively) unchanged gold price is also enough
to see PM stock move higher. Though some may want a massive move in gold (me no, the real
world consequences would be dire), there’s no need for $2500/oz gold next week to get stock
price movement for PM miners, all we need now is a continuation in the new momentum.
*War is war. Call it crisis, invasion, or even a Special Operation if you insist, Comrade. I’ll stick with “two armies killing
each other” as a reasonable definition of the word.
3

A extra thought on The Five Trade Ideas From IKN670
And yes, this will be brief. After some further feedback, including two friendly email exchanges
with a couple of you and one extended conversation (you know who you are, and thanks)
here’s one final thought on the new segment in the Stocks to Follow list, those five new trade
ideas as presented in IKN670 (Superior (SGI.v), Meridian (MNO.v), Newcore (NCAU.v), Electra
(ELBM.v), Western (WRN.to)). Up to now, the five trade ideas don’t carry any of my money
and, while that changes as from this week with the purchase of Superior Gold (SGI.v), the set-
up hasn’t changed; the five picks are there as potential trades in light of the new market
circumstances and the changes brought on by a geopolitical backdrop that really is different this
time. This time is different. Really. While the idea has gone down generally well, the one
repeated pushback has been the “skin in the game” angle, the perception that because your
author hasn’t bought any shares in these five, they are somehow lesser in status. For what it’s
worth I disagree and to illustrate this, here’s a thought experiment:
Hey, what if I buy 1,000 shares of each? Or even 500, or 300? With that done I could claim skin
in the game and the financial interest as well just “the trade call”. You out there won’t know
any better on the absolute size of my exposure and even if, let’s say, my 300 share trade in
ELBM hits a bad patch and drops by 50%, it’s not going to change my lifestyle or vacation
plans. Meanwhile, you get to think that “Mark is serious about this company” and as a result,
may feel more disposed to buy a few for yourself. In so many words, I could fake it if you
prefer that way.
Of course not. Therefore, what counts more is that they’re on the ‘Stocks to Follow’ list, albeit
in a new category with a different colour. These five stocks are chosen for their potential in
2022 and the new market circumstance and whether or not take advantage is up to me, the
size of my back pocket, my personal circumstance in the near and medium-term and whole
host of other variables. Just like you and yours, as the repeated trope on these pages “I am not
you, you are not me” tries to make clear. The IKN Weekly is best approached in the same way
as any other advisory service, with personal filters and your own criteria as the major influences
for your decisions, so whether or not I have fifty or fifty thousand dollars invested in a single
company is of lesser concern.
Fundamental Analysis of Mining Stocks
A fundamental analysis of Superior Gold (SGI.v) (in U$ unless stated)
In IKN670 two weeks ago, Superior Gold (SGI.v) was presented as one of the five new trade
ideas under the heading “All the leverage to gold you need”. Today we expand on that
introductory note and, on due consideration, SGI is also going to be the first of the five to
become a personal long trade on the Stocks to Follow list. However, today’s note isn’t going to
cover every aspect of SGI, instead we concentrate on the reason why I see SGI at today’s price
deck as an excellent entry point and trade for 2022. We begin with the standard top box:
Shares out: 122.9m
Options: 6.3m
Warrants: Zero
Incentive shares (DSU etc): 0.9m
Fully diluted: 130.2m
Current share price: C$0.94
Market Cap: C$115.53m
Approx cash per S/O: 18c
All prices are in US Dollars unless stated. Forex U$0.80=CAD$1
This isn’t going to be a comprehensive analysis of the company and some stones will be left
4

unturned. This report will focus squarely on the reason why SGI appeals to your author as a
trade vehicle here and now, April 2022. That’s due its near-term focus, rather than any longer-
term potential and to that end, today you get a hatful of charts, calculations and financial focus
on the current state of affairs with a 12 month price target at the end. I certainly do not want
to belittle SGI’s longer-term upside and recognize that without its “Well Defined Growth
Strategy” to quote its latest corporate presentation (found here (3)) however, the pressing
measure today is to lay out the mathematical reasons to buy and own some SGI shares today.
In order to get to the meat of today’s analysis, we’ll re-cap the recent history of SGI as well as
The IKN position via some bullet points:
 SGI owns the Plutonic mine in Western Australia, a large FIFO gold mine and
surrounding property with both open pit and underground workings.
 I once owned the stock, but production issues and resulting missed guidance made it a
failed trade. Another loser for the track record, so be it.
 Then the old management left, a new and better team led by current CEO Chris
Jordaan moved in.
 The new team re-worked the mine plan, spent the time and money required to put the
asset back on the right track and stopped the rot.
 We saw incremental improvement at the mine through 2021 and the mine is now ready
to move forward and show the growth it originally promised.
That brings The SGI Story up to date, so in order to cover the future growth potential of the
company as concisely as possible, this slide from the latest corporate presentation shows where
we are today (1), the next two
stages of organic/near organic
growth that, if things go well, will
get production up to around
150,000 oz per year in two to
three years (2) (3), then further
out its larger growth plans that
include new operations and/or
discoveries (4). On that score,
that may also include
development of the nearby K2
Tenements now that it has
(largely) reached agreement with
litigation rival Vango. That longer-
term potential is a growing and
interesting new angle to this story
(and for another day).
That’s as brief as possible on the mine and its operations, the good standing of SGI today and
its positive-looking future. However, none of those is the reason to own today, April 2022. The
reason for that is the math.
A financial analysis of SGI
In the IKN670 introduction to SGI, we used six graphics to outline the attraction of SGI and the
results of its Excel number crunch. Today we expand, go into the weeds and along the way use
26 visuals in order to develop the argument for ownership and if I do my job right, the
narrative will flow elegantly from chart to chart and by the time we’re done, you too will champ
at the bit to own some of these shares. Or something like that. Anyway, let’s begin.
To begin we check in on recent operational results and in the case of SGI, most of our datasets
will go back four years in order to cover the period in which the company first flattered to
deceive, then got its act together and improved parameters.
5

To get production, the basic three-cornered calculation is Throughput X Grade X Recovery. With
SGI at Plutonic, there’s rarely a lack of material to put through the mill (below right) and as this
second small chart shows (below left), there was a temporary dip in recoveries during 2020
when they ran sub-optimal rock through the production mill.
SGI: Gold recovery grades
Since then, recoveries have returned to their standard 86% and 87% levels and that, along
with the third variable of mill head grade, explains the incremental improvement in quarterly
production since CEO Chris Jordaan and his team took over.
Average mill head grade gets two charts and
the first is the most obvious (right), with milled
grade set out in the thick red line. We see the
way in which grade first deteriorated into the
2019/2020 bad days, then more recently the
improvement and the most recent average
result of 1.9 g/t Au through the mill.
Though it took a dip in 2020, most quarters
have seen SGI able to “Fill The Mill”, as its own
saying goes. That’s because SGI at Plutonic
mines three different rock types, with lower
grading “surface material” normally readily
available from the open pit operation. That runs
at perhaps 0.7 g/t (with variances), SGI then classifies “development material” as a separate
category but the driver of overall head grade is “stope material”, the high grading underground
and that’s also on the above chart, the thin line that used to run at up to and over 4 g/t. Once
upon a time when SGI bought out Plutonic and the previous team promised the world (and this
author) average annual run rates of 100k oz Au
and up to 110k oz Au in guidance, the team
assumed a goodly amount of higher grading stope
material would be available. Here we see one of
the major mistakes made, as the mine plan and
assumptions were unsustainable and as a result,
they had to either compromise on tonnage or
grade (sometimes both).
This is also where the new team under CEO
Jordaan has managed to turn Plutonic around, by
going back to basics, investing money required
and taking a more sober, staged approach to
mining. The new team has improved access and logistics and we’ve seen UG tonnage improve
along with modest improvements in average grade, the result being more higher grade making
the overall mill average that came in at 1.9 g/t in 4q21. The result of the combination shows in
overall quarterly gold production and sales, this one of the charts that first appeared in the
IKN670 intro piece. Here we also broach the subject of the future as well, with our estimates
for 2022 quarterly production:
6
%68 %09 %78 %78 %88 %78 %58 %48 %28 %48 %28 %48 %68 %88 %68 %78
100%
95%
90%
85%
80%
75%
70%
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
SGI: Total material milled
500000
400000
300000
200000
100000
0
source: SGI data
81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
tonnes
source: company filings
SGI: Milled gold average grade, per qtr
4.2
4
3.8
3.6
3.4
3.2
3
2.8
2.6
2.4
2.2
2
1.8
1.6
1.4
1.2
1
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
g/t Au
stope grade mined
grade milled
source: company filings
SGI: Stope material mined
220000
200000
180000
160000
140000
120000
100000
80000
60000
40000
20000
0
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
tonnes
source: company filings

SGI gold production and sales
7
25302 10812 35391 63802 92002 04981
79752 24852
50391 40522
73932
00971
99881
05861
63551 29451 55851
83571
99091 28291 34112 00091 00022 00022 00022
30000
27500 25000
22500
20000
17500
15000
12500
10000
7500
5000
2500
0
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
Oz Au
Au prod
Au sold
source: SGI data
The incremental improvement in production and sales since mid 2020 has brought Plutonic back
to competitive production levels. We still aren’t at the 100k+ run rates promised previously, but
the 80k to 90k annual guidance range now offered by SGI is both efficient and sustainable
(here’s the 2022 guidance segment, also from IKN670, as a reminder):
The above chart also maps out our estimates for the next four quarters and is based on what
we know from the company. By taking the mid-point of its 2022 guidance and assuming 85,000
oa gold out of Plutonic this year, then factoring in SGI’s guidance detail of 14 lost days during
1q21 (just complete) as the mill shut down for scheduled maintenance, we offer our best guess
of 19,000 oz produced and sold in 1q22, then 22,000 oz gold for the subsequent three quarters.
For sure these are best guesses, the first solid information will be along in a maximum of two
weeks when SGI announces its 1q21 production number. We may also see the company hitting
the straps and out-performing our reasonable mid-point forecasts for tonnages milled or
average grade, but as a benchmark from where to move forward, this works. However, the
other key point for mine sustainability is costs and for that, here’s the historic relationship
between average received prices for gold and its All-In Sustaining Costs (AISC) per quarter:
SGI: Avg received Au price vs AISC, per qtr
2100
2000
1900
1800
1700
1600
1500
1400
1300
1200
1100
1000
900
800
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$/oz
AISC/oz
realized gold price
NB: CUT DOWN Y-AXIS source: SGI
Moving first to our 2022 guesstimates for AISC, here we pitch at an average of U$1,500/oz in
order to play it safe. I was impressed by the quarter-
SGI: margin realized Au vs AISC over-quarter drop in AISC/oz seen in 2021 that
500
culminated in the returned U$1,416/oz in 4q21. That
400
combined with the stronger market price in 4q21 300
(U$1,786/oz) allowed SGI its best ever margin 200
100
between these key financial parameters of U$370/oz
0
(chart right) and with gold’s continued improvement -100
-200
-300
-400
81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$/oz
source: SGI filings, IKN ests

