IKN #703Premium

The IKN Weekly
Week 703, November 6th 2022
Contents
This Week: In Today’s Edition, Master of the Universe.
Fundamental Analysis: Amerigo Resources (ARG.to) and its bullet proof business model.
Stocks to Follow: Western Copper & Gold (WRN.to), Rio2 Ltd (RIO.v), Aldebaran (ALDE.v),
QC Copper & Gold (QCCU.v), Goldshore Resources (GSHR.v), Pure Gold (PGM.v), Minera
Alamos (MAI.v), Newcore Gold (NCAU.v).
Copper Basket: Overview, Nevada Copper (NCU.to), Oroco Resources (OCO.v).
Producer Basket: Overview, Barrick (GOLD) and Newmont (NEM), Gold Fields (GFI) and
Agnico (AEM) (and Yamana and Pan American).
TinyCaps Basket: Overview, Latin Metals (LMS.v).
Regional Politics: Brazil: Jair kind of concedes, Chile’s SEA softening its stance.
Market Watching: Abrasilver (ABRA.v) delivers its resource upgrade, A brief word on
Wesdome (WDO.to).
I remind subscribers that no part of this newsletter can be copied, reproduced or
given to any third party without the express permission of the author.
This Week
In Today’s Edition
 The IKN Weekly has copper-bottomed proposals for you today. The main fundies
section covers the Q3 results of our main copper trade Amerigo Resources (ARG.to),
the Stocks to Follow notes highlights the timely opportunity that may now be
presenting itself in Western Copper & Gold (WRN.to) and our Copper Basket section
considers the big Friday move in the metal and what it might mean.
 Not so much in Regional Politics this edition, but the interview given by Valentina Durán
of Chile’s environmental authority (SEA) this week is worthy of close consideration. This
Boric government is not going to do a 180° turn, but with its wings clipped by the
September Referendum reversal and the prospect of a Chile in recession next year it’s
now listening to economic reality. Without mining they are screwed and green agenda
or not, they know it.
 I sometimes wish there were more space to expand on the major mining companies
and their goings on, such is the case this week with both NEM and GOLD reporting,
plus the first mega-deal in the sector as PAAS and AEM have teamed up to out-bid (a
somewhat relieved) GFI for Yamana (AUY). We scoot through all that in the Producer
Basket notes, with a few high level thoughts replacing any real numbercrunch.
 We expected last week to be dominated by the FOMC meeting, it sure turned out that
way. In practical terms, it was a two and half day market week that began Wednesday
2pm and ended with an impressive Friday rally. That has left the metals market finely
poised for the week ahead, so today’s intro adds a couple of opinions on what went on,
plus thoughts on what it all might mean for metals and miners.
1

Master of the Universe
“Think’st thou that duty shall have dread to speak when
power to flattery bows? To plainness honour’s
bound when majesty falls to folly.”
King Lear Act 1 Sc1 LL164/167
“I have the power"
Prince Adam/He-Man
IKN701 was, “The hammer is the only tool”, last week in IKN702 it was “A weak US Dollar and
apathetic gold” and the messages of both were net negative for our sector, but this weekend
things are looking a little better and mostly due to Friday.
This chart (right) shows proxies for copper stocks
(COPX), gold bullion (GLD) and the PM miners (GDX) and
after a wretched post-FOMC they all went in the right
direction on a Friday to remember, particularly for copper
(see The Copper Basket for more on that). While data
provided enough reason to be moderately optimistic on
the shape of things to come, it was sentiment that drove
Friday’s sharp rally in stocks, bonds, broad market
indices and yes, even the metals. There were also
several moving parts to the week, including the mixed
messaging from the US Jobs report and the
rumour/denial/rumour train from China about upcoming relaxations to its strict Zero Covid
policy (see The Copper Basket for more on that), but here in today’s intro we’re going to
concentrate on the main event of the week, the fun and games from Wednesday’s FOMC. And
on the open blog that day I said as much in the post “The bit that matters in the FOMC
statement” (1) (which even though posted Wednesday afternoon was almost the first thing on
the blog all week…there simply wasn’t much to say about the non-action on Monday or
Tuesday). Anyway, in the post we first pasted out the only wording change in the FOMC
statement since the September statement…
"In determining the pace of future increases in the target range, the Committee will
take into account the cumulative tightening of monetary policy, the lags with which
monetary policy affects economic activity and inflation, and economic and financial
developments."
…then translated it…
Translation: "We'll slow down the tightening for non-monetary reasons if required."
…then translated the translation:
Translation of translation: "Pivot begins."
Then once Jay Powell had finished his presser, this was added (and the main takeaway is
highlighted for your convenience:
UPDATE: So here's the thing about that seriously hawkish Jay Powell presser: We
know the Fed wants to jawbone the market and we know the Fed Head wasn't going to
pass up this prime opportunity to cap any gains in the equity markets (we repeat; the
last thing he needs is people feeling wealthy) so of course he threw as much shade as
possible at the market. Hence all that talk about it being "very premature" to reverse
policy (which does not preclude a 50bps next time, as it would be the same direction)
or the way they're less worried about over-tightening than loosening too soon (which,
when you consider its logic, means nothing at all). So be clear, what the Fed writes in
its Statement is far more important than the post-FOMC massage, the Board is
judged on what it writes to the world and not on the ad-hoc presser afterward. The
above wording is new this month, ignore it at your peril.
That got the hackles up of some readers, especially on Thursday when the daily mailer readers
compared that position to the way the market was tanking that morning (WhatsApp, mails,
even a couple of comments on the blog…all welcome). But come Friday it was looking on-point
again and, as I write these words Sunday midday-ish, I see no reason to change stance. Jay
Powell layered on the jawbone on Wednesday afternoon and created the skittish market that
ran through Thursday, but what they write in the 2pm communiqué will always be the more
2

relevant takeaway than the 2:30pm talkshow, as the chat can always be walked back. We saw
as much on Friday when his colleagues took turns to dampen a newly fearful market. “We’ll
look at the data first”, said one. “We should relax the speed of hikes and see how they affect
the jobs market first”, said another. Indeed, Shakespeare’s “The lady doth protest too much
methinks” was high in my mind as I watched the Fed presser on Wednesday, but as it gets
over-used on these pages we went for a bit of Lear instead. Fed Head Jerome Powell laid the
hawkish language on thick and managed to move the market in way he desired that afternoon
and then for most of Thursday, but it didn’t last long and while there are fundamentals reasons
to point to for Friday’s rally…
 Yes, the US Jobs numbers allowed the USD to weaken slightly.
 Yes, the Chinese “Covid Zero” hearsay was conveniently timed.
 Yes, Thursday’s market probably oversold on the Jay Powell shade, and as a result…
 Yes, the messaging from Federal Reserve underlings on Friday that they would
indeed vote to slow the rate of increases as from December “if the data demanded
it” helped add to the renewed bullishness.
…Friday was more than the sum those parts.
Friday used those partial reasons but added a
rebellious sentiment; it was a market that
wanted to go up, a market that was getting
sick of dancing to the tune of one single man
at the centre of the game. It’s one thing to
debate whether the Fed is in front of or
behind the curve, but when the Dow rises and
falls in seconds due to the various utterances
of the Fed Head and how they are interpreted
during a press conference, it starts to get a bit
much for capital markets that disdain such
concentrations of power in any individual, let alone one who dances to the government tune.
The markets will only stomach so much power being held in the hands and opinions of just one
man for so long before pushing back, so Friday was less fighting the Fed, more fighting its
head. All it took was for a couple of Fed underlings to soothe Wednesday’s overly-hawkish
message and the rally took flight and in the process, we also witnessed a market make the
deliberate decision to ignore the data and go with its gut. There’s plenty of data pointing to the
growing chances of either recession or stagflation, for example in the deepening of the yield
curve inversion. Our preferred 10Yr – 2Yr tracker (above) hit a 21st century low on Thursday of
-0.57% and while it rallied to close at 0.49% on Friday, that’s still a clear signal that 2023 or
2024 (or both) are set for US recession, with all the misery and job losses that would entail.
The gold market was another to summarily ignore the deteriorating macro backdrop and as a
result, GLD holdings sold off even further. Its inventories are down to 906.96 metric tonnes and
with holders liquidating at the same time as that Friday price rally, the Inventory/Price ratio
sunk hard on Friday to close at an abysmal 5.8X. It was slightly lower than that at the peak of
the Ukrainian invasion fear moment, but it’s now close deeply oversold and ready to revert.
GLD gold holdings, 2022 YTD (metric tonnes)
1140
1120
1100
1080
1060
1040
1020
1000
980
960
940
920
900
880
3
12/21/13 22/1/01 22/1/02 22/1/03 22/2/9 22/2/91 22/3/1 22/3/11 22/3/12 22/3/13 22/4/01 22/4/02 22/4/03 22/5/01 22/5/02 22/5/03 22/6/9 22/6/91 22/6/92 22/7/9 22/7/91 22/7/92 22/8/8 22/8/81 22/8/82 22/9/7 22/9/71 22/9/72 22/01/7 22/01/71 22/01/72
mt 6.50 GLD: Inventory/Price Ratio, 2022 YTD
6.40
6.30
6.20
6.10
6.00
5.90
5.80
5.70
5.60
source: SPDR GLD data 5.50
13/21/1202 01/1/2202 02/1/2202 03/1/2202 9/2/2202 91/2/2202 1/3/2202 11/3/2202 12/3/2202 13/3/2202 01/4/2202 02/4/2202 03/4/2202 01/5/2202 02/5/2202 03/5/2202 9/6/2202 91/6/2202 92/6/2202 9/7/2202 91/7/2202 92/7/2202 8/8/2202 81/8/2202 82/8/2202 7/9/2202 71/9/2202 72/9/2202 7/01/2202 71/01/2202 72/01/2202
Source: SPDR data, IKN calcs

