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GOZ thread...
Why don't you create a new board here:
http://www.investorshub.com/boards/boards.asp?cat_id=136
Choose "create a new board" at the bottom...
Also, on your research relating to Cumberland and others, sure would appreciate you updating those boards...
Thanks!
Today was taking money from the small spec Oct Calls day...
The Commercials/Cartel had to sell Dec Futures in order to drive the POG down... They now have to buy back those Dec Futures (this evening?) at hopefully lower prices than they sold them for..., or see their short exposure increased rather dramatically (given the large Dec option volume). Lease rates did not increase today implying that no physical was sold into the market..., i.e. uncovered short Dec Futures.
We go up tomorrow on both HUI/$Gold IMO, could be down some more in the AM, but buy the low tomorrow AM should be a good strategy... Just my opinion... Reserving the right to change my mind, but that's my gameplan...
see L Kaplan has snippet today regarding the options...
http://www.321gold.com/editorials/kaplan/kaplan092503_snippet.html
Leonard Kaplan
Prospector Asset Management
September 25, 2003 - noon
Gold rallied sharply overnight and into the first hours on Comex, only to get smacked down by $1.00 at the present time (late morning).
The greatest influence on gold has been the sudden turnaround in the equities market, where prices broke into new recent lows, only to rally sharply. As stocks rose, gold fell.
And, most importantly, today is options expirations day for the October gold contract. As such, the gold price is drawn to the nearest "round" number, which is $390.
Look for a close in the October gold contract under that level, so that all the buyers of calls see their investments expire worthless. On the other hand, those who sold these calls against their futures, will pocket the entire premium that they received.
This is one reason why I rarely ever buy call options.
Leonard Kaplan
It was the Oct call OPTIONS, not the FUTURES, that were at risk today... And the Cartel effectively drove the price down so less call options would be in the money, and thus less hard cash to pay out to the option holders... Do not have it handy but L Kaplan posted a great commentary on this a few months back (i.e. call option expiration trading/specs).
FWIW, Oct gold has significantly less open interest than Dec gold... IMO, the trend in HUI and $Gold is still up from here...
FWIW October Gold Call Options...
Gold Cartel not in as much BIG trouble as Bill Murphy thought!! :)
FWIW, we are down today as Cartel ensures those $390 Oct calls expire worthless (and those $380 calls are worth less), but IMO believe this trend will reverse after this Oct call expiration...
Cartel (or long specs capitualating) really went into overdrive today, look at the number of contracts traded today.
Follow the weekly HUI chart for clues when this reverses, and it is not signaling a sell yet, IMO...
From Bill Murphy yesterday:
The Gold Cartel is in BIG trouble.
One of the reasons the dealers were pounding gold was to protect October option positions (based on the October futures contract) which expire tomorrow on the close. The biggie will be the 390 calls as there are 7610 of them. The question is whether The Stalker and friends are waiting in the weeds to pounce all over the positions of the increasingly desperate cabal and other bewildered shorts.
There are also around 3500 375 and 380 calls and 2000+ 385 calls, all of which are nicely in the money.
It wouldn't surprise me to see gold come in $390 bid.
The Gold Cartel appears to getting even SHORTER! The open interest went up yesterday, another 1811 contracts to 291,738, a new high. Certainly the specs aren’t going short here. Maybe a little profit taking. That’s about it. The specs keep piling in and the cabal and friends keep selling. Won’t be long before we have our Commercial Signal Failure.
Maybe we get that failure tomorrow. The stock market weakened all day and closed on its lows. In the Access market, gold traded as much as $1.80 higher on heavy volume.
Gold is coiled to explode. The Gold Cartel is trapped. Their only exit is to compete with The Stalker and buy massive amounts of gold.
_________________________
NatGas Storage +100
Storage Highlights:
Working gas in storage was 2,688 Bcf as of Friday, September 19, 2003, according to EIA estimates. This represents a net increase of 100 Bcf from the previous week. Stocks were 302 Bcf less than last year at this time and 93 Bcf below the 5-year average of 2,781 Bcf. In the East Region, stocks were 65 Bcf below the 5-year average following net injections of 60 Bcf. Stocks in the Producing Region were 39 Bcf below the 5-year average of 764 Bcf after a net injection of 28 Bcf. Stocks in the West Region were 11 Bcf above the 5-year average after a net addition of 12 Bcf. At 2,688 Bcf, total working gas is within the 5-year historical range.
Richard Russell latest...
dated 9/23 posted 9/25
check out the GG P&F chart...
http://www.gold-eagle.com/gold_digest_03/russell092503.html
NEM-nice mineweb article...
We need to see NEM make an acquisition or two, paying over $60 per reserve ounce... NEM got off way too cheap on the MOY deal...
Acquisitions and additions will become a key feature for us.
By: Tim Wood & Stewart Bailey
Posted: 2003/09/24 Wed 14:30 ZE2 / © Mineweb 1997-2003
DENVER -- Newmont [NEM] will refocus attention on acquisition opportunities from the beginning of next year as the process of integrating last year’s three-way merger with royalty group Franco Nevada and Australian miner Normandy is completed.
David Harquail, President of Newmont Capital, the mining group’s merchant banking unit, told Mineweb that while Newmont has organic growth opportunities and is “not pushed to go out and acquire ounces”, the group will place more emphasis on acquisitions.
“Acquisitions and additions will become a key feature for us. Rationalisation and cash raising are essentially done…sales of non-core assets should be completed by the end of the year. Optimising our retained assets will be an ongoing process,” said Harquail.
Harquail would not be drawn on which prey the group will go after first. He acknowledged that Newmont has received several proposals, but said these were predominantly from investment banks and other industry deal makers. Newmont remains a magnet for junior mining companies seeking joint venturing arrangements.
Implementing the Newmont way
Harquail says Newmont’s post-merger strategy was to rationalise the asset base and raise cash, primarily to pay down group debt and strengthen the group’s balance sheet. The mandate was to achieve this without putting a dent in production or the reserve profile.
At the same time, Newmont has been overhauling its accounting and information technology systems, replacing and standardising them so that all mines will report on the same basis. Years of growth through acquisition in times of lean gold prices meant that information systems were a patchwork of legacy projects that inhibited personnel rotations and rapid data assimilation at group level.