in 2022, we expect more of the same. However, we also recognize that the 14 day shutdown
and general inflationary backdrop means the company will have to pay more to run its mine this
year, therefore the best course of action is to pitch to the conservative side, assume a higher
U$1,500/oz AISC for the year and allow any surprises to be pleasant ones later down the line.
A breakdown on costs to date: Before getting to the pointy end of the anal ysis and to better
understand cost matters, such as the inflationary effects on SGI to date and what to expect
going forward, we now take a few lines out to examine the recent quarterly cost results at the
company. As mentioned previously, Plutonic is by nature a high average cost mine but its cost
profile is also reasonably predictable, being as it is a “FIFO” (Fly In, Fly Out) in a remote area of
Australia that needs to pay a high percentage of its costs on inputs that are not going away.
This is on display here, in the flat nature of direct mining costs and processing costs:
SGI: Mining costs
Things like transport, fuel, salaries
and wages, mine site ops and so
forth are a major part of its overall
profile and while it means SGI’s mine
will never make the desired lower
cost quartiles of world mines, at
least it’s predictable. Of course there
are two sides to that coin and having
high fixed costs is also a reason why
it offers high leverage to a rising
gold price and makes it an attractive
investment option, but we’ll get to
that below. However, the overall
costs profile has still risen over the
last eight quarters and most of that is the rise and rise of “Other” (above). That needs an extra
chart or two and here they are below, as SGI has effectively hidden its inflationary effects in the
“Site Services” line item by moving part of those from mining costs in FY21 (below left).
Therefore if we sum the two items and consider the last eight quarters, there is your level of
operating inflation and from a total of U$15.5m in 1q20, the aggregate is up by 29.7% to
20.1m in 4q21. Or if you prefer, 4q20 to 4q21 is up by U$2.4m or 13.6%. Sounds about right.
8
599.02 97.02 160.12
523.61 49.51 993.41 336.41 563.51 384.61 685.41 326.61 332.61 384.61
22
20
18
16
14
12
10 8 6
4
2
0
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
U$m SGI: Processing costs
source: company filings
199.5 754.5 261.6 683.5 60.6 959.4 807.5 135.5 592.5 948.5 941.6 504.5 593.5
U$m
8
7
6
5
4 3
2
1
0
4q181q192q193q194q191q202q203q204q201q212q213q214q21
source: company filings
$m
40 SGI: Op Costs Breakdown
other
35 Depr & Amort
processing
30 mining
25
20
15
10
5
0
4q18 1q19 2q19 3q19 4q19 1q20 2q20 3q20 4q20 1q21 2q21 3q21 4q21
source: SGI filings
SGI: Site services
929.0
947.0
279.0 872.1
258.1
331.1 25.1 155.1
258.1
341.3
174.3
878.3
575.3
5
4.5
4
3.5
3
2.5 2
1.5
1
0.5
0
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4
U$m SGI: Mining costs + Site services
source: company filings
4.41 6.41 4.51 5.61 6.41 6.61 2.61 5.61
U$m
22
site services 20
18 mining 1.9 3.5 3.9 3.6
16 1.1 1.5 1.6 3.1
14
12 10
8
6
4
2
0
1q20 2q20 3q20 4q20 1q21 2q21 3q21 4q21
source: company filings

So FIFO or not, SGI at Plutonic has seen its costs rise and as a result, we prefer to pitch to the
conservative side in our 2022 forecasts and estimates. However and as you’ll see, that still
leaves plenty of room for good margins and, as a result, share price appreciation in the
quarters to come. So with revenues and costs reiterated and by assuming U$1,850/oz for 1q21
and U$1,900/oz for the rest of 2022…
SGI: Revenues vs Costs
9
4.92 5.13 6.13 3.33 6.62 8.92 0.82 0.82 5.62 7.32 0.52 2.42 2.72 6.52 4.72 1.72 2.13 9.62 4.43 5.92 2.43 3.82 8.73 4.92
2.53
5.82
0.24
0.23
0.24
0.23
0.24
0.23
45
40
35
30
25
20 15
10
5
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$m
Revenues COGS
source: company filings
…we can now move through the P+L and consider what 2022 might have in store for SGI. This
chart shows top line revenues against operating earnings and underscores the high cost nature
of Plutonic operations, the long columns of revenues sat next to squat operating income levels.
SGI: Revenues and operating earnings, per qtr
870.3- 92.2- 803.4- 619.3-
411.1
324.0- 793.0-
548.1-
412.2 927.2 826.3
489.5
5.4 5.7 5.7 5.7
45
40
35
30
25
20
15
10
5
0
-5
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$m
Revenues Op income
source: company filings
But do not be deceived, those operating earnings are looking good these days. This next chart
shows that once costs are done at SGI, there’s very little friction and operating income is a
close proxy to real-world earnings:
SGI: Operating, pre-tax and net earnings
10
8
6
4
2
0
-2
-4
-6
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$m
Op income
pre-tax income
Net income
source: SGI filings
And as there’s no reason to suppose the company will sell any more shares (below left), the
improvement in operating and net earnings per share should continue and consolidate (below
right).

x
SGI: Shares Out 140
120
100
80
60
40
20
0
Please recall that our estimates for 2022 are just that (and erring to the side of caution, to
boot) so please don’t start keeping me to every tenth as shown in the above EPS chart, but it’s
worth considering that once 1q22 is behind us, something around 6c operating earnings be a
low 4X multiple to the current share price. But before getting to a target price, we round off the
financials with a quick run around the balance sheet, starting with the main overview charts for
assets and liabilities:
There is nothing here to cause alarm, with the rump of current liabilities being an accounts
payable line item that was, is and forever will be high due to the nature of FIFO. Long-term
liabilities are mostly standard provisions (pensions etc) so moving to focus on the liquidity at
SGI (below), that has already improved and with net profits part of its near future, should move
higher still in 2022. Cash was never tight, working capital was a problem and the potential for a
cash crunch as 2020 rolled out was probably the final nail in the coffin of the old team. With a
new CEO came a new broom and the opportunity to raise capital. From there the mine plan has
worked well and from now, assuming gold holds it price, the only way working cap doesn’t
increase as forecast is if SGI moves up its capital investment programs and spend the profits on
upgrading Plutonic more quickly. All this is a vast improvement in just six quarters.
10
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
source: company filings
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SGI: operating income and net income per share
0.070
0.060
0.050
0.040
0.030
0.020
0.010
0.000
-0.010
-0.020
-0.030
-0.040
-0.050
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$
Op Inc/share
net EPS
source: SGI filings, IKN ests
SGI: Assets
140
120
100
80
60
40
20
0
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$m fixed SGI: Liabilities Breakdown per qtr
other current
cash & eq 80
70
60
50
40
30
20
10
0
source: SGI filings
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
U$m
LT liab
current liab
source: company filings
40 SGI: Cash treasury per qtr
35
30
25
20
15
10
5
0
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
source: company filings/IKN ests
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40 SGI: Working Capital per qtr
35
30
25
20
15
10
5
0
-5
61q4 71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 tse22q1 tse22q2 tse22q3 tse22q4
source company filings
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Valuing Superior Gold: We now get to the interesting part and to begin, this chart shows the
type of production spread we could expect from Plutonic given its current throughput rates. We
assume a standard 87% for recovery (no reason to expect otherwise now) and a range of
tonnes per day throughput rates. For reference, SGI believes it can run at 4,500tpd these days
and in 4q21, it managed an average of 4,322tpd.
SGI: Annual production range (87% recovery, 360 days prod)
thruput average mill head grade (g/t Au)
tpd 1.8 1.9 2.0 2.1 2.3 2.5
3800 68,884 72,711 76,538 80,365 88,018 95,672
4000 72,509 76,538 80,566 84,594 92,651 100,707
4200 76,135 80,365 84,594 88,824 97,283 105,743
4400 79,760 84,191 88,623 93,054 101,916 110,778
4500 81,573 86,105 90,637 95,168 104,232 113,296
5000 90,637 95,672 100,707 105,743 115,814 125,884
6000 108,764 114,806 120,849 126,891 138,976 151,061
7000 126,891 133,941 140,990 148,040 162,139 176,238
source: SGI data, IKN calcs and estimates
By choosing a reasonably conservatively pitched 4,200tpd and expecting average head grade to
continue its improvement and reach an average of 2.0 g/t going forward (1.9 g/t in 4q21), the
model estimates annual production at 84,594 oz Au per year (no round numbers today)
however, the table is presented to let you disagree with me and pick your own run rate. It also
shows how the company’s 80,000 oz to 90,000 oz guidance for 2022 is eminently gettable as
there are plenty of alternative scenarios around my chosen 84,594 number. For example, if
they find grade dropping they can run more tonnes, or if grade is good they can work on
containing cash costs with a lower throughput, or maybe they decide to impress us and beat
guidance with improving grade at good TPD, etc. Finally the table allows for higher levels of
throughput in order to show how SGI’s medium-term plans of re-starting its second ball mill
would quickly and cost-effectively hike gold production to its envisaged milestones of 100k oz,
and 150k oz per year. Line items of up to 7,000tpd throughput are added accordingly to show
that SGI’s plans are logically attainable.
However, that’s getting ahead of ourselves and, while this desk agrees about this company’s
longer-term upside potential, the job today is to justify an investment based on 2022. For that
we run with the estimated 84,594 oz gold and then apply four gold prices to production/sales:
 U$1,600/oz: The backtest gold price
 U$1,800/oz: A present day bear case
 U$1,900/oz: The present day
 U$2,000/oz: A present day bull case
Our focus is one 2022 and a valuation for this year, so we use “real world” gold prices:
SGI: Model year revenues by metal type (U$m)
Ag price decks U$1600oz U$1800oz U$1900oz U$2000oz
Gold prod (oz) 84,594 84,594 84,594 84,594
U$/oz 1,600 1,800 1,900 2,000
Au revs (U$m) 135.4 152.3 160.7 169.2
Gross sales (US$) $247 $278 $293 $309
TC/RC (U$m) (20.3) (22.8) (24.1) (25.4)
Net sales(U$m) $112 $126 $133 $139
Sources: SGI.v data, IKN calcs and ests
For today’s valuation we run with an average gold price of U$1,900/oz and consider SGI on the
present day. Once estimated 15% TC/RC is subtracted, we assume top line sales of U$133m for
our model year and from that, can put together our simplified income statement:
11

