Dr. Copper In The House: Thom @ Large

January 27, 2012

By Thom Calandra

www.babybulls.com

VANCOUVER, Canada — Vancouver’s two January resources get-ups, Cambridge House for investors and B.C. Round Up for geos & technicians, gave us flogging five-day rains, one superb NHL hockey match … and plenty of hard-asset bravado:

  • “I don’t own stocks any more; I own colored diamonds,” diamond seller Colin Ferguson told me at a private party I hosted with Cambridge House‘s Joe Martin. (I invite the guests and Joe entertains ’em.)  Mr. Ferguson, a 51-year-old Vancouver Island resident, says we’ll see reports of diamond warehousing by aggressive hedge funds. Worldwide demand for diamonds is on track to exceed supply by 7 million carats. The “coloreds,” champagnes (cognac hues), pinks, blues and greens, are beginning to flash in fashion-minded markets. Colin will be at Mr. Martin’s Palm Springs investment conference at Indian Wells, California, in two weeks. I want to see more of these stones. (See: www. cambridgehouse.com)

    Dr. Clarke At PMI Gold Booth

  • “Poly-metallic mines and properties are always in demand,” Tom Macneill says. I came across Mr. Macneill, a lifelong  Saskatchewan resident and longtime chief of 49 North Resources (FNR in Canada), across the street from Waterfront at lunchtime. Tom, sitting at a lunch counter, is sitting on his merchant bank’s 10-percent-plus ownership of surging DNI Metals (DNI). DNI is a northern Canada smorgasbord of elements in an expansive property portfolio. I am fortunate to own FNR and DNI after a fishing trip a couple years back with Tom, Bob Bishop, Doug Casey and others, way up there in Saskatchewan. (By the way, Mr. Macneill is hot on uranium prospectors right now — especially one big one whose first letter is C and its last O.)
  • I tested my latest think on the exhibit floor at the Joe show; copper-gold porphyrys will outpace market gains of all metals equities in coming weeks. “When Dr. Copper is in the house, it’s a very, very, very good house,” says Don Mosher. Don represents Riverstone Resources (RVS), a Burkina Faso prospector whose shares look ready to bust out after a largely ignored resource report. A geologist I rely on for analysis, Dr. Peter Megaw of Minaurum (Gold (MGG), Candente Gold and others, told me, “Copper is a big-company business. A billion tonnes of half-percent copper with the gold credit blended in, that takes care of a lot of the risk of taking on a development.”

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Revolution Starts Here: Thom @ Large

January 18, 2012

SAN FRANCISCO – I got to see Aaron Keay of Revolution Resources as part of his swing through California.

Aaron, Rob McLeod, Pete Evans and Katie Lucas are developing the Carolinas’ “other” gold prospector in the Slate Belt. The dirt-cheap one.

I was there this past summer, getting acquainted with Revolution’s Champion Hills project thanks to senior geos Pete and Katie. (That is Katie holding some Champion core in the photo.)

Champion Hills core

Katie Lucas shows some core

Revolution Resources (OTCQX: RVRCF; TSX: RV) has two things going on right now. They are the Champion Hills district scale play in the slate belt of North Carolina (home to America’s original gold rush) and a recently optioned Universo project in Mexico, located next door to Goldcorp’s Camino Rojo property (4M oz gold and 68.3M oz silver) and on trend with Goldcorp’s mammoth Penasquito Mine (17.8M oz gold and 882M oz silver).

Revolution at the top end has CEO Aaron K., Chairman Mike Williams and VP Ex Rob M. the discovery team for Underworld Resources, which is now owned by Kinross.

Here is what got me when Aaron  (in photo below) presented the RV vitals to a full room in San Francisco: 10,000 meters of Champion Hills drill holes coming in the next 30 days. I am such a hound for fresh assays and the potential for share gains.

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Nevada’s Scorpio: Wind Cries Mary: Thom @ Large

January 6, 2012

Image

Cranes Keep Bringing Nevada Gold To Scorpio's Treasury

By Thom Calandra

BabyBulls.com

MINERAL RIDGE, NEVADA — Peter Hawley’s current gold producer, Scorpio Gold Corp. (TSX-V: SGN and OTC: SRCRF), hits the ground running.

Scorpio, a client of our Torrey Hills Capital, is starting off the new year with pit results from its Mineral Ridge project in western Nevada. The Mary Pit shows 10.67 meters of 3.65 g/t gold and 4.57 meters of 13.06 g/t silver.

Our takeaway: an overburden removal at the Mary Pit began in late autumn 2011 and it appears to be working. Scorpio CEO Peter Hawley says the pit looks on track to nail a general target for 2012 production rate of 60,000 to 80,000 ounces of gold equivalent.

We’ll see a revised mineral estimate at Mineral Ridge sometime soon.

Our team at Torrey Hills and I have been to Mineral Ridge several times.  Investors seeking a solid gold producer eventually will see Scorpio account for far more gold ounces produced (and sold) in its quarterly reports than is the case now. And in a producer category.

Currently, Scorpio Gold is not classified as a “producer” so it accounts  for sales of metal on the balance sheet as mining assets.” The trigger for this change is four consecutive months of 4,500 ounces or better per month.  Thus, sales become net income.

Based on what we see happening at Mineral Ridge in terms of tonnes moved to the processing plant and average grades, we believe that Scorpio should cross that line well within the first half of 2012.

At a cost of $600 per ounce (this estimate from a recent Jennings Research Report), a target of 60,000 ounces creates a quarterly top-line earnings  number in the neighborhood of around $15 million. Current market cap of Scorpio is $100 million. I am an owner of the shares.

Recent Travel Digest from Mineral Ridge here:  http://www.babybulls.com/PDF/Scorpio_Gold-Mineral_Ridge_Travel_Dispatch_Oct_2011_FINAL.pdf

Recent Q & A with Peter Hawley, CEO of Scorpio Gold here:  http://youtu.be/uMCtQKPqNl4

VANCOUVER: I’ll be speaking at Cambridge House’s January gathering of 500 hard asset companies in two weeks. See: www.cambridgehouse.com.

— Thom Calandra is a lifelong author whose work has appeared in dozens of newspapers, newsletters, magazines and across the Web. He is a founder of CBS MarketWatch, now Dow Jones MarketWatch. He is a member of Torrey Hills Capital. Scorpio Gold is a client and provides stock options to Torrey Hills in return for investor outreach services. Your comments are welcome, but please, no foul language. (Photos — Thom Calandra)