MAKE YOUR PORTFOLIO GREAT AGAIN !
This thread is a continuation of several threads posted previously by the author on gold and silver and hard asset investments. I am still a believer in hard assets. I also believe we are entering a period of inflation with continued dollar devaluation, higher interest rates, and a sluggish economy with chaotic dislocations. I believe there will be a lot of uncertainty and high volatility.
PURPOSE My intent is to find and discuss good mining and commodity ideas. Gold and silver remain a focus, but I want to achieve a more balanced approach still based on tangible commodities.
STEEL and IRON ORE…I believe Trump’s programs will benefit iron ore and steel. Stocks in this sector have been beaten down terribly but are rebounding. I am long VALE, a Brazilian company which is the world’s largest iron ore producer. I have been long Arcelor Mittal but do not have a position at the moment. Anybody know anything about cement and asphalt ?
COPPER, ZINC, PGM METALS…My very best conviction stock is Ivanhoe Mines IVPAF. I am completely comfortable with a large single position in IVPAF to cover these metals. However other investors may be uncomfortable with a small cap in sub-Saharan Africa. So I think it is beneficial to introduce other names even though I myself am not interested. Rio Tinto, Freeport-McMoran, Teck, Turquoise Hill, BHP and others come to mind. Travis, our host, is long Altius Minerals, and I have been also.
URANIUM…I’m bullish but the choices seem pretty limited. My top three investment-grade choices are Cameco first, then Cameco second, or my third pick would be Cameco. After that, you are speculating on small caps, or buying ETFS or funds comprised of Cameco and some small caps. At the moment, I am long Cameco and UEC.
LITHIUM…I am considering a long position in lithium. I have nothing to recommend at the moment, although I am strongly considering Galaxy, an Australian company. And I like Neometals, also an Australian, but it is difficult to get from my broker, who hates it when I want to buy obscure 50 cent companies on small foreign exchanges. If anybody’s got a great battery play, I am interested.
POTASH/FERTILIZER…very interested but they all seem pretty expensive. There has been consolidation but I have considered Agrium, Mosaic, and there is a German company whose name I forget at the moment (K&D? K&S?).
OIL AND GAS…I would like some very good conviction picks accompanied by strong reasons and decent research. This field is so big, we could get completely lost just tossing names around. I am somewhat worried about price weakness in the energy sector but feel that it is worthwhile to develop a point of view on a few companies. I have little experience although I made very good money in the past on XOM and CVX. Currently I would be interested in pipelines, LNG, or any other sector that someone knows something about. In natgas I like OGZPY.
SOLAR and WIND…really not too interested. The results depend too much on politics, the time frames seem too long. But I am not completely closed-minded on it if you have conviction on something.
COAL…same opinion as solar and wind, but the prices are low and depressed instead of hyped and high-flying. I am still stuck with some defaulted Arch Coal bonds that my financial advisor recommended. They went to ZERO. Now they are worth a Starbucks latte and a pastry. And no espresso shot in the latte, either.
AGRICULTURE…very interested. A large sector but really not too many choices if you rule out futures, like I do. I have a few obscure favorites, but no positions at present:
WHGPY (Chinese pork processor who bought Smithfield)
LAND (Gladstone Land, California farmland)
INCPY (Input Capital, a Canadian canola, streaming model).
Open to more conventional picks like ADM and DBA.
GOLD AND SILVER…my picks have been discussed at length previously. I follow these pretty closely. I am long royalty/streamers SAND, FNV, SLW, and OR; miners PVG, MAG; developers SA, CLASF, MRDCF, BALMF, KNTNF, and LXVMF; and I own PSLV and physical bullion. I swing trade big caps ABX and NEM.
****
DISCLOSURES. I am a retired executive and an amateur investor. I like both fundamental and technical analysis. I am a medium-term to long-term position player and prefer to discuss stock investment in that context. Please no minute-by-minute reports that oil is now 52.50 down 10 cents and the Iranians may suspend Ramadan next week so you are going long until the afternoon bell.
I am not an expert in any of the commodities discussed nor am I qualified to give advice.
Everyone makes mistakes and I make more than my share.Sometimes I change my mind.
When I post, I express my opinions and my positions. These are just that…they are my opinions and my positions. They are not advice or recommendations, which I remind you I am unqualified to make.
Opinions and positions are subject to change at any moment. That is quite unlike the pig-headed and foolish political convictions everybody carries around adamantly, and which change only rarely for unpredictable reasons that have nothing to do with logical thought or reasoned discussion.
Because of this, political developments can be introduced on this thread only when they have a clear bearing on the commodities or companies under discussion.
You are responsible for your decisions, and I am responsible for mine. Caveat emptor.
