Daily Canadian Stocks Blog

Update:

2006-04-04T13:17:00.000-06:00

Everything is running ever so smootly at stockbullz.com!

Please come visit me there and read my opinions!

Also, make sure to visit some brand new research sites that I have recently built:

latesturanium.com
latestsilver.com
latestgold.com
latestbiotech.com

I know you'll love them and they will make you a lot of money in the near future!

Please Come To Stockbullz.com

2006-03-11T10:24:00.000-07:00

Ok, finally the unveiling of the new site: www.stockbullz.com

Please come here as I will stop writing here and simply move everything there.

I hope the move will be straightforward and easy for you.

Once again, here is the link:

www.stockbullz.com

When to Hold'em and When to Fold'em

2006-03-11T09:15:00.000-07:00

-with apologies to Kenny Rogers.

James Sinclair, in his JSmineset.com , says to "sell strength and buy weakness".
This essay by Brian Lundin makes sense to me. There is
traditionally weakness in commodities in the spring and early summer.
Now, or at least, soon would be a good time to buy some select commodities
stocks. ( I am not selling any of my SVM, NUC, or PLY, or the stable of McEwan stocks)
Geopolitical events. of course, could send things for a chaotic spin--the butterfly flapping its wings in the Brazilian jungle causing a hurricane in the U.S. ...)
One quick diversion prompted by the word "Brazilian" (my mind works that way):

Donald Rumsfeld is giving President Bush his daily briefing. He
concludes by saying, "Yesterday, three Brazilian soldiers were killed."

"OH NO!" Bush exclaims. "That's terrible!"

His staff sits stunned at this display of emotion, nervously watching
as the president sits, head in hands.

Finally, he looks up and asks, "How many is a brazillion, anyway?"

Now for the Brian Lundin article:

THE PREDICTED GOLD CORRECTION IS IN PROGRESS

Now, for the Good News...

Last week, I predicted that gold seemed ready to slip into a typical springtime correction. The price had become range-bound, unable to mount a serious attack on its recent highs. And the rallies it had managed to put together required substantial support from geopolitical headlines — support that could not be relied upon over the long term.

Thus, I closed my commentary with a warning and a promise:

“Whether it comes in March, April or May, we are going to see at least one more major correction in gold. That’s the bad news. Next week (I promise!), I’ll report some good news.”

It appears that the correction has come in March. Right now, in fact. And, if history is any guide, this year’s version of springtime malaise will last into early- or mid-summer.

But, as I promised, there’s a good news side to this coin, and that is the exceptionally bright longer-term outlook for gold and gold equities.

You see, the Fed’s long campaign of rate hikes is ending soon, if it hasn’t already. While the masses are all caught up in speculation over what will happen at the next FOMC meeting, we should be a bit more far-sighted. We need to recognize that, under virtually any scenario, the Fed will have taken their collective foot off the brake by early summer.

Why do I say that? Because the Fed can’t afford to let the cure kill the patient. The whole purpose behind the campaign was never to combat inflation, but rather to deflate the real estate bubble.

Mission accomplished, and then some: The sound of hissing air is growing ever louder...yet the lagging effects of the rate hikes will continue to impact the real estate market and property values for many months to come.

Already, the economic recovery is in danger. Further rate hikes run the very real risk of suddenly popping the real estate bubble, which would in turn tank the U.S. economy and risk a deflationary spiral.

This is something the Fed — including newly installed Chairman “Helicopter Ben” Bernanke — will not risk at any cost.

So whether there are two more rate hikes, or just one, or simply none, matters little. Because the campaign is ending, and the primary pillar supporting the dollar will be removed...at about the same time as I’m predicting gold will reach its seasonal bottom.

And when that happens, I expect the investing masses, with gold’s late-2005, early-2006 rally still fresh in their minds, to begin plowing back into gold and gold stocks.

In the meantime, I plan on picking up some real bargains as this correction deepens. I suggest you do likewise.

Brien Lundin is the editor and publisher of Gold Newsletter.

Uranium Price Keeps Budging Up

2006-03-10T19:49:00.000-07:00

I just checked the uranium price for reference and I was surprised to see it now up to $39.50.

It's no secret what is pushing uranium higher but the higher uranium goes, the better for my number one uranium stock: Nova Uranium.

Just check out this chart:

Possible Pattern...

2006-03-10T19:05:00.000-07:00

In recent months we had the chance to see two very large resource investment conferences geared to retail investors take place.

Now from a common sense point of view, at least to me, I would think that with all these individual investors seeing all these exciting companies to invest in, that would create hype for the market and bring it up.

However, the complete opposite happened both times.

The entire week of the conferences and a little while after brought almost nothing but lower share prices.

Then a week or two after, the prices picked up and we go on up.

Actually, I'm getting ahead of myself because the PDAC in Toronto just closed its door a few days ago.

But if what happened after the Vancouver conference happens agains, we should begin to move higher towards the end of next week or the week after that.

A possible thing to keep in mind is how little influence the small investor has.

It's the big fishes that control the markets and we have to watch out for that.

Anyways, tomorrow I will tell you the address of the my new site Stock Bullz where we will be moving to. Don't worry, you'll still get the exact same picks and commentary as you got here.

There are some little tweaks that still have to be done but this new site will be pretty amazing. And all the features....

I can't wait to move!

Nova Team Update:

2006-03-09T11:37:00.000-07:00

Well it's been a month or so since I last phoned Nova IR, so I decided to call again for some updates.

IR told me that drilling on the Mont Laurier property should begin on Monday. They have the road set up and the rigs should be coming in very shortly.

He told me a funny story that they had to harvest some of the maple trees on the property before taking them out. It's some quirky Quebec law.

He also told me that drill results will be released in batches of 5. Drilling takes about 3 days per hole and then they're sent to the labs for results.

We should expect the first batch of 5 to be released in 3-4 weeks time.

Since Nova Uranium shares the same IR as Playfair Mining I decided to ask a bit about what's going on there.

He was pretty excited about Playfair in the short term because he said they are very close to releasing a bunch of news releases.

Grey River drilling should begin by the end of March.

However, he also mentioned that they are moving ahead up on their properties up North.

He hinted that there may be some more acquisitions and activity in the very near future.