Newmont Capital’s role has been integral to the process and last year alone it outstripped its budgeted sales of $250 million, to register contracted sales of $410 million. That was without the help of outside advisors, saving the group millions in fees and charges.
For 2002 and 2003, Newmont Capital has raised more than $640 million from the sale of non-core assets. The transaction schedule to date reads like a monthly shopping list; Lihir stake sold, TVX Newmont Americas sold, Aber Diamond shares sold, Kinross investment reduced to a level that no longer attracts attention, Newmont NFM privatised, among a host of others.
Further asset sales are planned in the near future. The sale of the Mesquite mine in California should close in October and the sales process for Perama in Greece and Kori Chaka in Bolivia, are well advanced. Notably, Mineweb understands that Durban Deep [DROOY] recently withdrew from a planned purchase of Newmont’s Martha mine in New Zealand. Mineweb broke news of the potential deal earlier this year.
Newmont Capital was also intimately involved in slashing the acquired Normandy gold hedge book and resolving the Yandal hedging showdown. Newmont’s remaining hedges are now its legacy book of price capped contracts totally 2.35 million ounces at an average price of $377/oz going out to 2011. There are also 435,000 ounces of prepaid forwards with a floor of $300 and a cap of $380/oz. The latter contracts are shown on the balance sheet as long-term liabilities.
De-leveraging equals wealth creation
Much of the sale proceeds have been committed to debt reduction. Newmont’s debt ratios – about 14% of book capitalization – are not onerous by industry standards, but the company is betting that deleveraging will raise its stock price.
Simply put, Newmont is betting that investors will continue to value it based on a high multiple. Consequently, any funds diverted from debt service to profits are expected to raise the stock price in order to sustain a forward price to earnings ratio. Newmont currently trades at around 40 times estimated 2003 full year earnings, so every 10 cent increase in earnings could be worth an additional $4 to the stock price.
The efforts at debt reduction have been impressive to date. While net debt was more than 42% of Newmont’s book capitalisation at the end of 2001, the number had fallen to a shade over 20% at year end 2002, and is now at about 14% from 16% at the end of June. Debt repayments to date total approximately three quarters of a billion dollars.
The decision by Standard & Poor’s to enforce its American only rule for participants in S&P500 index has been a boon for Newmont since it knocked Placer Dome [PDG] and Barrick Gold [ABX] out of the pool of tracker funds. Newmont has benefited by becoming identified as the American gold brand among generalist funds, to the chagrin of its competitors.
Optimisation and incentives
Parallel to the cash raising, Newmont Capital has also been tasked with squeezing the most value out of its current asset base.
“We’re asking ourselves if each asset make sense for us in the long term. They have to grow or go,” says Harquail. The process will culminate in a portfolio of large, core districts and fewer smaller operations, but not before a round of joint venturing, property rationalisation and more outright sales have taken place. Expect most of the sales to include retained royalties, even as the group counts on royalty income as a “natural hedge” against a market downturn.
The main tool Newmont is using to guide the strategy, he says, is a net asset value (NAV) curve for each project, with the group only interested in those on a rising or steady NAV trajectory. Size is also an issue for the group, which is loath to see management distracted by small, or marginal operations that are insignificant to production and reserves. “The 80-20 rule is well understood here,” says company investor relations executive, Russell Ball.
NAV is also the foundation of Newmont’s recently introduced incentive scheme. Newmont has established four “economic value drivers” and assigned a weighting to them, with an emphasis on long-term performance but acknowledging short-term cash flow needs.
“The recently announced joint venture deal at Getchell with Placer Dome was accretive on all four of Newmont’s economic drivers. Not only do shareholders benefit, but management is directly incentivised to do more of the same,” said Ball.
feeling upbeat, and well you should because the fireworks may start tomorrow... IF spot Price of Gold gets above $391 to take out the 52 week high, cyclepro is using futures for whatever reason, Dec futures are above $390 now...
to reiterate cyclepro:
(Sunday 9/21/2003 PM): As I am writing this Sunday evening, Sydney and Hong Kong markets are already trading and gold is up from Friday's New York close. The December COMEX futures contract traded as high as $391 on 2/5/03 so that is our next target, and our next resistance level. Breaking above that level should spark some fireworks because there are probably a large number of buy-stops set either by short sellers wishing to limit their losses, or by momentum traders that recognize an upside breakout means a higher likelihood of substantially higher prices. The "fireworks" comes from running these stops.
http://www.geocities.com/WallStreet/Exchange/9807/Charts/SP500/Outlook.htm
Finally, you torquesters have identified a good fundamental stock to buy..., now go out there and buy some more!! Would like to have seen todays spike up accompanied by more volume, so get off your duffs and get with the game plan...
Last 10 trades, spiked up to C$1.95 on light volume:
15:55 1.950 1,000 +0.250 Pacific Canaccord
15:52 1.970 500 +0.270 Pacific Canaccord
15:50 1.900 500 +0.200 Pacific BMO Nesbitt
15:46 1.900 2,000 +0.200 RBC BMO Nesbitt
15:42 1.800 50 OLT Haywood TD Securities
15:42 1.800 50 OLT Haywood RBC
15:42 1.850 700 +0.150 Haywood TD Securities
15:42 1.850 1,500 +0.150 Haywood BMO Nesbitt
15:41 1.820 2,300 +0.120 Haywood Canaccord
15:37 1.810 10,000 +0.110 McFarlane McFarlane
thanks Louis...
Am well aware of the equation of exchange, that is MV=PQ
(for those of you economically chalenged, MV=PQ means: the market value of all goods and services must be equal to the supply of money multiplied by the velocity of the circulation of currency.)
But IMO, one can safely assume V(elocity) as a constant...
Change in prices (inflation/deflation) is the primary cause of velocity as I recollect... Why and HOW do you think that a change in velocity would impact the price of gold? Please advise...
My opinion is that the use of the Equation of Exchange can illustrate the effects on the over-issue of a currency. That is, when money supply is increased faster than the level of production of goods and services in the economy. Excessive issue of currency in the absence of increased production of goods and services will lead to inflation/rise in the consumer price index.
In any event, hope you get the chance to model the POG vs. the G-7 money supply, post Bretton Woods time period will more than suffice... THANKS!