I would like to operate in a friendly, honest, and constructive atmosphere.
As thread moderator I reserve to myself the role of referee, censor, arbiter, and Grand Poobah, subject to the over-arching authority of Travis, who owns the site and who has on occasion exercised his right to ruthlessly censor and suppress my radical blatherings.
This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.
Williamstown, I’m liking Lucapa.
Are you long, and why ? Are you Australian ?
It doesn’t appear to available on the OTC or NASDAQ.
May have to open another account to buy it.
HN: I’m an Aussie, thanks to you long in IVN, Sand, MRLDF, PVG, CLQ ,LOM
Re LOM ASX You’re correct in saying it’s a high risk/ reward stock , but with even greater potential if they happen to strike the kimberlite.
If not the best alluvial mine in the world, must be very close.
The CEO Stephen Wetherall said recently ‘ we’re finding some of the very best diamonds in the world, it’s telling us there is something big close by’.
He is talking about finding the grail ” kimberlite ” diamond – bearing rock where the stones probably originated , including a 404 carat stone sold last month, the biggest ever found in Angola.
Hitting the kimberlite is a priority and where the big, big money is, they’re targeting the source(s) of the world’s highest $ per carat alluvial diamonds
They ‘re bringing in bigger drills, and hope for a better idea of what they have – kimberlite – by the end of June,
They’re focusing on large, high – value alluvial diamond areas where strong geological evidence exists of a proximal kimberlite source.
Some other points:
1 Angola isn’t, as you say HN,the best place in which to operate,
2 Holds minority 40% interest
3 2016 sales of US $ 51M from the Lulo mine,
4 a new 5 year exploration permit approved, and a Mineral Investment Contract being finalised
HN : LOM ASX further to above , there is a court appeal from a local company re LOM having acquired a70% interest of the Mothae project in The Kingdom of Lesotho, which is safer than Angola.
This mine is a hard rock mine, which Lucara took over from Motapa Diamonds in 2009, and in 2015 struck a deal with Paragon Diamonds to acquire 75% for US $ 8.5M, as I understand Lucara , at the time didn’t have enough funds or effort, to develop two mines.
Paragon couldn’t finalise the deal.
The largest stone to date is 254 carats, and over the mines life there has been 98 stones larger than 10 carats.
The holding has plenty of stones at US $ 1K/$2K /ct and type 11a diamonds.
The area is just under 9 ha .
LOM is being upgraded on the ASX this week to the S & P 500.
I don’t know when the court case will be finalised.
Williamstown, thanks very much. We could use a guy like you here, please keep us posted on good Ozzie opportunities.
A lot of Americans think they know everything. But we don’t, obviously. On Lucapa, it’s amazing, there has not been a single trade in the OTC market on Lucapa in months. Meanwhile on the ASX the thing trades like crazy.
I had to call a specialist at Schwab to get my order placed on LOM. Going long tomorrow, or trying to; I entered a one-day limit bid.
We could use some help over here finding good mining stocks in Australia. Hope to hear from you.
HN: no $Symbol: doesn’t the fact, as you stated above, that a particular foreign stock, which trades in great volume overseas, hardly trades in the US by its US listing, bother you? When you are ready to sell the security, there may not be any trader in the US willing to buy (minimal/nil volume implies that). Also with limited US traders, you will be more at the mercy of market makers in how they establish the bid/ask price. And with a security with nil US volume, the odds are great that there will be only one market maker for the security. IMO, that’s a risky situation to be in.
Hi Kenny, in many circumstances I would be concerned about these issues, and in general I agree with your points.
I do not mean to argue the point. The bid/ask spread does irritate on thin OTC stocks, often it keeps me out.
But for me, Lucapa is a very interesting proposition. In point of fact, I have entered a limit order on the Australian exchange for LOM in Australian dollars. This required phone calls to my broker (Schwab) but was preferable in my opinion to trading in the OTC grey market for reasons you have touched upon.
I can accept the extra expenses for currency conversion and so forth, because I am speculating for outsized gains and because I have more confidence in the Australian dollar than the US dollar. If I do not get a double on this I will consider it a failure.
USA NASDAQ OTC grey symbol is LCPDF, but it did not come up and I still had to call. Australian symbol is $LOM. It is also traded in Frankfurt.
Kenny – I am sensitive to the points you make, but hasn’t HN answered the question by making his trade under LOM on the AUS exchange ?
peterrv: $LOM – If HN purchased Lucapa as $LOM, and holds the security in his account as LOM and not $LCPDF, then yes, that would negate my concerns. HN, please correct me if I misrepresented what you did.
Apparently, his broker, Schwab permits this. Some brokers will only trade the US listed symbol and thus my initial caution.