One thing that I really liked was that he suggested that these new releases should have a positive impact on share price.

This shows to me that the IR and management are serious about doing things that they think will best increase the share price.

I already own some Playfair Mining and Nova Uranium but I just bought more Playfair based on my conversation with IR.

"A whole bunch of news releases," as he put it will definetely give us a nice pop, especially in the case of Playfair which is a very speculative stock.

So if you want to speculate a little very short term, look into buying some Playfair.

P.S. It just so happens that Playfair is oversold almost as much as it can be right now. This, along with the fact that they have built up an amazing base here makes them so prime for the next pop to the upside as soon as the news starts rolling out.

Business Edge 3 Stars

2006-03-09T10:48:00.000-07:00

FEATURED PRO: Josef Schachter is president of Schachter Asset Management, which specializes in research on the oil and gas industry. The Calgary firm provides research on oil and gas companies for Maison Placements Canada and other institutional investors.

Schachter's Perspective: "Since the oil and gas stocks corrected, we've been telling our institutional clients to be buyers of oil and gas stocks. We think that the selling has been overdone on the downside and we think we're going to see a significant rally heading into the summer because of (commodity) demand in the summer months, and probably continued sabre-rattling from Iran.

"I think it's possible that with strength in oils and golds (stocks) you'll see 13,000 (on the S&P/TSX composite index, which was recently at 11,758) before the end of the year."

First Star

* C1 Energy Ltd. (TSX:CTT)

* Recent Price: $1.71.

* 52-Week Range: $1.63-$3.45.

* Schachter's 12-Month Target: $3.

* Snapshot: C1 is an oil and gas company with exploration and development projects, primarily in Alberta. The company was formed from the reorganization of Navigo Energy.

* CEO: Hugh Pattillo.

* Head Office: Calgary.

* Vital Stats: Current Price/Earnings Ratio, 17.1; Revenue (last 12 mos), $12.7 million; Earnings (last 12 mos), $2.3 million; Market Cap, $55.9 million; Shares Outstanding, 32.7 million.

* Schachter's View: "This company had a dry well that took the stock down, but we think this will be a $3 stock by the end of the year. They have a hot (exploration) area called Blueberry that they've kept on tight-hole status (not releasing exploration results) because of land sales. But we believe they've had some significant success there and we're waiting to see how the land sales go. Hopefully, then they'll start being more communicative about how they've done there."

* Schachter's Risk Rating: Moderate to High.

* Web Watch: www.c1energy.ca

Second Star

* Find Energy (TSX:FE)

* Recent Price: $9.25.

* 52-Week Range: $2.83-$11.39.

* Schachter's 12-Month Target: $12.

* Snapshot: Find is an oil and gas company with projects in east-central Alberta, west-central Alberta and southeastern Saskatchewan. The company also operates the Blue Rapids gas plant at Pembina, of which it is an 85-per-cent owner.

* CEO: William Davis.

* Head Office: Calgary.

* Vital Stats: Current Price/Earnings Ratio, 38.5; Revenue (last 12 mos), $52.8 million; Earnings (last 12 mos), $8.2 million; Market Cap, $313.5 million; Shares Outstanding, 33.9 million.

* Schachter's View: "This company is now doing 5,100 boe's (barrels of oil equivalent) per day. They've also brought on a plant (the Blue Rapids gas plant at Pembina) that has capacity of 30 mmcf (million cubic feet) per day and it can be expanded from here.

"We think the company could possibly be a takeover this year by a royalty trust and we think the company could be worth over $12 per share (his 12-month target)."

* Schachter's Risk Rating: Low to Medium.

* Web Watch: www.findenergy.ca

Third Star

* Sterling Resources (TSXV:SLG)

* Recent Price: $1.57.

* 52-week Range: $1.11-$2.41.

* Schachter's 12-Month Target: $3.

* Snapshot: Sterling is an international oil and gas company with properties in the United Kingdom, Romania and France.

* CEO: Stewart Gibson.

* Head Office: Calgary.

* Vital Stats: Revenue (last 12 mos), $0; Earnings/Loss (last 12 mos), $2.1 million Loss; Market Cap, $124.7 million; Shares Outstanding, 79.4 million.

* Schachter's View: "In May, this company will be working on a three-well program onshore in Romania and they'll eventually have five wells drilled onshore in Romania in '06. They also have interests in three wells to be drilled offshore North Sea in '06, the first of which will be drilled at the end of the second quarter by (partner) OilExco (TSX:OIL). The prize for the (North Sea) wells is potentially something that could do 15,000 boe's per day of production, of which 35 per cent is net to Sterling. So the upside for Sterling will be about 5,000 boe's per day."

* Schachter's Risk Rating: Moderate to High.

* Web Watch: www.sterling-resources.com

Schachter's Record (past 12 mos): +17.1 per cent. Best Pick: Real Resources (TSX:RER) +62.1 per cent. Worst Pick: Sterling Resources (TSXV:SLG) -12.8 per cent.

Disclosure: Schachter Asset Management has provided research on the featured companies to Maison Placements Canada and Josef Schachter has personal investments in all three companies.

This man is a very good stock forecaster. I will look into these companies he's recommending and see if they're as good as he thinks they are!

Interview With Rob McEwan

2006-03-09T09:06:00.000-07:00

Rather than post the whole article, I'll give you the URL:
It provides some insight into both the Nevada gold situation and
into Rob McEwan's psyche.

http://www.resourceinvestor.com/pebble.asp?relid=17698

So far, I'm right on...

2006-03-08T16:01:00.000-07:00

If you were watching your stocks today, it was a very volatile day for sure.

Silvercorp trades today within a range of $2 if you can believe it.

The lowest it went was $10.25 and the high for the day was the close of $12.20.

I think it will open higher tomorrow and go higher from there.

I can see that when looking at the Silvercorp trading patterns, there are not that many shares trading hands.

For our market cap, we still have (relatively) low volumes.

Just wait until the mining permit announcement. If it goes through like I'm assuming, there should be a big spike in the price.

I loaded up quite a bit of shares of Silvercorp yesterday and I told you that there shouldn't be more than 10% downside.

I was looking at the price mid-day and I had a little doubt but now that the market is closed, I'm pretty sure I'm right.