Nice post Louis...
If you get the chance and/or the data, sure would like to see you replicate a chart that Murenbeeld uses, namely price of gold vs G7 money supply:
"Much attention has been focused on gold’s inverse correlation with the dollar, but Murenbeeld says it is less significant than the negative correlation with the money supply of the Group of Seven nations (US, UK, Canada, France, Italy, Germany, Japan)."
Think you could find this data and generate a chart... It never hurts to ask...
GG: Miningweb
By: Tim Wood
Posted: 2003/09/24 Wed 08:45 ZE2 / © Mineweb 1997-2003
DENVER -- Last year, many analysts went somewhat cold on Goldcorp [GG] when they interpreted a set of drill results to mean its company-making high grade zone was petering out, threatening to turn a spectacular ore body back into an ordinary one. Now that view appears to be reversing.
The company today (Tuesday) released exploration results reporting the “deepest high grade zone multi-ounce intersection of gold” ever at 7,165 feet. Goldcorp chief executive, Rob McEwen, says this is similar to the high grade zone closer to surface and the expectation is that the lower zone will improve in quality when measured by ounces per vertical foot.
Company geologists interpret the upper zone’s 3,500 ounces per vertical foot to be especially rich because of an intersection of geological structures. The lower zone is currently reporting 1,500 ounces per vertical foot. The hope now is to increase the latter figure since the data aligns with initial interpretations of the high-grade zone extending at depth. It seems improbable that the 3,500 ounce number can be replicated, but it is also quite likely that it will rise materially.
This opens up prospects for significant reserve expansion and increasing production in the medium term. Investors will be focusing especially on what seems to be a likely extension of the high grade zone adjacent to and above the bottom of Goldcorp’s new shaft that is presently being sunk. Once completed, exploration could be accelerated into the extension to provide plentiful reserves for long mine life and facilitate organic production growth.
The HGZ was also encountered below the planned new shaft bottom in the hanging wall zone, whilst sulphide mineralization was also encountered at its deepest level ever – 7,300 feet.
Professional investors have been muttering for a while now about Goldcorp’s premium rating which has been overhung by a small drought of exploration news and continued concerns about the company being a one asset wonder.
The exploration issues have been mostly addressed with this news and the risk of a single mine is partially offset by the new mine. Goldcorp continues to scout acquisitions, but, like most companies, says it hasn’t found anything of value yet. Absent any deal, Goldcorp will continue to produce nearly 600,000 ounces of gold per year at $100/oz cash cost, rising to 700,000 ounces a year at $70/oz.
“Some people would say our growth profile is relatively shallow; positive but shallow. We are the average of the growth going forward… without permitting risk. Goldcorp is a very simple story with an exploration buzz to it. All our assets are North American, our costs are low, we are unhedged, we have a strong balance sheet and we pay dividends,” says McEwen.
Goldcorp’s stock closed at an all-time high today, even as many gold stocks took a breather. The stock gained 3.5% in New York to $14.63 and traded closer to $15 in after-hours trade. Nearly 3 million shares changed hands, more than double average daily volume.
cyclepro update, some sage advice:
http://www.geocities.com/WallStreet/Exchange/9807/Charts/SP500/Outlook.htm
here's the introduction, much more at the link:
(Sunday 9/21/2003 PM): As I am writing this Sunday evening, Sydney and Hong Kong markets are already trading and gold is up from Friday's New York close. The December COMEX futures contract traded as high as $391 on 2/5/03 so that is our next target, and our next resistance level. Breaking above that level should spark some fireworks because there are probably a large number of buy-stops set either by short sellers wishing to limit their losses, or by momentum traders that recognize an upside breakout means a higher likelihood of substantially higher prices. The "fireworks" comes from running these stops.
GLG: Merrill
Kevin McArthur, President and CEO, provided an update on the company’s activities to delegates at the Denver Gold Forum.
Analysis
Mr. McArthur reported that the company's operations continue to perform well, its development projects are moving ahead, and it is also enjoying exploration success. The company has three development projects that will form the forecast growth phase in its gold output from 238,000 ozs in 2003E (lowered from 250,000 ozs due to short term leaching problems at San Martin) to over 550,000 ozs by 2006E. Cash costs are forecast to decline from $170/oz to below $150/oz by 2006.
At the 66.7%-owned Marigold mine in Nevada, the expansion is nearly complete and gold output is forecast to rise to 165,000 ozs in 2004 (100%). In its 2Q results, Glamis noted a new discovery called TZN. Drilling continues in order to delineate the full extent of this zone. This zone could allow Marigold to be expanded to over 200,000 ozs per annum The wholly owned El Sauzel project in Mexico recently received all major permits, and construction has commenced on schedule. The mine is scheduled to enter commercial output in early 2005 at an annual output rate of 190,000 ozs of gold and cash cost of $110/oz.
The Marlin project in Guatemala will be Glamis' third new mine, with commissioning expected in late 2005. Marlin is forecast to produce 190,000 ozs of gold at a cash cost of $101/oz. The company believes that it will receive permits in mid-2004, and has provincial government support. Regional exploration work is slated to start in 2004.
Holding $150 million in cash, our analysis indicates Glamis has sufficient capital and cash flow to finance the growth projects above (around $200 million).
What’s New - At the Marlin project, Mr. McArthur noted that local and federal authorities are supportive of the project and he is optimistic that Glamis can beat the permitting schedule (by mid-2004). Recent deep drilling at Marlin has intersected further extensions of the mineralization to the east, hitting 41 grams/tonne over 1.5 metres.
Recommendation
Currently trading at around 2. 4x estimated NAV, Glamis is still within the historical valuation range of 1 to 3 times for the gold producers. Based on 3 times adjusted NAV that we ascribe to gold growth companies, Glamis would be fully valued at $16/sh. Risks of this target not being met include unforeseen operating problems and gold price weakness.
GG: Merrill
Mr. McEwen stated that Goldcorp has a simple, powerful story. Its Red Lake mine is a lowcost ($100/oz), very profitable producer (34% for 6M03) and is unhedged. The company has a very strong balance sheet, with $353 million in liquid assets at June 30, 2003, including $200 million in cash, $85 million in gold bullion and $68 million in marketable securities, and no debt.