SGI: Condensed income statement (U$m)
U$1600oz U$1800oz U$1900oz U$2000oz
Sales (U$m) 111.6 125.5 132.5 139.5
Cash COGS 101.5 76.1 76.1 76.1
Depreciation 12.0 12.0 12.0 12.0
G&A 5.0 5.0 5.0 5.0
fin. Costs 0.0 0.0 0.0 0.0
royalty 3.5 3.9 4.1 4.3
Op income (10.4) 28.5 35.3 42.0
Exploration 6.0 6.0 6.0 6.0
Tax (4.1) 5.6 7.3 9.0
Net income (12.3) 16.9 22.0 27.0
Shares out (m) 123 123 123 123
EPS -0.10 0.14 0.18 0.22
Capex 12 12 12 12
FCF 0.10 0.33 0.37 0.42
Sources: SGI data, IKN estimates
…there are a couple of things to note. Firstly, this chart underscores the leverage SGI offers to
the price of gold, as you only need to drop down to U$1,600/oz gold and the operation would
be unprofitable. However, once gold is up to profitable levels it leveraged at around 4c for
every U$100/oz added and when you run valuation multiples on that EPS, the current low stock
price becomes a very attractive alternative. Our preferred U$1,900/oz price deck gives us the
following price target:
Sales & earnings model U$/oz Au prices Target price & valuation data for SGI based on
Au (U$) $1600/oz $1800/oz $1900k/oz $2000/oz 84.5k oz Au prod per year
Sales(U$m) 111.6 125.5 132.5 139.5 12-month target C$1.79 based on 8x EPS
Upside to target 90% U$1,900k/oz Au
EPS -0.10 0.14 0.18 0.22 Mkt cap (CAD$m) $116 Enterprise value $172
FCF 0.10 0.33 0.37 0.42 P/sales ($1600/oz) 0.92 EV/sales ($1600/oz) n/a
P/E ($1600/oz) -9.4 EV/EBITDA ($1600/oz) n/a
P/E ($1800/oz) 6.8 EV/EBITDA ($1800/oz) 4.2
P/E ($1900k/oz) 5.3 EV/EBITDA ($1900k/oz) 3.6
Once again, we underscore the conservative nature of this C$1.79 target price, representing a
90% upside to this weekend’s share price of C$0.94. This is an operating and profitable mining
operation that has turned its balance sheet around and is now on a table financial footing in a
low-risk jurisdiction Yes it has to invest over the medium-term in order to grow production, but
it has the raw materials in the shape of a
Plutonic mine and concession with plenty of
resource expansion potential and should to
move through the gears in 2022 and 2023
and grow organically, no extra capex cash
required. Even if the asset didn’t have clear
potential for a longer mine life this 8X P/E
multiple wouldn’t be a stretch compared to
peers, the fact that it has means my 8X is
likely selling SGI short. This thing is cheap.
However, the real reason why I’m a buyer is
here (right). Yes it has more shares out than
in 2018 and yes its costs profile is higher, but
the gold price has come for SGI at the right
time and back then, didn’t trade at U$1,900/oz with every chance of going higher in the months
12

to come. SGI’s high cash cost profile may put people off, but the FIFO operation means costs
are predictable and even with our conservatively-pitched model baking in cost inflation for the
year ahead, the company returns operating margins that will first let it report good EPS profits
and then allow organic investment and growth for Plutonic to 100k and eventually 150k oz per
year.
I’ve deliberately kept the talk of expansion and its longer-term plans to a minimum, they’re a
subject matter for another day once SGI starts delivering on its 2022. That’s because, aside
from the promise of more to come from the deposit, we can make a strong case for this stock
at this current price on 2022 alone. At the start of the year I originally identified McEwen Mining
(MUX) as the “turnaround story of 2022” but that plan came to naught. The MUX trade has
misfired and is on the way out after just one quarter as the company continues to disappoint
and fail to deliver. However, that doesn’t stop the the current macro market conditions from
being a golden opportunity for just that type of turnaround story, one in which a high cash cost
operation gets itself into gear and becomes a reliable producer of gold under new management
with the right vision. Step forward SGI, which did just that in 2021 and can now benefit from
being lucky with the gold price, it’s the right story with the right profile at the right time. As
such, I will open a position in Superior Gold (SGI.v) in the days to come and the stock will be
part of the open positions list by this time next week.
Stocks to Follow
Our big new bag has 19 open positions and of those, ten were winners on the week (RIO.v,
DSV.v, SMD.v, PA.v, APN.v, MIRL.cse, MNO.v, NCAU.v, WRN.to, MENE.v), three were
unchanged (QCCU.v, ALDE.v, ELBM.v) and six were losers (MAI.v, ARG.to, ECU.v, CKG.v, MUX,
SGI.v), so the headcount was good but, as the modest losses registered by Minera Alamos and
Amerigo were among the losers, it wasn’t a massively winning week on paper. However it was
better than my real week as the Astra Zeneca booster jab I had on Tuesday jiggered me until
Thursday (pro-tip: stick with the Pfizer next time). On the other hand, the only double figure
percentage movers were both winner so a cheer for the smallholdings Palamina (PA.v up
12.9%) and Altiplano (APN.v up 12.3%), while the best money result came as Discovery Silver
(DSV.v up 6.7%) swam against the silver price tide. It wasn’t all bad.
We’re now into our second week of the new Stocks to Follow presentation table and we there
are still 19 open positions, one less than our self-imposed maximum. Ten are in the green,
eight are in the red, one is unchanged on their cost averages.
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$0.61 190.4% $1.14 tgt, #1 idea on FY22 dev
Rio2 Ltd. RIO.v STR BUY C$0.83 22-Apr-18 C$0.78 -6.0% $1.30 tgt May22 permit catalyst
RECOMMENDED STOCKS
Amerigo Res ARG.to STR BUY C$1.36 12-Dec-21 C$1.87 37.5% $2..40 tgt on FY22 guidance
Discovery Silver DSV.v STR BUY C$1.77 24-Oct-21 C$1.92 8.5% Best Ag play, 1st tgt $2.75
QC Copper&Gold QCCU.v BUY C$0.275 25-Apr-21 C$0.27 -1.8% Now drilling. Easy hold
Element 29 ECU.v BUY C$0.58 6-Mar-22 C$0.58 0.0% Cu exploreco w/ 2 Peru assets
SPECULATIVE TRADES
Chesapeake Gold CKG.v SPEC BUY C$3.26 20-Feb-22 C$3.62 11.0% "Leverage to gold" started well
McEwen Mining MUX hold/sell U$0.89 2-Jan-22 U$0.84 -5.6% Failed trade to close in April
Aldebaran Res. ALDE.v SPEC BUY C$0.72 16-May-21 C$0.92 27.8% Assay catalyst in Q1 and Q2
Strategic Metals SMD.v BUY C$0.42 31-Jan-21 C$0.405 -3.6% Canada land bet+Zn in FY22
Palamina Corp PA.v SPEC BUY C$0.295 21-Nov-21 C$0.175 -40.8% Au expl in S.Peru
Altiplano Metals APN.v SPEC BUY C$0.31 17-Sep-21 C$0.32 3.2% Cheap entry, 1q22 re-rate
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.085 -56.4% CEO change will move stock
13

FIVE TRADE IDEAS FROM IKN670, March 2022 (yellow not owned, blue owned)
Meridian Mining MNO.v BUY C$0.88 20-Mar-22 C$1.03 17.0% tracking IKN670 idea
Superior Gold SGI.v BUY C$0.95 20-Mar-22 C$0.94 -1.1% tracking IKN670 idea
Newcore Gold NCAU.v BUY C$0.51 20-Mar-22 C$0.52 2.0% tracking IKN670 idea
Electra Battery ELBM.v BUY C$0.295 20-Mar-22 C$0.30 1.7% tracking IKN670 idea
Western Copper WRN.to BUY C$2.41 20-Mar-22 C$2.95 22.4% tracking IKN670 idea
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 TRADES IN 2022 date 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
Copper Mountain CMMC.to Feb'22 C$3.40 18-Jun-21 C$3.70 8.8% Sold rest on FY22 guidance
Trilogy Metals TMQ Mar'22 U$1.84 15-Sep-19 U$1.04 -41.3% killed by US permit reversal
2015 to 2021 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Now for some notes on some of our covered stocks, but keeping it very brief this weekend.
Element 29 (ECU.v): You’re going to accuse me of cheating and that’s okay, but when ECU
weakened to 56c last week I decided to take advantage and added just enough to bring my
cost average down a penny to the 58c average seen above. So as ECU closed right on that
number, I avoid a blob of red on the report this weekend. Bite me.
As for what may have been behind the weakness, on Thursday the company announced a
permanent replacement for Richard Osmond, who filled in as interim CEO until such time as a
candidate showed. The new CEO is Steve Stakiw, who has plenty of experience in South
America and Peru in his CV but this will be his first time as a CEO. On reaching out, the
company informed this desk that Stakiw was identified as a candidate by a recruitment
company and once under interview, ECU’s board liked his strong capital markets experience and
his traits of straight-shooting honesty and relationship building skills, so while this will be his
first time at the Buck Stops Here desk, they are confident of having picked the right person. We
wish him good fortune (and thank him for the buying opportunity).
McEwen Mining (MUX): In order to live up to his word, Rob McEwen now has to deliver on
the second tranche of the McEwen Copper seed financing package that he said would be done
by “the end of Q1” in the recent company Conference Call. As Q1 finished on Thursday, there’s
leeway to give MUX until this week to make the announcement, be it U$20m or the full U$40m,
but there’s also a time limit to credibility for this company now, they cannot simply fob off the
constant delays to this capital raising plan forever. Assuming MUX makes the expected
announcement this week, it may provide the liquidity window and extra price pop that gets me
to sell and leave. However, no decision until next weekend at a minimum.
The five IKN670 trade ideas, Superior (SGI.v) Meridian (MNO.v) Newcore (NCAU.v)
Electra (ELBM.v) and Western (WRN.to): We’re now two weeks in and here’s how our five
are faring compared to the nominal benchmark GDXJ:
14

That’s not bad, with two clear winners, one a couple of points in front and two level pegging.
Most notable so far is Western (WRN.to), which shot up two Fridays ago once its year-end
financials were in and successfully consolidated the move last week. I’m not the only one who
views the new price impetus in WRN as caused by “elephant foot prints” (to quote mailer RS)
and in my view, the fact strategic shareholder Rio Tinto (RTZ) was active in deciding where the
latest drill holes were located is enough to work out who the most likely suitor is.
Meridian (MNO.v) was easy to buy all week after its NR “Meridian Outlines Expanded Gold
Potential of Cabaçal’s Saint Helena Deposit”, which opened focus on one of the many outlaying
areas of Cabaçal. However, Friday afternoon again saw buyers appear and the stock closed
over the Loonie levelfor the first time since that rocket move up. We’ll have more on MNO in
future editions
Next up Electra (ELBM.v) should get tailwinds from the Biden administrations’ decision to
promote local production of critical minerals (and it’s worth noting that in its communiqué, The
USA names China as its major adversary rather than Russia). Regarding this, there’s a rumour
now circulating that ELBM may look to dual list its stock in The USA, either via the NYSE or the
NASDAQ. If true, this would be a very smart move by the company and would also provide a
natural window to raise extra capital.
Rio2 Ltd (RIO.v): Rio2 has started banging its
head up against a new price ceiling around 80c,
which is an improvement of course but we’re
going to need company generated news for the
next leg-up. The most likely moment for that is
May and the slated time window for its EIA
permit award.
QC Copper & Gold (QCCU.v): Another flat
week from this undervalued copper play, so if
you’re waiting along with me here’s the link (4)
the latest corporate presentation, as delivered on Friday to the Quebec Critical Metal Showcase.
It was also interesting to note CEO Stephen Stewart’s presence in Santiago this week, as the
CESCO Copper 2022 conference (though he has been tight-lipped about his meetings there).
QCCU also filed its quarter on Friday evening and while it’s not a critical matter for the stock or
share price upside, a look at the main balance sheet items shows how the financials are
developing, then adding estimates for the next quarter gives useful extra context.
QCCU.v: Assets, per qtr
22
20
18
16
14
12
10
8
6
4
2
0
The main story in the financials of any exploreco is its cash balance and how quickly it’s burning
away. The recent raisings and sale of Baselode (FIND.v) shares bolstered QCCU’s treasury well,
we also see how liabilities have dropped and will continue to drop as the flow-through liability
required by the rules drops as the cash is put into Opemiska drill holes.
15
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 tse22q2
$m QCCU.v: Liabilities, per qtr
4
3.5
fixed
other current 3
cash 2.5
2
1.5
1
0.5
0
source: company filings/IKN ests
91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 tse22q2
source: company filings/est
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LT liabs
current liabs