The above quote from King Lear comes as one of his loyal subjects, The Earl of Kent, summons
the courage to confront the king with one of his bad judgment calls (the play is scattered with
them, of course). His quote continues with, “Reverse thy doom; And in thy best consideration
check This hideous rashness” and that’s the market’s message for Jay Powell this weekend. The
money wants less talk about “Whatever It Takes” to beat inflation, more thought about the
unemployment the Fed seems bent on creating as a side-effect. That would mean a pivot
earlier rather than later and the narrative is now set for a more nuanced situation, where the
Fed can keep raising by “only” 0.5% or even 0.25% at a time, tighten the money supply but at
the same time, appease those who fear a direct run into a deep recession. And as for The Earl
of Kent, the fact that he ends up in the stocks and ridiculed by Lear’s court jester after his
impertinence of questioning his own Master of the Universe is neither here nor there. Hopefully,
anyway.
Fundamental Analysis of Mining Stocks
Amerigo Resources (ARG.to) and its bullet proof business model
If only there were a copper trade out there that offered strong downside price protection at
current metals prices, as well as a highly leveraged upside if metals climbs a little further. If
there were only a company that combined strong financials with the potential for fast gains for
speculators in junior mining sector.
Step forward, Amerigo Resources (ARG.to). There was a lot to like about its 3q22 results filed
on Wednesday and this weekend’s Fundies section is dedicated to continued coverage of our
preferred copper play (and personal largest copper position). Our job to day is to run the
numbers on the quarter, but also touch on the following subjects:
 ARG underscored the validity of our model for the company while copper at U$3.50/lb.
That price is all the company needs to
sustain its current business model and pay
its attractive C$0.03 dividend per quarter,
which is still a yield of over 10% even after
last week’s price pop (the latest 3c divi was
declared on October 31st).
 ARG gave us clear forward guidance on the
potential for either extra bonus dividends,
or the resumption of share buybacks, or
both. If/when copper returns to U$3.80/lb
pr above, the company will be in financial
shape to start ratcheting up shareholder
returns via those methods, thereby creating a virtuous circle for the share price.
 ARG the company reiterated how it’s now running on rails, with a flexible production
regime now in place that allows it to maintain mill output no matter what happens at its
tailings feed supplier, Codelco’s El Teniente (DET) mine.
 Finally, ARG is moving to better promote its outstanding ESG advantage to a wider
audience and is not limiting its promotion to the mining sector. Done effectively, this
should open the company and its story to a new range of potential shareholders.
That’s the outline for today so before we get into the weeds, here are the useful links for
today’s ARG anal ysis: This (2) takes you to the 3q22 news release, this (3) or this (4) for the
earnings call recording and this (5) is the latest corporate presentation, bang up to date with
the latest numbers. With that out the way, we move to charts and results.
4

3q22 results and financials: We begin with
the copper production and sales breakdowns,
starting with the most basic of charts.
Production came to exactly 16m lbs Cu, sales
to 16.18m lbs Cu and the company reiterated
its guidance for 63.8m lbs total for 2022,
which implies production/sales of 16.4m lbs
for the current Q4. Below is a little more
detail, the long-term breakdown chart of
copper production and we see to the right that
the company relied more heavily on the
historic Cauquenes tailings supply in Q3 than
in recent quarters. During the Conference Call,
CEO Aurora Davidson explained that supply of
fresh tailings from the Codelco El Teniente mine (DET) saw unexpected breaks, but the
flexibility in the company model these days means virtually zero lost processing time.
ARG: Production breakdown by source, per qtr
5
92.01
404.5
687.9
7.5
695.9
30.6
109.8
903.5
231.9
625.5
309.11
256.5
747.31
587.4
114.8
395.4
322.8
121.5
301.11
589.4
61.11
75.4
717.5
131.5
13.6
66.6
8
86.6
82.9
71.7
74.8
30.7
16.7
73.7
73.7
26.8
46.7
62.9
68.6
16.9
97.5
31.9
73.7
36.8
26
24
22
20
18
16
14 12 10
8
6 4
2
0
71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3
ARG.to: Copper sales
Mlb Cu
Slag processing
Cauquenes tailings
Fresh tailings
source: company filings
This small inset chart (right) shows the data for fresh
tailings production only. This brings advantages and
disadvantages, as the historic tailings allow for more molly
credit production and that’s a minor benefit, but the
historic tailings require more reagents and are more
expensive to process, which is why the company has
moved to lean on the fresh DET supply as much as
possible in recent years. CEO Davidson confirmed during
the ConfCall that DET supply was back to normal in Q4
and that should help ARG keep total costs down for the
upcoming quarter. As for average sales price, this chart
below left also made our preview a couple of weeks ago and confirms the preliminary
assumption of U$3.50/lb for Q3 and Q4.
28.11 7.31 29.41 9.51 11.51 31.51 9.61 298.61 92.61 9.41 81.61 4.61
25
22.5
20
17.5
15
12.5
10 7.5
5
2.5
0
02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
source: company filings
rtq/uC
sblM
ARG: Cu from DET fresh tailings only, per qtr
31.5
66.6 86.6 71.7 30.7 73.7
26.8 62.9 16.9 31.9 36.8
10
9
8
7
6
5
4
3
2
1
0
02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3
source: ARG data
uC
bbl
M
ARG: Average Cu price for MVC
29.2 76.2 26.2 67.2 53.2 16.2 40.3
25.3
80.4 44.4 32.4 23.4 46.4 01.4
05.3 05.3
5
4.5
4
3.5
3 2.5
2
1.5
1
0.5
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
U$/lb Cu ARG: Gross Cu and fair value adjustments, per qtr
source: Company data/IKN ests
341.85 436.66 100.27 36.27 797.37 766.36 457.65 4.75
80
70
60
50
40 30
20
10
0
-10
12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
U$m
Cu gross value
Fair value adj
source: company filings

The chart above right gives a breakdown on how gross copper sales (U$56.754m for 3q22)
were reduced by the “fair value adjustment”, as the company accounted for the change in
previous assumed copper revenues and the actual received. In both the NR and the ConfCall,
ARG went to some lengths to explain what is essentially an accounting device that adjusts
assumed revenues to final received revenues. As we can see in the chart above, in 2q22 ARG
made a provisional assumption that it would get U$4.10/lb for its copper. However, we also
know that since that time copper prices fell off a cliff and dropped to under U$3.20/lb at one
point, eventually recovering to a recent range of between U$3.40/lb and U$3.60/lb. As ARG
uses the standard industry method of being settled for any copper deliveries three months after
the date of sales, that means their assumption of getting U$4.10/lb for its 2q22 production was
wrong. In fact and as explained in the NR, this is what they got for the metal:
Q2-2022 copper deliveries were marked-to-market at June 30, 2022 at $4.10/lb and
were settled in Q3-2022 as follows:
• April 2022 sales settled at the July 2022 LME average price of $3.41/lb
• May 2022 sales settled at the August 2022 LME average price of $3.61/lb
• June 2022 sales settled at the September 2022 LME average price of $3.51/lb
Over the long-term, this system is a wash and doesn’t really matter much either way; A
company can make all the financial assumptions in the world, what really matter are the dollars
it receives. However, accountancy is accountancy and must be done so, as ARG assumed too
much revenue for 2q22, it has to adjust down when the money is received and in 3q22 it has
taken a chunky U$8.776m to its top line copper gross revenues. In real terms it’s a wash over
time but for accounting purposes it’s a double-edged sword as in quarters when copper
suddenly rises sharply, ARG will get to benefit from an accounting bonus in the following
quarter’s books. As one example, its 1q21 numbers were boosted by U$8.53m, as the copper it
sold in 4q20 at a provisional U$3.52/lb in fact sold for over U$4.10/lb, thanks to the big move in
copper at the start of 2021 (I remember it well). However, in the two recent quarters the drop
in copper prices have seen hefty negative adjustments and for another way to cut and slice
things, they also show up on this next chart:
ARG: Gross Cu value, Cu revs and Revs total, per qtr
6
341.85
376.66
709.84
436.66 293.17
305.05
100.27 431.96
231.84
36.27 172.57
900.25
797.37 904.97
567.35
766.36
818.55
485.33
457.65 879.74
858.03
4.75 4.75
58.83
90
80
70
60
50
40
30
20
10
0
12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
U$m
Cu gross value
Cu revs
Revs total
source: company filings
Here we see 1) the gross sales value of the copper this quarter (in 3q22 U$56.754m, or 16.18m
lbs at the provisional U$3.50/lb give or take 100k), then 2) the copper revenues after the fair
value adjustment in 3q22 U$47.978m), then the total revenues number that makes it to the top
line of the Profit+Loss sheet (in 3q22 U$30.858m). As explained previously, to get that number
we subtract the royalty payments to DET, smelting, refining and transport charges as seen in
the chart below left then below right, the add back of moly credits:
ARG: Mo credits
605.3
267.4
116.5
822.4
683.3
142.2
294.3
4.2
6
5
4
3
2
1
0
12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
ARG: Charges to Cu revs U$m
35
30
25
20
15
10
5
0
source: company filings, IKN ests
12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
U$m Transport
smelting/refining
DET royalties
source: company filings, IKN ests

These next charts show a different way of doing the main math involved and offer a better
handle on the cost incurred by ARG to produce its copper. This chart considers the three main
cost items per Lb of copper sold, i.e. the DET royalty, the smelting/Refining charge, then the
COGS/lb as seen on the P+L:
ARG: Main costs per Lb Cu
7
88.1
60.1
18.1
33.1
26.1
22.1
86.1
82.1
09.1
73.1
10.2
32.1
39.1
88.0
59.1
88.0
4.00
3.50 0.33 0.39 0.39
3.00 0.32 0.33 0.32 0.37 0.37
2.50
2.00
1.50
1.00
0.50
0.00
12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
U$/lb smelt/refine/lb
cash cost/lb
DET royalty/lb
source: ARG data, IKN ests
For 3q22 they add up to U$3.18/lb and when set against the average expected copper price for
the quarter as seen below, show a difference of U$0.32/lb. Equally, we run the numbers for
4q22 and arrive at an estimated difference of 30c/lb for the quarter to come.
ARG: Estimated margin/Lb Cu
52.3 80.4 38.0 74.3 44.4 79.0 61.3 32.4 70.1 82.3 23.4 40.1 56.3 46.4 99.0 36.3 01.4
74.0
81.3 05.3
23.0
02.3 05.3
03.0
5.00
4.50
4.00
3.50
3.00
2.50 2.00 1.50
1.00
0.50
0.00
12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
U$/lb Cu main cost subtotal
Avg Cu price
difference
source: ARG data, IKN ests
While there are other small deductions to make (e.g. transport, the low G&A, a small financing
expense and the catch-all “other”), the three items in the first chart make up the vast majority
of overall operational and corporate costs. The resulting margin backs out that accounting-
adjustment and shows that ARG over the long-term can survive and thrive at the (until last
Friday) current copper price deck of U$3.40lb/U$3.50/lb. This, in essence, has been our
investment thesis from the getgo and at the risk of over-simplifying and assuming the company
delivers on its production and costs guidance, it works something like this:
 At U$3.00/lb copper, the company can get by for a while and continue to pay its
juicy dividend
 At U$3.40/lb to U$3.50/lb copper, the current business model is self-sustaining and
the company can pay its dividend indefinitely
 At U$3.80/lb copper, the company starts making enough money to consider the
payment of bonus dividend.
 At U$4.00/lb and above, ARG goes back into serious moneymaking mode.
And indeed the company agrees with this stance. We read in the MD&A and heard in the
ConfCall that the MVC operation is running well, the scheduled wage negotiation with the main
union has closed successfully and inside expected budget (we add a U$2.9m one-time charge
to Q4 for the bonus payment due) and capital works are expected to finish inside budget for
the year (one project deferred, another scheduled for 2023 has started ahead of time). We also
heard specific confirmation from CEO Davidson that the company will indeed continue to pay its
3c/qtr dividend indefinitely and that as from U$3.80/lb, it will consider using the next NCIB
share buyback facility and/or pay bonus/top-up/performance dividends on top of the regular
dividend. In other words, a great fit on our model.