The goals of Goldcorp are to become a one-million-ounce gold producer, maintain $100/oz cash cost, remain unhedged, no debt, increase dividends and reserves. The company is spending $94 million to expand its Red Lake mine through the development of a 7,150-foot shaft and expanding the production rate from 650 to 1,000 tpd. Gold output from Red Lake is forecast to increase from 500,000 ozs to over 700,000 ozs by 2007.
Goldcorp is carrying out an aggressive exploration program in the Red Lake camp, both on the Red Lake mine ground and the surrounding region. The company is also perusing the acquisition market for opportunities but finds it must be disciplined, as valuations are not inexpensive.
What’s New - The company released further drill results from its Red Lake mine yesterday. The results returned the deepest High Grade Zone (HGZ) multi-ounce intersection of gold yet, which was 2.11 oz/ton gold over 48 feet at a depth of 7,165 feet. This discovery of multiple zones of multi-ounce, high-grade mineralization at depth indicates the gold content is increasing at depth, rather than decreasing as previous results had suggested. Goldcorp stated it is possible to increase the reserve and resource base at HGZ.
We will be reviewing our NAV model post the Denver Gold Show.
Recommendation At the current price, Goldcorp is trading just above 3 times estimated NAV. Historically gold shares have traded between 1 and 3 times asset value. We maintain our Neutral rating.
GLG - Research Capital report
http://www.researchcapital.com/docid.cfm?docid=4616
"you're older, wiser and more experienced right? < vbg >"
Well I was smart enough to take the 4% loss today in my SPY and QQQ shorts on 10% of my trading portfolio... Looks like we are headed higher (QQQ $40 is very possible), licking my 4% wounds from the seasonality play this year...
Robry has been very hot on timing the NatGas sector. He is looking for a 95ish build this week. Don't think its time to get back in natgas yet. Uncovered my CHK covered Sept $10 calls at expiration last week and awaiting to sell them again, CHK had a nice rally today. CHK will be issuing 3Q03 guidance in next couple days and should rally nicely (CHK has very successful ST hedging strategy) and will look to sell Oct $10 covered calls. My basis in CHK is $7.70 but I have pocketed over $2 now in covered calls. Looking to do something similar with GG and GLG, i.e. sell covered calls, premiums are great nowadays and can hopefully retain the shares for LT cap gain treatment... If not, then Jan 04 covered calls will effectively postpone the gain until 2004, need to minimize my capgains this year
Michael, nice trading my torque chasing f[r]iend... Still holding the rest of my CBD and EDV for now... Fundamentally, still prefer AGI and GBN which should have their day in the torque chasing sun in 2004, if not before. (Also holding CKG about half of which originated from Francisco as well as those freebie PAAS warrants via BAY.to) Have basically reinvested most of my junior gold stock sales into GLG and GG for this last leg up...
My advice is to watch the 3 year HUI weekly... Link Below. When I see my friend Wm%R starting to roll over on the weekly HUI chart (i.e. hits that -20), I will be exiting most all my GLG/GG (or selling covered calls) and getting down to 45% precious metals from about 80% now... No purchases of any torquesters right now for me, developing my exit plan!!
http://www.investorshub.com/boards/read_msg.asp?message_id=1478024
update: GoldCorp: up to 3.8M new ounces
The full 3.8M ounces would increase GG total resource from 7.6M ounces to 11.4M ounces...
Reduces their Market Cap per resource ounce from $322 to $215 at todays closing share price.
GG = $215 assuming ALL 3.8M oz increase
GLG = $160 per reserve oz.
NEM = $229 per reserve oz.
=DJ Goldcorp Sees Big Potential For Red Lake Mine >GG
By Tom Locke Of DOW JONES NEWSWIRES DENVER (Dow Jones)--Goldcorp Inc.'s (GG) new drilling at its Red Lake Mine in Ontario expands the dimension of a deeper high-grade zone that could approach the significance of a huge high-grade zone above it, Chief Executive Robert McEwen told Dow Jones Newswires Tuesday.
Further exploratory drilling will determine what the potential of the lower deposit really is, but "the potential could be as much as another 3.8 million ounces of gold," McEwen said following his presentation here at Denver Gold Forum 2003, sponsored by the Denver Gold Group.
In his presentation, McEwen also stressed the importance of a $94 million, 7,200-foot second shaft at Red Lake that will increase gold production there 40%, from about 500,000 ounces a year to about 700,000. It also will lower cash costs per ounce to $70 from $80, and provide some insurance as another access point should anything happen with the existing shaft.
The first full year of production after shaft completion is expected to be 2007. After the shaft is built, the company will be able to exploit lower-grade ore as well as high-grade ore, and it will expand production from 650 tons of ore a day to 1,000, with the capability of expanding to 2,500 tons a day.
One company goal is to expand to 1 million ounces of gold production a year, and it is looking at potential acquisitions in North America, South America and Europe to help it reach that goal, said McEwen. He said Goldcorp unsuccessfully tried for two years to buy Placer Dome Inc.'s (PDG) Campbell Mine next to the Red Lake Mine.
"Our approach to (mergers and acquisitions) is to wait for the opportunity," said McEwen, and the company wants to be ready to take advantage of it when it arises.
As of June 30, Goldcorp had considerable acquisition ammunition: $200 million in cash, $68 million in marketable securities and $85 million in gold bullion.
That 245,000 ounces of gold bullion, or 25% more than that of the Bank of Canada, is a result of Goldcorp's retaining some of its gold production in anticipation of a rise in gold prices. McEwen said the price of gold is "going to test the $800 mark" over the next six to eight years. That's more than twice its current level near $390 an ounce.
"We're into a generational change in the marketplace," he said. Investors are concerned about preserving wealth in an environment of a weaker dollar, underfunded pension plans and governments incurring debts to keep economies propped up, and they are looking to gold as an investment to offset these factors, he said.
-By Tom Locke, Dow Jones Newswires; 303-293-9294; tom.locke@dowjones.com
EDV - Endeavour
EDV only has 15.6M shares outstanding, but note the 6M shares traded...
This is very likely explained by Equitable Assurance getting out... The Equitable has wanted out for quite some time, and EDV has finally found buyers for all their shares it appears...