As for cahs and working capital, the company has stated it has all the money required to run its
2022 program and get into 2023 if necessary, that stands up to examination:
As for shares out, they now stand at just under 145m and while QCCU has its treasury, our
model also expects to go back to the market at some point in late 2022 in order to replenish:
QCCU.v: Shares out (m)
16
4.93 4.93 4.35 4.35 7.85 8.07
9.701 7.311 2.711
4.431
279.441
0.541
0.061 0.061
180
160
140
120
100
80
60
40
20
0
91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 tse22q2 tse22q3 tse22q4
QCCU.v: Cash treasury per qtr
20
18
16
14
12
10
8
6
4 2
0
source: company filings, IKN ests
Discovery Silver (DSV.v): More decent drilling results out of DSV last week, the Thursday
March 31st NR (5) headlining “328 g/t AgEq over 46
m Outside Current Resource at Cordero”, one of
several holes to hit along the North-East vein zone
of Cordero (dark pink area of this map) that isn’t
yet part of the overall resource. The high-grade
zones are deep and at “the other end” of where the
project is due to start its mining operations under
the current PEA (with the PFS coming to confirm
plans at the end of this year), so while good for
overall resource count and showing the expansion
potential of the deposit, these results won’t affect
our current price target.
The stock price did okay and rose on the NR, but
we’re still under C$2.00 and that makes all prices
very cheap, compared to what Cordero has to offer.
With size, scale, location, robust economics and a
serious management team running DSV, there’s no
better silver play out there.
The Copper Basket
After thirteen weeks of 2022, The Copper Basket shows a loss of 2.28% level stakes:
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 tse22q2
source: company filings/IKN ests
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QCCU.v: Working Capital per qtr
343.0 417.0 306.0 603.1 864.1 571.6 108.4
196.2 372.41 763.41
5.11
20
18
16
14
12
10
8
6 4
2
0
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 tse22q2
source company filings/IKN ests
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company ticker price 1/1/22 Shares out Market Cap current pps gain/loss%
1 Copper Mtn CMMC.to 3.42 210.166 790.22 3.76 9.9%
2 Western Copper WRN.to 2.00 151.451 446.78 2.95 47.5%
3 Marimaca Cop MARI.to 3.77 88.028 369.72 4.20 11.4%
4 Oroco Res OCO.v 2.04 203.4 357.98 1.76 -13.7%
5 Nevada Copper NCU.to 0.71 448.437 278.03 0.62 -12.7%
6 Meridian Min MNO.v 1.18 153.735 158.35 1.03 -12.7%
7 Hot Chili HCH.v 1.53 109.223 151.82 1.39 -9.2%
8 Regulus Res. REG.v 1.06 101.845 131.38 1.29 21.7%
9 Aldebaran Res. ALDE.v 0.84 114.495 105.34 0.92 9.5%
10 C3 Metals CCCM.v 0.16 645.379 64.54 0.10 -37.5%
11 Kutcho Copper KC.v 0.88 103.94 61.32 0.59 -33.0%
12 Doré Copper DCMC.v 0.79 66.123 56.87 0.86 8.9%
13 Element 29 Res ECU.v 0.58 79.24 45.96 0.58 0.0%
14 QC Copper QCCU.v 0.34 129.06 34.85 0.27 -20.6%
15 Coast Copper COCO.v 0.13 41.335 5.17 0.125 -3.8%
NB: All stocks in CAD$ Portfolio avg -2.28%
It spent nearly all of Q1 underwater and closes out
The Copper Basket 2022, weekly evolution
the quarter just below breakeven, having lost just 4%
over one point on the week. That despite the split 2%
being uncannily even, with five winners (MARI.to, 0%
WRN.to, MNO.v, HCH.v, DCMC.v), five unchanged -2%
stocks (REG.v, CCCM.v, ALDE.v, KC.v, QCCU.v) and
-4%
five losers (CMMC.to, OCO.v, NCU.to, ECU.v,
-6%
COCO.v). The overall aggregate loss was due to the
-8%
only two double-figure movers being losers, namely
-10%
serial mess Nevada Copper (NCU.to down 17.3%)
and tiny Coast Copper (COCO.v down 10.7%).
As for copper price news, we could talk up a small drop in the price of the metal over the week,
but this chart that takes in three weeks of market is a more accurate take on the current
market. Since mid-March the market has got used to the idea of paying U$4.70/lb for copper
and a new line in the sand is being drawn.
We’re at Week 13, the end of the quarter and time for our first comparative snapshot of the
Copper Basket component stocks for 2022 to consider the winners and losers:
17
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 ht6raM ht31 ht02 ht72 dr3rpa
source: IKN calcs

The 2022 Copper Basket components after 13 weeks
18
%5.74
%7.12
%4.11
%9.9 %5.9 %9.8
%0.0
%8.3-
%2.9-
%7.21- %7.21- %7.31-
%6.02-
%0.33-
%5.73-
50%
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
-50%
ot.NRW v.GER ot.IRAM ot.CMMC v.EDLA v.CMCD v.UCE v.OCOC v.HCH ot.UCN v.ONM v.OCO v.UCCQ v.CK v.MCCC
source: TSX, IKN calcs
The recent spurts put on by both Western (WRN.to) and Regulus (REG.v) have pulled them
ahead of the pack, but to date only four others are in positive territory for the year. This alone
tells us that the copper producer stocks are doing better than their exploreco cousins.
Meanwhile at the bottom of the pile, QC Copper & Gold (QCCU.v) has been my biggest personal
disappointment, Kutcho Copper (KC.v) has been hit hard by Wheaton (WPM) cashing in its
position and C3Metals (CCCM.v) has been suffering from a dose of cruel reality. We’ll check
back in at 26 weeks, when there will be more interesting comparative data to consider.
Moving on to the copper macro news section, the story about Shanghai’s warehousing and
metals distribution zone going under Covid-19 lockdown catches the eye, as it may put a
temporary brake on China’s voracious appetite for copper. How long the hiatus lasts is anyone’s
guess (China and Omicron, it’s a thing) but as Bloomie points out (6), demand crimps are
already with us:
Shanghai’s strict lockdowns are threatening production at hundreds of factories in
nearby industrial regions that rely on a steady flow of metal from China’s top
commodities trading hub.
Trucking of base metals like copper and zinc in and out of warehouses in Shanghai,
including those in the duty-free bonded zones, largely ground to a halt this week after
the city’s government imposed tight curbs on the movement of people and vehicles,
according to traders and logistics managers.
The financial and commercial center on China’s east coast ordered a two-stage
lockdown to fight a wave of omicron cases. That’s snarled up logistics by creating a
shortage of truck drivers and warehouse staff, the people said.
…and…
Six out of twelve copper-rod plants in neighboring provinces surveyed by Shanghai
Metals Market said they either have halted or plan to halt output from this weekend,
according to a note on the researcher’s website.
The Shanghai Covid story may be a temporary factor, but the real macro news last week came
out of Chile and the CESCO Copper Week 2022 conference, where the tone was upbeat and
industry voices took turns in giving their own version of the same “Copper Going Up” message.
Antofagasta’s CEO said he expects strong copper prices “for the next 12 months” (8), Goldman
Sachs sent metals permabull Nicholas Snowdon (the tag team partner of Jeff Currie) to say that
copper prices need to go up “in order to stimulate a supply response” (i.e. “buy explorecos,
folks), but the most quotable quote came from Richard Adkerson of Freeport (FCX), who has a
way with words. Speaking on the sidelines of the gala dinner (7) he said market tightness “is
far beyond a price issue” and the clean energy transition is changing demand dynamics. Here’s
the money quote:
“Even if the price of copper were to double overnight it would still be years
before we had significant incremental production coming on, “The market is
going to need it far faster than companies like ours can produce it.”
The metals world’s answer to the folksy wisdom of Warren Buffett. Enough chatting more

charting. It’s the end of the month and time for the long-term copper tracking charts for copper
inventories in which you get to enjoy bullishness in visual terms. The first one says, “Where has
all the copper gone?”
Key Cu inventory aggregate, 2012 to date
1000000
900000
800000
700000
600000
500000
400000
300000
200000
100000
0
19
21.naJ ram yam luj pes von 31.naJ ram yam luj pes von 41.naj ram yam luj pes von 51.naj ram yam luj pes von 61.naj ram yam luj pes von 71.naj ram yam luj pes von 81
naj
ram yam luj pes von 91
naj
ram yam luj pes von 02
naj
ram yam luj pes von 12
naj
ram yam luj pes von 22
naj
ram
Mt Cu
Comex
Shanghai
LME
source: Cochilco
The developing story is that of inventories that are low and staying low, the SHFE seasonal
restock hasn’t arrived and improvements at LME warehouses are also scant. The sum is a highly
disrupted supplier of last resort and historic levels of supply tightness. There’s more than a little
“News Fatigue” about this dataset and I know I make a song and danced about it almost every
week at the moment, but it needs underscoring. As for the distribution of the tonnages, the
abrupt halt in SHFE re-stocking has put a spanner in the works of normal patterns, there’s not
so much to read into this chart at the moment. Copper is tight, the end.
Copper inventories: percentage held per exchange
80
70
60
50
40
30
20
10
0
21.naJ ram yam luj pes von 31.naJ ram yam luj pes von 41.naj ram yam luj pes von 51.naj ram yam luj pes von 61.naj ram yam luj pes von 71.naj ram yam luj pes von 81
naj
ram yam luj pes von 91
naj
ram yam luj pes von 02
naj
ram yam luj pes von 12
naj
ram yam luj pes von 22
naj
ram
LME Shanghai Comex source: Cochilco
Longer-term views done, we move to our regular segment of weekly copper inventory moves.
 World copper stocks at the three systems added an aggregate of 5,396 metric tonnes
(mt) on the week, the total closing at 254,893mt and that’s impressively low both
absolute and seasonal bases.
 The SHFE is still like watching a slow motion train wreck. Its drop of 8,934mt last week
puts its inventory total back under 100k, at 93,121mt. Look no further for your flashing
red light and the reality of copper supply, last week again tells us this
 The LME managed an aggregate improvement of 13,275 mt the week, with 11k of that
hitting Asian warehouses in South Korea and Taiwan. This is what should be happening
at this time of year and if the SHFE were doing the same, there’d be no need to worry
about the inventory data on a weekly basis.
 The Comex’s minor moves are neither her nor there at the moment, this week it added
955mt to close at 67,797mt.
Here’s the dedicated SHFE inventory chart and its implications are stark, but the scale means
the visual drama doesn’t quite match what the data tells this desk. Therefore today, a couple of
other presentations to try to ram the point home.

