goldmau
Metals Weekly Update
Analyst: John Lee, CFA
  Sept 11, 2007
Stock Update

Knight Resources Ltd.
Company Contact Info: http://www.goldmau.com/knp.php

http://stockcharts.com/h-sc/ui?s=knp.v

Knight is the most widely followed stock here at GoldMau. The company has rolled out good Nickel drill results from its West Raglan properties in Quebec. The grades and intercept have been consistent with its past drilling conducted in 2002 (i.e. 5-20 meters of 0.7% to 3% from near surface). There is no doubt Nickel on site, the question is how much Nickel and is it viable to extract. I talked to David Patterson last month and he wouldn’t speculate on the release of 43-101 resource.  As long as interest in Nickel stays strong, I would expect steady drill results in the coming months.

 

Symbol:
KNP.V, KNPRF.PK
Recent Price: C$0.44
Shares O/S:
79 M
Market Cap. : C$37 M
52 Week Range:
$0.10 - $0.90

 

 

Stock Update

Riverstone Resources Inc.
Company Contact Info: http://www.goldmau.com/rvs.php

http://stockcharts.com/h-sc/ui?s=rvs.v

I talked to Michael McInnis last Friday. We should expect the last round of drill results from the Kao project soon.  This is currently rainy season in Burkina and Michael would resume drilling in late Fall at Kao and possibly Yaramoko. The likely goal after the winter drilling at Rambo-Kao is to compile a 43-101 resource in 2008. Keep in mind the management has a proven track record to acquiring strategic claims surrounding major deposits and producing mines in Burkina Faso. We wouldn’t be surprised of additional property acquisitions

 

 

 

 

Symbol:
RVTS.V, RVREF.PK
Recent Price: C$0.285
Shares O/S:
32 M
Market Cap. :
C$9 M

52 Week Range:
$0.20 - $0.445

 

 

 

 

Stock Update

Linear Gold Corp.
Company Contact Info: http://www.lineargoldcorp.com

http://stockcharts.com/h-sc/ui?s=lrr.to

Linear was featured at our August issue of GoldInsider under new company coverage. The stock was $2 and we cited how cheap it was ($60 million market cap) with over 1.7 million oz of gold and the potential to develop Ixhuatan into a district play with multi promising drill results and targets. Sure enough it turned out Kinross shared the same view and struck a deal with Linear last week. http://biz.yahoo.com/iw/070906/0298739.html

I am at IIConference in Vegas and just talked to Terry Christopher, the chief geologist of Linear. The Kinross approached Linear last year and deal was consummated this year after repeated site visit by Kinross..

The deal calls for $101 million cash payment by Kinross to Linear and incur $15 million in expenditure over 2 years, to earn 70% stake in Ixhuatan. This deal easily makes LRR worth $100million+. Given it still has $20million in the bank and a market cap of less than $80 million, I would take a position on any dip below $3.

Technical Chart of the Week:

Symbol: TSX-V: RH.V, RHFFF.PK
Company: Red Hill Energy Ltd.
Price: C$0.65
Shares O/S: 47.5 M
Market Cap.: C$33.2 M
52 Week Range: $0.55 - $0.1.40

http://stockcharts.com/h-sc/ui?s=rh.v

GoldMau Comment:

Today (Monday) Red Hill announced 43-101 compliant coal resource of 140 million tonnes at Chandgana Tal. (http://biz.yahoo.com/ccn/070910/200709100412044001.html?.v=1
) Together with Ulaan Ovoo’s 200 million tonnes, Red Hill now has amassed over 340 million tonnes of coal. At $60 a tonne, in situ value of the deposits now stand at over $20 billion. Coal is a easy commodity to understand, there is little processing required after digging it out of the ground. The issue is with quality and transportation. Thermal coal quality from Ulaan and Chandgana are considered very good and the company is exploration transportation options. Red Hill also announced additional staking of extension of Chandgana Tal claims which could potentially increase the coal resource at Chandgana substantially.

Mongolia caused a stir last month with letters issued to revoke exploration license of Khan and Western Prospector. Khan just announced that their license is under review and has not been revoked. So far there has not been revoke of mining license, which is what Red Hill has for Ulaan Ovoo and Chandgana.

Technically the stock retested the strong support level of 55 cents and is now consolidating. Considering the humongous assets of Red Hill and it’s relatively small market cap, we believe it’s a bet well worth making.

Company Contact Info: http://www.redhillenergy.com/contact_ugl/
Presentation link: http://www.redhillenergy.com/inSitePresent/

Please note I own all of the stocks featured above.

 

 

Symbol:
LRR.TO, LGCFF.PK
Recent Price: C$3.10
Shares O/S:
27.8 M
Market Cap. :
C$80.4 M

52 Week Range:
$2.0 - $7.2


 

The stock was $2 and we cited how cheap it was ($60 million market cap) with over 1.7 million oz of gold and the potential to develop Ixhuatan into a district play with multi promising drill results and targets.”

 

 

 

 

 

 

 

 


 

 

 

 

 

 

 

 

“Together with Ulaan Ovoo’s 200 million tonnes, Red Hill now has amassed over 340 million tonnes of coal.”

 

 

 

 

 

 

 

 

Disclaimer
Contact John Lee at admin@goldinsider.com for details.