THE EQUITABLE LIFE ASSURANCE SOCIETY
REPORT PURSUANT TO NATIONAL INSTRUMENT 62-103
A. The name and address of the offeror:
The Equitable Life Assurance Society
City Place House
55 Basinghall Street
London, ECC2V 5DR
United Kingdom
B. The designation and number or principal amount of securities and the offeror’s securityholding percentage in the class of securities of which theofferor acquired ownership or control in the transaction or occurrence giving rise to the obligation to file the news release, and whether it was ownership or control that was acquired in those circumstances:
The Equitable Life Assurance Society (“Equitable”) announces, with reference to the news release issued by Endeavour Mining Capital Corp. (“EMCC”) on September 9, 2002, that as of that date Equitable owned a total of 5,592,064 ordinary voting shares in the capital of EMCC. These shares were acquired by Equitable earlier while EMCC was still privately held. EMCC has advised Equitable that effective September 9, 2002, upon closing of the transaction (the “Arrangement”) contemplated under an arrangement agreement dated as of July 30, 2002, between Welcome Opportunities Ltd., EMCC and Endeavour Capital Corporation, EMCC became a reporting issuer under the Securities Acts of British Columbia, Alberta and Ontario and that its issued share capital had increased to 15,542,868 ordinary voting shares.
Equitable’s shareholdings constitute 35.98% of the EMCC shares issued and outstanding. Equitable has agreed with EMCC not to sell any of its EMCC shares before March 9, 2003 without EMCC’s prior written consent.
Upon closing of the Arrangement, Equitable held 5,592,064 EMCC shares or 35.98% of the 15,542,868 EMCC shares then issued and outstanding.
D. The designation and number or principal amount of securities and the percentage of outstanding securities of the class of securities referred to in paragraph (C) over which:
(i) the offeror, either alone or together with any joint actors, has ownership and control: 5,592,064 ordinary voting shares of EMCC (35.98%)
SA Rand - price of gold...
Good article for those invested in GFI, GBN, HMY, DROOY, etc...
http://www.mips1.net/MGGold.nsf/Current/4225685F0043D1B242256DAA00247C36?OpenDocument
Michael: Thanks for the Murenbeeld link...
FWIW, he is one of my favorite gold analysts...
GoldCorp - Gold is better than money...
GOLDCORP INC.: Deepest HGZ Multi-Ounce Intersection of Gold, Yet 2.11 Ounces per Ton over 48 Feet Best Intersection: 39.98 Ounces per Ton over 34.1 Feet Expansion on Target
TORONTO, Sep 22, 2003 (BUSINESS WIRE) --
(All assay values are uncut) (All dollar amounts in US$) GOLDCORP INC. (NYSE:GG) (TSX:G) is pleased to announce encouraging exploration results from its Red Lake Mine, in northwestern Ontario, Canada. Multiple zones of multi-ounce gold mineralization continue to be encountered at greater depths. This type of mineralization is a characteristic of the upper areas of the High Grade Zone (HGZ), where the richest concentrations of gold have been found, to-date. In addition, the dimensions of HGZ and Sulphide Mineralization (SZ) in all of the target areas continue to expand. Also, the mine expansion and construction of the new shaft is moving forward quickly.
Highlights of the exploration results are summarized below:
-- The deepest multiple ounce occurrence of the HGZ ever encountered: 2.11 ounces of gold per ton (opt) (72.4 grams per tonne (gpt)) over 48 feet (ft) (14.63 metres (m)) at a vertical depth of 7,165 ft (2184 m). This intersection indicates the HGZ now extends below the planned bottom of the new shaft (7,150 ft or 2180 m).
-- Multiple zones of high grade mineralization were encountered beneath current reserves. The best values were found within a 134 ft (40.84 m) interval containing four intersections of the HGZ that included 16.46 opt (564.3 gpt) over 22 ft (6.71 m), and 3.24 opt (111.1 gpt) over 33.5 ft (10.21 m).
-- The extremely high grade nature of the Hanging Wall Zones beneath the current reserves was confirmed by intersections of up to 39.98 opt (1,370.7 gpt) over 34.1 ft (10.39 m).
-- The HGZ was identified 260 ft (79 m) east of its previously identified eastern limits with intersections of up to 3.52 opt (120.7 gpt) over 7.4 ft (2.26 m) at a vertical depth of 7,112 ft (2,168 m).
-- The deepest intersection of Sulphide Mineralization ever, was obtained at a vertical depth of 7,300 ft (2,225 m), some 3,000 ft (920 m) below where it was last mined.
CONTINUING EXPLORATION SUCCESS!
HIGH GRADE ZONE (HGZ)
Objective to increase ounces per vertical foot In the upper 1,200 ft (366 m) of the HGZ, to a depth of 5,500 ft (1,676 m), which is the area which has received the most intensive exploration efforts, the average gold content (including mined material) is 3,500 ounces of gold per vertical foot. Below this, the HGZ has been shown to extend deeper for at least an additional 1,900 ft (579 m). However the HGZ in this lower area is less explored and so far, the gold content (including mined material) is lower at 1,500 ounces of gold per vertical foot. The recent discovery of multiple zones of multi-ounce, high grade mineralization at depth indicates that the gold content is increasing and with it the possibility to increase the reserve and resource base of the HGZ.
Hanging Wall Zones
Deepest Intersection of Multi-Ounce Mineralization
2.11 opt (72.4 gpt) over 48 ft (14.63 m) Hole 37L034IW intersected 2.11 opt (72.4 gpt) over 48 ft (14.63 m) at a vertical depth of 7,165 ft (2,184 m) in the Hanging Wall Zones of the HGZ. This is the deepest intersection of multi-ounce mineralization yet obtained in the HGZ. This result is significant as it indicates the HGZ continues at least to the planned depth (7,150 ft or 2,180 m) of the new shaft and further suggests the likelihood that it is continuous at depths below this.
HGZ 260 ft (79 m) East of Previous Limits
3.52 opt (120.7 gpt) over 7.4 ft (2.26 m) Hole 37L460AW intersected 3.52 opt (120.7 gpt) over 7.4 ft (2.26 m) at a vertical depth of 7,112 ft (2,168 m), 260 ft (79 m) east of the previously defined eastern limits of the Hanging Wall Zones. This hole is significant since it is the second deepest occurrence of multi-ounce mineralization in the HGZ and it suggests the possibility that the dimensions of the mineralization increase at depth either through increased lateral continuity or increased structural complexity, or possibly a combination of both.