Shanghai Futures Exchange Warehouse Stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
20
31'13ceD dr32 ht02 ht51 ht01 ht5tco ht03 ht52 dn22 ht71 ht21 ht6pes ts1von 102ht72ced ts12 ht71 ht21 ht7guA dn2tcO ht4ceD ht92 ht62 ts12 ht61 ht01 7102
ht5von
ts13 ht52 dn22 ht42 ht91 ht41 ht9 9102
dr3bef
ts13 ht62 ts12 ht51 ht01 0202ht5naj 0202ts1ram ht62 ts12 ht61 ht11 0202ht6ced ts13 ht82 dr32 ht81 ht21 ht7 2202dn2naj ht72
Mt Cu
|
source: Cochilco
As SHFE stocks usually peak around end March to mid-April every year, one method of showing
how 2022 is different is to put all the
SHFE-only end-March inventory levels
next to each other in one chart, so here
you are (right). Those of you with a
memory for a year ago may recall these
pages pointing to the low inventory levels
of March 2021 and warning about its
implications to the copper price for the
year ahead. Well, 2021 seems idyllic
compared to the signal being flashed by
SHFE warehouse levels today. As for the
timing of SHFE’s inventory dip, this chart
below shows the way in which this year’s
peak isn’t just lower, but the reversal and
drop comes weeks before the normal seasonal depletion should begin. When China runs out of
copper, neither Richard Adkerson nor your author will be particularly surprised.
SHFE copper inventory levels, 2018 to 2022
400000
350000
300000
250000
200000
150000
100000
50000
0
1 2 3 4 5 6 7 8 9 01 11 21 31 41 51 61 71 81 91 02 12 22 32 42 52 62 72 82 92 03 13 23 33 43 53 63 73 83 93 04 14 24 34 44 54 64 74 84 94 05 15 25
SHFE Copper inventories at end March, per year
MT Cu 2022
2021
2020
2019
2018
source: Cochilco data
Now for notes on a couple of our basket stocks:
Regulus Resources (REG.v): We made it to April with no drill results from the holes started
December, no surprise. However, we should get a NR soon enough and the market seems to be
anticipating good news.
Copper Mountain (CMMC.to): On Friday, CMMC announced it was getting its 1q21 financials
out the way as quickly as possible and would file on April 25th. As the company doesn’t pre-
announce production any longer (or isn’t expected to) we get to find out everything that day
and this desk expects its 1q21 to be soft. That’s the reason I stepped out of this trade earlier
this year, so getting the 1q21 results is a good thing and may allow a window to buy back
418812 372932 527391 295342
527863
673703 534703
214162
534233
953881
12139
mt Cu
400000
350000
300000
250000
200000
150000
100000
50000
0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
source: SHFE

(though that may be too cute for my own good).
Nevada Copper (NCU.to): Thursday evening saw NCU file its 4q21 and year-end financials
and to get the general idea, here’s the picture that paints the requisite thousand words:
Yup, the quarter sucked with an 4c loss per share and its working capital position still deeply
underwater at negative $49.96m.
The Producer Basket
After thirteen weeks of 2022, the Producer Basket shows a gain of 23.63% to level stakes:
company ticker price 1/1/22 Shares out MktCap(U$Bn) current pps gain/loss%
1 Newmont NEM 62.02 797.44 66.01 82.78 33.5%
2 Barrick GOLD 19.00 1779 44.37 24.94 31.3%
3 Franco-Nevada FNV 138.29 191.192 31.29 163.67 18.4%
4 Agnico Eagle AEM 53.14 454.71 28.77 63.28 19.1%
5 Wheaton PM WPM 42.93 450.3 22.01 48.87 13.8%
6 Gold Fields GFI 10.99 887.72 14.31 16.12 46.7%
7 Kinross Gold KGC 5.81 1369.3 8.24 6.02 3.6%
8 B2Gold BTG 3.93 1055.6 4.99 4.73 20.4%
9 Alamos Gold AGI 7.69 392.503 3.40 8.67 12.7%
10 Sandstorm SAND 6.20 191.4 1.62 8.49 36.9%
All prices and stock quotes in U$ Port. avg 23.63%
We end an excellent quarter for the PM producer sector in fine style, with GDX out-performing
the juniors and all ten of our stocks returning week-over-week gains as the new U$1,900/oz to
U$1,950/oz price range begins to attract money to the larger equities. Kinross (KGC up 5.1%)
was the best mover in percentage terms as the market nodded its approval of plans to sell
Kupol, while Newmont (NEM up 4.9%) hit a new all-time high and continued to rock along.
The 2022 Producer Basket: Weekly performance and
30% comparative to GDX control
25%
20%
15%
10%
5%
0%
-5%
-10%
-15%
21
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 ht6ram ht31 ht02 ht72 dr3rpa
The 2022 Producer Basket: Percentage difference
between GDX benchmark & basket (negative = IKN ahead) 6.0%
5.0%
4.0% ikn
gdx control
3.0%
2.0%
1.0%
0.0%
-1.0%
source: NYSE, IKN Calcs ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 ht6ram ht31 ht02 ht72 dr3rpa
source: IKN calcs, NYSE data

Meanwhile in our semi-serious annual fight against the GDX benchmark, our basket clawed
back some of GDX’s lead over us, but we’re still lagging after the first quarter so for more on
that, here’s the comparative performance of our ten charges with Q1 closed, notes below:
The 2022 Producer Basket components after 13 weeks
22
%7.64
%9.63
%5.33
%3.13
%4.02 %1.91 %4.81
%8.31 %7.21
%6.3
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
GFI SAND NEM GOLD BTG AEM FNV WPM AGI KGC
source: NYSE, IKN calcs
It took until this very week to get all ten companies into the green, but we made it. Even so,
there’s no doubt about the laggard of the bunch as Kinross was first marked down as its
purchase of Great Bear (GBR.v) became a reality to it and its balance sheet, then its exposure
to Russia via Kupol (plus some development stage projects in the vicinity) saw the stock price
suffer through no real fault of the company. As for the winners, the decision to swap out Pan
American Silver (+15% approx YTD) for Gold Fields (GFI) has paid off. A good job too,
considering the decision to add the more conservatively pitched royalty plays as well. The
smaller and more leveraged Sandstorm (SAND) has picked up speed since eschewing itself of
Hod Maden, but for me the most impressive stock in 2022 to date has been Newmont (NEM),
the world’s #1 and one of only three stocks on our 2021 list that finished in up for the year.
NEM has since gone from strength to strength so consider, at the beginning of 2011 there was
less than U$8Bn in difference between the market caps of NEM and its nearest rival, Barrick
(GOLD). Today that gap is nearly U$22Bn, so well done Mr. Palmer.
Is Kinross Gold (KGC) in-play?
It’s taken a while for KGC to steady its ship, but the advent of 1) the new $1Bn line of credit
that eases pressure on its balance sheet and 2) the news last week it was in the process of
disposing of Kupol and its other Russia assets saw KGC do something it hasn’t done for a long
time; Out-perform the GDX:
After considering the rough Q1 period at Special K and how it’s now managed to stop the rot,
your author’s thoughts again returned to the idea of it as an M&A target. Not the first time this
idea has been floated here and with an interesting asset book, the disposal of the Russia assets
may make it even more attractive. The first stop is its balance sheet and here, the YE financials
don’t include the recent closure of the GBR deal nor its the recent $1Bn credit facility, but about
20 seconds of staring at the numbers show how Kinross’s working capital is basically its
inventory position and it’s no surprise to see it improve liquidity in the way it did:

The Kinross (KGC) balance sheet, as at 2021 YE
To the plus side, we can ignore the new credit facility and consider Special K on its above
numbers to recognize that its debt position really isn’t that bad. Provisions are largely generated
by its North American operations (Fort Know, Round Mountain, Battle Mountain) and are normal
(at face value) and with the rump of capex obligations now baked in (La Coipa is just about
built, Tasiast saw U$320m in capitalization last year) the cash suck period is now behind it. So
in theory at least, that juicy property asset value of U$7.6Bn compared to the current market
would put Kinross in play to an aggressor looking to expand and challenge for the top spot in
world gold production.
The Barrick (GOLD) balance sheet, as at 2021 YE
23

Would Barrick (GOLD) buy Kinross (KGC)?
Which means it’s time to dial up the balance sheet of its most likely suitor, Barrick (GOLD)
(above). On paper at least GOLD has enough room to make a clear run at Kinross without
affecting its financial fortunes and checks the boxes of a company with a growing war chest,
wondering what to do with it. Thornton and Bristow got cash, got working capital, and the
GOLD debt liabilities are not only small compared to market cap these days (what a change
from the mess Munk got the company into ten years ago), but due dates on that paper are
mostly long into the future. Kupol was one of Kinross’s major cash cows and required by the
company, but Barrick has less immediate need of such free cash flow and makes heaps of
quarterly profit all by itself, so the geopolitical advantages of its disposal suit more than its
drawbacks.
Barrick has made clear noises about its own plans to grow organically, of course, and the
market has recently responded well to its financial results and messaging. But the addition of
those Kinross assets would see them revalue instantly and considering the way Nevada Gold
Mines JV (GOLD and NEM) went about its cost cutting regime, GOLD now has its blueprint to
optimize the Kinross North American assets as well.
The bottom line to this strategy notelet and to address the question in the title, the official
answer is “I don’t know”. For sure that’s a cop-out because one never knows how mining M&A
plays out, but there’s reasonable cause to think that Barrick (or other) could still make a run at
Kinross, if only for the fact that it would get its Canadian prize at Dixie at a discount to its offer
of last year. Seeing Kupol leave Kinross certainly make sit more buyable and with its other fixed
assets trading at a market discount, the market would seeing the accretive value in any
eventual deal (assuming GOLD doesn’t overpay, which it wouldn’t). Meanwhile Barrick has both
cash and balance sheet strength, plus a clear desire to grow. Large scale M&A never offers
perfect fits, this imagined deal offers enough to make it feasible.
Bottom bottom line: Maybe laggard Kinross is a place to bet in 2q22, for its potential as an M&A
target as much as its rebound/catch-up potential.
The TinyCaps List
After thirteen weeks of 2022, the TinyCaps show a gain of 5.91% 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 5.20 0.15 15.4%
Infield Min INFD.v 0.06 48.276 2.17 0.045 -25.0%
Kingfisher Met KFR.v 0.30 84.57 16.91 0.20 -33.3%
Latin Metals LMS.v 0.12 57.296 7.73 0.135 12.5%
Manitou Gold MTU.v 0.06 344.47 20.67 0.06 0.0%
Melkior Res MKR.v 0.295 24.011 6.12 0.255 -13.6%
Precipitate Gold PRG.v 0.105 129.322 16.17 0.125 28.6%
Signature Res SGU.v 0.07 238.4 25.03 0.105 50.0%
Winshear Gold WINS.v 0.08 61.585 5.54 0.09 12.5%
Prices in CAD$, data from TSXV basket avg 5.91%
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
24

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.
14% TinyCaps, 2022 weekly tracker
The microcaps were again a mixed bag, with 12%
our TinyCaps basket returning four winners 10%
(AUL.v, LMS.v, SGU.v, WINS.v), three 8%
unchanged stocks (INFD.v, KFR.v, MTU.v) and 6%
three losers (GDP.v, MKR.v, PRG.v). The overall 4%
basket average benefited from the two big 2%
movers in the plus column, namely Winshear 0%
(WINS.v up 20.0%) and Signature (SGU.v up -2%
16.7%).
Melkior Resources (MKR.v): The reason
MKR made the TinyCaps section this year was as much for its price chart (right) than anything
else. Luckily it wasn’t for its assumed newsflow because so far this year, we’ve had zero zip
nada from the company. So far at least, it looks as though I’ve picked a bit of a dud for the list
Kingfisher Metals (KFR.v): I told myself not to repeat on KFR this week, but this price chart
demands a few words. As well as the video show linked last week, KFR’s CEO Dustin Perry
showed on Crux Investor in the snappily entitled
“Kingfisher Metals (KFR) - Grading 60g/t Gold as
Drill Season Starts (9) even though diamond
drilling doesn’t kick off until May. The message
seemed to attract some attention and KFR was bid
up as high as 24c midweek before our market’s
fruit fly attention span kicked in, volume dropped
and a late Friday close-out trade saw KFR finish
UNCH for the week. That means the stock is again
buyable at the 20c basement price level, it also
suggests there’s no need to bid up the stock at
the moment and it will need to generate real news
in order to make a price move stick. And that’s the
last on KFR for a couple of weeks, promise.
Manitou Gold (MTU.v): Unlike MKR, Manitou has been busy and we should soon see the
assay numbers for the five holes it announced complete on March 8th. The target is a new area
of its Goudreau Project in Ontario and as stated by CEO Richard Murphy at the time, President
and CEO of Manitou Gold. “The targets we are currently testing all lie within one of the best
possible structural settings for forming a large orogenic gold deposit”.
25
dn2naJ ht9
naJ
ht61naJ dr32 ht03 ht6bef ht31 ht02 ht72 ht6ram ht31 ht02 ht72 dr3rpa
source: IKN calcs, TSX data

