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many believe, myself included, that gold performs best when real rates are negative.
would think this already priced into GBN stock, but maybe not...
Tranter BEE ownership issue has been known for quite some time. Tranter will be "purchasing" some of its stake albeit at bargain terms (my recollection is 15% will be more or less freebies but the remaining 11% will be "purchased". I use 20% dilution for Tranter's BEE ownership. That is, take GBN market cap per ounce and multiply by 80% to dilute for Tranter.
much more of a problem than the Tranter BEE %, IMO, is the financing required for Burnstone capex. sure was hoping this could be done via Hollister cash flow, but Burnstone capex will be required sooner now given Hecla delays at Hollister...
(van Eeden)/your comment:
"... a rise in interest rates typically leads to a strengthening of the US dollar. If the dollar strengthens metal prices come down."
For gold, it is the REAL interest rates which are key (e.g. 2 year T-Bill rate less inflation rate/CPI, and NOT the nominal interest rate.
If US interest rates rise but inflation rises more, this is positive for gold. Thus, Fed must hike interest/fed funds rate more than CPI/inflation for this to be gold negative.
TSU @ 10:35am
http://events.onlinebroadcasting.com/minellc/103106/index.php?mode=1&sel_date=1
lots of drill activity coming up, going from 1 drill rig in 4Q06 to 2 drill rigs in Jan07 to 4 rigs in Feb07 to 5 rigs in Mar07
Louis Gold/Silver-Commitments of Traders Reports
http://users.skynet.be/bk336919/commodities/cotoi.html
Central Bank Gold Sales-Slovenia added to ECB
FWIW, per world gold council, Slovenia has just 5.1 tonnes per gold (versus for example USA @ 8,133 tonnes or Germany @ 3,422 tonnes).
________________________
Slovenia Joins Central Bank Gold Agreement
By Christian Vits
Dow Jones Newswires
Friday, December 22, 2006
FRANKFURT -- The Slovenian central bank will become a party to the European gold agreement, the European Central Bank said Friday.
"In the interest of clarifying its intentions with respect to its gold holdings, Banka Slovenije agrees with and becomes a party to the joint statement dated March 8, 2004," the ECB said.
The maximum annual sales of the Slovenian central bank, as well as the total sales, both as specified in this agreement by its signatories, will remain unchanged over the period of the agreement.
The central bank also agreed not to expand its gold leasing and its use of gold futures and options during the period of the agreement, the ECB said.
Yes, that is what I plan on doing, giving it the ol' one month time frame. Looks like a nice tax loss selling opportunity as you surmised, exactly what I was looking for. Thanks.
Looking for a little Michael Soucie torque for my portfolio... Keep me advised on those 3 small cap drillers.
Ok, bought TSU.v at US$.89
hopefully, you will still be my friend next month...!!
http://www.frank.pembleton.youaremyfriend.com/
bought some SHY yesterday and last week at C$.38
sold 50% of my WHIT
How do SHY.v and WHIT look...?
Thanks!
Ok, Frank, need a few new stock picks for 2007..., guaranteed winners only please...
Guess its best to flatter you a bit first...
http://frank.pembleton.YouAreMyFriend.com/
Central Bank Gold Sales
Large sell this week...
http://amarks.homestead.com/CBGold.html
Our corporate currency specialist, Ashish Advani, shared some views on the Canadian dollar Friday which I thought were very interesting. It seems a pattern has emerged in the trading of the loonie vs. the US$:
Between Sep.26, '06 and Oct. 17, '06 USD/CAD rallied from 1.1087 to 1.1419 (332 bps, 14 trading days)
The Pullback - 240 bps to 1.1179 on Oct. 27, '06 (8 trading days).
Between Oct. 27, '06 and Nov. 21, '06 USD/CAD rallied from 1.1179 to 1.1496 (317 bps, 17 trading days).
The Pullback - 209 bps to 1.1287 on Nov. 28 '06 (6 trading days).
And the most recent up leg..
Between Nov. 28, '06 and today, USD/CAD rallied from 1.1287 to 1.1580 (293 bps so far and 12 trading days).
Another day or 2 of topside pressure and 24-39 bps would put USD/CAD around 1.1604/19 which is almost exactly the top of 6 month old ascending price channel. It would also match the previous 2 up legs in both magnitude and duration (and time of month for that matter). SHOULD the pattern repeat itself, we could see a 200-250 bps pullback to unfold sometime over the next week and possibly over the illiquid holiday week after that. Target would be ~1.1350 which is where the daily support line that connects the pullback lows mentioned above comes in. Good news for the CAD$.
Don Coxe
Okay. A couple of other topics. First of all, what's happening on the US
and Canadian dollars - what we've had was we had a big sell-off in the
American dollar during the month of November and that's reversed partly with
a rally in December. The rally in December goes along with a trip to
Beijing in which the two biggest heavyweights in the US public sector of
finance are going to Beijing together: Ben Bernanke and Hank Paulson.
Watching them standing together on a receiving line yesterday I thought,
"What a display of American power when what they are essentially doing over
there is asking China to somehow or other support the dollar while letting
the renminbi go up," which is the kind of balancing act you expect of those
Chinese circus performers to come out and dazzle audiences, but as a basis
for trying to answer the long-term problems of America is perhaps an
inadequate strategy.
What is interesting of course is that the Canadian dollar has not shared in
this rally against the American dollar. We've discussed some aspects of it
in the current Basic Points but I'd like to note that the coincidence if you
look back at the chart at yearend '04 of the US dollar index and the
Canadian dollar, you'll see the same phenomenom at work. The US dollar
falling late in the year but the Canadian dollar not rallying. So it was
other currencies it absorbed.