Continuity Confirmed at Depth
Extremely High Grade and Multiple Zones.
Up to 39.98 opt (1,370.7 gpt) over 34.1 ft (10.39 m)! Exploration below the limits of reserves (6,475 ft or 1,974 m) has been successful in establishing the continuity of the Hanging Wall Zones of the HGZ, and confirming the extremely high grade nature of this mineralization over substantial thicknesses.
For example hole 37L422A intersected 39.98 opt (1,370.7 gpt) over 34.1 ft (10.39 m) at a vertical depth of 6,480 ft (1,975 m). In addition hole 37L464 intersected multiple zones of high grade mineralization to a maximum depth of 6,800 ft (2,073 m). This latter hole encountered four zones of mineralization over a length of 134 ft (40.84 m) which included 16.46 opt (564.3 gpt) over 22 ft (6.71 m), 5.61 opt (192.3 gpt) over 5.0 ft (1.52 m), and 3.24 opt (111.1 gpt) over 33.5 ft (10.21 m).
The occurrence of multiple zones of high grade mineralization has increased with the intensity of drilling at depth. It potentially indicates increased structural complexity at depth, which is a feature of the upper areas of the HGZ where it is richest.
Footwall Zones
Extended 100 ft (30.50 m) vertically
Up to 2.00 opt (68.6 gpt) over 7.1 ft (2.16 m) The most recent results have demonstrated that these zones extend for at least an additional 100 ft (30.5 m) to a vertical depth of 6,250 ft (1,905 m). Among the more significant intersections were 2.00 opt (68.6 gpt) over 7.1 ft (2.16 m), in hole 34L1267, which was the deepest intersection to date in the Footwall Zones, and 1.52 opt (52.1 gpt) over 10.0 ft (3.05 m) in hole 34L1275.
Since the beginning of 2003 the vertical extent of the Footwall Zones has been increased by 500 ft (152 m). This success illustrates the potential for exploration of this target area to significantly increase the reserves and resources of the Footwall Zones. Future exploration will investigate whether the Footwall Zones have the same vertical continuity as the Hanging Wall Zones to the west, which currently extend to at least 7,360 ft (2,243 m).
SULPHIDE ZONE (SZ)
Expanding Resources
Identifying Mineralization at Depth Exploration of these targets is focused on two goals. First, defining and expanding areas of known resources in order to increase the reserve base of the SZ, and Second, exploring for new areas of mineralization in order to increase the resource base. The latest exploration results demonstrate we have continued to have success with both goals.
Depth Extensions of Previously Mined Ore
300 ft (91 m) beyond current resource limits
Up to 0.37 opt (12.6 gpt) over 31.7 ft (9.66 m) Drilling within the currently defined resources confirmed continuity of the SZ with intersections including 0.37 opt (12.6 gpt) over 16.0 ft (4.88 m) in hole 34L1254.
Significant Sulphide Mineralization was encountered as far as 300 ft (91.44 m) outside the currently defined margins of these resources in three directions, above, below and to the west. Wide intersections as high as 0.37 opt (12.7 gpt) over 31.7 ft (9.66 m) were obtained in hole 34L1216. In addition, narrow high grade intersections were also encountered including 1.76 opt (60.3 gpt) over 1.6 ft (0.49 m) in hole 37L419.
The variation in grade and thickness of the Sulphide Mineralization intersected was consistent with that of the same mineralization previously extracted (1948 - 1996) from the upper levels of the mine, and illustrates the potential for the resource base of this mineralization to continue to grow in both the near and long terms.
Deepest intersection of Sulphide Mineralization ever - 7300 ft (2,225m) and 3,000 ft deeper than mined!
As part of the larger scale step-out exploration work, hole 34L1276 intersected the deepest occurrence of Sulphide Mineralization yet with 0.27 opt (9.3 gpt) over 9.0 ft (2.74 m) at a vertical depth of 7,300 ft (2,225 m). This is 1,300 ft (396 m) deeper than the current base of Sulphide Mineralization resources and 3000 ft (920 m) below previously mined sulphide zones. Together, these results suggests there is excellent potential to increase these resources over the long term.
Far East Zone
Continuity of Resources Confirmed
Up to 0.84 opt (28.7 gpt) over 6.0 ft (1.83 m) Approximately 240,000 ounces of Sulphide Mineralization resources at a grade of 0.47 opt (16.1 gpt) have already been identified in the Far East Zone from the 16 Level to a depth of 3,100 ft (945 m). The latest results continue to better define the continuity of this mineralization with the goal of moving it into the reserve category. The latest results include intersections of up to 0.84 opt (28.7 gpt) over 6.0 ft (1.83 m) in hole 16L1243, which are consistent with mineralization previously encountered.
Drilling from the 26 and 34 Levels is directed towards identifying more significant extensions of Sulphide Mineralization. The deepest intersection obtained from this work was 0.13 opt (4.5 gpt) over 15.0 ft (4.57 m) in hole 34L1270 at a vertical depth of 6,460 ft (1,969 m). Sulphide Mineralization has now been identified in scattered intersections over vertical and lateral distances of, respectively, 5,000 ft (1,524 m) and 1,700 ft (518 m). Future work over the next 2-3 years will focus on establishing continuity of this mineralization and increasing the reserve and resource base.
MINE EXPANSION on Target
Construction of the new shaft at our Red Lake Mine is progressing well. The shaft collar has been sunk to 191 ft (58 m), the contractor is equipping the shaft sinking setup, and the headframe construction and hoist installation are underway. The shaft sinking will commence in January 2004, completion is scheduled to occur before the end of 2006.
This new shaft will go to a depth of 7150 ft (2180 m) and will allow annual gold production at the mine to increase to more than 700,000 ounces and reduce cash costs to $70 per ounce. The economics of this expansion project are very attractive with a 46% Internal Rate of Return (IRR) at a gold price of $350 per ounce and a US$: CDN$ exchange rate of 1.40.