The balance sheet items underscore these data. The overview assets and liabilities charts show
a decline in the last two quarters as lower copper prices have affected cash treasury, we also
take into account the upcoming $3.5m scheduled debt payment and the $2.9m that’s going to
the workforce this quarter. Despite the lower than expected revenues in Q2 and Q3 (and the
new estimates for Q4) the cash position shows that ARG will have no problem in covering the
approximate U$4m in quarterly dividends.
ARG.to: Total Assets
350
300
250
200
150
100
50
0
While working capital looks thin (we model the next three quarters to show that it’s likely to
stay the same at current copper prices U$3.50/lb), a cash position that won’t drop much below
U$40m (not Canadian, recall) provides all the leeway required to keep those dividends running.
And once the 2021/2022 share buybacks are taken into account (below left and please don’t be
fooled by the cut-down Y-axis), the only real change to the intrinsic value of the company in the
last quarters in Canadian Dollar terms are the dividends paid to its shareholders (below right).
This chart mapping ARG’s book value is the reason why this company is such a strong buy at
8
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
source: company filings
srallod
fo
snoillim
ARG.to: Liabilities Breakdown per qtr
200
cash&eq Trade/Rec
Inventory other current 180
fixed 160
140
120
100
80
60
40
20
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
source: company filings
srallod
fo
snoillim
LT liab
current liab
ARG.to: Cash and ST
80
70
60
50
40
30
20
10
0
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
ARG.to: Working capital $m
40
30
20
10
0
-10
-20
-30
-40
source: company filings
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4 tse32q1 tse32q2
U$m
source company filings
ARG.to: Shares Out
190
(NB: cut down Y-axis)
185
180
175
170 165
160
155
150
71q1 71q2 71q3 71q4 81q1 81q2 81q3 81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 22q4
source: company filings, IKN ests
serahs
fo snoillim
ARG.to: Book value per share, per qtr
77.0 27.0 17.0 17.0 86.0 66.0 07.0 77.0 38.0 19.0 79.0 00.1 60.1 00.1 00.1 10.1
1.20
1.10
1.00
0.90
0.80
0.70
0.60 0.50 0.40
0.30
0.20
0.10
0.00
91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
CAD$
source: company filings, IKN ests

current levels. Even if copper fails to rally we have a company that is distributing its asset value
to its shareholders and at current valuations, even if copper collapses and ARG has to batten
down the hatches, its downside compared to hard asset value is minimal. This isn’t the same
company as five or ten years ago when it traded around 50c, there’s more basic backbone and
a mature, profit-making operation that won’t see its equity crushed as low again.
With the downside to the current price minimized, we finish today on an optimistic note and
consider an ARG.to at potentially higher copper prices. We know that at the moment, with
copper at U$3.50/lb, that the company will sustain its business model and pay its way but won’t
consider an extra corporate financial moves until copper re-gains the U$3.80/lb line. This,
therefore, sets up a virtuous circle and a clear trigger price for ARG as, if copper continues to
climb toward a steady U$3.80/lb level, we can expect ARG shares to get bought up by people
who now know that once it crosses that line, the company itself will join in on the open market
and buy its own shares (as from December 2022 when the next NCIB opens, at least). Then as
copper climbs above U$4.00/lb shareholders will know that they are onto a true cash cow that
not only collects serious treasury cash, but will distribute it quickly and efficiently according to
its policy. This is why Amerigo Resources (ARG.to) is such an attractive proposition at this
specific juncture of the market:
 If price remain steady, we collect a quiet and juicy 3c/qtr
 If prices drop, there’s enough strength in its financial background to maintain the
equity price
 If prices rise, ARG moves quickly into cash cow mode and with clear trigger points
for the share price to move quickly higher.
All the upside potential, minimal downside risk and
even if the copper market stagnates at current
prices, its investors will reap their reward. That’s
Amerigo Resources in 4q22 and we leave this
report on the company’s 3q22 results with a 12-
month comparative of ARG with the continuous
contract spot copper (HG00). The timing looks
good to me.
Stocks to Follow
Despite there being just five winners (MAI.v, ARG.to, ALDE.v, PA.v, MENE.v) among the 17
covered and followed stocks, the personal back pocket did well because two of the winners
were my largest holdings. Also, the pop seen in Aldebaran (ALDE.v up 21.9%) helped a little
and in sum, the winners out-weighed the ten losers (QCCU.v, RIO.v, CKG.v, NCAU.v, GSHR.v,
APN.v, PGM.v, ATC.v, ELBM.v, XYZ.v), with two stocks remaining unchanged on the week
(MIRL.cse, WRN.to).
We currently have 17 stocks under consideration and I own shares in 13 of them. Just three are
in the green.
9

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$0.405 92.9% $0.75 first tgt, #1 idea
RECOMMENDED STOCKS
Amerigo Res ARG.to STR BUY C$1.36 12-Dec-21 C$1.12 -17.6% CheapCu w/low downside risk
QC Copper&Gold QCCU.v BUY C$0.275 25-Apr-21 C$0.155 -43.6% Now drilling. Easy hold
Rio2 Ltd. RIO.v HOLD C$0.83 22-Apr-18 C$0.12 -85.5% Cheap on permit probs, appeal
SPECULATIVE TRADES
Chesapeake Gold CKG.v SPEC BUY C$3.07 20-Feb-22 C$1.95 -36.5% Au leverage, small trade so far
Aldebaran Res. ALDE.v BUY C$0.72 16-May-21 C$0.89 23.6% trying patience
Newcore Gold NCAU.v SPEC BUY C$0.21 23-Oct-22 C$0.20 -4.8% Near-term spec trade idea
Goldshore Res GSHR.v SPEC BUY C$0.18 23-Oct-22 C$0.185 2.8% Near-term spec trade idea
Palamina Corp PA.v SPEC BUY C$0.295 21-Nov-21 C$0.08 -72.9% Au expl in S.Peru
Altiplano Metals APN.v HOLD C$0.31 17-Sep-21 C$0.175 -43.5% Cheap entry, plan on track.
Pure Gold PGM.v hold C$0.14 26-Sep-22 C$0.015 -89.3% tiny trade, hit Ch11 wall
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.095 -51.3% CEO change will move stock
A WATCHLIST OF POTENTIAL TRADES. NB: I DO NOT OWN
ATAC Res ATC.v SPEC BUY C$0.095 11-Sep-22 C$0.08 -15.8% Cheap Yukon neighbour play
Electra Battery ELBM.v WATCH C$5.31 20-Mar-22 C$4.00 -24.7% potential battery metals play
Anacortes Mining XYZ.v WATCH C$0.49 22-Jul-22 C$0.48 -2.0% potential gold exploreco trade
Western Copper WRN.to SPEC BUY C$2.41 20-Mar-22 C$1.81 -24.9% potential copper trade
LONG-TERM NON-MINING HOLD
Mene Inc. MENE.v adding C$0.66 6-Dec-20 C$0.52 -21.2% 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
McEwen Mining MUX Apr'22 U$0.89 2-Jan-22 U$0.82 -7.9% No 2022 turnaround, cut loss
Abrasilver Res. ABRA.v May'22 C$0.42 24-Apr-22 C$0.33 -21.4% sold to reduce Ag exposure
Strategic Metals SMD.v May'22 C$0.42 31-Jan-21 C$0.30 -28.6% trade flatlined 1.5 years
Discovery Silver DSV.v Jun'22 C$1.77 24-Oct-21 C$1.39 -21.5% Cutting Ag exp.& raising cash
Element 29 ECU.v Jul'22 C$0.58 6-Mar-22 C$0.30 -48.3% sold to cut Cu exposure
Superior Gold SGI.v Oct'22 C$0.95 3-Apr-22 C$0.24 -74.7% Q3 prod fail was last straw
2015 to 2021 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Now for a few notes on some of the covered companies:
Rio2 Ltd (RIO.v): The stock continues to bounce around in the same penalty box and while
penny and 2c moves in either direction make for big percentage differences, there’s no real
change until and unless some volume arrives in the stock. Meanwhile, I’d encourage all readers
to visit this weekend’s Regional Politics section and the note “Chile’s SEA softening its stance”,
as that’s the office behind the denial of the RIO.v permit in July. While the political signals are
subtle rather than blatant, there’s good reason to believe that good corporate citizens can
indeed get their permits from this government in the future, especially those in good standing
with their communities.
Western Copper & Gold (WRN.to): WRN was one of many stocks to file its 3q22 financials
last week and while others require closer inspection to understand the state of play, we can do
enough of this financially straightforward company in the Stocks to Follow notes to cover the
basics, just four of our tracking charts should be enough.
10

WRN’s financial are an archetype for the junior exploreco and that’s always been an advantage
to this story, no matter what you think of the large, remote and low grade Casino project. The
assets and liabilities overview charts demonstrate this, with tiny amounts on the debit side of
the ledger and assets that capitalize exploration at this advanced stage of development. The
other thing to note is the good housekeeping at WRN that sweeps reserve cash into an interest
bearing account. That policy has provided WRN with over a third of a million in Canadian dollar
interest and helps keep the burn rate down.
WRN.to: Assets per qtr
140
120
100
80
60
40
20
0
On that subject, the other two charts today show how working capital (below left) remains
more than adequate to cover the combo of corporate operating expenses and mine property
expenses (below right), which is essentially its total burn.
The latest quarter was heavy on the mine exploration as WRN completed its 2022 drilling
campaign (in conjunction with the desires of its strategic partner, Rio Tinto). This latest quarter
is likely to be the last heavy burn we’ll see, as WRN now moves into its permitting application
period. On that, WRN announced last week that there are some minor changes to the social
and community consultation period but the changes aren’t expected to meaningfully alter the
permitting timeline.
Finally and importantly, the terms of the agreement with Rio Tinto is about to expire at the end
of this month, which means RTZ either loses its board observer (i.e. the inside track on the
data) or RTZ extends its agreement by another 12 months. In other words, the ball is in RTZ’s
court and we’re about to find out whether the big partner is truly interested in buying Casino,
or whether they are going to step back from a foothold position in a large copper project (for a
company the size of RTZ, 8% of a U$200m market capper is a rounding error on its books).
Clearly, WRN and its shareholders would like to see a move from RTZ that indicates its
continued interest in Casino. Therefore, ladies and gentlemen, we’re at some sort of put-up-or-
shut-up moment for this company and RTZ, a sentiment that applies directly to this desk as
well. If these three are true…
 RTZ is a likely buyer of Casino
 We like Casino and the opportunity it provides in the current market
11
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3
C$m WRN.to: Liabilities per qtr
6.0
5.5
fixed 5.0
other current 4.5 St inv 4.0
cash
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
source: company filings
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3
source: company filings
srallod
fo
snoillim
LT liabs current liabs
60 WRN.to: Working Capital per qtr
55
50
45 40
35
30
25
20
15
10
5
0
81q4 91q1 91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3 tse22q4
source company filings
srallod
fo
snoillim
WRN: Cash burn/qtr, 2019 to date
11
10
9
8
7
6
5
4
3
2
1
0
91q2 91q3 91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 22q3
C$m
min. prop exp.
operating exp.
source: company filings