So, why is that? Well, I think that there's a variety of factors in that
but remember that the Canadian dollar is still a small currency. And when
you come up towards yearend in the major currency markets when people are
squaring their books they are really - this is not a kind of currency that
they go long on. They make their basic plays on the Yen and on the Euro
now.
So I think that what you are going to see going into the new year is a
resumption of the bearish condition of the US dollar index and if we break
80, then there is going to be a rush to the exits and the Canadian dollar I
think this time will be outperforming on the upside because the forecast
that was in there was that the commodity prices were now about to give up
their gains of the year, that was all speculative froth and
everything...hasn't happened and I think the markets are going to take note
of that.
And finally the bond market once again as soon as we get some good inflation
numbers what we get is a terrific rally in the long end of the market so
that this hedge that I recommended that you put on where I said that the
long zeros were a nearly perfect hedge inverse correlation to mining stocks
and oil stocks to the extent that you consider that copper and gold and oil
are "inflation assets", I would debate that to some extent, but I believe
they are perceived that way in the market, what you can certainly say about
a long zero it's definitely a deflation asset. I mean the long zero loses -
if the economy is strong, the long zero loses bigger if inflation is strong.
So when we get a day like today when there's still these lingering doubts
about the strength of the economy - because if you look at those retail
sales numbers that had people dancing in the streets and sending the DOW to
an all-time high, one of the big things that led the list the biggest
consumer growth area was sales of consumer electronics. Now the only ones
of those that are still made in the US are those that are being repaired by
people from ones that were made abroad. So that what you've got was that
this was the suggestion of the tremendous strength of the US economy, when
what it does is that it testifies to the strength of the US trade deficit
and therefore will therefore show up absolutely certainly when the trade
deficit numbers come out which is the kind of thing which will concern the
dollar.
So, putting this together I still believe that you keep your hedge on,
because you don't even have to pay the insurance premium. And I have the
feeling that something is going to go wrong for the Dollar in the next few
months. There's just too many things wrong here and if Beijing and Tokyo
decide that they are prepared to let their currencies appreciate somewhat,
in other words if this trip to Beijing is successful, then the dollar is
going to fall and we'll be back up to the $700 mark on gold. And if it
happens quite suddenly what we could have is one of those financial events
where we have a major stock market sell-off, consumer confidence gets
knocked and then what we have is one quarter or so of zero or negative
growth. And then there is the perception that the central bankers of the
world are going to have to reverse their strategies.
That is going to be the beginning of the next commodity bull market which we
talk about.
Central Bank Gold Sales
http://amarks.homestead.com/CBGold.html
YTD actual sales are 61.8 tonnes versus expected 101.0 tonnes. About 39.2 tonnes behind scheduled sales.
central bank gold sales
http://amarks.homestead.com/CBGold.html
* Per top 2007 chart, YTD actual sales are 57.1 tonnes versus expected 91.3 tonnes. About 34.2 tonnes behind scheduled sales.
Martin M
In an issue of the Financial Monitor, Martin Murenbeeld, Chief Economist of Dundee Group of Companies, actually calculated the effect that past U.S. recessions had and found that “China is not as dependent on the U.S. economy as one might have thought.”
According to Murenbeeld, for the seven years (not counting 1960) that the U.S. economy was in recession, the average increase in Chinese exports as a percent of GDP was 0.14%, with a range of -0.75% in 2001 to 1.29% in 1991.
“U.S. recessions don’t seem to hurt Chinese exports in any consistent manner!” Murenbeeld exclaimed.
He added that for the same seven years the change in U.S. imports as a percent of GDP averaged -0.09%, meaning that “U.S. recessions do hurt U.S. imports in a consistent manner!”
A U.S. recession might cut 1% off the Chinese exports to GDP percentage, meaning that Chinese
GDP growth is damaged by at least 1% with the loss of exports, according to the report. But simple regression analysis for the period 1980-2006, suggests a 1% rise in U.S. GDP adds 0.58% to Chinese GDP. Assuming Chinese GDP would grow at 9.6% in a world where U.S. GDP grows 3.0%, a U.S. GDP growth of -1% would knock 2.3% off the Chinese growth rate.
“This is less than one might have imagined!” Murenbeeld said. “My inclination is to suggest that Chinese exports and Chinese GDP dance to their own drummer more than to the U.S. drummer.”
In other words, demand for commodities in China will not wither away in the event of a U.S. recession.
_______________
"Things are getting more serious," said Martin Murenbeeld, of Victoria-based M. Murenbeeld & Associates Inc., publisher of the Gold Monitor. The news that Mr. Ben Bernanke will accompany U.S. Treasury Secretary Henry Paulson to China may have triggered the recent currency weakness, he said.
"That's the kind of feeling I sense in the market," Mr. Murenbeeld said. "Everybody is waiting for the Asian currencies to be revalued upward."
Given the currency risks and possible geopolitical flare-ups, gold could reach $710 an ounce by the end of the year, he said.
Central Bank Gold Sales
http://amarks.homestead.com/CBGold.html
YTD actual sales are 49.3 tonnes versus expected 81.7 tonnes. About 32.4 tonnes behind scheduled sales.
Me too. New tax change legislation on CanRoys was most helpful in keeping Canadian exchange rate competitive to US$.
Central Bank Gold Sales
YTD actual sales are 36.0 tonnes versus expected 62.5 tonnes. About 26.5 tonnes behind scheduled sales.