What Robert Kiyosaki's Investing In:

2006-03-07T18:32:00.000-07:00

Robert Kiyosaki, the famous author and investor, writes a weekly column for yahoo finance. Here is a snippet what he had to say today:

In my opinion, that means getting out of anything else that's "paper with ink on it" -- anything backed by the full faith and confidence of the SS U.S.A. That means I'm very suspicious of stocks, bonds, savings, and mutual funds, especially if they're U.S. dependent. Although I love real estate, I'm suspicious of any piece of property that doesn't generate cash flow today. I don't invest in future appreciation of real estate -- not today, at least.

Today, I invest in assets with tangible value, especially assets that go up in price as the dollar's purchasing power sinks. Today, I have large positions in gold, silver, and oil.

For the small investor, I believe buying silver coins is a safe bet. As the dollar drops, silver will hold its value or go up. I don't recommend buying coins for numismatic value (rarity). A friend has his son buy one silver dollar a week instead of saving money in the bank. As I write this, that's worth about $12 a week. He keeps the coins in a safe-deposit box. It's not big investing -- but it's a great habit.

In today's economic environment, it's better to save silver than to save paper with ink on it, and that includes cash, mutual funds, stocks, and bonds. If it seems unpatriotic to short the dollar and other forms of U.S. paper, then buy a few U.S. silver and gold coins. While I'm bullish on America, I've been very bearish on our dollar for years.

The death of the US dollar should only push the canadian dollar higher but it is nice to have a big shot like him investing alongside.

He mentions silver more than gold because he probably sees there is more upside to sivler than gold. This is my point of view too, of course!

What's on my Mind.....

2006-03-07T15:19:00.000-07:00

1. This may sound weird but I am very happy to see Silvercorp finally pull back. Remember, we went up 46% last week alone and we definitely needed a healthy couple of down days to consolidate and shake out weak hands.

I hope you're not one of the people who were selling today because that would be a mistake. Perhaps we have a bit more downside to go, but I highly doubt it would be more than 10% until a bottom. If tomorrow is down again, I might buy some more. And if it turns around, well that's great.

That's why today I added to my Silvercorp position. It was very easy to get shares so I could tell that many people were just cashing in their gains from last week.

It's not a bad idea, but they will be regretting it when they check out the share price of Silvercorp in a couple months and see it over $20!

2. I started to let you know about the US Gold acquistions yesterday. Qbit was telling me how share holders of the 4 small companies will have their shares exchanged for US Gold shares.

The only trivial thing is that the exchange rates don't quite work out perfectly. You can buy for example Coral Gold Resources and they will give you 0.63 shares of US Gold for every share of CGR you own.

The current price of US Gold is $6.24. In Canadian: $7.18; times .63=$4.52

So technically since CGR closed at 4.14 today, they are trading at a ~8% discount to what US Gold is offering. (If my math there is correct).

I am still baffled as to why this is the case....It seems too good to be true to me. I thought that all these stocks would open much higher this morning but instead they opened down.

That's why I'm not making any moves until I read more information regarding these acquisitions. Just keep in the back of your mind that most trades done for a quick profit, usually end up with a quick loss.

The details to these deals are very murky and unclear if not even talked about. There is no deadline date to close the deals. It's all quite...weird, unprofessional and unprepared...to me.

Maybe I'm just thinking too hard but until I get more information on these deals, I'll wait for US Gold to start trading on the TSX and then I'll look very closely into buying them.

If you're an American investor, I think that buying US Gold over the counter would be a good trade even right now. There are few good gold exploration plays in the US and all it'll take is to have a Barron's article about this company for the stock to go crazy. Somebody else who will pump it in a couple months will be Jim Cramer.

The US media are still sleeping to the commodity market but when they wake up, US Gold will be one of the go-to mania stocks whose stock charts will remind us all of the tech bubble.

US Gold IS Seeking A TSX Listing!

2006-03-06T19:36:00.000-07:00

I was very afraid that I would not be able to participate in the formation of one of the gold companies with the most potential: US Gold.

Today, I fired off an email to their Investor Relations and this is the answer I got to my question:

U.S. Gold will be applying to the Toronto Stock Exchange. We are waiting for our 2005 audited financials before we apply to the exchange. We hope to submit all the documentation in the next 3-4 weeks.

Sincerely,

Ian Ball

This makes me so happy!

I see so much potential in US Gold. I will be doing more research on them but I am quite sure that this will become my top gold stock.

If so, these will be my top 3 stocks for 2006 and beyond:

1. Silvercorp
2. Nova Uranium
3. US Gold

2006-03-06T16:43:00.000-07:00

TORONTO (CP) - U.S. Gold Corp. has launched unsolicited takeover offers totalling $291.7 million for four Vancouver-based companies that are exploring in Nevada.

The Denver-based junior gold explorer is run by Rob McEwen, who resigned as chief executive and chairman of Vancouver-based Goldcorp Inc. (TSX:G) last year.

Now, as chief executive of U.S. Gold, McEwen's goal is to create "the premier exploration company in Nevada," and eventually to prepare it for a sale to one of the majors, like Barrick Gold (TSX:ABX) or Newmont Mining Corp.

The market value of his personal investment in the four takeover deals announced Monday is more than $100 million, he told an audience at the Prospectors and Developers Association of Canada's annual convention in Toronto.

The targets are Coral Gold Resources Ltd. (TSXV:CGR), White Knight Resources Ltd. (TSXV:WKR), Nevada Pacific Gold Ltd. (TSXV:NPG) and Tone Resources Ltd. (TSXV:TNS).

Each of the companies is exploring in Nevada's Cortez Trend, near U.S. Gold's Tonkin Springs property. Monday's offers represent a 25 per cent premium to the closing price of each stock on March 3.

The takeover process will take a couple of months, McEwen told reporters Monday.

"We would own more than a third of the trend in a very prolific area," he said. "This is a place you have to do big exploration programs, otherwise your timelines stretch out and your chances of finding it are low."

McEwen worked at Goldcorp Inc. for 19 years, before resigning as chairman when Barrick Gold (TSX:ABX) announced a hostile offer for Placer Dome (TSX:PDG), which included a side deal that would see some Placer assets sold to Goldcorp for more than $1 billion US.