Kenny you are correct, you did not misrepresent anything; and as I said in general I agree with you.
If I had been unable to place the trade for LOM, I likely would have taken the chance on the US security, despite the risks you highlighted. But it is not something I would do in most cases.
Williamstown, I am not a geologist but the concept is understandable even to me and is fairly persuasive, espedcially after looking at the map of the claim and strike areas.
Diamond mines…Lucapa (Angola) and Lucara (Botswana)
Thanks to Williamstown for Lucapa.
Strictly from the standpoint of the geology, the output, and financial aspects of the two companies in relation to market cap, I prefer Lucapa.
The main difference from our perspective is the jurisdiction. Lucapa is in Angola, a much less attractive jurisdiction than Botswana.
LUCARA (Botswana) The risk with Lucara is future production and
the value of the unmined resource; and Lucara already has a fairly high market cap. The jurisdictional risk is low.
LUCAPA (Angola) In my opinion, the value in the ground at Lucapa is more certain, and Lucapa even exceeds Lucara on value realized per carat. I would also opine that the exploration prospects of Lucapa are superior to those of Lucara.
The valuation is very attractive in relation to the output, cash prospects, and exploration. Personally I am still very much interested in Lucapa. I would like to acquire some.
But there is no way to sugar-coat the jurisdiction issue. Angola is not a great neighborhood. Lucapa thus presents high jurisdictional risk, although I prefer the deposit.
I would characterize Lucara as a speculation, and Lucapa as a high-risk, high-reward investment on account of the jurisdiction.
Good Morning HN,
I asked my broker about Lucara. He said
“We’ve made a killing on Lucara – and the price pullback could well be a buying opportunity if you’re keen to take a look. Diamond producers are high risk – but diamond exploration is extraordinarily high risk!
Another one that will kick out more consistent smaller stones (but much higher quantity) is Mountain Province Diamonds.
Lucara has been more of the extremely large and high value stones – they pulled 3 record setting stones out last year alone – so there’s the potential that there are more of those to be had – but it’s a total crapshoot. Mountain Province is more a mining operation where cash flows have more predictability”
Just giving you some nuggets to chew on. I’ll probably try a little speculating here too. Thanks for the reveal.
Brian
MiningStockEducation.com video: 5 Tips for Investing.
Refers to Druckenmiller.
Tips:
– self-direct
– be contrarian
– strategy and focus
– discipline
– be forward thinking
https://www.youtube.com/watch?v=9KpoYVFZFxA
MiningStockEducation.com video: How to Profit from the Cyclicality of Mining Stocks
https://www.youtube.com/watch?v=7SW96tD9Kdg
Excellent for relative newbies (like me) in PM mining.
MiningStockEducation.com video: Where in the lifecycle of a mine to invest for the best returns.
https://www.youtube.com/watch?v=-5lBSESTxqc
This video presents Marin Katusa’s warning to uranium investors regarding which jurisdictions he considers unsafe and which he recommends.
MiningStockEducation.com: Uranium investment warnings
https://www.youtube.com/watch?v=yMYAbIaYKtk
And one more…
MiningStockEducation.com: 2017 Gold and Silver Price Predictions from Ten Experts
https://www.youtube.com/watch?v=qNTyP8eo45M
Jurisdictions…
This is probably a question without a good answer, but I’ll ask anyway.
Is there some way to predict/guess which jurisdictions might be the most prone to civil unrest or nationalization of mines in the event of a worldwide financial crisis? I viewed a video today in which Marin Katusa says to stay far away from any mining projects that involve Russia or China (not just IN Russia or China, but involving them, also). He seems to advise investing instead in North America and some parts of South America. With all of the gloom and doom forecasts regarding the global economy, how does one sensibly weigh the risks against the rewards in African/Asian/European, etc. countries?
$SA Seabridge Gold…attention drykoff…I have written extensively on Seabridge in earlier posts, see if you can find them. I have made a lot of observations on Seabridge that I don’t believe you will see anywhere else.
$SA is a conviction pick for me. I consider it the Cadillac of exploration/development speculations. It is close to being an investment, as opposed to a speculation; actually, as I consider it now, the size of my position is too large to be a speculation.
For a company with no operating mine on its property, Seabridge is as solid as it gets. In my opinion, of course.
Jurisdictions: I lost 99% of a USA mining investment, suggested by my financial advisor at a big firm. The same firm would not execute trades for me on Ivanhoe, which has gone up 350% since I first purchased it. The big firm said it was too risky.
After all, Ivanhoe is a penny stock and its copper deposit is in the Democratic Republic of Congo.
SA Does anyone have any insight or opinion on Seabridge Gold? Been doing some research and pulled to them due to their apparent good relationship to the locals and attempt to decrease the negative footprint left by mining in general.