This was first week of fiscal year where weekly actual sales (11.8 tonnes) were greater than weekly planned sales (9.62 tonnes each week for 52 weeks = 500 tonnes).
http://amarks.homestead.com/CBGold.html
natgas-nice presentation
http://www.aspo-usa.com/fall2006/presentations/pdf/Hughes_D_NatGas_Boston_2006.pdf
thanks
central bank gold sales
http://amarks.homestead.com/CBGold.html
Simmons latest...
http://www.simmonsco-intl.com/files/ASPO-Boston.pdf
Ortega said to win Nicaraguan election
Victory would expand club of leftist leaders in Latin America
By Traci Carl
The Associated Press
Originally published November 6, 2006, 8:45 AM EST
MANAGUA, NICARAGUA // Leftist Sandinista leader Daniel Ortega appeared today to have easily defeated four other presidential candidates in his long quest to return to power 16 years after a United States-backed rebellion helped force him from office, according to an electoral observer group projecting victory based on a sampling of the votes.
Ortega's victory, if confirmed by final results, would give Venezuelan President Hugo Chavez a strong ally in the region while threatening U.S. aid to the second-poorest nation in the hemisphere.
Many here still have bitter memories of the Sandinistas' decade in power, in which homes and businesses were seized and a war with Contra rebels left 30,000 dead.
The race was Ortega's fifth consecutive presidential campaign. He won an 1984 election boycotted by Sandinista opponents, then lost in 1990 to Violeta Chamorro, ending Sandinista rule and the Contra war. His next two presidential attempts, in 1996 and 2001, were also failures.
The quick count by the Nicaraguan Civic Group for Ethics and Transparency gave Ortega 38.5 percent of the vote to 29.5 percent for Harvard-educated Eduardo Montealegre of the Nicaraguan Liberal Alliance, a party that broke from the ruling Constitutionalist Liberal Party after former President Arnoldo Aleman was convicted of corruption.
Trailing were Sandinista dissident Edmundo Jarquin, ruling-party candidate Jose Rizo and former Contra rebel Eden Pastora.
The quick count, based on results from a representative sample of polling stations, had a margin of error of 1.7 percentage points. Amid concerns of fraud, the group carried out the count as a gauge to judge the final results. Some candidates expressed concern that the Supreme Electoral Tribunal was controlled by the Sandinistas and could influence the final vote.
Thanks to a change in electoral law, Ortega needs only 35 percent of the vote and an advantage of 5 percentage points over his closest rival to avoid a runoff in December. Before, he would have needed 45 percent to avoid a runoff.
The U.S. Embassy issued a statement late Sunday saying it was too soon to "make an overall judgment on the fairness and transparency of the process."
"We are receiving reports of some anomalies in the electoral process, including the late opening of (polling places), the slowness of the voting process and the premature closing of some" polling places, it said.
Roberto Rivas, president of the Supreme Electoral Council, blasted the U.S. statement, saying, "We have promised the Nicaraguan people transparent elections, and that's what we've done. I think there were enough observers to witness that."
Ortega's supporters flooded the streets, setting off celebratory fireworks, waving the party's red-and-black flag and swaying to the candidate's campaign song, set to the tune of John Lennon's "Give Peace a Chance."
Montealegre brushed aside Ortega's lead, saying: "No one has won here. The Nicaraguan people, in a runoff, will determine the next president."
Ruling party spokesman Leonel Teller warned that electoral authorities were "inciting something could end in blood and violence."
At stake are millions of dollars in potential investments, many from foreign companies drawn to Nicaragua by its cheap labor, low crime rates and decision to join the new Central American Free Trade Agreement. Many are waiting to see if Ortega wins and stays true to promises to continue free trade policies.
"We are playing with the stability of the country," said Jose Adan Aguirre, president of the Chamber of Commerce.
Observers said voting overall was peaceful, although many polling stations opened late, leaving long lines of people waiting to cast their ballots. After the polls closed, groups of angry voters pounded on shuttered doors, screaming at officials inside to let them vote.
Ortega didn't make any public statements early today.
Ortega says he has changed. In fact, his vice presidential candidate was once one of his biggest enemies: Jaime Morales, who served as the spokesman for the Contras.
As Sandinista leader, Ortega seized Morales' six-bedroom estate, but they reconciled after Ortega offered to pay Morales for his former home -- now Ortega's campaign headquarters.
Marvin Lopez, a 46-year-old doctor waiting in a long line at the same polling station where Ortega voted, said he feared an Ortega would bring back uncontrollable inflation and conflict.
"I don't want to return to a dictatorship, the misery, the abuse of families' rights," he said.
Waiting at the end of the line was 26-year-old student Gema Amaya Larios, who said she woke up at dawn to cast her vote for Ortega.
"He's the only one who will give the people what they need," she said. "Everyone else just cares about their own interests."
If Ortega wins, she predicted that his presidency would be different from his 1985-1990 term.
"There was an embargo, a war," she said. "Besides, we all learn from our mistakes."
Armed soldiers kept guard at polling stations monitored by more than 18,000 observers -- including three former presidents: the United States' Jimmy Carter, Peru's Alejandro Toledo and Panama's Nicolas Ardito Barletta.
Nicaraguan presidents cannot serve two consecutive terms, and President Enrique Bolanos steps down Jan. 10.
something is going to break..., I continue to build up cash and US Treasury positions. Now under 34% in common stocks.
more Central Bank Gold Sales
http://www.miningmx.com/gold_silver/345807.htm
Virtual Metals lending credibility to Barclays report of Central Banks reaching full 500 tonnes in 2nd Year. If true, we should see 90+ tonnes in near future on ECB reports showing this forward sale... Forward sale for 2006 fiscal year (likely in Sept 06), but will be reported in current 2007 fiscal year (likely within next few weeks, before year end).