QUALIFIED PERSON
These results have been prepared under the guidance of Gilles Filion, Eng. (OIQ), Vice President of Exploration, who is designated as a Qualified Person with the ability and authority to verify the authenticity and validity of this data. All samples were analyzed by either ALS Chemex Laboratories Ltd. of Mississauga, Ontario, TSL Laboratories of Saskatoon, Saskatchewan, or SGS XRAL Laboratories of Toronto Ontario.
Goldcorp's Red Lake Mine is the richest gold mine in the world. The Company is in excellent financial condition: has NO DEBT, a Large Treasury and Strong Cash Flow and Earnings. GOLDCORP is completely UNHEDGED and pays a dividend six times a year. Goldcorp's shares are listed on the New York and Toronto Stock Exchanges under the trading symbols of GG and G respectively and its options trade on the American Stock Exchange (AMEX), the Chicago Board of Options Exchange (CBOE) and the Pacific Stock Exchange (PCX) in the United States, and on the Montreal Exchange (MX) in Canada.
Gold is better than Money, Goldcorp is Gold!
SOURCE: Goldcorp Inc.
"We have 3-773 rock trucks, a 350 excavator, a 966 loader and a 250 ton per day mobile crushing plant, portable power packs, 2 large diesel fuel storage tanks, several equipment lube trucks etc."
Where are the women? It gets cold way up there you know, not to mention better employee morale!
Added to GLG today, anticipating GLG can run up to $15.55 or so... GLG presenting tomorrow at Denver Gold...
Glamis Gold Ltd. (NYSE:GLG)(TSX:GLG) will give a presentation to the Denver Gold Forum on Tuesday, September 23, 2003 at 11:45 am MDT (1:45 pm EDT). During the presentation, Kevin McArthur, President and Chief Executive Officer, will provide an update on the activities of the Company, including the following:
-- El Sauzal project development is on schedule and progressing smoothly, with initial gold production expected by the fourth quarter of 2004 and full commercial production during the first quarter of 2005.
-- At the Marlin project, optimization of the internal feasibility study released in May continues, with a formal construction decision expected in November of this year.
-- Glamis will host an analyst tour this week at the Marigold mine, highlighting the ongoing expansion as well as the new TZN discovery.
-- Lower gold production at the San Martin mine, as reported for the second quarter, continued during the third quarter, with gold production returning to budgeted levels in September.
-- While the Marigold mine expansion is expected to partially offset the lower production at San Martin, Glamis' 2003 gold production is now expected to be approximately five percent below the original 250,000 ounce forecast, at total cash costs of $175 to $185 per ounce.
-- Glamis remains on track to achieve its strategic goal of increasing annual gold production to 500,000 ounces at total cash costs below $150 per ounce. Mr. McArthur's presentation will be simultaneously webcast at the Denver Gold Forum and can be accessed on the Company's website at www.glamis.com. Replays will be available approximately one hour after the presentation for a period of 90 days.
Glamis Gold Ltd. is a premier intermediate gold producer with low-cost gold mines and development projects in Nevada, Mexico and Central America. The company remains debt free and 100 percent unhedged.
__________________
Here is an end game strategy I am toying with, wait and hope for GLG to hit $15.55 or higher, then sell Nov or Jan $12.50 covered calls and pocket the premium upon a 61.8% fib retrace as this 8 week cycle ends... Comments on this strategy anyone...?
$Gold/$HUI-Weekly (3 Year)
Euro/30 Year-Weekly (3 Year)
Am thinking the producers may now start to outperform the juniors... Have been taking profits in the juniors (except Alamos and GBN) and putting the proceeds into RIC (believe this CC pick may now start to rise in earnest) and a much larger position in GLG. Continue to hold GG as well as Jan04$7.50 options in GG (bought shortly before the Weiss rec, there was only a $.05 premium on the $7.50 from spot).
my mistake, someone posted this as an update on another board so I posted here, then looked at it in more detail and determined its the original article...
there is another great chart I posted earlier by ursamajor, be sure to take a peek at that one... here it is the ol' 27/8
better to view it via this link:
http://www.100megsfree4.com/ursamajor/GOLD-27%20WEEK%20CYCLE.gif
Eric Hommelberg update
http://www.gold-eagle.com/editorials_03/hommelberg071803.html
Find these Mauldin/Weldon comments of interest...
i.e. Fed buying US treasuries to keep interest rates low while simultanously trying to devalue US$ against other currencies. Believe this is the US/Fed gameplan...
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And thus we are now set-up for the conversation with one of my favorite macro analysts, Greg Weldon. He answers some of Bill's questions, writing in this afternoon's Metal Monitor www.metal-monitor.com
"The Fed is buying US Treasuries, and has now for two consecutive weeks, as revealed within last night's Fed money supply data. Japanese investors are buying UST, and ....increased their NET exposure by a whopping $12 billion, in just the latest week.
"...And, last, but FAR from 'least', Foreign Central Banks are buying US Treasuries, as reflected by a string of weekly increases in Custody Holdings, including the $3.2 billion increase posted last night.
"And yet ... USD-JPY is still ... lower."
"We feel that a MAJOR shift is taking place, where the US and Japan might agree, to allow the USD to depreciate...."
This echoes readings from others over the past few weeks, but Weldon crystallizes the trigger point. I sense we are ready for another round of dollar depreciation.
If the dollar were allowed to drop against the yen, might other Asian currencies allow it to drop as well? Slowly re-adjusting the trade balance and the value of the dollar?
If Asian countries buy fewer dollars, thus allowing their currencies to rise, this would normally mean that US interest rates would rise. Not only would their US bonds be worth less in terms of their local currency, they would also lose as their US bonds fall in value. A double whammy! It is the old supply and demand conundrum.
But if the Fed quietly agrees to buy enough bonds to maintain the value as they seem to be doing now, and foreign governments don't actively sell (in effect, they just buy less), the hope would be a slow re-setting of the value of the dollar, a reflation of the US economy and a lower trade deficit.
Weldon believes the Fed does not give a time frame because they don't have a clue as to what the time frame is. They are playing this one by ear. If they announce an inflation target north of where we are today, would that spook the bond market? Would they feel boxed in if they set a target at 2% and then decided we needed more stimulus even if we were already at that same 2%?
