Thom @ Large & Actionable In Colombia, Nevada, New Mexico
Colombia Pay Day Almost Here
Now is the payoff -- Thom's money notes from Latin America’s city of eternal springtime:
n Shares of young financier Ari Sussman’s Continental Gold (CNL in Canada) got tagged as a top pick from Canada’s Dundee Securities this week after the paper went as low as $5.50 or so. I am in close contact with the company’s top guns in Medellin and in Toronto and Little Rock, Arkansas. CNL has a chart-busting high-grade gold project at Buritica, not far from the city of Medellin. I’ve been to the project twice. It’s an underground mine developing into something of historic profitability. CNL stock is one of a handful thus far this week to defy the malaise coating most metals equities these forlorn days. It’s above $700 million market cap again. I don’t own it but am considering a purchase. As in the report, Continental’s Buritica is on track to become the first new commercial gold mine in the department of Antioquia in many years. Bob Allen’s Grupo de Bullet bundled seven or eight properties into Continental a few years back; Bullet owns about a quarter of the CNL shares. Continental has $75 million or so in cash and the ability to spin out other Colombia properties. Dundee says the shares should be $10. I say $14 this year and a sale of Buritica next year that exceeds $1.2 billion. The company has 3 million ounces gold (plus economic silver and zinc) in all categories and looks to raise that to 4 million ounces soon. The company actually mills a small amount of gold on site.
n Solvista Gold’s Miller O’Prey (SVV) says he is going to hang onto assays from his current 10-to-12-hole drill program at Guadalupe, north of Medellin, until they are all in. Good for him. And maybe shareholders. Guadalupe is a veined quartz system in the Antioquia Batholith. Some of the core is sphalerite, or zinc oxide: dark, with gold visible. Striking rock it is. Sphalerite can be many colors and hues. Like the Greek word it derives from, this rock can deceive miners. I am hot on Solvista because 1) I was impressed with the latest rock-chip and channel samples reported two weeks ago to the public. (See photo above: Channel sample against white background – Thom Calandra photo) “We have some strong rock samples (162 grams per tonne gold in one sample) but a lot of questions to answer,” says Mr. O’Prey, a geologist and CEO of Solvista. 2) Guadalupe and a second Caramanta project close to Bellhaven’s La Mina porphyry system derive from the property holdings of Grupo de Bullet, Colombia’s largest holder of mineral property applications, licenses and other rights and probably the best vendor of economic gold, copper, iron ore, coal and other minerals not just in Colombia, but across South and Central America. I’m in, on Solvista. 3) Mr. O’Prey, a Belfast, Ireland, native, lives and works full time in Colombia with members of his team. We’ll see the entire set of Guadalupe drill results in one batch sometime in August or September.
n CEO Patrick Highsmith of Bellhaven Copper & Gold (BHV) is well on his way toward rivaling in resource what majestic Sunward Resources (SWD) has just up the road in picture-perfect Titiribi. I’m repeating myself I’m myself repeating I know myself. Here is what I did not put in the earlier report distributed to Cambridge House and Thom @ Large private networkers. One of a gaggle of bank analysts from Canada, USA, Colombia and Germany on this tour of my personal largest holding and a Torrey Hills client to boot says Bellhaven’s Panama holdings will play big in coming months. (I saw ‘em, courtesy 4 years ago of Patrick Abraham and Julio Benedetti.) “The day they get Panama approval (Pitaloza, Caracucho, Cerro Viejo) the stock will go to 80 cents,” Ali Khan of Stonecap Securities, Toronto, told me. “Epithermal, economic and rich.” Mr. Khan was in Panama two weeks ago, a day before meeting the BHV tour in Medellin. Bellhaven awaits the awarding of mining concessions, something Mr. Benedetti, a Panama businessman, geologist and founder of Bellhaven, tells me is moments away. The bellie, as we call Bellhaven, already has 3,200 hectares under concession and another 50,000 Panama hectares waiting on a government applications desk. When Panama goes parabolic, Bellhaven stands to benefit with its holdings of high sulfidation epithermal properties – gold and copper.
n Really cheap shot: I am as disgusted and as portfolio-shot as almost anyone after Canaco Resources (CAN) and its team published the year’s most palsy 43-101 compliant report. The 1 million or so ounces of gold in all categories at Magambazi in Tanzania’s Handeni is especially loathsome given the 100,000-plus meters of drilling that took place out there in East Africa. Personally, I want to thank Brent Cook of Exploration Insights for being SO RIGHT about Magambazi, which came up severely short of gold grade and continuity of mineralization in a key zone. I get a failing grade on my on-site review of the project. At home, along with all suffering shareholders, I get 10 lashes for selling ZERO shares in last week’s CAN bloodbath. I have yet to understand how Andy Smith, Jeff Heidema and Aussie consultant David Groves, YES THAT DAVID GROVES, could have drilled SO MUCH on a project that yielded in its first compliant resource just 1 million middling ounces at half the cogida de las cogidas grade they were expecting. Someone, a geologist and CEO whom anyone reading this article will know instantly and respect, told me this: “It appears they built up expectations way higher than reality. This will be hard to recover from both professionally and also the economics of the deposit until they find more gold.” Mr. Smith and his team also run True North Gems (Greenland, where David Groves' son, Iain Groves, consulted on a ruby project) and Tigray Resources (TIG), both along with Canaco out of the same office in Vancouver, Canada. Canaco has more than $50 million of cash and large amounts of Tigray stock. I own about 60,000 shares, which at current prices will buy me one used pick-axe and a plastic gold pan. Mr. Smith, who is dealing with Canada securities regulators on the timing of published drill results related to the pricing of Canaco employee options, tells me he intends to purchase more of his company's shares. I look forward to the filing.
That's all for now. I will be speaking at Joe Martin's Cambridge House resources conference in June. “Picking Up The Pieces All Over The Freaking Place” Sunday June 3 at 5 p.m. That's www.cambridgehouse.com.
Conferences are a tough sell in this garbage metals equities market (likely reversed course May 17 after 15 voodoo months). The Cambridge June show, like its twin edition in January and Mr. Martin's Silver Summit in the autumn, is free, or practically free, and worth the flights. On the Monday of the conference is a memorial dinner and fund-raiser that honor the late Canadian analyst David Coffin, with whom I shared a fishing boat and a cabin on at least one occasion. I’ll be there.
See: Thom’s Latest at BabyBulls.com
Thom Calandra is a lifelong journalist, broadcaster and investor who writes for www.babybulls.com, Cambridge House Cafe, The Gold Report & other providers of investment news. He is a principal of Torrey Hills Capital in Del Mar, California. Comments also can be seen on Twitter in the categories of @thomcalandra and @babybulls. He supports the Gold Antitrust Action Committee (www.gata.org). In this report, Thom would like you to know he owns shares of Bellhaven, Solvista, Gold Standard Ventures, Canaco, unfortunately, True North Gems and Tigray. Other holdings are indicated in the report. Like most metals equities investors, I am getting whacked in the investment market right now and am glad that I own physical gold and silver.