____________________
Sales under the second year of the Central Bank Gold Agreement are believed by Virtual Metals to have hit the 500 tonne limit in the year to 26 September, but sales will fall short of that level in 2007, Cross said.
The reason for that is based on Germany stating that it might not come to the market to unload its full quota of gold under the five-year agreement.
On the demand side, jewellery consumption is seen rising on the back of a recovery in Middle Eastern buying of investment jewellery with money generated from high oil prices.
Central bank purchases are expected to fall to zero from 100 tonnes in 2006.
_________
This last comment of zero tonnes of central bank purchases will be proven wrong if UAE purchases 13 tonnes (=1% of reserves) per UAE comments on prior post...
Yet more Ferdi PR...
The media sure likes to talk to Ferdi....
Great Basin Gold Lists on JSE
By Lindsay Williams
30 Oct 2006 at 08:22 AM EST
JOHANNESBURG (Business Day) -- Ferdi Dippenaar, chief executive of Great Basin Gold [TSX:GBG], a north American company listed on the Toronto stock exchange and is now listed on the JSE, speaks with Classic Business Day on the company, gold, and the listing.
LINDSAY WILLIAMS: We’ll come to that later on, but let’s find out about the company and its prospects. Ferdi’s in the studio with me. Ferdi background to Great Basin please.
FERDI DIPPENAAR: Yes well first of all it’s great to be back. A bit of background to the company. I joined the company in January this year. at the time I evaluated the prospects I looked at the two assets. One in South Africa, the old Burnstone project. I call it the old one, I kind of refer to that one as well; a project in North America, in Nevada on the Carlin Trend, epithermal vein systems – very different to South Africa. But if we dwell with that for a while, it’s a decline, it’s already under ground, it’s already under construction, and we’re doing trial mining. so it’s a lot further ahead in terms of delivery compared to the Burnstone Project, so that’s going pretty well.
LINDSAY WILLIAMS: So let’s just take a step back again if I may – you are still then a fully blown exploration company rather than a company that’s actually producing any gold?
FERDI DIPPENAAR: No I would say we’re further than exploration. We’d probably be classified as a gold company in construction mode. We’ve got two mines under construction, as I said. Well in Nevada to convert the resource to reserve, you actually have to complete the decline and then start drilling, and we’ve completed about 60% of the drilling as part of this conversion, putting the ore model together. That’s done well. if that goes ahead with mining, which it should starting late next year, the company will be producing 100,000 ounces – our share from that operation - by 2008. And that’s for a period of six years.
LINDSAY WILLIAMS: That’s a decent deposit but I think the Burnstone development is the one you’re really excited about?
FERDI DIPPENAAR: I am and that’s probably the one where the credibility of the Great Basin team will be built around. it’s a 7-million ounce resource. We’ve got a 2.4 million ounce mining reserve. We’ve completed the bankable feasibility in May, its shallow deposit, it’s a low cost in cash cost. Even in capital cost pit terms. It’s a project that we started on 7 July – we actually started the box hole or the portal. We’ve gone underground on 11 August. We had our first blast nearly 170-meters down the decline. So we’ve actually started the project and I think that’s the excitement about it.
LINDSAY WILLIAMS: So it’s a shallow deposit and that automatically means that costs come down. What sort of costs are you actually talking about in rand terms?
FERDI DIPPENAAR: In rand terms R57,000 (US$7564) per kilogram and it is, it’s a function of the shallow nature of the ore body. We actually intersect reefs at about 220 meters below surface and the current planned depth of mining, ultimately, is just under 1,000 meters. The vertical shaft is 500-meters. It will also be serviced by a three kilometer decline as I said, so this is easy stuff.
LINDSAY WILLIAMS: And the life of the mine?
FERDI DIPPENAAR: 14 years at this stage.
LINDSAY WILLIAMS: OK so you’ve got six years over there, you’ve got 14 years over here, you’re going to be on the acquisition trail as well. is that one of the reasons why you’ve achieved this secondary listing today?
FERDI DIPPENAAR: No. the secondary listing today was really more focused on the future. First of all I think that the fact that we’re building the mine in South Africa, two-thirds of our production as we see it at the moment coming from the project. We’ve had such a huge amount of interest and you just don’t build a mine like this in the backyard of a gold mining country and not expect interest. So based on the interest we received – institutions as well – its giving the opportunity to investors and of course get the additional exposure to the north American project, and then should we optimize the mine any further, and we are doing that – we’ve got exploration program going at Burnstone – if we do have another million or million and a half ounces to the reserve phase, we’ll optimise the mine. Possibly produce more for longer.
LINDSAY WILLIAMS: What’s been the reaction from the institutions? You’re obviously out here, you’ve been doing a bit of a road show, people are always hungry for new projects, specifically when it comes to resources, despite the fact that they’ve come down a little bit recently. Have you had a very favourable reaction?
FERDI DIPPENAAR: I have. I’ve been pleasantly surprised. Not to the extent of the reaction, but I think its been favourable. The fact is we offer a different alternative in terms of investment. I think you find the three majors being slightly more mature in terms of their production and life of mine profile and what we offer at the moment, at least is two projects in construction phase with a lot of life of mine left, as the value gets added as we get into production.
LINDSAY WILLIAMS: What’s your view as a member of the gold mining industry about the state of the gold market at the moment? it wasn’t so long ago that people were writing in often – I noticed this afternoon once the New York market opened, getting close to $600 an ounce in the first half hour of trading, do you think the recent dip is just that? Just a dip and we can go on from here?