 The copper is looking more positive
…then it’s time for your author to make a decision. So be clear, WRN is now at the very top of
my personal shopping list and I’ll be watching the development of the copper price very closely
in the week ahead. See The Copper Basket below for more on that.
Aldebaran (ALDE.v): Last week ALDE awarded
4.65m incentive options to insiders at a strike of
79c. Which is fair enough, though the illiquid nature
of the stock means that they need to improve
trading in order to cash them in. The stock rose by
over 20% on the week and that’s good at face
value at this Friday’s 89c close is the highest price
since last April, but the tiny volumes involved mean
that could reverse if even one seller shows up with
a desire to liquidate. With Tax Loss Selling season
now on the horizon that’s always a possibility, this
stock spent most of Q1 this year trading above a
Loonie.
QC Copper & Gold (QCCU.v): We’re in a quiet
period for this stock. For sure its share price has
taken the same type of beating as many others
small juniors in 2022, but we seem to have
confirmed a bottom in its price action and the way
QCCU absorbed a larger seller on Monday (480k
shares traded that day, mostly in two lumps) at 15c
was encouraging. It was thin stuff the rest of the
week, however.
Goldshore Resources (GSHR.v): We got another
drill assay NR from GSHR on Wednesday (6), with
the company reporting a headline cut of (we quote) “…1.34 g/t Au over 90.95m in 100 Meter
Step-Out to the North”. That’s a decent step out and the type of assay we’ve come to expect
from Moss Lake, but the real news from the company came this time from the CEO comment
below. Here’s part of the extended quote, your author adds a couple of highlights
“As we illustrated at the end of H1 2022, our focus turned from identifying and drilling
the size of the global resource; to identifying the high(er) grade sections contained
within the historical resource (and stepped out from the historical resource), and
focusing on building a much smaller open pit project PEA around this. The results from
this change in focus are evident in press releases in H1 2022 and Q3 2022, and
continue with the results highlighted today. To that end, we are expediting our
independent mineral resource estimate (“MRE”) on the high(er) grade sections
within the historical resource, and look to have the results of this MRE presented
to the market by the end of 2022, versus the end of Q1 2023, as previously guided.
This will also lead to the Company accelerating a preliminary economic assessment
(“PEA”) on a smaller, high(er) grade resource, but much more manageable
project in terms of CapEx and project timeline, versus a large-scale project PEA on
an updated larger resource similar to the historic resource.
We know that GSHR changed tack when the market got rough earlier this year, cutting back on
a very aggressive eight rig drill campaign. We now know that the change of plan includes a new
focus, as they aim at the sweet spot of Moss Lake and plan to deliver a smaller sized 43-101
compliant resource by the end of this year, followed by a PEA on the same by the end of 1q23
latest. They’re sure to remind us along the way that the large-scale potential of Moss Lake
hasn’t suddenly disappeared and that the move to so smaller and deliver a higher-maergin,
lower capex project is in reply to a tough market. That’s fair enough and we therefore wait to
see how large/small they aim for a MRE that seems destined to be marketed as a starter pit.
Pure Gold (PGM.v): As expected, PGM filed for and achieved creditor protection last week
12

and the stock sold off on the news. To repeat, I will hold this position through the process as its
almost literally not worth my time to liquidate it (it was very small even before the
care&maintenance decision crash the stock). I consider it as paying for a ticket to a show.
Minera Alamos (MAI.v): The price weakness on volume continued in the early days of last
week, though it was good to see volume dry up on Friday and the stock price crawl back into
the 4-handle as market sentiment changed again. There’s no real way of knowing, but the
trading patterns I witnessed on the tape last week, particularly on Monday, fit the working
theory of a short attack on the stock.
Newcore Gold (NCAU.v): The disappointing trader of the bunch last week, it dropped and
then did very little. The small starter position is opened, no need to make a second move
immediately. Watching brief.
The Copper Basket
After forty-four weeks of 2022, The Copper Basket shows a loss of 46.69% to level stakes:
company ticker price 1/1/22 Shares out Market Cap current pps gain/loss%
1 Copper Mtn CMMC.to 3.42 210.166 388.81 1.85 -45.9%
2 Marimaca Cop MARI.to 3.77 88.118 274.93 3.12 -17.2%
3 Western Copper WRN.to 2.00 151.597 274.39 1.81 -9.5%
4 Nevada Copper NCU.to 0.71 658.638 200.88 0.305 -57.0%
5 Oroco Res OCO.v 2.04 207.033 194.61 0.94 -53.9%
6 Aldebaran Res. ALDE.v 0.84 138.579 123.34 0.89 6.0%
7 Hot Chili HCH.v 1.53 109.223 90.66 0.83 -45.8%
8 Regulus Res. REG.v 1.06 101.85 76.39 0.75 -29.2%
9 Meridian Min MNO.to 1.18 153.735 55.34 0.36 -69.5%
10 C3 Metals CCCM.v 0.16 645.379 35.50 0.055 -65.6%
11 Doré Copper DCMC.v 0.79 84.1 26.91 0.32 -59.5%
12 Kutcho Copper KC.v 0.88 103.94 22.87 0.22 -75.0%
13 QC Copper QCCU.v 0.34 129.06 20.00 0.155 -54.4%
14 Element 29 Res ECU.v 0.58 79.24 17.43 0.22 -62.1%
15 Coast Copper COCO.v 0.13 41.335 2.07 0.05 -61.5%
NB: All stocks in CAD$ Portfolio avg -46.69%
The basket average would have been a lot worse if it weren’t for the neck-breaker rally we saw
in copper on Friday, even so the overall average
The Copper Basket 2022, weekly evolution
failed to move up much and of our 15 charges, 10%
just seven returned Week-Over-Week wins 0%
(OCO.v, MARI.to, NCU.to, HCH.v, ALDE.v, KC.v, -10%
DCMC.v), with three others remaining unchanged -20%
on the week (WRN.to, CMMC.to, COCO.v). That
-30%
leaves five losers (MNO.to, REG.v, CCCM.v, ECU.v,
-40%
QCCU.v) and that’s a lot for a week when spot
-50%
copper improved by almost 8%. As for the
-60%
winners, the best move came from Aldebaran
(ALDE.v up 21.9%), a move that brings one small
spot of green back to the table above. Quite nice
to own that stock at the same time (but a pity QC Copper can’t emulate the move, to date at
least). The other big mover was Nevada Copper (NCU.to up 19.6%) on the back of the
finalization of its corporate financial re-jig. See below as to why you shouldn’t go near that
stock at this new market cap and share price.
As for copper, it all happened at once and all happened in Friday. This two-month hourlies chart
is the choice for context, as we also see the September 13th spike-and-drop when the dollar
13
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 ht6raM ht31 ht02 ht72 dr3rpA ht01 ht71 ht42 s1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3yluj ht01 ht71 ht42 ts13 ht7gua ht41 ts12 ht82 ht4pes ht11 ht81 ht52 dn2tco ht9 ht61 dr32 ht03 ht6von
source: IKN calcs

went through a weak moment and talk abounded of
Chinese stimuli. That move got whacked over the
head by recession talk, interest rates and the
resulting strength of the USD, so the burning
question today is whether this latest move will stick.
As noted in today’s intro (above), Friday’s move was
due to the interplay of several factors including the
US jobs data that gave Fed doves new room to argue
and the ensuing USD drop and broad market rally.
However in the case of copper (and other
metals…did you see silver?) there was special sauce
dolloped on top of the mix and for that, this short
passage from this Investing.com report (7) does a good job in summing up the main driver of
Friday’s face-ripper in copper:
Mining stocks rose sharply on Friday as base metals prices gained in response to a
report that bolstered hopes for a quick relaxation to China's Zero-COVID policy.
Bloomberg reported earlier that China is working on plans to scrap a system that
penalizes airlines for bringing virus cases into the country. The report revived this
week's strong rally in Chinese stocks, which had begun when unverified claims on
Chinese social media said the government may put together a new committee to
coordinate an exit from a policy that has acted as a drag on the world's second-largest
economy all year.
The National Health Committee had poured cold water on those suggestions on
Thursday, but Friday's reaction suggested that a market that has underperformed
badly amid the lingering disruption of the pandemic desperately wants to believe in a
turn for the better.
Those hopes were reinforced later when newswires reported Zeng Guang, an
epidemiologist who has previously advised the Chinese government, as telling an
investment conference that he expects significant changes to the Zero-COVID policy
within five to six months.
The Bloomie report referenced above also ran a line about how Friday’s rally was “the biggest
single day move since 2009” and while technically true, it wouldn’t have been as impressive if it
weren’t for the way the market sat on copper just the day before, the Thursday that took Jay
Powell at his word. Also and while impressive over 24 hours, Friday didn’t bust out of any long-
term price trends so a direct comparison to the post-Lehman/GFC rally of 2009 is somewhat
deceptive. What it does measure, however, is the crazy topsy-turviness of today’s market and
sentiment that moves from bust to boom in the space of 24 hours.
However and as reported both before and after the Bloomie note and ensuing rally, that whole
“China Covid Zero Change” thing ain’t necessarily so. Here’s a report out Thursday, the day
before the rumours fuelled the copper run (8):
China’s National Health Commission said Wednesday that the country will stick to its
“COVID-zero” policy without wavering. The comments were seen as dispelling rumors
that the mainland might relax its pandemic policy.
And from Yesterday Saturday here’s Bill Bishop of the excellent China-specialist site Sinocism
(9), adding his own to an update report out of Bloomie Saturday morning:
I do not usually publish on Saturdays but I wanted to share two new podcasts and
briefly discuss today’s State Council news conference about Covid policies. The short
answer is they announced no meaningful changes, so markets might be a little sad
Monday. From Bloomberg - China to ‘Unswervingly’ Keep to Covid Zero Policy,
Dashing Hopes:
China will “unswervingly” adhere to its current Covid controls as the country faces
an increasingly serious outbreaks, health officials said, damping hopes that
Beijing will ease its stringent policies that have put cities and factories under
prolonged lockdowns.
“Previous practices have proved that our prevention and control plans and a
series of strategic measures are completely correct,” Hu Xiang, an official at
National Health Commission’s disease prevention and control bureau, said at a
14