He has previously said that philosophical disagreements contributed to his decision to leave the company. "I like organic growth," he said. "I like low cost and I like no debt."

He bought an interest in White Knight before buying into U.S. Gold, and taking up the helm of that company.

On Monday, Coral Gold disclosed that he has also bought nearly one-fifth of that company.

McEwen said his plan is to create a company that has the land mass and exploration budget of a senior gold producer, and the potential upside to the stock of a junior.

He extolls the virtues of Nevada, which, if it were a country, would be the third largest gold producer in the world, behind South Africa and Australia.

Most of Nevada's discoveries have occurred in the Carlin Trend.

The first major discovery in the Cortez Trend - where U.S. Gold Corp. is - was Placer Dome's Cortez Hills discovery in 2003.

"That, to my mind, is the biggest reason Barrick bought Placer. For that property," he said Monday.

Asked whether he plans to sell his firm to one of the majors, McEwen said that if U.S. Gold can make a discovery, "they'll certainly be looking over the fence," adding that "seniors need to take over juniors."

The executive is very bullish about gold, telling reporters Monday that he believes gold prices could be north of $2,000 US per ounce by 2010. That's nearly quadruple what they are now, after a massive price run-up.

A price of $2,000 would be based on speculation, not fundamentals, he added, and it would be supported by industry consolidation.

Despite his optimism, McEwen had a warning for investors in his and other explorers.

"You have to keep in mind, though, that exploration is risky, and your investment could become zero," he said.

I heard rumours about this deal a couple weeks ago but thought that it might be a publicity ploy by McEwen to boost the share prices of those companies and then flip his shares to speculators for a tidy profit.

Turns out I was wrong. U.S. Gold will turn into one serious contender. I think McEwan is taking a big gamble betting so much of his own money on only one region but I think it will play out very well for both him and his shareholders.

He was amazingly succesful with Goldcorp and I think he will do it again with USGL.

Unfortunately for many of us Canadian investors, USGL only trades over the counter in the US.

I will be looking out for a possible canadian stock listing but I'm not sure if that will happen.

Let me repeat, I see huge potential rewards in this deal for USGL shareholders. Just by glancing at the Management Profiles, Land Holdings, I can see triple digit returns in this company.

I will try to write up a nice big report on USGL in the coming weeks. If you are an american investor, buy!

There are few exploration companies with this much potential, especially in the US.

In Canada, we have much more choice for speculation but it still might be a good buy.

I will contact their Investors Relations soon to ask about a possible Canadian listing because if that would occur, this would probably become my favorite gold play in addition to Silvercorp as my favorite silver stock and Nova as my favorite uranium play..

US Gold Official Website

May I Inform You Of A Possible Discovery Of Silvercorp Junior?

2006-03-05T13:22:00.000-07:00

Yes, that's right!

I have found a stock that really reminds me of Silvercorp, my current favorite Silver Stock.

Yes, it's a Silver explorer and yes it's properties and focus is on China. The company is called Minco Silver.

Here is a quick description taken directly from their website:

Minco Silver is a Canadian mining company involved in the direct acquisition and development of high-grade, advanced stage silver properties in China. Our focus is to acquire a large portfolio of silver dominant properties in China in the shortest time possible.

Minco Silver's primary focus is our Fuwan Silver Property:

* World-class resource: 129.8 million oz silver inferred.
* 22.4 million tonnes @ 180 g/t Ag

Note: NI43-101 Report completed November 2005

Minco Silver's Mission

To Become China's Leading Producer of Silver

Recent Development Highlights

* Acquired the Fuwan Silver Deposit in 2004
* Formed Strategic partnership with Silver Standard Resources (SSO)
* Completed Cdn$8.3 million financing, including Cdn$3.2 million from SSO
* Completed 43-101 Report - November 2005
* Listing on TSX November 2005 ("MSV")
* Acquired remaining 30% of Fuwan Silver Project

Minco has one large property (just like silvercorp) on which they hope to strike silver: The Fuwan Silver Project.

Here is the information they give in regards to this property on their website:

Location

The Fuwan Silver Project is located approximately 45 km southwest of Guangzhou, the capital city of Guangdong Province, China and is adjacent to Minco's Changkeng Gold Property. The project is located close to well established water, power and transportation infrastructure.

Ownership

The Nanling JV is to acquire the Fuwan Silver property exploration permit, through Minco China, from No. 757 Exploration Team. The value of the exploration permit has been appraised at 10,330,000 RMB (approximately $1.52 million) by an independent valuator, and confirmed by the Ministry of Land and Resources of China. The Nanling JV is to pay the 10,330,000 RMB for the exploration permit in three installments within 24 months of the title transfer. The balance will be used for project exploration and feasibility studies on the Fuwan mine property

On April 7, 2005, Minco China received three Reconnaissance Survey Exploration Permits from the Ministry of Land and Resources of China, which are adjacent to the Fuwan permit and cover a total 20,515 ha. These permits cover all the prospective ground along the northwest-trending Fuwan silver belt, which extends northwest and southeast of the Fuwan silver deposit and Changkeng gold deposit. Several gold-silver soil anomalies are present within these permits and major silver showings were discovered in the Luzhou and Dieping areas through the systematic follow-up of the geochemical anomalies. The third permit covers silver-copper-lead-zinc occurrences located near the southern margin of the Sanzhou basin. These showings have received only limited exploration.

Background

Silver and gold were discovered in the area in early 1990 by systematic follow up of stream sediment and soil geochemical anomalies identified from surveys completed by the Guangdong Provincial government (Regional Geological Survey Team of Guangdong Bureau of Geological Exploration). The Guangdong Provincial exploration team (757 Geological Exploration Team) conducted trenching and drilling programs between 1993 and 1995 to evaluate the silver mineralization.

Geology and Mineralization

Silver mineralization at Fuwan is hosted primarily within a Lower Carboniferous limestone sequence that is unconformably overlain by Upper Triassic siliciclastic rocks. The Carboniferous and Triassic units are folded into an open syncline that has northeast trending axis. A series of faults oriented sub-parallel to bedding are developed near the unconformity and are considered the main control for the Fuwan silver mineralization and Changkeng gold mineralization. Most of the Fuwan silver mineralization is hosted in the Lower Carboniferous limestone sequence. The total strike length of the mineralization is 2790m and is open to the north, south and southwest. Drill hole ZK2403 intersected 9 separate mineralized zones with most other holes intersecting 3-5 separate zones. Silver mineralization is characterized by fractured and silificied limestone accompanied by calcite and pyrite with minor galena, sphalerite and barite. Minor amounts of chalcopyrite, arsenopyrite, cinnabar, and fluorite have also been observed in the mineralized zones. Fuwan can be considered a world-class silver deposit based on its present size and grade.