FERDI DIPPENAAR: Yes, I think if you speak to the chartists, they did expect it to correct. They expected the correction to be slightly lower than what it was. It is trying to break through a psychological level of $600 an ounce. I think the trend is still intact. And if you have a look at the political environment in the world, the cost of energy, I don’t think its going to change in the short-term. We’ll probably have the benefit of high gold prices for a few years to come and from our perspective of course, we’d like to be in production as soon as possible and have the benefit of that gold price.
LINDSAY WILLIAMS: The secondary listing isn’t immediately going to attract an enormous amount of volume, but that’s what people want obviously. They want another gold counter. We’ve got some really big players here, but they want something that they can get really highly geared up to. DRD Gold [Nasdaq:DROOY] is one that is really geared up to the rand price of gold. They want another one though but there’s been no trade this afternoon, well up until 15h30 but I’ll check the price in a moment. but up until then there was nothing. R15 (US$2) bid – what are you going to do about that Ferdi? Come on now.
FERDI DIPPENAAR: Well, on a day like today one must assume that something must go wrong and something did go wrong. Its basically a bit of paperwork but that’s been held up between here and Toronto. But we will see liquidity in the market, so I was told at about 15h30 there will be liquidity in the market and we will start seeing some trade’s in the stock. We also have approximately 20% of our shares are held by South African shareholders which…
LINDSAY WILLIAMS: Can you tell us more about that?
FERDI DIPPENAAR: Well they owned the mining or mineral rights and as part of buying them, GBG issued them stock or equity in return. That was held offshore. That was held in Toronto as part of the dispensation by the South African Reserve Bank with a secondary listing, of course the shares now come back to South Africa and not that we expect to see a lot of them flow back into the market, but definite liquidity. I think the other thing one must expect, as you start trading on the first day, every share that’s bought in South Africa, must be taken off the market in Toronto, and on the first day you will have a six hour delay just in terms of timing. But that will filter out of the system by tomorrow. I actually expect liquidity to pick up quite nicely.
LINDSAY WILLIAMS: Good. Ferdi good luck with this secondary listing. Good luck with the Burnstone Project in particular, R57,000 (US$7564) per kilo and with the price being – well I’ll give you the price later on once I’ve done my calculations, but it looks like an attractive prospect.
central bank gold...
The United Arab Emirates Central Bank may cut its U.S. dollar-dominated reserves by up to 90 percent and is looking at other currencies such as the yen, euro, and sterling, UAE Central Bank Governor Sultan Nasser Al Suwaidi said yesterday. He did not elaborate.
"The bank hopes to lower the dollar share of its foreign currency reserves to a range of between 50 to 90 percent," Al Suwaidi said. At present, he said, 98 percent of the bank's reserves holdings are in U.S. dollars. The foreign currency reserves of the UAE currently stand at over $25 billion. The Central Bank is yet to convert 10 percent of the total reserves into euros and gold, a decision it took earlier this year.
My math shows UAE would be purchasing about 13 tonnes if it held 1% in gold... Would more than offset 1 week ECB planned sales (about 9.6 tonnes per week=plan sales).
UAE Reserves... 25,000,000,000
1%... 1.0%
1% Reserves... 250,000,000
POG... $600.00
Oz... 416666.67
Tonnes... 12.96
central bank gold sales
http://amarks.homestead.com/CBGold.html
Yes, I noticed that 30Y to 3M chart too...! Amazing movement on that one...
FWIW, I am 32% in US Treasuries (3 months to 1 year) at rates above five percent; and have another 11% in cash and 8% in physical gold/silver. Only 22% in gold stocks and 41% in all common stocks including gold.
Having read Fooled by Randomness a few weeks ago, I got more conservative... plus I do NOT like inverted yield curves.
Yield spread between 30 Year T-Bond and 3-month T-Bill. If the yield ratio turns up and the real rate of interest remains negative, then gold should fly.
Martin M sighting...
http://www.resourceinvestor.com/pebble.asp?relid=25248
Bullish Outlook
Martin Murenbeeld, Chief Economist of Dundee Group of Companies, gave a more bullish outlook in the latest edition of “The Gold Monitor.”
According to Murenbeeld, mine supply should not rise for the next few years, due to the lagged effects of the low price of gold in the late 1990s and the “lag effect is 8-12 years!”
“My point is, mine output should not threaten the gold price going forward,” he said.
Murenbeeld said the other major category of supply is central bank supply, noting that “central banks appear to have a more gold-friendly attitude these days.”
Central banks in the European Gold Agreement fell short of the 500-tonne quota in the last CBGA2 year by about 100 tonnes. The Bundesbank, which held out on gold sales last year, announced on October 5 it would not sell any gold this year either.
“My point is, central bank gold sales are very unlikely to threaten the gold price going forward through 2009,” said Murenbeeld.
He reaffirmed that his long-term bias remains quite bullish, but said “I’m inclined to suggest that the gold price is poised to do somewhat better over the near term as some of the fundamental forces mentioned above play out.”
Ferdi Dippenaar: CEO and president, Great Basin Gold
By: Chris Buchanan
Posted: '27-OCT-06 23:23' GMT © Mineweb 1997-2006
MINEWEB: Well a listing on the JSE today of another resource stock. That’s Great Basin Gold listing today. We’ve got Ferdi Dippenaar, CEO and president of Great Basin Gold on the line. Ferdi, you’re already on Toronto and Amex in the States, which is very much like our AltX. How has your performance been on these bourses to date?
FERDI DIPPENAAR: Well, good evening. On the Amex and Toronto Stock Exchange the performances have actually been pretty good. In terms of liquidity we trade probably between 250 000 and 300 000 shares per day. This evening the stock prices go up quite sharply, probably in line with what happened in Johannesburg today. So it's actually done well.