briefing Saturday. “The policies are also the most economical and effective.”
That might take the edge (or the spike) from the copper run on Friday, but then again it may
not. We’re seem to be watching a large game of bluff, or liar’s poker, at the moment and it’s
one thing to try and talk this market back down but another (and Jay Powell knows) to manage
it successfully. A confluence of factors pushed copper and other metals higher on Friday, but
perhaps the real takeaway is how the world is now looking for an excuse to move higher. It
wouldn’t be the biggest shock to see Dr. Copper shake off any early copper weakness and
return to (or even beat) Friday’s U$3.70/lb close and if that happens this coming week, there
will be every reason to believe this metals rally.
The bottom line: It’s good to feel more optimistic about higher copper prices, but there’s no
reason to take a single day’s worth of rally as some definitive signal that the good times are
back. With the conflicting signals over Covid Zero coming out of China this weekend, it’s
prudent to wait a week to see if Friday’s rally is confirmed or denied. If it peters out quickly
then so be it, but if copper manages to hold on to its brand new gains then it’s probably time to
avail more copper exposure and for that, we have plenty of beaten-down shares from which to
choose so pick your poison, from quality juniors that move up 50% while offering downside
protection, to zingy high-risk dog stocks with the potential to triple your small bets (or die
trying). And with that, we move to our regular weekly digest with data from Cochilco (10):
 For the second week running, copper stocks across the world took a sharp drop and the
world aggregate total in the three official systems went down by 29,668 metric tonnes
(mt) to close at 180,803mt. That’s all the recent gains wiped out and should sound
alarm bells in the world’s short positions for the metal.
 The SHFE lost a more modest 4,376mt last week to close at 59,064mt, which continues
the drawdown after the (Russia tonnage?) spike of three weeks ago. We’re now in the
traditional stocking period for factories on the Chinese mainland and in a normal year,
inventories are depleted further in November and December.
 But the real action was at the LME, with 24,525mt disappearing from stocks on the
week to see its total close at 88,600mt.
LME: Cu tonnage under cancelled warrant
That’s extremely tight for LME numbers
and what’s more, 17,700mt of those
24,525mt were removed from its Asian
warehouses, if you had any doubt as to
where the end-user demand originated. It also means nearly 50% of the remaining
LME copper inventory is holed up in its
USA warehouses, infamous as roach
motels in the world system; tonnages
enter, but have a hard job leaving.
 Comex stocks also dropped last week, a
more modest 767mt to leave this weekend’s total at 33,139mt.
Now for the dedicated SHFE charts and while one is probably enough in a quiet week for SHFE
stock moves, you get both anyway:
15
00142 52074 57334 00714 52045 05205 52027 52418 52926 05694 57332 52271 05761 52511 57471 52581 52862 00642 00743 57924 00914 52975 05174 05803 04441 0588 0018 5786 00864 05386 57077
05064
100000
90000
80000
70000
60000
50000 40000 30000 20000
10000
0
dr3rpa ht01 ht71 ht42 1.yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3yluj ht01 ht71 ht42 ts13 ht7gua ht41 ts12 ht82 ht4pes ht11 ht81 ht52 dn2tco ht9 ht61 dr32 ht03 ht6von
mt Cu
source: Cochilco
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
MT Cu 2022
2021
2020
2019
2018
source: Cochilco data

Shanghai Futures Exchange Warehouse Stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
16
31'13ceD dr32 ht02 ht51 ht01 ht5tco ht03 ht52 dn22 ht71 ht21 ht6pes ts1von 5102ht72ced 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 ht42 ht91 ht41 ht9
Mt Cu
|
source: Cochilco
The chart below underscores just how historically low things are at the moment. That’s the real
story here and if Chinese buyers now step up as they tend to do in a normal pre-Christmas,
they may find it hard to complete their orders.
We move to notes on some of our basket stocks:
Nevada Copper (NCU.to): Last week NCU first announced the closure of its corporate
financing moves that have added working capital to treasury and turned a lot of its welter debt
held by stakeholders such as Mercuria and Pala into shares. This has improved the balance
sheet to the point where the company can move to invest in its improvement plans, all with a
view to turning the mine back on in late 2023 and becoming a profitable entity by 2024. We got
a high-level view of its plans from the NR out later last week and while all good, the abysmal
record of this company to date and its long lead-time to its eventual new production plans
mean there’s no reason to rush in at this price.
And then there’s the share dilution, of course. The new total shares out count as seen in the
above chart of 658.6m includes the large positions now held by Pala and Mercuria but even
then and almost literally, that’s not even the half of it. Both those entities also hold special
warrants, mostly at $0.25 or about, that if fully exercised would move the share count to just
over 1.3Bn (with a B) and leave Pala owning 57.3% of the company and Mercuria owning
24.7%. It would also imply an approximate $500m market cap if the share price holds up and
we again point readers to NCU’s track record of failed projects, re-vamps and wealth
destruction at this money pit of an operation. If the new plan works well good for them and all
fine, but the implied equity values involved here are excessively high for this desk, not until the
operations are proven to work.
Oroco Resources (OCO.v): It’s nobody’s idea of
massive or tradable volumes, but OCO is up 20%
over the last two weeks and at least its volume is
regularly small, rather than ALDE’s patchy and
unreliable pattern.
No news on the week, but we remind readers that
this stock gets plenty of social media noise from
its paid rah-rah supporters and ensuing fan clubs.
If copper goes on a tear, it’s the type of stock that
gets eyeballs among the more naïve.
The Producer Basket
After 44 weeks of 2022, the Producer Basket shows a loss of 19.44% to level stakes:

company ticker price 1/1/22 Shares out MktCap(U$Bn) current pps gain/loss%
1 Newmont NEM 62.02 797.44 32.69 40.99 -33.9%
2 Barrick GOLD 19.00 1779 25.26 14.20 -25.3%
3 Franco-Nevada FNV 138.29 191.192 24.27 126.95 -8.2%
4 Agnico Eagle AEM 53.14 454.904 19.75 43.41 -18.3%
5 Wheaton PM WPM 42.93 450.3 15.45 34.30 -20.1%
6 Gold Fields GFI 10.99 887.72 7.55 8.51 -22.6%
7 Kinross Gold KGC 5.81 1296.5 5.00 3.86 -33.6%
8 B2Gold BTG 3.93 1055.6 3.34 3.16 -19.6%
9 Alamos Gold AGI 7.69 392.503 3.18 8.11 5.5%
10 Sandstorm SAND 6.20 223.79 1.13 5.06 -18.4%
All prices and stock quotes in U$ Port. avg -19.44%
That was a strange old week. With gold up by 2.16% on the week (GLD proxy) you’d expect
more from GDX than we got, but the combo of the late week rally, the somewhat disappointing
Q3 results from some of the sector’s heavy hitters (NEM, GOLD) and M&A action crimping the
bigger stocks (AEM) combined for a GDX that added just 0.9% on the week. Things were better
among the smaller stocks and GDXJ improved by 4.3%, but our level stakes list of ten was
weighed down by the under-performers and only improve by 0.06%. So when the dust settled
it was four losers (NEM, GOLD, AEM, AGI) and six winners (FNV, WPM, GFI, KGC, BTG, SAND)
with the best move from Kinross (KGC up 5.5%) and the worst move from Barrick (GOLD down
7.3%). At this point, we remind readers that in May this year the CEO of Barrick called the
Kinross assets “Mediocre”, “marginal” and “cow dung.” Except that he didn’t say dung.
The 2022 Producer Basket: Weekly performance and
35% comparative to GDX control
30%
25%
20%
15%
10%
5%
0%
-5%
-10%
-15%
-20%
-25%
-30%
Barrick (GOLD) and Newmont (NEM): In Airplane!, Lloyd Bridges picked the wrong week to
quit smoking/drinking/amphetamines/sniffing glue. At Barrick, they picked the wrong day to
report a mediocre quarter. Here’s a chart that shows how much luck plays a part in the current
market:
The two biggest players in world gold mining reported last week and among the data:
17
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 t6ram ht31 ht02 ht72 dr3rpa ht01 ht71 ht42 1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3luj ht01 ht71 ht42 ts13 ht7 ht41 ts12 ht82 t4pes ht11 ht81 ht52 n2tco ht9 ht61 dr32 ht03 ht6von
The 2022 Producer Basket: Percentage difference
5.0% between GDX benchmark & basket (negative = IKN ahead)
ikn 4.0%
gdx control 3.0%
2.0%
1.0%
0.0%
-1.0%
-2.0%
-3.0%
source: NYSE, IKN Calcs
-4.0%
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 t6ram ht31 ht02 ht72 dr3rpa ht01 ht71 ht42 1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3luj ht01 ht71 ht42 ts13 ht7 ht41 ts12 ht82 t4pes ht11 ht81 ht52 n2tco ht9 ht61 dr32 ht03 ht6von
source: IKN calcs, NYSE data