I’ve owned it since january/16, since then its gone from 7 to 16 back down to 7 now back up to 11.5, for a bit of a roller coaster ride. Its a gold in the ground play, with high reward potential, but I don’t believe there is any guarantee they cash in. It may take $1600 gold to mine their stuff, and if we get that, all these gold stocks will be bursting, so pick your horses. I’m cashing this one out, with a side bet this company gave me a double in 14 months, and I’m good with that, and don’t want any more trips down. My own opinion, FWIW, if you are interested in this stock, a better entry point is about 9.5 or lower. Of course, ultimately it will move up and down with the price of gold.
Please put the stock $TICKER in your writeup. Thanks.
And when the dollar sign $ is in front, it makes it easier to search for information on that particular $STOCK $TICKER.
You are awesome. Thank you. I’ll keep watching
$TLRS I thought this was an interesting press release. I posted about this company a month or two ago, under the banner “this one might be very underpriced”. In the next 10 days they need to make a 1M option payment on their property, and for everything I know, the payment is not in doubt. When they make it, it could be a catalyst for a price increase, again, they look silly undervalued to me. But I don’t know, this press release kind of has the feel of pump and dump time. I am long, so if they help run the price up thru “investor relation services”, I’m good with that.
March 20, 2017) – Timberline Resources Corporation (OTCQB:TLRS)(TSX VENTURE:TBR) (“Timberline” or the “Company”) announces that it has engaged O&M Partners, LLC (“Otis & Mandy”) to provide certain Investor Relations services for an initial 3-month term, which may continue on mutual agreement.
In connection with the aforementioned engagement, the Company announces that, subject to regulatory approval, it has approved a grant of 250,000 stock options pursuant to its 2015 Stock and Incentive Plan to Otis & Mandy.
Gold, silver, uranium, etc., in Australia. (Williamstown, if you have good information to add, please share!)
As I was thinking about jurisdiction risks, I remembered that I have a couple of small positions in Australian gold mines. I could be incorrect, but I’m betting that Australian mines are pretty “safe” as far as jurisdiction issues are involved. I’d say at least as safe as North American mines. (Williamstown, any thoughts on that?)
That said, I’ve been perusing the web looking for possibilities. Here’s what I’ve found on Wikipedia (not exactly a mining journal, but typically actively corrected by editors) regarding gold, silver, uranium, and diamonds.
Gold – Australia is the second largest producer after China, producing 300 metric tonnes, 10% of the world’s output.[11][12]
Silver – In 2015 Australia was the fourth largest producer, producing 1,700 metric tonnes, 6% of the world’s output.[13]
Uranium – Australia is responsible for 11% of the world’s production and was the world’s third largest producer in 2010 after Kazakhstan and Canada.[14]
Diamond – Australia has the third largest commercially viable deposits after Russia and Botswana.[citation needed] Australia also boasts the richest diamantiferous pipe with production reaching peak levels of 42 metric tons (41 LT/46 ST) per year in the 1990s.[citation needed]
ttps://en.wikipedia.org/wiki/Mining_in_Australia#Environment_and_politics
So…I’m in search of good investments in Australia. Any insights will be appreciated!
Jurisdictions…I have a few bucks in countries that one might get woozy thinking about, like DRC, Mongolia, and Turkey. And I am on the verge of doing something with Lucapa, which has a major operation in Angola.
There are a few places I would be very resistant to: Venezuela, the Chaos-stans, Albania, North Korea, Eritrea, Syria, Lebanon. I am a little worried about China and Russia because the political situation could get bad; but in the end, in general, I wouldn’t be stopped by it.
In mining, Rick Rule made the point that the United States is not such a great jurisdiction. For mining, I am neutral about it.
I am very positive on Canada and Australia; neutral on Argentina and Brazil. I worry a little about Mexico, but for silver it is pretty tough to avoid it. Same with Peru…I am a little negative, but think Bear Creek is worth the risk.
I just check into most other countries if something comes up that I am interested in. For example, K92 is in Papua/New Guinea. After checking, I was OK with it. They are having a PGA Tour event in Port Moresby.
Thanks Bridutt and Williamstown !
I’ve been reading through the Lucapa website and surfing around the web looking for information. I have not found anything that scares me off. On the contrary, my impression is stronger: given the considerable inherent risks of jurisdiction, mining, and commodity speculation, we are at a relatively good moment for entering into a speculation.
On a macro level, the Australian diamond market has been depressed after a a boom a while ago that did not have legs. So the market has been dead.
Just starting to perk up.