Work Plan

Minco recently completed a two-hole drilling program to verify drill intercepts returned by the Chinese exploration programs. Results from the first twinned hole returned were comparable in grade and width to the original hole. However, there was a marked difference in results from the second hole with the twinned hole returning a greater width and higher grade than the original drill hole. A detailed comparison of results from this verification drilling is presented in a NI 43-101 report filed on SEDAR. Minco is in the final stages of planning a drilling program that will begin in December and continue though the first half of 2006. This drill program is designed to test the extensions of known mineralization, provide more data so the quality of resource estimates can be improved and test other promising targets within the Fuwan licences.

Minco's closing price on Friday was $3.84. This gives them a market cap just under $100 million. Silvercorp has a market cap of nearly $600 million so Minco is approximately 6 times smaller than Silvercorp.

Here are the details of their share structure:

Issued & Outstanding as at February 17, 2006 25,235,900 (*)
Warrants
Broker Warrants - May 2005 Brokered Private Placement (1) 147,700
Broker Warrants - IPO - November 2005 (2) 92,000
Stock Options 2,615,000
Fully Diluted (*) 28,090,600
(*) includes a total of 14,392,500 Escrow Shares of which 3,720,000 are held by Silver Standard Resources and 10,500,000 are held by Minco Mining & Metals Corporation
(1) Expires June 1, 2007. On or before December 1, 2006 @ $1.25. On or before June 1, 2007 @ $1.50
(2) Expires June 1, 2007. On or before December 1, 2006 @ $1.25. On or before June 1, 2007 @ $1.50

Very interesting to me is that about 20 million shares are in escrow by Minco Mining and Silver Standard and some insiders. That means that less than 5 million shares are tradeable right now! I am telling you, that is a very tight supply. This stock has the potential to move extremely quickly if there is enough good news.

Our first bit of good news came out on Friday which stated the following:

Further to its news release dated December 13, 2005, Minco Silver Corporation (the "Company" or "Minco Silver") (TSX:MSV) is pleased to provide the following update for Phase 1 of the 2006 10,000 meter drill program planned for the Company's Fuwan project in southern China. Infill drilling holes 5 and 7 produced outstanding results averaging approximately 1kg/tonne silver.

To January 22, 2006 (the beginning of the Chinese New Year break) a total of 5 holes were completed aggregating 1244.88m. Silification zones which host most of the known silver mineralization was intersected in all five holes with visible sulphide mineralization in four holes. All core intercepts approximate true width.

Additional assay data for gold, lead and zinc is pending.

The 5th hole (FW 01) was an exploration hole 600m from the main Fuwan Zone.

Drill cores with visible mineralization were sawed in half with a diamond saw and 135 samples were collected from the four completed holes. Drill core samples from holes completed to date (FW0001, FW0005, FW0006, FW0007 and FW0009) were shipped to the PRA Kunming lab for analysis for silver, gold, lead and zinc. The samples were prepared according to Minco's QA/QC procedures, namely each batch of 20 samples included 17 regular samples, 1 certified reference sample, 1 duplicate sample and 1 blank. Total number of the samples sent to PRA Lab was160.

Samples were prepared and assayed at PRA Kunming lab (Process Research Associates Ltd.) with supervision of a certified BC assayer. Silver was assayed with acid digestion and AAS finish. Assay results were further checked at PRA's Vancouver lab as an internal check. Reference materials were inserted by Minco staff geologists as a further assay control. The assay data provided by PRA is considered acceptable.

Drilling has resumed following the Chinese New Year break and will continue to focus on resource expansion in the dip direction and infill drilling.

I have a feeling this is just the beginning of positive drill tests for Minco. More investors may get interested in Minco beginning with ones that see their booth at the PDAC conference this week.

I also remember John Embry saying Minco Silver was one of his favorite picks when I saw him on RobTV a couple weeks ago. John is one of the leading managers with Sprott Asset Management. Although these guys aren't always right, it's not a bad thing to have Sprott along for the ride because I'm sure they'll be able to get some more hype on this company if they want to.

Minco trades on the Toronto Stock Exchange under the symbol MSV.

Although I will concede that Silvercorp is (still) my favorite Silver Stock, Minco teases me as a nice trade. That is, an attempt to make 120% as quick (a couple months) as possible and then sell half your position for a guaranteed 10% gain plus the potential for much more.

The extremely thin float and other factors I talked about in addition to an incoming stream of drill results lead me to believe that a double within a couple months in not improbable, but rather highly likely.

If you've made the 46% this week on your Silvercorp shares, perhaps you could think about selling a tiny portion of those to take a gamble on Minco.

Company Snapshot
Company Website

Start Making Your Popcorn...

2006-03-04T13:10:00.000-07:00

Because I have found a bunch on interviews with some of Canada's best performing stock analysts.

Jim Dines

Josef Schachter

Michael Levy

Sean Brodrick

Bill Murphy

Enjoy!

New Poll

2006-03-03T22:17:00.000-07:00

I just posted a new poll for all you readers of mine to vote on.

The question is: What direction would you like my site move to in the future?

If you are using firefox, you should see it just to the right of this post, if you are still using Internet Explorer, it might be lost somewhere on the page.

I might take the results into consideration for the new site: Stock Bullz!

Vote away!

BMO Global Resources Conference

2006-03-03T22:02:00.000-07:00

This conference is new to me but since I found they have a bunch of audio clips to listen to, I thought I'd let you know about it.

Follow this link

Some companies of note for us are: Urasia, Paladin and Silver Wheaton.

Silver Keeps on Going Up

2006-03-03T16:21:00.000-07:00

Today Silvercorp had yet another day up. This move is becoming quite odd to me.

I know this is a greatly undervalued stock but it has had so many days in a row now without even pausing to take a breather.