MINEWEB: OK, and on the Toronto side?
FERDI DIPPENAAR: Toronto side as well. That’s where the primary listing is. But we have found that the volume or liquidity is probably a lot higher on the Amex. So just a larger market based in America.
MINEWEB: And now what are your prime objectives with the secondary listing on the JSE?
FERDI DIPPENAAR: Well, the secondary listing I think eventually, should we need the cash, it gives us an alternative in terms of raising capital to actually build the mine. And that would specifically be the Burnstone property in South Africa. What it also does give us is an increased level of awareness with local institutions and shareholders. And I think, thirdly, the fact that two-thirds of our production will be coming from South Africa, the fact that we are building this mine, it's close to Balfour, Johannesburg, Heidelberg – you know, it's really local in more ways than one. We have seen some interest in that, and really we’re just supplying the shares into the interest locally.
MINEWEB: I want to have a look at your various holdings, your various assets. Let’s look at the Burnstone asset in Mpumalanga. Just take us through exactly the situation with Burnstone.
FERDI DIPPENAAR: Burnstone – it's just over a 7m ounce resource. And it's got a mineable reserve of 2.4m ounces. It's Kimberley reef that we mine. It has been well drilled out. I think the one thing that the company has done extremely well – they drilled 261 surface boreholes into the ore body, so the risk associated with mining it is pretty low. The capital cost, because it's shallow, 220m below surface, dipping down to about 700, 800m below as part of phase one, which is extremely shallow as well, means the capital cost is low. It's just over R1bn life-of-mine capital cost. And all in all, you know, we’ve started the project, we kicked off the project from the 7th of July by starting the construction, the portal. Started blasting on the 11th or August. So what we’ve got at the moment, we’ve actually started construction of the mine. And I think that was an important step in the actual delivery of the project.
MINEWEB: Now you’ve got other assets. The one in the United States, the Hollister property, what’s that about?
FERDI DIPPENAAR: Well high-grade silver and gold epithermal vein systems. These are also shallow. We’ve got a decline that has been constructed in Nevada, Hecla, a silver operator wanting exposure into gold is actually earning in on the project. But to give you an idea, it's a million-ounce resource at this stage. On average it's about 42 grams per ton of gold and 225 grams per ton of silver. So it's very different to the Wits Basin, but a lot easier to mine. It's about 200 feet below surface. That’s where we start mining these veins. So you can see both assets are very shallow in terms of ore bodies, and very easy to mine and low risk.
MINEWEB: Right and then the Casino Project in Canada?
FERDI DIPPENAAR: Well that’s non-core at this stage. It is a property. We’ve got our hands full. The one thing we have done as a dedicated management team is apply or appoint the necessary exploration capacity and skills within the company, and we’ve just embarked on a fairly aggressive exploration programme on both properties because we believe there is quite a lot more to find on them. That’s the Burnstone and the Hollister property in Nevada. So the Casino Project has been put on the back burner at this stage and as soon as the other projects are up and running we’ll probably re-look at it again.
MINEWEB: Now finally, you’re wanting to evolve from an emerging gold producer to a mid-tier producer. What is the time frame that you’re looking at gearing yourself up, or bringing yourself into that mid-tier sector?
FERDI DIPPENAAR: Yeah, well we’ve given ourselves three years from the listing today. You know, if I have a look at the production expectations in about three years’ time, probably close to about 300 000 ounces per annum. That does leave a gap of where we’d like to be at 200 000 ounces. So we will be looking at either organic growth or then acquisition to take us to that limit.
MINEWEB: Thanks, Ferdi Dippenaar, CEO and president of Great Basin Gold.
Great Basin Gold's secondary listing on the JSE
By: Tessa Kruger
Posted: '27-OCT-06 15:00' GMT © Mineweb 1997-2006
JOHANNESBURG (Mineweb.com) --The secondary listing of emerging gold producer Great Basin Gold on the JSE today will provide local investors with an appetite for gold with a wider selection of junior mining stocks.
Chief executive of GBG, South African Ferdi Dippenaar, who used to work for Bernard Swanepoel at Harmony, said at the listing in Johannesburg that the company’s principal Burnstone gold mining project in South Africa made the JSE the “logical” choice for a secondary listing.
GBG, a company with a current market capitalisation of R1.4 billion (around US$185 million) was not aiming to raise capital with the secondary listing, but wanted to raise its profile in order to be able to raise capital in future, he said.
Great Basin, which is also bringing a gold and silver property in Nevada, U.S.A. into production, is also listed on the Toronto and the American Stock Exchanges.
Dippenaar believes GBG will receive support from investors as mining is still a prominent activity in South Africa and it is constructing its key Burnstone mine near Balfour in South Africa’s Mpumulanga province.
“We would like South African residents to directly invest in the company to enhance liquidity in its shares,” he said.
Burnstone is expected to deliver 214,000 ounces of gold annually over a mine life of 14 years at a total cost of $314 per ounce.
However, production could be lifted as Burnstone has total measured and indicated resource of 7.1 million ounces. The current mining plan includes a mineable reserve of 2.4 million ounces only.
Construction of the Burnstone mine has started with the building of a decline to 321 metres below surface from where a shaft will be sunk further underground.
Dippenaar said they had the advantage of an ore body starting 220 metres below surface and, at the lowest point, only reaching 800 to 900 metres underground.
This meant that capital cost of building the mine per ounce was low compared with a deep level gold mine, which would have to sink a number of shafts to a lower level.
Burnstone is expected to deliver 214,000 ounces annually over a mine life of 14 years at a total capital and operating cost of $323 per ounce. Its reserves are on The Kimberley reef which carries what GBG describes as moderate to high grade gold mineralisation amenable to underground mining. The Kimberley reef has been mined very successfully, for example, in the Randfontein/Krugersdorp area in the past.