On the level of project viability and geology, Lucapa looks pretty promising. Apparently there are two major types of diamond mining:
Alluvial and kimberlite/hard rock. Alluvial is finding the diamonds that have been moved around by erosion and water, analogous to panning for gold in a stream or river. Now the income at Lucapa is primarily from alluvial mining, but they believe a larger hard rock source for these diamonds is lurking nearby. Alluvial is easier but unreliable as a major long-term mining investment strategy.
Looking at the geography of the existing mine and the drill targets, this makes sense to me. There is a pretty developed system of rivers and small stream feeders at the main site. The major sites for Lucapa recoveries are all on the eastern side of the main river, near the junctions of feeder tributaries that originate uphill, farther east. The drill targets for the
hypothetical kimberlite sources for these diamionds are in the eastern
upland areas, presumably in the areas where these diamonds hypothetically would have originated. So at least one can understand the logic for the optimism and the expenditure of time and treasure looking there.
Also the profile of the size/grade diamonds found at the Lucapa alluvial sites is impressive. So the idea of finding the hard rock source for them is
pretty compelling.
Another thing that I like is that Lucapa has a similar strategy to K92, a gold miner: they intend to generate cash from the existing operation, and use this cash to fund exploration for bigger targets in the same property. They are sensitive to budget and cash flow. So the chance of major shareholder dilution for exploration is mitigated, and there is high upside.
The market cap for Lucapa is under $100 million. Looking at the prices they get for unusual diamonds, their historical income, and the size/quality profile of their output, I think this is pretty reasonable. We can’t do anything about the jurisdiction risk, or the odds on finding more shiny stones in the muck, but on a straight numbers calculation the price is very reasonable.
For anyone interested in the US, Lucapa has an OTC symbol LCPDF.
It has not been traded for months and Schwab would not take a computerized order, I must call to get execution. Lucapa’s symbol on the Australian exchange is LOM.
No position but will probably enter with a small position this week.
The price is under 40 cents USD.
$TLRS Timberline: I posted about this company a month or two ago, and linked some material that made a big case that this stock was under-valued. Earlier today I posted a kind of strange press release. I researched the company they just gave a bunch of stock options to, here is another release from another miner who used them: “””Excelsior Mining Corp. announced the retention of O&M Partners, a New York City based communications firm as a corporate advisor. O&M will assist the Company in targeting non-deal open-market investors through a virtual awareness campaign, which will introduce Excelsior to a national audience of micro-cap investors in 22 US markets””””. That blurb is much easier to translate than the Timberline one, which talked about “certain investor relations services”. In other words, they just hired this company to pump their stock price, and paid them with stock options. So the shrewd investor who has figured out how this industry works might see this as quite the opportunity, just all teed up for you at 34 cents..
Stock has lost 95 % of its value over the past 5 years…..
yes, true. The deposit hasn’t however, and if you look into it, so underpriced now relative to its peers. Anyway, it looks like it just hired a PR firm to pump it, its under-valuedness will be a selling point, and I am now going to look into this O&M Partners, and see what happened to the stock prices of the companies that have hired them in the past.
About us
O & M Partners is a New York-based marketing and communications firm focused on incubating entrepreneurial public companies.
O&M Partners is widely recognized by institutional and independent money managers for its ability to discover high-potential companies, identify sector trends, and qualify market sentiment. Since 1995, O&M’s New York-based marketing professionals have been bringing Wall Street together with the senior management of publicly traded companies on the TSX, TSX-V, NASDAQ, OTCQX and NYSE MKT AMX. O&M specializes in non-deal institutional marketing of micro- and small-caps.
I’ve looked at 5 companies who’ve announced the hiring of O&M, 4 of them had at least a 20% bump in the 2 months that followed, the fifth went down
I also need to mention this company has a 1M option payment due in 10 days, and if it doesn’t make it, its game over. I have several reasons to believe it won’t be a problem, so I’m not worried about it, I play this company for a re-valuation in the next 2-3 months, then probably dump it, hopefully for a decent % gain.
I liked the deposit but the binary nature of the option is not a risk that I felt at all comfortable with. Besides the risk of abject failure, serious dilution of existing shareholders is a distinct possibility even with a refi deal.
It might work out, but it is not the type of risk I am willing to accept. Too many other
opportunities that have surer prospects.
HN
Which stock are you referring to?
$TLRS. We are of the same opinion.
Understand but since we have other more certain companies to invest in, why gamble?
There must be a valid reason no one else has come into the picture.
Yes, everybody has his own risk/reward comfort zones. I just see this as a good short term play with a high likelihood of giving me a quick pop in the next 2-3 months. We’ll see what happens.
what stock?
$TLRS
I am a real newby here. Can not seem to get the search to work for older posts. I would love to read them but feeling very remedial on finding 🙁
Hi, drykoff.