Drilling over the seasons at Goudreau has been more misses than hits, you only need to see the
6c share price to know that. However and along the way, it has hit the occasional good (and
sometimes very good) grades of gold vein mineralization. MTU retains Alamos as strategic
sponsor and is by no means dead as a potential drill play. It also does decent traded volume at
times, so those of you looking for a very high risk spec play may want to consider it.
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 are strictly neutral.
Regional politics
Chile: The politics of CESCO Week 2022
Chile was the centre of LatAm’s mining world last week. The main economic themes from
CESCO Week 2022 and the CRU Copper conference in Santiago, Chile are in The Copper Basket
and dominated by macro supply (and therefore, price). Here we tackle the political side and on
that score, two main themes emerged from the conference:
 Chile’s new government and its position on mining
 The latest on mining from Chile’s Constitutional Convention
First the Chilean local political scene and the messaging from the newly-installed government
under President Gabriel Boric. He was a notable no-show at the conference and left the talking
to his Minister of Mining Marcela Hernando; we note how the government was given the
Monday inaugural and the Tuesday keynote speech slots, but she did both. Though to be fair,
her message to the private sector went down well and she told them what they wanted to hear,
for example while touching on the exploration side of Chile's mining industry Minister Hernando
talked of the 117 exploration-stage projects currently permitted, with 103 of those projects
under active development, "These are companies that have placed their trust in our country
and with whom we want to continue working strongly."
As for the likelihood of State burden increases and specifically the now long-toothed Royalty
Law bill, Minister Hernando had a positive message for companies even as she got them ready
to pay more to the State as they mine metal in Chile. She noted that the Royalty Law project
had “Gone through a lot of modifications” in passage through Chile’s Upper House of Congress
(Senate). The project now has to go back to the Lower House (Deputies) for ratification before
being sent to the President for passage. That means the watered down royalty law may not get
through immediately and may get beefed up again. A quote:
“We understand that when the law bill goes back to the Chamber of Deputies,
it won’t have the same support that it has today in the Senate… therefore any
decision is not yet made and therefore, the proposed extra burden “to finance
our public sector agenda may come through a tax reform and not necessarily
via the royalty law project. Therefore, this is a work in progress on which we
ask for your understanding…”
In other words, the current royalty law may eventually be scrapped and in its place, a more
classic tax on EBIT raised and while no company ever wants to pay more tax, this wouldn’t be
the worst of situations for the mining sector. I also paused her speech quote there to make this
point because Minister Hernando, as segued into the message they all wanted to hear:
“…because neither this government nor President Boric is interested in or has
programmed the nationalization, expropriation or the scaring away of
investment.”
That part received a warm round of applause from the audience and made plenty of headlines
in the local media, general newspapers (10) (11) as well as business and mining media. In fact,
26

Minister Hernando was also veritably glowing in her praise for FDI in Chile, up to and including
this phrase:
“I’m used to saying uncomfortable things that aren’t politically correct, but I
have to say that often, it’s the foreign companies that behave better toward
their workforce than the way our own Chilean companies do.”
That smacks of a little inside politicking and a swipe at Chile’s Mining Chamber of Commerce
more than laying out the red carpet for FDI, but it would have sounded good to the foreign
delegates.
Unsurprisingly, the whole “nationalization question” was always at hand and throughout the
week, was referred to by both sides of the money. A typical example of the private sector came
from BHP regional executive Rangar Udd, as quoted here (12):
"We love Chile. We would like to stay here. We would like to grow in this
country. But in order to do that, it will require fiscal stability, legal certainty
and a clear pathway to permit," Ragnar Udd, BHP's president of minerals,
Americas, told the CRU-CESCO World Copper Conference in Santiago.
That position was labelled “blackmail” by the Chilean left wing press (it exists) and in its note,
Reuters tried to find an angle of friction by noting that Minister Hernando “had already left” the
conference by the time Udd got up to speak. However, neither represents the reality of the
Boric government position and it’s difficult to create an argument where one doesn’t exist. The
Chilean government’s view had already come over clearly during the Minister’s first speech (see
above) and she reprised the segment the next day, just in case.
However, the mining sector has moved its worries away from the plans of the Constitutional
Convention (CC) to vote for outright nationalization and is now up in arms over another law
project being moved by the CC that’s framed as “Stealth Nationalization” by its detractors. This
report and analysis (13) has plenty of details for those of you versed in Spanish, here we cover
the main point. The CC now has three projects concerning mining to present to the plenary of
the CC for inclusion in the draft constitution and they come as numbered law bills:
 873-5: This is the one you’ve heard about which proposes the outright nationalization of
the industry in Chile. For what it’s worth, this project was voted down last week and
while it can reappear, it’s now clear that for all intents and purposes it’s dead.
 882-5: A hybrid project which effectively means that private capitals would only have the
right to mine in Chile as a 49/51 minority partner with the State. This is also highly
unlikely to pass into the draft constitution.
 430-5: Here we arrive at the mining industry’s new bugbear, the one they are trying to
frame as “Stealth Nationalization” because it’s more likely to pass the CC plenary and be
included in the draft. Here, the project allows private capitals to own concessions and
operate their mines the same way as today, but their concessions are administrated by a
State-run entity and have a strict time limit, after which all concessions would be
returned to the State. The CC project is also deliberately vague on what sort of limits of
time and ownership would be allowed, also its detractors point out that there’s no
indication on whether this project would be retroactive in nature or only apply to future
concession grants. Finally, it also states that lithium projects could not be awarded to
private companies and must be developed by The State.
Clearly, the passage and inclusion of 430-5 in Chile’s draught constitution would be a lot better
than the previous plan of outright expropriation and nationalization, but to the downside it
would add a new layer of judicial uncertainty about the ownership (and therefore asset value9
of any concession owned by private capitals in the country and, therefore, the mining sector is
already pushing back hard against its adoption. For example, Chile’s national daily “La Tercera”
quoted an un-named “important lawyer working in large-scale mining” who said (translated):
27

“At first, large-scale mining’s attention was taken by the nationalization law
project and this proposal (i.e. 430-5) from the Socialist coalition wasn’t
noticed. However, we now realize that this initiative, though appearing bland
and intermediate, could get the votes required to be approved and could be a
covert nationalization if applied badly.”
Then later:
“That’s to say, perpetual concessions (as per the current Constitution)
become administrative and temporary concessions that have no indication of
expiries or renewal conditions. What’s more, there’s no indication of how the
transition would be made or whether the law would be retroactive…if it were
applied to existing concessions, this would look dangerously close to
expropriation.”
The bottom line is that while 430-5 may make it into the draft constitution, the fears being
whipped up around its implementation are almost certainly exaggerated. The right wing in Chile
will continue to see Reds Under The Beds as long as Boric is in power but with his government
committed to a proactive and welcoming attitude toward mining FDI, the worst-case scenarios
being painted by lawyers and mining executives are difficult to swallow and with a
constitutional project written in such a vague way, its interpretation would make it unworkable
and prone to never-ending legal challenges.
So overall, a good and successful week for the mining industry in Chile and its CESCO show.
The new government is going to be hot on environmental matters (and there was a lot of talk
about the rising importance of water desalination plants for the industry, that means capex) but
those weren’t exactly surprises to those present. But the mining world now realizes that under
Boric, not much is going to change and that’s a good thing.
Ecuador’s road to new social protests
A note on the Ecuador political scene this week has me wondering where to start, because
while we make regular updates on things directly related to its mining sector, I try not to delve
too deeply into the mess that is its general political scene. That’s no longer an option and some
word is required, because the last ten days (or so) have set the country on course for one of its
regular dates with widespread social protests and political unrest. Therefore today’s note is
mainly about the general politics and upheaval going on but at the end we get back to our
focus subject and attempt to explain how all this might affect the mining sector and its players.
First job is to get a handle on events and, while there are other things in the mix, perhaps the
best place is to start at Ecuador’s Congress two Fridays ago, at which Congress voted by a wide
margin to rejected President Guillermo Lasso’s centrepiece “Ley de Inversiones” (The
Investments Law) law bill and slam the brakes on his proposed economic reform plans and pro-
business policies. Though the “Ley de Inversiones” has been a bone of contention between the
Lasso presidency and the opposition controlled Congress since he was elected, after some
modifications and plenty of campaigning of the “Let’s Get Ecuador Moving” variety, President
Lasso still sent his signal policy law bill to Congress for approval in February. It took a month to
come up for debate and all through the process, Lasso remained optimistic it would be passed,
but when the debate and vote came it didn’t just fail, but Congress voted against him bigtime.
It was a full-scale political slap in the face in front of millions on live TV (to conjure up an
image…wonder where that came from?) and the flashpoint when the increasingly fractious
relationship between the Presidential executive and Congress became open conflict. The “Ley
de Inversiones” was Lasso’s big idea, one that includes (but not limited to) business-friendly
measures such as tax holidays for investment capital and zero duties for the importation of
capital goods, as well as easier bureaucracy for any business wanting to set up in Ecuador. In
other words good for many sectors and, it just so happens, perfect for the mining industry
(more on that later). But in one fell swoop it turned to dust as it went against the wishes of an
opposition ruled Congress and saw the UNES Party (Rafael Correa’s gang) join with the
28