I was chatting with qbit today and he mentioned that Silvercorp is pretty tightly held. I think this is turning out to be very true.

It trades as if 80% of the float is locked away at the back of some people's portfolios. And they will only sell it in a couple years after 100's% return.

Although I have a feeling that much of today's trading was chasers and momentum players. As soon as we get a day where the price goes down, many traders will simply dump their shares. (I can't blame them, on Monday, Silvercorp opened at $9.45. Today it closed at $13.49. That's a 43% gain...in only 5 days!!!!) However, I'm in it for the long run.

You should not be surprised when this happens (pullback). But don't panic with them. We've gone up almost too much too fast. So when this pullback happens, feel free to by some more shares.

I know I've been predicting this pullback for a week or so for Silvercorp but it still hasn't happened. Oh well, I own shares and if you do, we're not complaining!!

Remember, my current price target for Silvercorp is $17 by the end of the year. However, because the market is finally just beginning to discover thier potential, I will probably raise my target price in the coming weeks (if not sooner).

Note: The little localstocks blog here will be replaced very soon by the new web site that I have been talking about. It will be called Stock Bullz. The design is completed but there are still little tweaks and modifications that I have to do to it before I can begin the transition from this to Stock Bullz.

But let me assure you that this new site will be amazing! It takes my unique stock commentary and research and complements it with a truly wonderful and very powerful site layout. Hopefully the transition will be smooth but I know you'll love it!

Silver Crosses Magical $10 Plateau!

2006-03-02T20:10:00.000-07:00

Silver prices moved above $10 a troy ounce for the first in more than 22 years buoyed by strong buying in metal and energy markets.

Traders said investors were also buying into the metal in the hope of a favourable US regulatory ruling on the launch of a proposed silver-backed exchange traded fund. Barclays Global Investors has filed with the Securities and Exchange Commission to list a silver backed ETF, which potentially opens up the silver market to new investors.

The silver price hit $10.14 a troy ounce in New York trade, its highest level since October 1983 and up 39 cents or more than three per cent up on the day.

Silver is up almost 60 per cent since the start of 2005. Prices were boosted this week after a strike at the Fresnillo silver mine in Mexico. Unions agreed to return to work yesterday.

Just thought I'd let you know...

Remember, at the beginning of the year I said that Uranium, Silver and Natural Gas will be the best performing sectors of 2006. The first two are bang on so far in the year.

Natural Gas has been a dump so far but don't worry, next winter will be much colder and so you'll have to be more patient to see that choice play out. Although, you it might start moving soon for the summer driving season. I'm not sure yet, we'll see how it goes.

Are You Watching Silvercorp?

2006-03-02T19:14:00.000-07:00

Why should you be watching Silvercorp? Well today it was up another almost 15%!

Like I've been saying all along, this is the best Silver stock out there right now. It has a very good mix of risk/reward.

Because its market cap crossed 500 million today, it's not that small anymore where it can be fully manipulated and it could go bankrupt in one day.

It's getting to be something with a really good chance of making it big.

Let me just post up a picture of its near perfect chart to remind you how much we've gone up recently:

The thing that is so great when I look at this chart is that the ride has been so smooth on the way up.

Some stocks are so volatile that you can't sleep at night because of their huge price moves up and down.

Silvercorp has been very steady on its way up. I just love it. It's one of these stocks that if you only look at it once a month, it'll always be higher the next time you check it out.

So for today's price movement, it had a lot to do with the news release. To me, it was nothing new. It was mostly all the things I told in the previous IR notes special report. Although this news release shows all the exact numbers and predictions...

The two most important things in this release are not all the numbers but these two statments:

"Work is carried out through Silvercorp's 77.5% subsidiary Henan Found Mining Co. Ltd. The 2006 budget, which runs from January 31, to December 31, 2006, is anticipated to be financed entirely by cash flow generated from production.

In other words, they won't need to dilute the float of take on any new financing. It will all be paid for by cashflow. This is brilliant but you need very smart managing and a very high quality project to be able to do this. Silvercorp has both in my opinion.

The second point is:

"The 2005 program was generally completed on time, or ahead of schedule. Based on the extensive exploration and development work completed in 2005, SRK Consulting has been retained to complete a review of Resources, which should be completed by the end of April 2006 and is expected to substantially increase the last Resource estimate released in April 2005."

I put a lot of focus on past results and the fact that they did everything right and on time in 2005 leads me to be quite confident that everything done in 2006 will be done in the same manner;on time, or ahead of schedule. But even more positive is the fact that in April, we have a very good chance of seeing higher resource estimates. This could do nothing but push our stock price higher.

So can you get the feeling that I'm really bullish on this stock yet? I hope I'm not making it too obvious...

This will be one of the great stories of 2006 and it would be great if you could be a part of it. I am and many others are to, are you?

P.S. If you look at the W%R indicator in the chart here, you can see that Silvercorp is too overbought. That means that we've had a great run over the past little while and there is a good chance that we need to take a little breather. If this happens, I will try to pick up some more shares. However, I thought that this week would be that breather but I was wrong. The fundamentals for Silver and Silvercorp are so strong that it's very difficult to predict down days/weeks because there are so few of them compared to all the up days! I suggest you buy Silvercorp over many days/weeks and cost average your shares...or just buy all you can right away, tuck them in the back of your rrsp and send me a thank-you cheque next year when you've made mad money!

It's a Bull Market You Know!

2006-03-01T16:22:00.000-07:00

Our recent volatility and up/down market movements really remind me of a book I was reading recently: Reminisces of a Stock Operator.

This is an absolute classic containing hundreds of pages of priceless wisdom on how to make money in the stock market.

In one of the chapters, the master trader talks about how he would often see this old man buying stocks on down days. He asked him why he was buying and the man replied with nothing more than "it's a bull market you know."

And I think that's what we have in Canada here today. A full out bull market.

But before you rush out to buy Nortel or Bombardier, let me remind you it's not in all sectors.

The best sectors to be in right now are commodity ones. Everything that China and India and the USA need to grow and live. Things like silver, oil, uranium those are the companies you should be buying.

And although there is some more risk, I think you should be drifting towards smaller cap plays on these commodities. Smaller caps usually perform better than their larger compadres. Sure some of them will go bust but if you can get a couple 10-baggers, you'll be much better off.