Here’s a link to the discussion that HN set up before this one:
http://www.stockgumshoe.com/2016/06/microblog-gold-bull-investments-for-the-next-leg-upjune-2016/comment-page-1/#comment-4836213
Don’t feel alone…discussions are incredibly difficult to find unless you know the titles of them!
There is lots of great information–especially HN’s analyses and descriptions of his thought processes–in every one of his microblogs!! Many others have also contributed valuable information and insights, too.
Happy reading!
any thoughts, ideas, commentary on rccmf company. new drilling technology seems very worthwhile.
Haven’t looked at them in a long time, but they were promoted a few years ago and seemed a long way from being “real” back then. New technology for old industries always sounds cool to non-experts like me, but it’s usually not nearly as practical as promoters imply — change in heavy industries is often very slow. So far they seem to have made little progress, but I haven’t looked at the details.
Ivanhoe Mines Latest Announcement.
Ivanhoe Mines Latest News….
From – http://www.marketwired.com/
New discovery hole intersects a shallow, 3.8-kilometre extension – now known as Kakula West – of the Kakula Copper Discovery at the Kamoa-Kakula Project
Length of copper-rich mineralized system at Kakula essentially doubled to more than 10 kilometres and remains open for expansion Five of 14 drill rigs now on site targeting additional Kakula West drilling and high-priority targets on the 400-square-kilometre project
KOLWEZI, DEMOCRATIC REPUBLIC OF CONGO–(Marketwired – March 21, 2017) – Ivanhoe Mines (TSX:IVN)(OTCQX:IVPAF) Executive Chairman Robert Friedland and Chief Executive Officer Lars-Eric Johansson announced today that a new step-out hole – drilled 5.4 kilometres west of the present boundary of Kakula’s current Inferred Resources – intersected a relatively shallow, 16.3-metre zone of typical Kakula-style, chalcocite-rich copper mineralization similar to holes drilled in the centre of the high-grade Kakula Deposit on the company’s Tier One Kamoa-Kakula Copper Project.
The DD1124 discovery hole is 3.8 kilometres west of the current limit of Kakula drilling and 4.1 kilometres west of the last drill hole with returned assays – DD1093 – that was announced on January 23 this year.
The target area where DD1124 was drilled – now named Kakula West – was selected by the Kamoa-Kakula geological team at the intersection of the axis of the interpreted Kakula trend with a southwesterly-northeasterly-trending antiform (the Kakula West antiform). DD1124 intersected 16.3 metres of visually moderate-strong chalcocite copper mineralization, similar to the mineralization encountered within the core of the chalcocite-rich Kakula Deposit, beginning at a downhole depth of 422.2 metres (410 metres below surface), which included a 4.0-metre zone of strong-to-very-strong mineralization beginning at a downhole depth of 432.4 metres (see Figure 1). Assays for DD1124 are expected in approximately two weeks. Up to five rigs are being mobilized to fast-track the drilling at the Kakula West discovery.
Hole DD1124 now has extended the length of the Kakula mineralized trend to approximately 10.1 kilometres (see figures 2 and 3), essentially doubling the previously estimated strike length of 5.5 kilometres contained in Ivanhoe’s January 23, 2017 news release. The continuing success also means that the discovery has grown to become six kilometres longer than the deposit’s 4.1-kilometre strike length that was used in calculating the initial Kakula resource estimate in October 2016.
The Kakula Discovery remains open along a westerly-southeasterly strike (see Figure 2). Importantly, the chalcocite-rich zone of mineralization in DD1124 was intersected at a depth of approximately 400 metres, indicating that the Kakula mineralized zone extends significantly closer toward the surface in the area around the new discovery hole (see Figure 4).
The Kamoa-Kakula Project, a joint venture between Ivanhoe Mines, Zijin Mining and the DRC government, is near the mining centre of Kolwezi on the Central African Copperbelt in the Democratic Republic of Congo (DRC).
“In the mining exploration business, the very idea that a crew would drill a step-out hole almost four kilometres away from the last known mineralization is virtually unheard of,” Mr. Friedland said.
“Nonetheless, our geologists and independent advisors have become so confident in the proven consistency of Kakula’s chalcocite-rich mineralization that they expected we would find more thick, near-surface, Kakula-style mineralization in the vicinity of where it actually was discovered. The remarkable success with DD1124 is further validation of our team’s judgment and expertise.”
Mr. Friedland added: “Bear in mind that the Kakula Discovery now is vastly larger and more important than it was last year when Kamoa-Kakula was independently ranked among the 10 largest copper deposits in the world. In fact, the resource estimate that we announced for Kakula last October only covers approximately 40% of the presently defined 10.1-kilometre strike length of Kakula’s mineralized trend.”