Think of the European Central Bank. They set inflation targets and then came under enormous pressure to ease their money supply as some of their main countries went into recession. Greenspan does not want in that box. Trust me on this one. He made that very clear in Jackson Hole.
Everybody and their dog knows that the dollar is going lower. The debate is only about how far. If the Fed were to allow interest rates to rise as foreign central bank buying slows up, that would trigger higher home mortgage rates, which would put in jeopardy home values. Deflating home values, as Weldon points out, is the last thing the world or the Fed wants to see.
If the world (read China and Asia) pulled the plug on the US dollar, which they could do in about 15 minutes, the result would be a world wide depression. Nobody wants that. Everyone's interest is aligned in keeping the game going. They want the US to keep buying and they want to keep selling.
However, it must now becoming apparent even to central bankers that the current trends cannot continue. You cannot keep racking up $500 billion trade deficits forever. You cannot keep adding up $500 billion dollar government deficits. We no longer simply "owe it to ourselves." Since foreign governments are buying an ever higher percentage of US government debt (they currently are at an all-time high of 46%), the current trend if left unchecked means eventually the US government owes trillions to foreign nations. When you are increasing the foreign debt by $500 billion a year, it does not take long.
A rise in rates would mean the US would owe hundreds of billions of tax dollars in annual interest payments to foreign banks, unless the trends are stopped. Such an event would mean an unraveling of the current world economic structure.
Thus, the dance truly begins to allow the dollar to drop. Hopefully slowly, while the Fed keeps rates low, hoping the US economy can begin to produce jobs.
The Fed issued a statement after its meeting this week. It was word for word the same as the one in August, with two minor differences. The one to pay attention to was "a phrase in the next to the last sentence in the second paragraph. In August they said ...... 'labor market indicators were mixed'. In September they rephrased that to..... 'labor market has been
weakening.'" (Courtesy of Art Cashin)
I attended a private reception yesterday evening over in Dallas for Jimmie Rogers (former Soros partner and author of Adventure Capitalist) given by David Tice, who runs the Prudent Bear Fund. There were a few genetically pre-determined bearish souls in attendance. One complained to me that recent Fed actions are only going to make things worse -- that we need to go through the economic re-balancing, deal with the recession that would occur and move on, or words to that effect. He was from the "take your medicine now" school of thought.
But that will not happen. The members of the Federal Reserve are programmed, deep within their economic DNA, to fight recessions with all the tools available, and especially a deflationary recession which might develop. They do not believe that it will make things worse.
Weldon makes great sense when he says we may be at a cross-roads in the value of the dollar. I also believe the Fed will do what they feel they have to do to help the world adjust and to try and hold back the forces which would raise rates and shut off a recovery that has been produced by the most massive application of stimulus in the history of the world and that has yet to produce jobs.
If they believed the recovery was powerful enough to properly develop on its own, they would not be using the word "considerable." They would be raising rates, not talking about a "the probability, though minor, of an unwelcome fall in inflation" as they did in the recent reports.
We live in interesting times. Yes, indeed we do. Think gold.
thanks for that EDV update...
Would just speculate on GBN, none of the other Hunter Dickinson plays are as worthwhile, IMO...
EDV makes most of their money from their mining investments rather than from fee income. If the junior stocks they own go up in value, they book this as income.
EDV owns a ton of Wheaton, Apollo, Northern Orion, Thistle, and warrants on all of these... (unless they sold some?)... They helped to take each of these companies public and/or were involved in the ground floor financing.
Thus, if these junior gold companies decrease in value, the EDV reported income will decrease (unless they sell and invest someplace safer). EDV is like a closed end fund, and it was selling at a 30%+ discount, and likely is still at a 10%+ discount (just guessing, will not know for sure until their annual report comes out, for fiscal year ending Aug)... EDV does pay a rather hefty management fee, but when you get freebie warrants on these junior mining companies, it is well worth the added management fee...
When I purchased, I viewed EDV as the best means to have exposure to junior golds I did not like as much (i.e. Wheaton, Apollo, and Northern Orion). Much prefer to own CBD, GBN, Chesapeake, and Alamos outright and to buy these other juniors at a 30% discount via EDV. Still likely a decent value now, but much is dependant on what future good deals they can find and how much their portfolio goes up... Also, very thinly traded historically, not listed on Toronto/Amex, etc., so best to lock in some profits now IMO..., because there will be some bagholders if and when the HUI declines and folks start selling this thinly traded issue...
just my opinion...
FWIW, sold about 20% of my EDV today... trying to get my precious metals % of portfolio down to 50%...
My EDV is flying...
NatGas - Robry model updated...
http://amarks.homestead.com/RobryNGModel.html
CUMBERLAND RESOURCES LTD. (CBD : TSX : C$4.30) - SPECULATIVE BUY - 12-MONTH TARGET PRICE: C$5.30
Graeme Currie
Comment: Cumberland provides further update from Meadowbank gold project
Yesterday the company provided assay results from a further 98 holes completed at the Vault pit area. This drilling formed part of a 14,000-metre phase I program. An additional 5,000-metre phase II program is currently being completed. This drilling is really designed to allow for pit-shell optimization in order to define recoverable reserves and resources for final feasibility study estimates. All of the intersections released yesterday are reported as falling within the preliminary open pit design for the Vault deposit. Highlights from the latest infill drilling included 80.3 g/t Au over 4.3 metres and 17.3 g/t Au over 3.6 metres. In all, the results continue to provide further evidence of the general uniformity of this deposit. Final pit shell work will continue and, with the incorporation of these results, should allow the company to prepare the resources for reserve classification. We anticipate that final in situ total ounce estimates are likely to be within 10-15% of previously reported estimates, plus or minus. Additional drilling at Goose Island and in the Portage Pit should allow for similar improvements in resource and reserve confidence levels. Again we do not anticipate substantial changes from total in-pit resource estimates previously announced. Cumberland also noted in the release that they remain on schedule to complete the Feasibility Study, lead by AMEC Simon, by late Q4/03 or early Q1/04. We maintain Cumberland Resources as a SPECULATIVE BUY with a $5.30 per share target price.
okay, 45 minutes to the 12 midnight POG bounce..., hope I don't jinx it tonight, but it has been consistent here lately...