 The NEM 27c EPS misses analyst consensus by 2c and its YoY profit dropped by 56%
 The Barrick 13c EPS beat analyst consensus by 2c and the YoY profit dropped by 30%
So on paper, GOLD returned better (less wrose?) numbers than NEM but at market, the fact
that Barrick delivered its bad news on the worst day for mining stocks possible meant there was
no way back for the company. So despite being largely joined at the hip and dependent on the
increasingly Nevada Gold Mines (NGM) JV to drive production, NEM did 4% better than GOLD.
So on to Q4 and with GOLD promising to recoup some of the delayed production, they may be
a better bet in the weeks to come. What’s more its #2 position on the table is starting to come
under threat as t the start of 2022, Barrick’s market cap was $7.3Bn in front of the third placed
company on the league table, Franco-Nevada (FNV). The gap is down to less than a billion.
Gold Fields (GFI) and Agnico (AEM) (and Yamana and Pan American): Despite the bad
news out of the producer sector’s biggest players, last weeks’ headlines belong to the deal
proposed by Pan American Silver (PAAS) and Agnico Eagle (AEM), who have teamed up to out-
big Gold Fields (GFI) and in the process, get Chris Griffith out of a jail of his own making. The
run toward the GFI SGM to vote on the GFI buyout of Yamana (AUY) has seen the deal’s critics
from inside GFI raise their voices again and sow doubt, therefore the Friday news (11) that
PAAS and AEM were teaming up to out-bid GFI for AUY seems to be a win/win/win. Heck, even
PAAS has managed to keep the market losses to a minimum via some smart deal conditions.
The basic deal means each AUY share would
be exchanged for U$1.04 in cash 0.1598
PAAS shares and 0.0376 AEM shares. That
ticket price was U$5.02 on Friday pre-open
and thanks to the market we saw that day,
the deal closed the week with a ticket of
U$5.06 (cash U$1.04 + PAAS share
component U$2.39 + AEM share component
U$1.63), so the deal got applause form the
market. What’s more, as you can see on this
ten-day chart (right) Gold Fields (GFI) rallied
almost as much as Yamana on news of the
deal, with GFI up 16.6% Friday and AUY up
19.9%. As for the carve-up, for its end AEM
gets full control of its Malartic, its prized
mine in Canada, and PAAS gets Yamana’s non-Canadian assets (e.g. Brazil, Argentina) which is
in its wheelhouse. So far so good and yes, clearly the deal got a slice of good luck by being
announced on the big metals rally day. What’s more, a smart clause in the double-team deal
between the cash rich AEM and the (relatively) cash poor PAAS sees AEM prepared to buy
U$150m of PAAS stock on the open market, an interesting stipulation that helps shore up the
baseline value on the deal and ensured PAAS share didn’t collapse on the day. Indeed, early
morning PAAS shares traded almost 20% lower but with the market giving the thumbs-up to
the deal and buyers arriving, PAAS ended Friday just 4% lower.
Meanwhile, the win/win/win comes from the way GFI gets left off the hook, having been under
pressure to close the deal and with dissenting shareholders, GFI is now highly unlikely to match
the AEM/PAAS offer and that shows in the way it traded higher on the day. The dissenters must
be happy, as is CEO Griffith who now gets and elegant out and should keep his job. But for
me, the real bottom line is the positive message the mining sector now gets the shout to the
world: WE THINK ARE ASSETS ARE VERY CHEAP TODAY AND WHAT’S MORE, WE’RE PUTTING
OUR MONEY WHERE OUR MOUTHS ARE. If AEM and PAAS can join up, gazump GFI and pay up
to win Yamana in a mostly share deal, it means they all think their equity is great value and
what’s more, the market reaction says that they are right. We needed a big deal to kick-start
interest from bigger money, U$5Bn is enough to move anyone’s dial and if gold continues to
rally, this could start a virtuous circle that re-rates asset rich/equity poor companies across the
board.
18

The TinyCaps List
After forty-four weeks of 2022, the TinyCaps show a loss of 45.47% to level stakes:
company ticker price 1/1/22 Shares out Mkt Cap current pps gain/loss%
Aurelius Min AUL.v 0.24 45.836 2.98 0.065 -72.9%
Golden Pursuit GDP.v 0.13 34.638 4.33 0.125 -3.8%
Infield Min INFD.v 0.06 48.445 1.45 0.03 -50.0%
Kingfisher Met KFR.v 0.30 103.007 12.36 0.12 -60.0%
Latin Metals LMS.v 0.12 57.686 7.50 0.13 8.3%
Manitou Gold MTU.v 0.06 344.57 6.89 0.02 -66.7%
Melkior Res MKR.v 0.295 24.011 4.56 0.19 -35.6%
Precipitate Gold PRG.v 0.105 129.322 9.05 0.07 -33.3%
Signature Res SGU.v 0.07 238.4 2.38 0.01 -85.7%
Winshear Gold WINS.v 0.08 61.585 2.46 0.04 -50.0%
Prices in CAD$, data from TSXV basket avg -45.47%
This section attempts to track the tinycap mining sub-sector of the market, our ten companies
chosen under the following criteria to put together a list representing the state of play in the
sub-sector of tinycap exploration company stocks. At least, that’s the plan.
 Market capitalization of under $20m. They have to be tiny. In two cases I’ve stretched the window a
little and allowed sub-U$20m market capper in that are just over the C$20m level, but the spirit is unaltered.
 A “non broken” stock price and project story. There are literally hundreds of tinycap juniors of the right
size, but it was a particularly depressing exercise to trawl through the whole of the TSXV and find companies
that are small enough, but with life in them. The vast majority of sub-$20m stocks are broken stocks, either
traded to death on the exchange or with projects that are a bust or with entrenched management more
interested in their monthly paycheck than anything else.
 Likelihood of meaningful newsflow in 2022. 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.
There were only two weekly winners out of 15% TinyCaps, 2022 weekly tracker
the ten TinyCaps on our list, but as Precipitate 10%
5%
(PRG.v up 27.3%) and Latin Metals (LMS.v up 0%
18.2%) both made big moves it was enough -5%
-10%
to keep the basket average where it was last -15%
-20%
week. Three others were unchanged (MKR.v,
-25%
SGU.v, WINS.v) and weirdly, the other five -30%
-35%
stocks all lost half a cent on the week (AUL.v,
-40%
GDP.v, INFD.v, KFR.v, MTU.v). We’re again -45%
-50%
seeing these stocks traded thinly and with
little appetite.
A brief note on just one basket stock this
weekend, this is not where the action or the money is at the moment.
Latin Metals (LMS.v): This company had two pieces of news last week, firstly closing its
upsized financing for gross proceeds of $1.227m and secondly reporting interesting grab
samples from its Auquis copper project, one of five early stage assets it has in Peru (12). The
grab sample stage of exploration rarely moves the market, but the 200+ samples have returned
clear target areas of higher grading rocks that should form the basis for eventual drill targets.
With modest cash now in treasury, we should get more exploration-level news out of LMS going
forward.
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.
19
dn2naJ naJ t61naJ dr32 ht03 ht6bef ht31 ht02 ht72 ht6ram ht31 ht02 ht72 dr3rpa ht01 ht71 ht42 s1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3yluj ht01 ht71 ht42 ts13 ht7gua ht41 ts12 ht82 ht4pes ht11 ht81 ht52 dn2tco ht9 ht61 dr32 ht03 ht6von
source: IKN calcs, TSX data

Regional politics
Brazil: Jair kind of concedes
It’s difficult to say with certainty, but the way in which out-going President Jair Bolsonaro stated
in public that his government would comply with his country’s election laws and edicts (without
ever admitting defeat), plus the way his underlings have seemingly been sent out to spread the
message that the election is over, should see Brazil avoid the worst potential scenarios in the
last two months of 2022. That means we should have a reasonably workable hand-over period
and come January 1st, Lula da Silva will become President for the third time (a new record for
the country).
So if peace breaks out that’s a very good thing, of course. Good for Brazil and good for the
wider South American and even LatAm region, no matter what your preferred flavour of politics
might be. As for mining, to tie off the issue a final time and reiterate the stated house position,
the large-scale mining and O&G industries in the country (e.g. the mega iron ore mines) are an
Easy target and may see new levels of State burdens but the companies under our focus did
perfectly fine under previous Lula (and Dilma) PT administrations and there’s no reason why
that should change. However, environmentally hot button projects will have a tougher time in
Brazil as the “more permissive policies” (let’s say) and desire to “open up the Amazon” under
Jair is reverted. For example, those bidding for the Tucano mine in the upcoming Great Panther
disposal sale should consider the fines that mine might have to pay.
Chile’s SEA softening its stance
In the post on the open blog Thursday (13) “Valentina Durán, head of Chile’s SEA environment
office, talks mining permits” we featured the extended Q&A between Chile’s mining TV Reporte
Minero and the eponymous head Chile’s Servicio de Evaluación Ambiental (SEA), the body that
has blocked the approval of at least six major mining projects in the country since her
appointment under new President Boric in March. Those permit denials include that for the
Anglo Los Bronces expansion, a U$3Bn project, and of course the Rio2 Fenix gold project that
hit its share price in the guts in June and July.
We’ve followed the growing voices of dissent against the tenure of Mr Durán since then,
particularly the criticisms received from Chile’s Chamber of Mining Commerce SONAMI, so it
was interesting to see Valentina Durán show her face on a specialist mining show to answer
critics and offer the Chilean government’s point of view.
The main problem of been christened in Chile as “Permisologia” (Permitology). i.e. the delays
and blocks being placed between companies and their projects by government authorities. We
know the issue via Rio2 Ltd, but also other high profile cases such as Los Bronces and as the
interviewer put it at the start of the segment, the “companies comply with the conditions but
then the criteria change and as a result, mining projects…which are long-term plans end up
being truncated by a newly critical vision from the government”. To give the interviewer credit,
he found that diplomatic way to phrase a hotly criticized aspect of Chile’s current government
and as a result, Ms. Durán had the space to reply freely. After a general presentation of what
the SEA does and some of the basic recent gripes, we got to the meat of the Q&A and here’s a
translation of one key segment:
“There aren’t that many projects that have gone to appeal (after the denial of a
permit). And what I’d also like to make clear is that every week and every
month we receive (permit applications from) mining projects, modifications for
permits and new permit applications, therefore I would like to de-dramatize the
situation. Perhaps recently there has been a rise of negative sentiment toward
the SEA, a sensation that (at the SEA) there’s a system that’s destined to
reject projects. The truth is quite the opposite. We are working in order to
approve projects so that they are robust. And this is something we’ve told the
mining industry about, and to other industries; they need to present technically
robust, well-prepared projects, with good community relations in the area in
which the project will be developed.”
Durán also tried to push the narrative she’d previously used in a generalist press interview that
20

her SEA had approved over 40 permits for the industry, but as we’ve noted previously her
SONAMI critics showed the big difference between approvals for small-scale improvements or
additions to previously installed infrastructure and permits for new capital works. The SEA’s
position was made clearer in this next segment, basing her pushbacks toward mining
companies on the environmental angle (no surprise) but using the new political line from the
newly re-formed Boric cabinet. Another quote (translated):
“President Gabriel Boric has clearly signalled that environmental permits and
the protection of the environment are not a barrier to development, rather
they are a necessary condition for development. This needs to be clearly
understood, the environmental demands are not going to be relaxed. We are
faced with an environmental crisis, a climate crisis, a crisis of contamination
and it’s also an economic crisis, of course. Therefore, this requires the
generation of trust and dialogue with all actors, and it’s also the job of
legislators and of course the Ministry of the Environment, with whom we are
going to collaborate in their proposals to modernize the systems of evaluation
of environmental impact and their regulations.”
We know that she works closely with Maisa Rojas, Minster of the Environment and one of the
more ideological left wingers in the Boric cabinet, but since the September 4th Referendum
vote rejection result the hard left in the government has had to cede power and control, with
the newly drafted in centre-lefties now driving the narrative. This seems to have seeped down
to the SEA level and the mere fact Valentina Durán appeared in this TV slot to give account was
enough. Ms. Durán defended the government line on environmental matters and that’s fair
enough, but it’s clear she was on the show to help (re)build bridges and meet the mining
industry halfway. The interviewer didn’t let her off the hook, puched her on some points and on
occasion, Durán was left with repeating platitudes when details were demanded. But overall,
she came across as professional, administrative and using the whole “it’s the environment”
argument as her shield, but it’s clear that pressure from inside the Boric government to improve
the atmosphere with the mining sector has risen.
The bottom line is that, she was also more conciliatory toward the sector than I expected.
Durán was most keen on pushing the line of how application of environmental rules were good
for everyone, mining companies included, as they would assure the general public of their good
environmental standing at a time when people demanded more care for the planet, etc. How
exactly a small family of Chinchilla Chinchilla fits into her over-arching narrative is quite beyond
me, however. Also, her position failed to explain even the most basic issues brought up by the
cases of Los Bronces, Fenix and others, where companies toed the line to the letter and
presented all the environmental information demanded of them by the Chilean authorities, only
to see their permits refused due to a “lack of data”.
Market Watching
A brief word on Wesdome Gold (WDO.to)
After featuring Wesdome Gold (WDO.to) two weekends ago in IKN701 (somewhat to my own
surprise) and then giving it a quick follow-up last weekend in IKN702, I have two things to do
in this brief update:
1) Thanks for the feedback, as several of you
took me up on the idea of running more
analysis on the company. There’s clearly
enough interest in WDO to warrant some
further coverage, so if WDO looks interesting
I won’t hold back.
2) That may happen sooner rather than later.
The stock has held under C$9 in the recent
sector rally and that’s still a very buyable
price, plus WDO is scheduled to report its
21