Expanded exploration program now testing Kamoa-Kakula grass-roots targets
Ongoing studies have highlighted numerous Kakula-style targets to the west and east of the Kakula Dome and elsewhere in the 400-square-kilometre Kamoa-Kakula Project Area. The Kakula West target was the first of these to be tested.
“The Kamoa-Kakula exploration team is continuing to enhance its understanding of the unique geological controls influencing the project’s very-high-grade copper mineralization,” Mr. Friedland said.
In response to the ongoing exploration success, Ivanhoe Mines and Zijin Mining have accelerated the Kamoa-Kakula exploration program with the mobilization of additional contractor drill rigs that has expanded the available fleet to 14 rigs.
Ivanhoe Mines Latest News…
Figure 1. Strip log of drill hole 1124, with drill-core images showing strong chalocite: http://media3.marketwire.com/docs/1089391-F1.pdf
Figure 2. Kamoa-Kakula mining licence, showing copper grade of Indicated and Inferred Resources at a 2% copper cut-off, untested areas, current target areas and location of Kakula West Discovery: http://media3.marketwire.com/docs/1089391-F2.pdf
Figure 3. Planned drilling over the Kakula Exploration Area for Q1 2017 and Q2 to Q4 2017, showing current and future drilling areas and location of recent significant intersections: http://media3.marketwire.com/docs/1089391-F3.pdf
Figure 4. Section along the axis on the Kakula Deposit on the section A – A’- A” – B showing drilling completed to date and composites at a 2.5 % copper cut-off: http://media3.marketwire.com/docs/1089391-F4.pdf
As shown in Figure 4, the Kakula Deposit is a gently-dipping blanket of thick, chalcocite-rich copper mineralization. Initial mine development is planned to focus on the flat, near-surface mineralized section (highlighted in the inset) which, along the deposit’s axis, has mineralized zones ranging between 7.1 and 11.7 metres thick and grading between 8.11% and 10.35% copper, at a 3% copper cut-off.
Qualified Person and Quality Control and Assurance
The scientific and technical information in this release has been reviewed and approved by Stephen Torr, P.Geo., Ivanhoe Mines’ Vice President, Project Geology and Evaluation, and a Qualified Person under the terms of National Instrument 43-101. Mr. Torr has verified the technical data disclosed in this news release.
Ivanhoe Mines maintains a comprehensive chain of custody and QA-QC program on assays from its Kamoa-Kakula Project. Half-sawn core is processed at Kamoa-Kakula’s on-site preparation laboratory and prepared samples then are shipped by secure courier to Bureau Veritas Minerals (BVM) Laboratories in Australia, an ISO17025-accredited facility. Copper assays are determined at BVM by mixed-acid digestion with ICP finish. Industry-standard certified reference materials and blanks are inserted into the sample stream prior to dispatch to BVM. For detailed information about assay methods and data verification measures used to support the scientific and technical information, please refer to the January 2017 technical report on the Kamoa-Kakula Project titled “Kakula 2016 Preliminary Economic Assessment” on the SEDAR profile of Ivanhoe Mines at http://www.sedar.com and on the Ivanhoe Mines website at http://www.ivanhoemines.com.
About Ivanhoe Mines
Ivanhoe Mines is advancing its three principal projects in Sub-Saharan Africa: Mine development at the Platreef platinum-palladium-gold-nickel-copper discovery on the Northern Limb of South Africa’s Bushveld Complex; mine development and exploration at the Kamoa-Kakula copper project on the Central African Copperbelt in the DRC; and upgrading at the historic, high-grade Kipushi zinc-copper-silver-germanium mine, also on the DRC’s Copperbelt. For details, visit http://www.ivanhoemines.com.
Cautionary statement on forward-looking information
Certain statements in this release constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws, including without limitation, the timing and results of: (1) statements regarding assays for DD1124 are expected in approximately two weeks; (2) statements regarding up to five rigs are being mobilized to fast-track the drilling at the Kakula West discovery; (3) statements regarding Kakula Discovery remains open along a westerly-southeasterly strike; and (4) statements regarding initial mine development at Kakula is planned to focus on the flat, near-surface mineralized section which, along the deposit’s axis, has mineralized zones ranging between 7.1 and 11.7 metres thick and grading between 8.11% and 10.35% copper, at a 3% copper cut-off.
Such statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. Such statements can be identified by the use of words such as “may”, “would”, “could”, “will”, “intend”, “expect”, “believe”, “plan”, “anticipate”, “estimate”, “scheduled”, “forecast”, “predict” and other similar terminology, or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. These statements reflect the company’s current expectations regarding future events, performance and results and speak only as of the date of this release.