Pachakutik (the CONAIE indigenous political party) and other groups to vote it down by a wide
margin. On hearing the result Lasso hit the roof and, among his declarations, accused members
of Congress of outright corruption, singling out five members of Pachakutik as having asked the
Presidential executive for bribes in order to get their votes (in either programs for their regions
or outright cash payments). However and it must be said, though Lasso’s accusations are
serious they’ve been framed in a way to make them vague. Those accused pushed back
immediately and on Tuesday, Congress (which is presided over by a member of the Pachakutik
party) voted by an even wider margin to reprimand the President for his attitude and false
statements.
However more important than the accusations of corruption was the political move he made at
the same time, as President Lasso announced he would no longer send law bills to Congress
and instead, would govern “by executive order and direct referendums”. He reasoned there was
no point in trying to pass laws through a Congress that just votes everything down, but this is a
controversial decision for two reasons, not just for the obvious way opposition gets to accuse
him of ruling by decree and taking the position of a wannabe dictator. The other is that in
Ecuador, there’s a Constitutional mechanism commonly called the “Muerte Cruzada”, a
translation for gist being “Crossfire Death”. This law allows the President to dissolve Congress
and rule by decree for a maximum of one calendar year, at which new elections for both
Congress and the Presidency must take place. In other words, this case of warring powers can
be resolved by Lasso if he 1) uses the mechanism, then 2) he can pass the laws he wants for
one year but also 3) submits himself to re-election by this time next year, thereby allowing the
people to decide whether his subsequent decisions and decrees were the right ones.
But Lasso didn’t do that and his way smacks of having cake and eating it. His preferred course
is to simply ignore Congress, not dissolve it and then to attempt to push as much as he can
through by Presidential decree. There are limits to what he can do that way, so if there’s a Big
Thing he wants to change he wants to bypass Congress by going to the people and holding
direct plebiscites. And yes, you may also have noticed that by not invoking the Muerte Cruzada
mechanism he gets to keep his job, not come up for personal examination via election and be
President to his own convenience. His decision is controversial and caused uproar across the
political spectrum, so while supporters that include many business leaders have come to his
defence, the critics have rained down on him from all sides. They include from inside his own
cabinet, as on Wednesday one of his key ministers, Alexandra Vela (who was the equivalent of
Interior Minister), resigned in protest at his decision not to invoke the constitutional Muerte
Cruzada mechanism. The government spokesperson also resigned at the same time.
This is where we stand this weekend (and in just four paragraphs, tough to make that unholy
mess more concise). Ecuador’s President is now in open conflict with Congress and has a newly
reshuffled cabinet who will now try to push through as many of his economic reform policies as
possible via executive decree. For one example, his team is currently “examining whether
Congress’s decision to reject the Investment Law was unconstitutional”, all the hint you need on
his plans to try to turn his banner policy into law without any further debates or votes. So we
now get to the practical end of this overview of Ecuador’s political situation and how it might
affect our subject of interest, the country’s mining industry. To begin, we consider those
aspects of the Investment Law project that would suit the mining industry. They include a
corporate tax holiday for the first ten years in specific “Special Zones of Economic
Development” (Zonas Especiales de Desarrollo Económico, or “Zede”). After that a 10% tax
reduction in the same zones as from year 11. Then zero taxes on imported capital goods and
raw materials, plus 0% VAT (IVA) on same. Those are clearly friendly measures for a capital
intensive sector such as mine development, so any decision to push these measures through,
either in one go on in a piecemeal manner, would be viewed positively by the mining sector.
Next we consider the timing of Lasso’s decision to send the Investment Law to Congress and,
while he made all the right noises about its possible passage, he must have known it was going
to be a contentious measure and its eventual voting down likely. His decision comes at the start
of the year (Ecuador tends to take January off for its vacation season) and also while he still
29

has some measure of support. In the latest opinion polls, Gullermo Lasso is scoring around
32% to 35% approval which is a long way from his Honeymoon period rating of 74% in last
year, but when stacked next to the public opinion of its Congress, given an approval rating of
just 11.5% two weeks ago, it allows him some room for manoeuvre (before his own popularity
sinks to that level. Lasso is not a naïve politico, realizes his “less unpopular” position still offers
him some political capital so now is the time to act. Therefore, on the back of last week’s
upheaval we should expect Lasso to move reasonably quickly, start firing off Presidential
Decrees and, as the Investment Law is both his banner proposal and the straw that broke his
relationship with the unpopular Congress, look no further for his subject matter. Therefore, we
can state two things, one positive and one negative:
 In the next few weeks, Lasso’s government will make pro-business noises and pass (or at
least try to pass) a series of Executive Decrees that will go down well with the mining sector.
 However, opposition to his government is growing fast and the pushback will no longer be
confined to Congress. That’s a roundabout way of saying that Ecuador is now on collision
course and social protests now seem an inevitability, we know that the indigenous pressure
groups (CONAIE) are not afraid of organizing protest marches and strike actions (look no
further than 2018) and while the good vibes from Executive Decrees etc will be more
immediate, the reactions are bound to come.
This weekend that’s about as far as this desk dares look into the future. This is the Mini Basket
Case Country after all, anything can happen and often does, it’s no use trying to predict the
unpredictable. Perhaps Lasso forces his way into a governable position, or perhaps thing spiral
out of control quickly and he’s forced to use ‘Muerte Cruzada’ after all. Perhaps Congress tries
to impeach the President for abuse of power, perhaps we get mass marches against the
government (Congress may be unpopular, but its parties retain regional grassroots power) (13)
(14).
Ecuador: The anti-mining petition in the Quito region begins
In other Ecuador mining news, this week saw the official start of the signature-collection
campaign in Ecuador’s capital city and surrounding area (officially, the “Mancomunidad Chocó
Andino”, a sub-region of several cantons that includes Quito and its suburbs, as well as a large
rural area around the capital which has six months to collect around 200,000 signatures.
Assuming that happens, the local and regional election in February next year will get an extra
question for voters in the region. Organizers put on a show last week (16) and at the presser,
stated they had 35 official signature collection points as well as the required small army of
volunteers.
Peru: The President survives and his FinMin wants to raise taxes on miners
On Monday, Peru’s members of Congress decided they liked their cushy jobs and wouldn’t
impeach their President, as it became clear that in order to kick out the Head of State they
would also have to invoke national elections for their jobs as well. The motion to impeach
received just 55 votes from the 130 seat parliament, notable because it had needed 74 seats to
bring the motion to the floor in the first place.
The situation is somewhat similar to that of Ecuador and its “Muerte Cruzada” but on a more
informal level, with Peru’s executive and Congress in a political version of a gun-toting Mexican
Stand-Off (to mix country names and confuse you even further). Peru has hit an impasse, with
a Lame Duck President who policy decisions get blocked at every turn, but even his staunchest
oppositors now admit that they won’t be able to remove him using the “Vacancy”
(impeachment) laws. Overall, this probably a good thing for the country’s external image but
also means precious little will be able to get done as long as Castillo remains as President.
This desk still considers it unlikely that Castillo make it to the end of 2022 as Head of State, let
alone his full term. His enemies will now fall back on their previously successful method of
sniping away his ministers, one by one, and eroding his power. Those on the chopping block
include his health minister and the Minister of Energy and Mines, they may be joined soon by
30

his new FinMin after this story on Friday, broken by Reuters (17):
LIMA, April 1 (Reuters) - Peru, the world's no. 2 copper producer, will target "excess
profits" that mining firms have gained from soaring global metals prices for extra
taxation, the country's economy minister told Reuters.
While President Pedro Castillo came to power last July pledging to increase taxes on
the powerful mining sector, the current plan is far less ambitious than initial promises of
sharp tax hikes that met fierce resistance from the industry and a divided Congress.
"The focus is on the surplus profits," Oscar Graham, the country's minister of economy
and finance, said in an interview in Lima late on Friday, adding that the government
was looking at an "adjustment" to taxes.
Copper prices are currently trading at near record levels around $10,000 per tonne in
the wake of Russia's invasion of Ukraine.
"The margins (of the adjustment) are being evaluated," he said, but added it was
important that the sector did not lose competitiveness and that mining investment was
not discouraged.
This sounds reasonable (from a left wing policy perspective at least), what with the rise in
metals prices and Peru’s need for public sector funding. However, the chances of getting a tax
hike on mining through the legal hoops required in any meaningful length of time are between
slim and none, that’s not even taking into account the howls of pain the spectre of a Wind Fall
Tax will cause in a pro-mining jurisdiction such as Peru. Statements such as that of the FinMin
above make for good headlines, but implementation is unlikely.
Colombia: A new poll sees Fico close the gap on Petro
This weekend’s voter intention survey comes from pollster CNC for Semana magazine and you
can see the whole PDF on this link (18). After asking over 4,200 people in a face-to-face poll
with a margin of error of +/- 1.5%, the slightly right-wing CNC puts left wing Gustavo Petro on
36.5% for the round one vote on May 29th, with closest rival the right wing coalition candidate
Federico ‘Fico’ Gutiérrez on 24.5%. In third place is Rodolfo Hernandez on 10.0%, then comes
Sergio Fajardo on 8.4%, the “vote in white” non-votes are down to 8.1% and then come the
others. However, most headline-writers in Colombia this weekend have moved to CNC’s
forecast for the eventual round two run-off between Fico (who, by the way, won permission
this week to appear on the vote ballot as “Fico” rather than Federico) and Petro, as all signposts
point that way. According to CNC, the run off intention stands…
 Gustavo Petro 43.1%
 Fico Gutiérrez 40.1%
…and that’s a lot closer than any other recent poll. After going deeper into the weeds of the
report, the key data point deems to be the way Colombia’s central coalition (the Sergio Fajardo
people) would split 2-to-1 toward Fico in the run-off. Therein lays the hope for Colombia’s
mining sector, as well as many other sectors of business and commerce who are dead set
against an eventual Petro presidency. Be in no doubt, Fico will be able to run a well-funded
second round campaign.
Brazil: Jair Bolsonaro a little closer to Lula
The latest poll from Brazil’s reliable PoderData pollster (19) was released on Wednesday and is
the first poll to measure voter intention since the unofficial start of President Jair Bolsonaro’s re-
election campaign. Here are the first round scores:
 Lula (PT): 41%
 Bolsonaro (PL): 32%
 Ciro Gomes (PDT): 7%
 Sergio Moro (Podemos): 6%
 João Doria (PSDB): 3%
 Others: 4%
 Vote in white: 5%
 Don’t know: 2%
31

And once again, this poll indicates Brazil will go to a second round run-off between Lula and
Jair, so for that…
 Lula 50%
 Jair: 38%
…it puts the gap at 12 points, which is still wide but does represent a slight narrowing of the
gap between the top players.
However, all this came before a big political day on Thursday, in which Jair Bolsonaro accepted
the resignation of ten of his cabinet in order they might run for the governorships of their
respective regions. The move was widely expected, with the strategy hoping to inject some
more life and impetus into Bolsonaro’s re-election bid. Meanwhile and on the same day, the
nominal third placed candidate Sergio Moro announced he was standing down from his re-
election bid (and moving to another centre-right party, though on Friday in another speech he
seemed to backtrack slightly and left room for a continued run (20)), while Sao Paulo governor
João Doria confirmed (to the surprise of some) he would continue with his Presidential bid. The
moves in the minor places are not expected to help or hinder Lula, but may see some
improvement to Bolsonaro’s voter intention.
The bottom line: Brazil’s election campaign has now begun in earnest and is bound to become
increasingly noisy between now and the first round of voting, set for October 2nd.
Market Watching
Deferred
I got lazy.
Conclusion
IKN672 is done, we end with bullet points:
 The case to own Superior Gold (SGI.v) is too strong for me to resist. I still think there
will be a window to buy more once its lower-end.
 Chile is in good shape, but be ready for another round of negativity when the “Stealth
Nationalization” story takes over and replaces the “Commies Will Steal Everything Now”
line that was used up to now. On the other hand, Ecuador is in bad shape so don’t fall
for the near-term banner headlines when President Lasso starts using executive orders
to push his pro-business agenda.
 I do feel bad about the typos.
I thank you in advance for any feedback. Our Top Pick stocks are Minera Alamos (MAI.v) and
Rio2 Ltd (RIO.v). Flash updates will be sent if required by events.
I wish you good trading fortune, ladies and gentlemen.
Best wishes, Mark
Footnotes, appendices, references, disclaimer
(1) https://edition.cnn.com/2022/02/01/politics/blinken-lavrov-call/index.html
(2) https://iknnews.com/gold-miners-gold-metal-continued/
(3) https://superior-gold.com/investors/#news-presentations
(4) https://www.youtube.com/watch?v=IzijBm3mFOU
32