Burnstone promises investment rate returns of 19% at a gold price of $450 per ounce and an SA Rand exchange rate of R7 to the US$.
The recent average gold price reached a level of $620 compared to $554 in the first quarter of 2006, according to GBG.
“But there is definitely opportunity for growth at the mine, as exploration activities are aimed at converting the remaining 4.7 million ounce resource to reserve ounces.”
Great Basin has acquired 8 of 10 new order exploration licenses in order to expand measurable reserves. The company is currently negotiating a BEE deal with a local consortium and will make its application for new order mining rights after it is finalised.
Great Basin’s second large core project - the Hollister Development project in Nevada - will start production in two years.
The 520- ton a day undergound mine will have an estimated life of 5.9 years, annual production of 150,000 ounces of gold and 760,000 ounces of silver. The internal rate of return is estimated at 78%.
decent volume on the futures, especially for a Sunday night...
http://charts.barchart.com/chart.asp?sym=GCZ6&data=Z90&date=102606&den=MED&divd=Y&am...
More Ferdi PR...
http://www.miningweekly.co.za/min/news/today/?show=96591
Newly JSE-listed Great Basin Gold in South African expansion drive
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Canadian-listed junior miner Great Basin Gold hoped to increase production at its Burnstone mine to 240 000 oz-plus a year and extend mine life beyond 14 years, CEO Ferdi Dippenaar said on Friday following its JSE main-board listing.
Burnstone, situated near Balfour in the South Rand goldfields 80 km from Johannesburg, was scheduled to come into production by 2009.
Dippenaar said that surface drilling was continuing at the Mpumalanga operation in a bid to convert 4,7-million resource ounces to reserve ounces.
Burnstone had a total measured-and-indicated resource of 7,1-million ounces and a mining reserve of 2,4-million ounces in its Area 1 mining area, the major portion of which was under new-order prospecting rights.
By December, he expected initial drilling to convert 600 000 resource ounces to reserve ounces and further drilling to convert another million ounces.
Primary listed in Toronto, Dippenaar said that the secondary JSE listing was undertaken to create an additional growth-funding mechanism and also to enhance awareness of the company among South African investors.
Finance would not be raised on the JSE at this stage, however, as the company - which was concluding a black-economic-empowerment transaction with Sipho Nkosi's Tranter Investments - was adequately financed for the short- to medium-term.
Minerals and Energy Minister Buyelwa Sonjica had, earlier in the week, converted a further three prospecting rights, bringing the total new-order prospecting rights to eight, with two further conversions awaited.
Outside of South Africa, Great Basin Gold was developing the 93 500 oz/y Hollister mine in North America, a project that presented opportunities for further exploration.
Faber debates two of Bloomberg tv's finest.
http://www.bloomberg.com/avp/avp.htm?clipSRC=mms://media2.bloomberg.com/cache/vo69YlO4h3SE.asf#
Ortega Extends Advantage in Nicaragua
In the event no presidential contender receives 40 per cent of all cast ballots, the first place finisher can only avoid a run-off by reaching the 35 per cent mark and holding a five-point advantage over the closest rival.
Ortega needs to get from 33% to 35% to win on first ballot...
October 29, 2006
- Former head of state Daniel Ortega is still the candidate to beat in Nicaragua, according to a poll by CID-Gallup published in La Prensa. 33 per cent of respondents would vote for the Sandinista National Liberation Front (FSLN) candidate in next month’s presidential election, up four points since August.
Eduardo Montealegre of the Nicaraguan Liberal Alliance - Conservative Party (ALN-PC) is second with 22 per cent, followed by José Rizo of the Constitutionalist Liberal Party (PLC) with 17 per cent, Edmundo Jarquín of the Sandinista Renewal Movement (MRS) with 13 per cent, and Edén Pastora of Christian Alternative (AC) with one per cent.
In 2001, the PLC’s Enrique Bolaños won the presidential election with 56.3 per cent of the vote. The PLC and the FSLN have traditionally been the dominant parties in the Central American country’s political scene. Montealegre once belonged to the PLC, and the MRS was assembled by former FSLN members.
In March 2005, the FSLN officially designated Ortega as its presidential nominee. Ortega governed from 1985 to 1990, but was a losing candidate in the 1990, 1996 and 2001 ballots.
On Oct. 27, Ortega refused to attend a debate with Montealegre in Managua. The ALN-PC candidate expressed disappointment, declaring, "It was important for (Ortega) to show up, but he unfortunately decided not to do so. (...) During his government, we had alliances with conflictive countries, wars, divisions, press censorship and half a million Nicaraguans emigrated to look for a better life."
The Nicaraguan presidential election is scheduled for Nov. 5. In the event no presidential contender receives 40 per cent of all cast ballots, the first place finisher can only avoid a run-off by reaching the 35 per cent mark and holding a five-point advantage over the closest rival.
Polling Data
Who would you vote for in the presidential election?
Oct. 2006
Aug. 2006
Jun. 2006
Daniel Ortega (FSLN)
33%
29%
23%
Eduardo Montealegre (ALN)
22%
23%
17%
José Rizo (PLC)
17%
14%
11%
Edmundo Jarquín (MRS)
13%
14%
--
Edén Pastora (AC)
1%
1%
1%
None / Undecided
14%
19%
32%
Great Basin may seek gold project funding
Allan Seccombe
Posted: Fri, 27 Oct 2006
[miningmx.com] -- GREAT BASIN GOLD is likely to come to the market to raise capital if it decides early next year to accelerate and expand its South African gold project to 250,000 oz/year from the planned 214,000 oz, CEO Ferdi Dippenaar said on Friday.