All such forward-looking information and statements are based on certain assumptions and analyses made by Ivanhoe Mines’ management in light of their experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believe are appropriate in the circumstances. These statements, however, are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information or statements including, but not limited to, unexpected changes in laws, rules or regulations, or their enforcement by applicable authorities; the failure of parties to contracts to perform as agreed; social or labour unrest; changes in commodity prices; unexpected failure or inadequacy of infrastructure, or delays in the development of infrastructure, and the failure of exploration programs or other studies to deliver anticipated results or results that would justify and support continued studies, development or operations. Other important factors that could cause actual results to differ from these forward-looking statements also include those described under the heading “Risk Factors” in the company’s most recently filed MD&A as well as in the most recent Annual Information Form filed by Ivanhoe Mines. Readers are cautioned not to place undue reliance on forward-looking information or statements. The factors and assumptions used to develop the forward-looking information and statements, and the risks that could cause the actual results to differ materially are set forth in the “Risk Factors” section and elsewhere in the company’s most recent Management’s Discussion and Analysis report and Annual Information Form, available at http://www.sedar.com.
Although the forward-looking statements contained in this news release are based upon what management of the company believes are reasonable assumptions, the company cannot assure investors that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this news release and are expressly qualified in their entirety by this cautionary statement. Subject to applicable securities laws, the company does not assume any obligation to update or revise the forward-looking statements contained herein to reflect events or circumstances occurring after the date of this news release.
Ivanhoe Mines – Investors
Bill Trenaman
+1.604.331.9834
Ivanhoe Mines – Media
North America:
Bob Williamson
+1.604.512.4856
South Africa:
Jeremy Michaels
+27.82.939.4812
http://www.ivanhoemines.com
And here….
Ivanhoe Mines: New Discovery Hole Intersects Shallow, 3.8-Kilometre Extension – Now Known as Kakula West – of Kakula Copper Discovery at Kamoa-Kakula Project
https://www.juniorminingnetwork.com/junior-miner-news/press-releases/397-tsx/ivn/30446-ivanhoe-mines-new-discovery-hole-intersects-shallow-3-8-kilometre-extension-now-known-as-kakula-west-of-kakula-copper-discovery-at-kamoa-kakula-project.html
$IVPAF…look at figure 4 in the link. Caterpillar cut in half.
$IVPAF chart with the dissected caterpillar is figure 3,
just above figure 4.
$IVPAF…Ivanhoe…new discovery…in one of my previous posts I described the drilling map of the Kakula deposit. The drilled area defining the known deposit looks like a giant slug, lying east-to-west, that has been abruptly sliced in half at its midsection. The cut boundary was simply the line of the drilling, north-south; so the extent of the deposit, it seemed to me, was certainly beyond the known drilled area. How far beyond was impossible to know, of course; but a geological layer hundreds of meters thick and kilometers wide and long is not going to end in a straight line that coincides with where they plotted drill holes. I did not think it was wishful thinking to suppose that the deposit could actually be twice as big as was
established. It might turn out to be only be 20% or 40% or 60% larger; but it was going to be a lot larger, that was for sure. It wasn’t going to end in a straight line.
This is one of the several reasons I have been exceedingly confident on
Ivanhoe. The amount of copper at high grades at Kamoa and Kakula is simply stupefying, it is really hard to get a grasp of how large the deposit is; and it will remain an open question, because the deposit is far from being fully defined yet. First they had Kamoa. Then the defined Kakula, because it was so much better they differentiated it. And now they are defining Kakula West.
I tell you, there is going to be good news from this company for a long time.
The risks are civil breakdown or war in DRC, copper pricing collapse, and interruption of world trade and industry.
Otherwise it is blue skies for Ivanhoe.
Long IVPAF.
Drykoff…my tendency has been to focus on small companies of interest and to really look at them from a variety of angles. I find it helpful to write about them, because I must make sure my reasoning and logic can stand up to criticism by the readership; and I actually look for arguments and negatives that I may have missed.
Anyway, if you search the threads, you will find my reasoning for the picks that I consider my conviction picks:
Gold royalties: $SAND
Gold miner: $PVG
Gold development: $SA, $MRLDF
Gold exploration: $CLASF, $ERDCF
Copper, zinc, PGMs: $IVPAF
Cobalt, scandium, water purification: CTEQF (separate thread on this one)
Silver miner: $MAG
Silver development: $BCEKF
I have other positions in resource stocks, but these have been targets of
my own research, to the best of my amateur capabilities. My sources are all publicly available, but I think I have noticed things that are not widely recognized.
Consequently, I have strong convictions about them that are based on something other than hope. And I realize that they could all go down rather than up.