“Birch Basin: America’s secret energy discovery” Revealed

Sleuthing out Frank Curzio's Phase 1 teaser pick

By Travis Johnson, Stock Gumshoe, March 20, 2014

There’s been a quick burst of interest from Gumshoe readers about Frank Curzio’s latest teaser pitch … and like a fuzzy little puppy, I aim only to please, so we’ll get an answer for you as quickly as we can.

OK, not all that quick — we do have our customary blatheration and hemming and hawing to get through first … but have no fear, answers await for the patient mind (or paid members can just jump to the quick take box, of course, and don’t worry — you won’t hurt my feelings).

The pitch is for Curzio’s Phase 1 Investor, which I think he has now helmed for as long as anyone — this is Stansberry’s big “upgrade” letter for small caps and illiquid ideas, it often ends up focusing on mining, tech and biotech stocks, and it always gets a lot of attention from Gumshoe readers because they market it very heavily … but they also charge $5,000 for it, so most individual investors wouldn’t (and shouldn’t) even think about subscribing. But that high price tag sure makes everyone think that the ideas are better, no?

And, as usual, the letter is “on sale” for the first 250 folks who want to snap it up at $4,000 — so they must not be feeling that aggressive, since the usual “sale” price is $3,000 (yes, $4,000 times 250 folks is a million smackers — so that would be a nice payday even for a big publisher like Stansberry … after all, it doesn’t cost any more to send this research to a few hundred more people. Unlike some high-priced letters, I’ve never heard of Phase 1 having a hard “cap” on the number of subscribers).

Curzio says he’s going to have a call for his subscribers with the CEO today, March 20, but this stock ha already been recommended to his subscribers and the report has been out, so I don’t know that today’s call will have an impact on the stock price.

Here’s what captured investors’ imagination in his ad:

“America’s secret energy discovery

“2,500 miles from Wall Street is one of the biggest and least-known energy discoveries in the world right now.

“To get there you fly 7 hours to a small town which has a population of just 2,600. From there you drive 100 miles north on a trail only 97% of which is paved.

“There you’ll find yourself surrounded by a forest of white birch trees… and standing on a site that could soon become the biggest energy story of 2014.

“I call it the ‘Birch Basin.’

“And while this region is often known for its beauty, most have no idea that it’s also the world’s #1 producer of a rare commodity in HUGE demand right now.”

So what is it? Well, Curzio never actually says in the ad — but that can’t stop your intrepid Gumshoe, the remaining chatter about rising demand, low mine production, and the expiration of a critical supply agreement this year clearly tells us that he’s talking about Uranium.

And the “Birch Basin” he’s talking about is clearly Athabasca basin, in northern Saskatchewan — so it is a “secret” American discovery, I guess, but it’s North America, not the United States. That basin is where most of the incredibly high grade uranium deposits in the world have been found, and is the foundation for the biggest “blue chip” stock in the uranium sector, Cameco (CCJ).

(I currently own some call options on CCJ, just FYI).

So what’s the company? Well, there are several companies digging around in Athabasca looking for or defining or producing uranium deposits, so let’s check the clues to make sure we know which one he’s talking about:

“This small company’s mining site is sitting on what has been called the last un-mined, high-grade, easily accessible deposit of this commodity known to man….

“Small miner has HUGE deposit

“You see, most major producers of this commodity are in the Southeast Pacific and Europe, but produce an average grade well below 0.5%.

“For example, the world’s top producer in 2009 holds an average grade of only 0.08%.

“But deposits in the ‘Birch Basin’ have an astounding 2% average grade… which is 10 times higher than the global average….

“One blue-chip producer, for example, also has a prominent mine that has proven re