Great Basin, which listed on the Johannesburg bourse on Friday, plans to grow group production to 500,000 oz in three years from its Burnstone project in South Africa, its 50%-held Hollister project in Nevada and possible acquisitions, he told Miningmx in an interview.
The Hollister project, which could bring 30,000 oz of pre-production gold onto the market in 2007, will be brought into production in 2008.
we might have to come to the market for capital“As the projects stand now Hollister will fund Burnstone, but if we decide to optimise Burnstone, based on results from our exploration drilling, we might have to come to the market for capital in the form of debt and equity to enable us to build a mine,” Dippenaar said.
An estimated R300m to R350m would be needed for the plant and shaft.
By midday South African time the illiquid shares were untraded. Bids were recorded at R14.60 a share. The listing was not intended as a capital raising. Great Basin is listed on the TSX and AMEX.
Plans to install bigger ball mills at Burnstone are being studied. The plant will have a nameplate production capacity of 300,000 oz/year.
The Burnstone project has been brought forward by 12 months by starting work on the decline shaft under the rights granted by its prospecting licence.
An application for a new order mining right will be submitted before the end of the year, Dippenaar said, which implies an empowerment deal with Tranter Gold, headed by Eyesizwe Coal CEO Sipho Nkosi, will be finalised by then.
Great Basin, which drilled 261 holes on the Burnstone deposit to build up reserves of 2.4m oz, will drill another 24 holes before year-end to add one million oz to the mineable reserves category and bump 500,000 oz up into the measured resources category.
It currently has measured resources of 5.86m oz. The conversion rate of measured resources into the mineable category is more than 80%, he said.
There are more exploration targets on outcropping reef in a 10-20km arc to the south and south east of the proposed mine. An inexpensive drilling programme will see if these targets are economically viable.
There is another reef 300 metres below the Kimberley Reef at the Burnstone mine, which will ultimately go down 500 metres. Mining will start at 316 metres. Great Basin is awaiting assay results from a core sample taken from the deeper Main Reef.
Free news alerts: click here to subscribeAt the Ivanhoe property on Nevada’s Carlin Trend, the US version of South Africa’s Wits Basin, five percent of the block called Hollister is under development in a 50/50 joint venture with Hecla Mining.
Hecla, which will manage the mine, needs to spend $28m to complete a bankable feasibility study and bring the mine into production to earn its full stake in the project.
“I’d like Great Basin to own 100% of the Hollister project,” Dippenaar said of the decline mine that has a six-year life and produce 150,000 oz of gold and 760,000 oz of silver a year.
“I know how important Hollister is to fund Burnstone. We’d be mining more of it, no doubt. Hecla has a different level of urgency because they have other projects,” he said.
The Great Basin team has been quite aggressive in its approach to the project, taking over the building of an ore reserve model to design a mine.
Great Basin is exploring the remainder of the Ivanhoe property, which Dippenaar called “highly prospective” and which is solely owned by his company.
“There’s been quite a bit of interest in Hollister which we have chosen to ignore,” Dippenaar said, raising the point Great Basin makes an attractive takeover target. “We are dirt cheap. A company with a seven million oz resource is not something you find every day.”
“We are not putting this lady up for sale. That’s not the point,” he said.
Great Basin to make JSE debut on Friday
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Canadian-miner Great Basin Gold will start trading on the JSE's gold-mining sector on Friday (October 27), CEO Ferdi Dippenaar announced on Tuesday.
The company initially aimed for a secondary listing in July but was forced to make several postponements.
The JSE has approved the listing of the entire issued share capital of Great Basin. At the date of listing, the authorised share capital of Great Basin will comprise an unlimited number of ordinary shares with no par value, of which 112 665 213 ordinary shares have been issued.
The company has a primary listing on the Toronto Stock Exchange and a secondary listing on the American Stock Exchange.
Earlier, Dippenaar said that listing on the JSE would offer South African investors exposure to its development projects in South Africa and its high-grade gold and silver deposit in Nevada, the US.
“When in production, both are expected to be shallow, low cash cost operations,” he said.
Its main South African property is the Burnstone project, located on the South Rand area of the Witwatersrand Basin.
Meanwhile, Great Basin Gold also announced that South Africa's Minerals and Energy department had successfully converted a further three prospecting rights to the new order and that the State had granted it two new-order rights solely in terms of the Mineral and Petroleum Resources Development Act (MPRDA).
This brought the number of prospecting rights that have been granted to Great Basin to eight, covering an area of about 30 000 ha. The applications for conversion of one old order prospecting right and the application for the granting of one new order right were still outstanding, but the company said that the conversions were expected shortly.
The major portion of the planned mining area of the Burnstone gold project, known as 'Area 1' had now been converted. This area would give the Burnstone mine an estimated life of mine of 14 years.
Great Basin started with the construction of an access decline in accordance with its old-order prospecting rights on July 7. To October 18, the decline had been advanced to 155 m. Stage one of the development programme, that encompassed construction of the decline and taking a bulk sample, would be complete in about 16 months' time.
In terms of the MPRDA, which places prospecting and mining rights under the custodianship of the State, Great Basin, as holder of the prospecting rights, would also have an exclusive right to apply for the mining rights in the area.
“Great Basin intends to complete the administrative process by applying for a mining right before the end of the current year. The estimated time for the processing of a mining right is approximately one year and the company intends coinciding this with the finalisation of the bulk sample in order to make a seamless transition to the proposed mining operations,” it said.
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Published: 2006/10/24 Printer