3q22 financials this Wednesday November 9th post-close, the ConfCall next day (14).
As it’s not a stock on my personal shopping list I’m not going to guarantee coverage in the near
future. Also as the 12 month chart shows, WDO is one of the stocks that may see Tax Loss
Selling season pressure this year, which is another potential piece to the puzzle. However, we’ll
be watching the WDO its numbers this week and if there’s an angle to report I won’t hold back.
Abrasilver (ABRA.v) delivers its resource upgrade
Another company that timed its news badly last week was Abrasilver (ABRA.v), the silver
company that most interests this desk at the moment due to its exciting and fast developing
Diablillos project in Northern Argentina. Subject of the main fundies note in IKN698 dated
October 3rd, ABRA last week delivered its updated resource following the phase II drill program
of this year in the NR (15) “AbraSilver Announces New Mineral Resource Estimate with Over
215Moz AgEq at Diablillos.” However, ABRA chose Thursday pre-open to publish and as we now
know, the FOMC hangover that hit stocks that
morning made it the worst day possible to publish
good news about a resource at a silver project. As
that chart above shows volume was thin on the day
of the announcement and while ABRA found love
early Friday morning with around 800k of shares
traded at the open, there was no follow-through
and other silver stocks (SIL proxy) and even silver
bullion (SLV proxy) out-performed ABRA.
Which was unfair on this company, as the updated
resource news was strong. In his NR comments,
ABRA President and CEO John Miniotis called the
new Diablillos resource “…one of the highest-quality, potentially open-pittable, undeveloped
primary silver projects in the world” and while he’s going to speak well of his own child, he has
a point. There are open pit mines that get built on deposits with 1.3m of 0.79 g/t gold alone,
this one comes with that in M+I gold, plus 109m oz of 2oz silver in the same rock. In fact, the
total of 215.52m oz of silver equivalent (AgEq) shows the payable metal to be almost equally
split between silver and gold revenues and depending on the gold/silver ratio, we may even see
Diablillos produce more revenue from gold than from silver.
However, there are a few nits to pick about the new MRE and for the right context, let’s
compare the new to the old. This is the previous resource, the one that formed the basis to the
January 2022 PEA on the stock (see IKN698 for more):
THE OLD RESOURCE
And now below on the next page, the new resource with notes below:
22

There’s a lot to like here:
Considering the total Measured and Indicated count as our baseline, ABRA has added over 10m
tonnes of mineralization and in doing so, the average grade of the silver component has
dropped by just 2 g/t and the gold component has in fact risen by 0.03 g/t. In IKN698 we
noted that there was the possibility that ABRA would be able to increase its resource and
metals grade at the same time, a rare achievement as a resource expands. In the end they
nearly managed to improve all three main metrics and only a very slight drop in silver grade
separated them from the achievement. All the same, this is a remarkable update if only for the
way tonnage improved by over 20% and grade remained essentially unchanged.
It’s best to ignore the “silver equivalent” column, as although ABRA uses the same 35g/t AgfEq
cut-off, it has changed calculation to include estimated recoveries and as a result, the 70/1
used in the 2022 PEA is now 81.9/1. For context, if the old ratio had been used last week they
would return an AgEq total of 200.16m oz, over 15m oz AgEq lower than the above table.
However, just taking the improvement in silver ounces (19.205m oz) and gold ounces (295k oz)
is impressive enough, a signal improvement for the resource and without including the new
high-grade returns from the new Phase III program now drilling the southwest zone (see
IKN698). ABRA is set to return a maiden resource for the SW zone in 1q23, followed by a PFS
in 2q23 and it’s at that point when we get a handle on the real improvement in project
economics.
The quality of ounces looks promising, too. Last week’s NR didn’t have all the information we’ll
get once the 43-101 is filed and we’re going to have to wait for the eventual PFS in 2023 for a
clear idea, but a look at the new variable cut-off table from the NR…
…when compared to the old table…
23

THE PREVIOUS CUT-OFF TABLE
…makes for good reading at the higher cuts. For example at a 50g AgEq cut, ABRA has added
6,500mt, kept silver grade the same and raised gold grade. That suggests success with the
shallower laying gold mineralization and if so, it will improve early year economics.
As for the cost effectiveness of the phase II program, in the NR CEO Miniotis claimed that on
spending US$5.1M in Phase II exploration drilling, ABRA managed to add 43m ounces of silver
equivalent. He called this, “…an impressive cost of only US$0.12 per contained ounce of AgEq
added to the new M&I Mineral Resource Estimate.” That’s stretching the facts a little too far to
go without comment, so to nitpick, the drilling at Diablillos cost $5.1m, but it couldn’t have
happened without the support cost at the camp and when those expenses are factored in, the
total $8.4m means discovery cost is more like U$0.195/oz AgEq. Also, we could really start
splitting split hairs and note that at the new 81.9X gold/silver ratio they added just over 3m
AgEq ounces compared to 70/1, but that’s neither here nor there. What we can say and without
a shadow of a doubt is that the Phase II program was a resounding success and with the SW
zone, Diablillos is about to expand even further.
When the 43-101 is filed to SEDAR, expect these pages to update on ABRA as at that point,
we’ll have a better idea of where the company has managed to add these new ounces. That will
allow us to run a new mine model on the stock and adapt the current model, which relies on a
7,000tpd operation and higher grades in the early years. The questions to answer are whether
grade increases, whether mine life improves, whether Diablillos will be able to support a higher
throughput rate. In the meantime, those of you as interested in this outstanding silver/gold
project as this desk should check out the brand new corporate presentation, found here (16).
Conclusion
IKN703 is done, we end with a couple of bullet points:
 On the subject of my renewed interest Western Copper (WRN.to) and its potential to be
the next open copper trade, the company and its CEO Paul West-Sells is appearing on a
webinar this Wednesday at 4:05pm EST. Here’s the link for the free sign up (17), see
you there.
 WRN is a possible addition in the near future, but Amerigo Resources (ARG.to) remains
this publication’s #1 pick in the copper space. The company’s Q3 came in well despite
that fair value adjustment and at the current price deck, the upside potential far
outweighs the downside risk.
I thank you in advance for any feedback. Our Top Pick stock is Minera Alamos (MAI.v). Flash
updates will be sent if required by events.
I wish you good trading fortune, ladies and gentlemen.
Best wishes, Mark
24