(5) https://discoverysilver.com/news/discovery-intercepts-328-g-t-ageq-over-46-m-outside-current-resource-at-cordero/
(6) https://www.bloomberg.com/news/articles/2022-04-01/sudden-shanghai-lockdown-snarls-china-s-biggest-metals-hub
(7) https://finance.yahoo.com/news/copper-tightness-far-beyond-price-200923075.html
(8) https://www.youtube.com/watch?v=5KsH1NYDzK4
(9) https://www.youtube.com/watch?v=s4fTYwk0l9E
(10) https://www.emol.com/noticias/Economia/2022/03/29/1056359/ministra-mineria-confianza-nacionalizar.html
(11) https://www.bloomberglinea.com/2022/03/29/ministra-de-mineria-impuesto-a-mineras-podria-legislarse-en-amplia-
reforma-tributaria/
(12) https://www.reuters.com/business/cru-cesco-bhp-eyes-10-bln-chilean-investments-only-with-legal-certainty-2022-
03-29/
(13) https://www.elperiodista.cl/2022/03/presidente-aia-sobre-norma-de-concesiones-mineras-en-la-convencion-varios-
especialistas-advierten-que-va-en-el-camino-de-una-nacionalizacion-encubierta/
(14) http://www.ecuadorchequea.com/denuncia-de-chantaje-fractura-la-relacion-ejecutivo-pachakutik/
(15) http://www.ecuadorchequea.com/asamblea-cronica-de-la-ingobernabilidad/
(16) https://www.teleamazonas.com/empezo-la-campana-de-recoleccion-de-firmas-para-consulta-popular/
(17) https://www.reuters.com/world/americas/exclusive-peru-targets-copper-price-windfall-dialed-back-tax-reform-
minister-2022-04-02/
(18) https://www.elcolombiano.com/colombia/politica/elecciones-2022-gustavo-petro-y-federico-gutierrez-crecen-en-
intencion-de-votos-y-se-disputarian-segunda-vuelta-HD17147550
(19) https://br.noticias.yahoo.com/segundo-turno-diferenca-entre-lula-e-bolsonaro-cai-ao-menor-indice-de-2022-
154147046.html
(20) https://www.reuters.com/world/americas/brazilian-ex-judge-moro-not-ruling-out-presidential-bid-2022-04-02/
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
33

Bonterra Res BTR.v Jan'20 C$1.90 9-Dec-19 C$1.66 -12.6% TLS flip play, loss taken
McEwen Mining MUX Jan'20 U$1.12 2-Dec-19 U$1.18 5.4% TLS flip play, profit taken
Core Gold CGLD.v Jan'20 C$0.255 7-Apr-19 C$0.305 19.6% arb trade, profit taken
HudBay Min HBM Jan'20 U$3.56 9-Dec-19 U$3.36 -5.6% TLS flip play, loss taken
Midas Gold MAX.to Feb'20 C$0.71 5-Jan-20 C$0.57 -19.7% sm & silly trade
Warrior Gold WAR.v Feb'20 C$0.08 3-Aug-18 C$0.05 -31.3% clean out non-perf sm stocks
Contact Gold C.v Feb'20 C$0.40 19-Aug-18 C$0.18 -55.0% clean out non-perf sm stocks
Sandstorm Gold SAND Feb'20 U$3.73 17-Apr-16 U$7.21 93.3% Sold during port rebalance
NexGen Energy NXE Feb'20 U$1.20 2-Dec-19 U$1.06 -11.7% TLS flip play, loss taken
MAG Silver MAG Apr'20 U$8.95 1-Mar-20 U$10.07 12.5% Sold to cut silver exposure
Alexco Res AXU Apr'20 U$1.69 7-Sep-17 U$1.69 0.0% sold to close Ag exp. in FY20
Bonterra Res BTR.v Jun'20 C$1.62 2-Feb-20 C$1.10 -32.1% under-performer cash moved
Regulus Res REG.v Jun'20 C$0.64 6-Apr-15 C$0.79 23.4% moved $ TMQ/MIN & Au stocks
Great Panther GPR.to Aug'20 C$0.60 21-Jun-20 C$1.10 83.3% Profit taken, good trade
Jaguar Mining JAG.v Aug'20 C$0.42 21-Jun-20 C$0.65 54.8% Profit taken, good trade
Sandstorm Gold SAND Aug'20 U$7.76 10-May-20 U$9.37 20.7% Profit taken, good trade
Integra Resources ITR.v Aug'20 C$2.23 13-Aug-18 C$5.40 142.2% Profit taken, good trade
Wesdome Gold WDO.to Aug'20 C$2.37 14-Oct-17 C$14.82 525.3% last 1/2 of big win closed
INV Metals INV.to Sep'20 C$0.40 17-May-20 C$0.45 12.5% Cut all Ecuador exposure
Cartier Resources ECR.v Nov'20 C$0.155 3-Aug-18 C$0.25 67.7% Exact close price TBA
Tinka Res TK.v Dec'20 C$0.195 19-Apr-16 C$0.195 0.0% Closed on a round trip fail
2015 to 2019 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Stocks To Follow Closed Positions 2019
Closed in 2019 closed close price
Atico Mining ATY.v jan'19 C$0.55 24-Jul-16 C$0.32 41.8% patience ran out, made room
Candente Copper DNT.to jan'19 C$0.075 3-Ago-18 C$0.05 -33.3% tiny trade, made room for new
B2Gold BTO.to feb'19 C$2.11 12-Set-14 C$4.05 91.9% Took 1/2 profits, reduce size
Western Copper WRN.to mar'19 C$0.80 20-Ene-19 C$0.81 1.3% Spec trade that didn't work
B2Gold BTO.to mar'19 C$2.11 12-Set-14 C$4.15 96.7% Took rest of profit.
GT Gold GTT.v mar'19 C$1.17 10-Oct-18 C$0.90 -23.1% Took loss. Story changed
NovaGold NG apr'19 U$3.84 13-Ene-19 U$4.15 -8.1% Short that didn't work, sm loss
Zinc One Z.v jun'19 C$0.47 14-Set-17 C$0.025 -94.7% clearing out dead trade
Amarillo Gold AGC.v jun'19 C$0.24 22-Ago-18 C$0.20 -16.7% clearing out dead trade
New Gold NGD aug'19 U$1.44 31-Jul-19 U$1.23 14.6% ST short win thru Q2 earnings
IMPACT Silver IPT.v aug'19 C$0.39 21-Jul-19 C$0.46 18.0% took a quick profit
Fiore Gold F.v aug'19 C$0.34 26-May-19 C$0.56 64.7% Took profit, 2q19 avg
Chakana Copper PERU.v oct'19 C$0.84 22-Mar-18 C$0.16 -81.0% Exploreco trade fail. Want space
Wesdome Gold WDO.to oct'19 C$2.37 14-Oct-17 C$7.57 219.4% Sold half, profit taking
Superior Gold SGI.v oct'19 C$1.46 8-Abr-18 C$0.47 -67.8% Failed sm spec on Au. Moved on
Amerigo Res ARG.to nov'19 C$0.91 23-Set-18 C$0.50 -45.1% worst trade of year, hefty loss
Guyana Goldfields GUY.to dec'19 C$0.94 14-Abr-19 C$0.56 -40.4% taking the loss, financials weak
Tethyan Res TETH.v dec'19 C$0.30 8-Set-19 C$0.16 -46.7% tiny trade, word of probs in co
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
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B2Gold BTO.to May'18 C$2.11 12-Sep-14 C$3.67 73.9% sold 25% to reduce exposure
Lara Expl. LRA.v May'18 C$0.65 11-Feb-18 C$0.58 -13.8% Spec on Brazil didn't work
Solitario XPL June'18 U$0.72 19-Mar-17 U$0.41 -43.1% Failed trade, may return in 4q18
SolGold plc SOLG.to July'18 C$0.475 19-Nov-17 C$0.415 -12.6% cut, trade didn't perform
Pan American PAAS July'18 U$17.90 1-Jun-18 U$16.30 8.9% modest win on short position
NGEx Res NGQ.to Sep'18 C$1.01 22-Oct-17 C$1.00 -1.0% Closed to reduce Argentina exp
Sandstorm Gold SAND Oct'18 U$3.73 17-Apr-16 U$4.13 10.7% partial sale to raise cash for GTT
Aldebaran Res ALDE.v Nov'18 n/a n/a n/a n/a liquidate spin out of REG
Stocks To Follow Closed Positions 2017
Closed in 2017 closed close price
Continental Gold CNL.to Jan'17 C$2.68 22-May-16 C$4.17 55.6% trade closed, profit taken
Focus Ventures FCV.v Jan'17 C$0.23 1-Jul-12 C$0.05 -78.3% Give up, a disaster trade
Wesdome Gold WDO.to Feb'17 C$1.72 28-Aug-16 C$3.00 74.4% Target hit, sold, good trade
Belo Sun BSX.to Mar'17 C$0.90 30-Jan-17 C$0.90 0.0% failed near-term flip trade
Lara Expl. LRA.v Mar'17 C$1.15 8-Apr-12 C$1.05 -8.7% cut to make room for new trade
Rye Patch Gold RPM.v Apr'17 C$0.31 2-Sep-16 C$0.32 3.2% cut for doubts & new stock
Cordoba Min. CDB.v Jun'17 C$0.75 15-Sep-16 C$0.63 -16.0% closed
Constantine Metal CEM.v Aug'17 C$0.135 9-Apr-17 C$0.28 107.4% spec trade closed, good win
Red Eagle Min. R.to Sep'17 C$0.67 13-Dec-16 C$0.27 -59.7% IKN's biggest failure in years
Starcore Intl SAM.to Sep'17 C$0.61 10-Jan-15 C$0.31 -49.2% Patience ran out
B2Gold BTO.to Dec'17 C$2.11 12-Sep-14 C$3.39 60.7% sold small portion for liquidity
Stocks To Follow Closed Positions 2016
Closed in 2016 closed close price
Phoscan Chem FOS.to jan16 C$0.28 29-mar-15 C$0.265 -5.4% Buyout trade, bot but poor deal
True Gold TGM.v jan16 C$0.18 23-ago-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-ene-15 U$1.20 10.1% sold due to lack of value
Lake Shore Gold LSG.to feb-16 C$1.10 07-abr-15 C$1.69 53.6% bot out, sold early in process
Atacama Pacific ATM.v feb-16 C$0.19 26-abr-15 C$0.40 110.5% sold for a double on big pop
New Gold NGD feb-16 U$2.06 24-ene-16 U$2.96 43.7% closed good near-term trade
Sandspring Res SSP.v mar-16 C$0.195 18-oct-15 C$0.32 64.1% Hit tgt, took profit
Teranga Gold TGZ.to mar-16 C$0.54 15-feb-15 C$0.60 11.1% disappointing trade
B2Gold BTG mar-16 U$0.85 13-ene-16 U$1.30 52.9% Separate trade on B2, hit tgt
Dalradian Res DNA.to mar-16 C$0.67 27-oct-13 C$1.00 49.3% Hit target, sold, good win
HudBay Min. HBM may-16 U$4.10 03-abr-16 U$4.36 -6.3% Short trade, poor timing
Nevada Sunrise NEV.v may-16 C$0.185 28-feb-16 C$0.23 24.3% V. small, no big deal either way
Richmont RIC jun-16 U$7.60 01-may-16 U$9.30 22.4% near-term trade, profit taken
INV Metals INV.to jul-16 C$0.25 03-abr-16 C$0.95 280.0% Trade closed on time
HudBay Min. HBM aug16 U$4.98 09-jun-16 U$4.80 3.6% short trade covered, no big deal
Miranda Gold MAD.v oct-16 C$0.125 03-jul-16 C$0.10 -20.0% tiny spec trade, didn't work
Avino G & S ASM nov-16 U$2.00 21-oct-16 U$1.40 -30.0% Abandon trade on bad bot deal
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
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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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