So today we just regained everything we lost yesterday. Now the thing to take from this is to buy on the dips. And don't sell when it goes up, just stay on what you own. But when there's a down day, it could be a good time to buy a little more.

For example, today Silvercorp is up 4.1%, Connacher up 3.43%, Arawak up 6.29% and Playfair up 9.28%.

That's a fair chunk of my portfolio and it's looking really good since the start of the year.

I hope yours is looking good too.

If you need some ideas, I think Silvercorp is the best silver stock; Nova is the best speculative uranium play;connacher the best oil sands play;arawak the best kazakh oil play.

If anything, I'd just like to remind you to keep your cool when the market dips. And if you have some extra cash, sometimes it's not a bad idea to buy some more.

If you're the nervous type, just buy some of the best companies in each sector and sock them away and check only once a month on them. Then add to the positions if needed.

So although many of the companies will have corrections and slow times over the next year, I am very confident that they will be much higher at the end of the year.

Tim Hortons IPO Coming Soon

2006-02-28T12:31:00.000-07:00

Listen up everybody, the time to get back some of all that money you've spent buying coffee and donuts at good 'ol timmy's is coming very soon. Every Canucks favorite fast food hut is finally going public.

With only 29 million shares going live at first, the price will go up very quickly I'm willing to predict.

If they open at $21, I think they will close the first day at $25 at least.

Tim Hortons, owned by Wendy's, makes more money for its owner than the owner does. Tim Hortons is very profitable and growing very quickly.

Here is an article I read about the IPO today:

Tim Hortons wants to raise more than $600 million in its initial public offering, according to documents filed with U.S. securities regulators.

The iconic Canadian doughnut and coffee shop said it plans to issue 29 million shares, priced between $21 and $23, according to a prospectus filed on Monday with the U.S. Securities and Exchange Commission.
3-month trading

At those prices, the IPO would be worth between $609 million and $667 million Cdn.

The IPO is scheduled to go ahead in March.

The lead underwriters are Goldman, Sachs & Co., JPMorgan, RBC Capital Markets and Scotia Capital.

Under the plan, the stock will be listed on the New York and Toronto Stock Exchanges under the symbol THI. The TSX has already given conditional approval to the listing.

Wendy's International Inc. will continue to own 84.65 per cent of Tim Hortons' outstanding shares, or 82.75 per cent if the underwriters exercise their over-allotment option in full.

The company said proceeds from the IPO will repay debt owed to Wendy's.

Wendy's share price (NYSE:WEN) fell 41 cents to $58.25 US on the New York Stock Exchange on Tuesday morning.

The coffee and doughnut chain was founded in 1964 by Toronto Maple Leafs defenceman Tim Horton and Ron Joyce, a former Hamilton police officer and franchisee of the first store. Horton later died in a car accident after his Italian sports car hit a bridge abutment on Ontario's Queen Elizabeth Way.

The coffee and doughnut chain was bought by Wendy's in 1995 in a deal worth $580 million Cdn. At the time, the private Canadian company had 1,000 outlets across Canada and reported sales in 1994 of $600 million.

In 2005, Tim Hortons earned a profit of $191.1 million on sales of $1.48 billion.

Tim Hortons has proved highly successful in recent years. It now has more outlets in Canada than the McDonald's hamburger chain, and is growing faster than Wendy's in both the U.S. and Canadian markets.

If you want to read that US prospectus, click here. It's kind of difficult to read but that's the best I could find...

How to Buy a Piece of Stockhouse

2006-02-27T20:41:00.000-07:00

I’m sure you have all heard of Stockhouse. There’s also a very high probability that you visit that website quite often. At least I know I do.

It’s not a secret that the Stockhouse website is owned by Stockgroup. However, it seems to be a well-kept secret that you can buy Stockgroup shares on the TSX-Venture exchange right here in Canada.

I’m a pretty well connected guy and I know of many quirky and unusual companies but I only today found out that you can buy a piece of Stockhouse. So how many ordinary investors know of this fact? Very few I would suggest.

But this is to our great advantage. There is an opportunity to buy into the Stockhouse dynasty very cheap, very early.

After all, the stock is only trading at $0.40! The market cap is only $13 million!

If Google can fetch astronomical P/E ratios why can’t Stockgroup?

Well for one (in my brief research on it today), they aren’t profitable yet. They posted a $0.01 loss per share in the last quarter.

But all is not lost. They claim that they have a current record of posting 9 consecutive quarters of increasing revenue. They will soon turn profitable and if they even earn $0.01/share for the next 4 quarters, that will equal at P/E of only 10x. That is very cheap indeed.

Online advertising is growing 30% every year according to their CEO and he believes that their Stockhouse website will be able to ride this wave.

One more thing that is great for investors is that the CEO claims that Stockhouse has a 90-95% market share on Canadian stock message board traffic. I’m not sure that’s accurate but if it is, that’s a near monopoly. And monopolies are great at rewarding investors.

So while I can’t put out a “buy” recommendation on SWB yet, I can recommend you to put this company on your stock symbol watch list. Like I said, I only started researching this company today so I have a limited database in my head on them. However, in the coming weeks I will try to put more info out there for you so you can decide whether or not SWB would look good in your portfolio.

Company Snapshot

Silver IPO--Maybe Not....

2006-02-27T11:23:00.000-07:00

Reuters news service put out this today:

UPDATE 1-Chile's Codelco denies silver IPO report
Mon Feb 27, 2006 12:07 PM ET

SANTIAGO, Chile, Feb 27 (Reuters) - State-owned Codelco, the biggest copper miner in the world, denied on Monday a newspaper report that the company was readying a $1 billion spin-off of silver assets into a new company to be listed on the Toronto Stock Exchange.

"It's not true. It's not true that Codelco is going to list $1 billion (of silver assets)," Codelco spokesman Ivan Badilla told Reuters.

Asked whether the company was planning to spin off its silver assets into a separate company without selling shares in that new company, Badilla said "no comment."

Citing unnamed Canadian financial sector sources, Toronto's Globe and Mail newspaper said in a report on Monday that Codelco had auditioned investment bankers in New York to lay the groundwork for an initial public offering this year.

Codelco, which produces some 1.8 million tonnes of copper a year, produces only a small amount of silver, as a copper by-product.