Footnotes, appendices, references, disclaimer
(1) https://iknnews.com/the-bit-that-matters-in-the-fomc-statement/
(2) http://www.amerigoresources.com/_resources/news/nr_20221102.pdf
(3) http://www.amerigoresources.com/investors/earnings-calls/
(4) http://playback.conferenceconsole.com/recordings/rec99826991_20221103132506.mp3
(5) http://www.amerigoresources.com/_resources/presentations/corporate-presentation.pdf?v=0.173
(6) https://goldshoreresources.com/goldshore-intersects-1-34-g-t-au-over-90-95m-in-100-meter-step-out-to-the-north/
(7) https://finance.yahoo.com/news/mining-stocks-metals-roar-higher-054118241.html
(8) https://www.asgam.com/index.php/2022/11/03/chinas-national-health-commission-outlines-unwavering-insistence-
on-covid-zero/
(9) https://sinocism.com/p/covid-policy-20th-party-congress?utm_source=substack&utm_medium=email
(10)
https://www.cochilco.cl/Paginas/Estudios/Mercados%20de%20metales%20e%20insumos%20estrat%C3%A9gicos/Infor
mes-Semanales-2015.aspx
(11) https://www.panamericansilver.com/news/pan-american-and-agnico-eagle-deliver-definitive-binding-offer-to-
acquire-yamana/
(12) https://finance.yahoo.com/news/latin-metals-expands-high-grade-122500637.html
(13) https://iknnews.com/valentina-duran-head-of-chiles-sea-environment-office-talks-mining-permits/
(14) https://www.wesdome.com/English/investors/latest-news/news-details/2022/Wesdome-Announces-Details-of2022-
Third-Quarter-Financial-Results-Conference-Call/default.aspx
(15) https://abrasilver.com/news-releases/abrasilver-announces-new-mineral-resource-estimate-with-over-215moz-
ageq-at-diablillos
(16) https://abrasilver.com/_resources/presentations/corporate-presentation.pdf?v=0.821
(17)
https://event.on24.com/eventRegistration/EventLobbyServletV2?target=lobby20V2.jsp&eventid=3998957&sessionid=1&
format=fhvideo1&key=14E0CC5040716E8A212CAFAF82D30928&eventuserid=568411419
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-Apr-21 C$0.19 -36.7% Failed spec trade, cut loss
Cartier Res ECR.v sep'21 C$0.32 21-Mar-21 C$0.235 -26.6% Failed spec trade, cut loss
Amarillo Gold AGC.v sep'21 C$0.31 30-May-21 C$0.30 -3.2% Capex story changed: Out
Excelsior Mining MIN.to oct'21 C$0.93 10-Mar-19 C$0.53 -43.0% May return in 2022
Royal Road Min. RYR.v nov'21 C$0.155 17-Mar-19 C$0.275 77.4% Closed on Nica pol risk
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
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Stocks To Follow Closed Positions 2020
Closed in 2020 closed close price
TMAC Resources TMR.to Jan'20 C$3.41 20-Dec-19 C$3.61 5.9% TLS flip play, sold new year
Regulus Res REG.v Jan'20 C$1.10 20-Dec-19 C$1.30 18.2% TLS flip play, profit taken
Bonterra Res BTR.v Jan'20 C$1.90 9-Dec-19 C$1.66 -12.6% TLS flip play, loss taken
McEwen Mining MUX Jan'20 U$1.12 2-Dec-19 U$1.18 5.4% TLS flip play, profit taken
Core Gold CGLD.v Jan'20 C$0.255 7-Apr-19 C$0.305 19.6% arb trade, profit taken
HudBay Min HBM Jan'20 U$3.56 9-Dec-19 U$3.36 -5.6% TLS flip play, loss taken
Midas Gold MAX.to Feb'20 C$0.71 5-Jan-20 C$0.57 -19.7% sm & silly trade
Warrior Gold WAR.v Feb'20 C$0.08 3-Aug-18 C$0.05 -31.3% clean out non-perf sm stocks
Contact Gold C.v Feb'20 C$0.40 19-Aug-18 C$0.18 -55.0% clean out non-perf sm stocks
Sandstorm Gold SAND Feb'20 U$3.73 17-Apr-16 U$7.21 93.3% Sold during port rebalance
NexGen Energy NXE Feb'20 U$1.20 2-Dec-19 U$1.06 -11.7% TLS flip play, loss taken
MAG Silver MAG Apr'20 U$8.95 1-Mar-20 U$10.07 12.5% Sold to cut silver exposure
Alexco Res AXU Apr'20 U$1.69 7-Sep-17 U$1.69 0.0% sold to close Ag exp. in FY20
Bonterra Res BTR.v Jun'20 C$1.62 2-Feb-20 C$1.10 -32.1% under-performer cash moved
Regulus Res REG.v Jun'20 C$0.64 6-Apr-15 C$0.79 23.4% moved $ TMQ/MIN & Au stocks
Great Panther GPR.to Aug'20 C$0.60 21-Jun-20 C$1.10 83.3% Profit taken, good trade
Jaguar Mining JAG.v Aug'20 C$0.42 21-Jun-20 C$0.65 54.8% Profit taken, good trade
Sandstorm Gold SAND Aug'20 U$7.76 10-May-20 U$9.37 20.7% Profit taken, good trade
Integra Resources ITR.v Aug'20 C$2.23 13-Aug-18 C$5.40 142.2% Profit taken, good trade
Wesdome Gold WDO.to Aug'20 C$2.37 14-Oct-17 C$14.82 525.3% last 1/2 of big win closed
INV Metals INV.to Sep'20 C$0.40 17-May-20 C$0.45 12.5% Cut all Ecuador exposure
Cartier Resources ECR.v Nov'20 C$0.155 3-Aug-18 C$0.25 67.7% Exact close price TBA
Tinka Res TK.v Dec'20 C$0.195 19-Apr-16 C$0.195 0.0% Closed on a round trip fail
2015 to 2019 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Stocks To Follow Closed Positions 2019
Closed in 2019 closed close price
Atico Mining ATY.v jan'19 C$0.55 24-Jul-16 C$0.32 41.8% patience ran out, made room
Candente Copper DNT.to jan'19 C$0.075 3-Aug-18 C$0.05 -33.3% tiny trade, made room for new
B2Gold BTO.to feb'19 C$2.11 12-Sep-14 C$4.05 91.9% Took 1/2 profits, reduce size
Western Copper WRN.to mar'19 C$0.80 20-Jan-19 C$0.81 1.3% Spec trade that didn't work
B2Gold BTO.to mar'19 C$2.11 12-Sep-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-Jan-19 U$4.15 -8.1% Short that didn't work, sm loss
Zinc One Z.v jun'19 C$0.47 14-Sep-17 C$0.025 -94.7% clearing out dead trade
Amarillo Gold AGC.v jun'19 C$0.24 22-Aug-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-Apr-18 C$0.47 -67.8% Failed sm spec on Au. Moved on
Amerigo Res ARG.to nov'19 C$0.91 23-Sep-18 C$0.50 -45.1% worst trade of year, hefty loss
Guyana Goldfields GUY.to dec'19 C$0.94 14-Apr-19 C$0.56 -40.4% taking the loss, financials weak
Tethyan Res TETH.v dec'19 C$0.30 8-Sep-19 C$0.16 -46.7% tiny trade, word of probs in co
26

Stocks To Follow Closed Positions 2018
Closed in 2018 closed close price
Amarillo Gold AGC.v jan'18 C$0.38 24-Mar-17 C$0.31 -18.4% Cut away losing trade
Riverside Res RRI.v jan'18 C$0.39 27-Jun-16 C$0.31 -20.5% Cut away losing trade
Eros Res ERC.v jan'18 C$0.175 1-Mar-17 C$0.16 -8.6% CEO sudden exit, not good
Excellon Res EXN.to jan'18 C$1.54 9-Oct-16 C$1.66 7.8% 4q17 poor, one too many bad qtrs
Wesdome Gold WDO.to jan'18 C$1.68 15-Dec-17 C$2.06 22.6% Near-term trade block, took profit
Sabina G&S SBB.to apr'18 C$2.06 17-Dec-17 C$1.77 -14.1% Near-term trade, bad timing, small
B2Gold BTO.to May'18 C$2.11 12-Sep-14 C$3.67 73.9% sold 25% to reduce exposure
Lara Expl. LRA.v May'18 C$0.65 11-Feb-18 C$0.58 -13.8% Spec on Brazil didn't work
Solitario XPL June'18 U$0.72 19-Mar-17 U$0.41 -43.1% Failed trade, may return in 4q18
SolGold plc SOLG.to July'18 C$0.475 19-Nov-17 C$0.415 -12.6% cut, trade didn't perform
Pan American PAAS July'18 U$17.90 1-Jun-18 U$16.30 8.9% modest win on short position
NGEx Res NGQ.to Sep'18 C$1.01 22-Oct-17 C$1.00 -1.0% Closed to reduce Argentina exp
Sandstorm Gold SAND Oct'18 U$3.73 17-Apr-16 U$4.13 10.7% partial sale to raise cash for GTT
Aldebaran Res ALDE.v Nov'18 n/a n/a n/a n/a liquidate spin out of REG
Stocks To Follow Closed Positions 2017
Closed in 2017 closed close price
Continental Gold CNL.to Jan'17 C$2.68 22-May-16 C$4.17 55.6% trade closed, profit taken
Focus Ventures FCV.v Jan'17 C$0.23 1-Jul-12 C$0.05 -78.3% Give up, a disaster trade
Wesdome Gold WDO.to Feb'17 C$1.72 28-Aug-16 C$3.00 74.4% Target hit, sold, good trade
Belo Sun BSX.to Mar'17 C$0.90 30-Jan-17 C$0.90 0.0% failed near-term flip trade
Lara Expl. LRA.v Mar'17 C$1.15 8-Apr-12 C$1.05 -8.7% cut to make room for new trade
Rye Patch Gold RPM.v Apr'17 C$0.31 2-Sep-16 C$0.32 3.2% cut for doubts & new stock
Cordoba Min. CDB.v Jun'17 C$0.75 15-Sep-16 C$0.63 -16.0% closed
Constantine Metal CEM.v Aug'17 C$0.135 9-Apr-17 C$0.28 107.4% spec trade closed, good win
Red Eagle Min. R.to Sep'17 C$0.67 13-Dec-16 C$0.27 -59.7% IKN's biggest failure in years
Starcore Intl SAM.to Sep'17 C$0.61 10-Jan-15 C$0.31 -49.2% Patience ran out
B2Gold BTO.to Dec'17 C$2.11 12-Sep-14 C$3.39 60.7% sold small portion for liquidity
Stocks To Follow Closed Positions 2016
Closed in 2016 closed close price
Phoscan Chem FOS.to jan16 C$0.28 29-mar-15 C$0.265 -5.4% Buyout trade, bot but poor deal
True Gold TGM.v jan16 C$0.18 23-aug-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-jan-15 U$1.20 10.1% sold due to lack of value
Lake Shore Gold LSG.to feb-16 C$1.10 07-apr-15 C$1.69 53.6% bot out, sold early in process
Atacama Pacific ATM.v feb-16 C$0.19 26-apr-15 C$0.40 110.5% sold for a double on big pop
New Gold NGD feb-16 U$2.06 24-jan-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-jan-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-apr-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-apr-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
27

Stocks To Follow Closed Positions 2015
Closed in 2015 closed close price
Argonaut Gold AR.to jan'15 C$1.47 14-dec-14 C$2.53 72.1% Big gain small time, profit taken
Amerigo Res ARG.to jan'15 C$0.405 20-jul-14 C$0.285 -29.6% Given up on weak Cu prices
Reservoir Min. RMC.v jan'15 C$6.05 18-jun-14 C$4.12 -31.9% sold on Cu downturn
Coro Mining COP.to jan'15 C$0.075 26-jan-14 C$0.035 -53.3% sm, sold on Cu downturn
Fortuna Silver FSM mar'15 U$4.12 10-nov-14 U$3.75 9.0% Short used as hedge
GoldQuest Min. GQC.v mar'15 C$0.26 27-oct-13 C$0.085 -67.3% given up ghost
Rio Alto Mining RIO.to apr'15 C$2.30 07-apr-11 C$3.57 55.2% Top pick, bot out, big win
Timmins Gold TGD jun'15 U$0.60 19-apr-15 U$0.62 3.3% near-term trade, out of time
First Majestic AG jul'15 U$10.51 10-aug-14 U$4.55 56.7% horrible failed trade
NovaCopper NCQ.to jul'15 C$1.05 09-apr-14 C$0.50 -52.4% no more Cu exposure, sm sell
McEwen Mining MUX aug'15 U$0.695 21-jul-15 U$0.92 32.4% Closed nearterm flip for win
Midas Gold MAX.to sep'15 C$0.39 21-sep-15 C$0.35 -10.3% Sm. trade idea that didn't work
New Gold NGD oct'15 U$2.18 23-aug-15 U$3.05 39.9% trade closed, profit taken
Legend Gold LGN.v nov'15 C$0.085 01-mar-15 C$0.035 -58.8% tiny "land grab" idea, failed
Timmins Gold TGD nov'15 U$0.245 20-sep-15 U$0.15 -38.8% small near-term loser
Please note that due to space considerations closed positions 2009 to 2014 are now
available on request, or were published in any edition to IKN553 (end 2019).
Important Disclosure
The information and opinions contained within this report reflect the personal views of the author and therefore all
material within should not be construed as accurate or reliable or be utilized as advice for investment or business
purposes. Independent due diligence and discussions with ones own investment and business advisor is strongly
recommended. Accordingly, nothing in this report should be construed as offering a guarantee of the accuracy or
completeness of the information contained herein, as an offer or solicitation with respect to the purchase or sale of any
security or as an endorsement of any product or service. All opinions and estimates included in this report are subject to
change without notice. It is prohibited to copy or redistribute this report to any type of third party without the express
permission of the author.
28