Codelco's first mainly silver project, the Puren mine, is to enter production this year. Codelco owns 35 percent of Puren, and two Canadian companies, Placer Dome (PDG.TO: Quote, Profile, Research) and Kinross Gold Corp., hold 65 percent of the mine through their company Mantos de Oro.

Puren is seen producing some 30 million ounces of silver and 100,000 ounces of gold in its initial, two-year mine life plan.

The mine will begin operating this year and is expected to produce 12.9 million ounces of silver this year.

The company may just be coy.

BTW on a down day for silver, Silvercorp was as high as $10.27, blowing by SLW.

New Silver IPO:

2006-02-27T10:18:00.000-07:00

If this new IPO is succesful, it will help push Silvercorp even higher because it will create more publicity for Silver companies. Nice day up for Silvercorp today by the way!

SINCLAIR STEWART AND ANDREW WILLIS
Monday, February 27, 2006

The world's largest copper producer, state-owned Codelco of Chile, is preparing a $1-billion (U.S.) spin-out of its silver mining assets that is expected to create a new company listed on the Toronto Stock Exchange.

The Santiago-based company auditioned investment bankers over the past two weeks in New York as it laid the groundwork for an initial public offering later this year, according to financiers vying for the business. Codelco is capitalizing on the fact that silver bullion prices have doubled in the past four years, with the precious metal changing hands Friday at $9.59 an ounce.

Silver and gold are afterthoughts for Codelco, which produces 40 per cent of the world's copper. The company estimates it will spend $12-billion expanding its copper mines over the next four years, and an IPO of its silver assets would help pay these bills.

At least five Canadian brokerage houses, along with several global investment banks, pitched for a starring role in the IPO, which would likely pay out more than $20-million in fees. Investment bank N.M. Rothschild & Sons Ltd. is supervising the selection of financial advisers, sources said. Codelco is expected to select an investment bank within two weeks, with an IPO to follow.

"This would be a real coup, to have a new, billion-dollar mining company arriving on the TSX," said one Canadian financer pitching Codelco. The new silver company is expected to list its shares on some combination of the TSX, New York Stock Exchange and AIM, an arm of the London Stock Exchange. Officials at Codelco could not be reached for comment.

More than half of the world's mining companies -- more than 4,400 stocks -- are listed on either the TSX or the Calgary-based TSX Venture Exchange.

Codelco does not disclose its silver output, but it is one of the world's top 20 miners of the precious metal.

The Silver Institute, a Washington-based industry association, estimated that the Chilean company produced 9.6 million ounces in 2004, good for 16th place in the ranking of international silver miners.

One of the largest silver-focused mining companies on the TSX is Pan American Silver Corp. It turned out 11.2 million ounces of the metal in 2004, and commands a $1.8-billion (Canadian) market capitalization.

Vancouver-based Pan American also lists its stock on the Nasdaq Stock Market, an American exchange.

Though Codelco is government owned, a company-commissioned study by Goldman Sachs & Co. last year pegged its value at between $24.5-billion (U.S.) and $27.5-billion. In 2004, the company posted a $3.3-billion profit on sales of $8.2-billion, and it has 16,700 employees.

Prior to the 1990s, Codelco had a monopoly on mining in Chile, but the market has now opened up.

In addition to producing silver at wholly owned mines, Codelco has partnered with two Canadian companies on Chile's Puren mine, slated to begin production later this year.

Codelco owns 35 per cent of the project, which is expected to churn out 12.9 million ounces of silver in the first year of operation, and more than 50,000 ounces of gold.

The remaining 65-per-cent stake is held by Mantos de Oro, a joint venture between Kinross Gold Corp. and Placer Dome Inc.

Worldwide silver supply was 879.2 million ounces in 2004, according to the Silver Institute, which also says that demand for the metal has outstripped supply for 14 consecutive years.

Demand for the metal comes primarily from bullion-buying investors, jewellery and silverware manufacturing, industrial applications and photography, with the latter a declining market.

The commodity's hot run in the past few years has come in part on the back of other metals.

A recent Silver Institute report said: "Silver has never really enjoyed the 'safe haven' status that gold possesses. However, its linkage to gold and the base metals meant silver was often an attractive home for speculative capital since it was perceived as likely to ride the coattails of any rally in these other markets."

© Copyright The Globe and Mail

P.D.A.C. Conference Mar. 5-8

2006-02-26T21:26:00.000-07:00

That is, the Prospectors and Developer's Association of Canada; and
their annual conference is in Toronto from Mar 5-8.
If you want to see who is going to be where in the mining conference world,
go to:

http://www.exhibitorresearch.com/s/iSearch.asp

and explore the permutations on the site.

Indubitibly, the mining stock hype machines will go into gear in the next two
weeks, which should be good for our share prices, depending, of course on the
usual geopolitical randomising factors.

How To Squeeze All You Can Out Of My Site....

2006-02-26T14:27:00.000-07:00

Since DCSB is growing very quickly and attracting new readers every day, many of these new readers might be a little behind in what sectors I like and what are my favorite stocks.

Here are 5 tips for you, the reader, to squeeze as much out of this site as possible:

1. You must download the Firefox internet browser. Most people are still using the inferior Internet Explorer which does not display my pages properly making my site look like a pre-schooler designer it (which I can assure you did not happen). Firefox is safer, faster, blocks pop-ups, viruses and spyware. Please download it using the link below this post and I guarantee you will never go back to Internet Explorer again!

2. Use the search tool bar at the top of the page. For example, try searching about silvercorp and you will see all the past articles that I have written about them.

3. Browse old articles in chronological order: There are almost 150 articles in the archive spanning over 3 months and if you read them all in one day, I guarantee you will be a millionaire next year. Actually I can't guarantee that but I do guarantee you will learn something new....about investing and some potential companies you can slot your money into..(To do this simply click on the Archives link in the right hand toolbar.)

4. If you like what you're reading here, subscribe to the daily email updates. This is not spam at all if that's what you were afraid of. It is simply one email sent every day with a summary of what I wrote about in the previous day. If you want to read the entire article, simply click on the link and it will bring you to my page with the article. Using this service will make sure you never miss any one of my articles, pieces of news or stock profiles. If you really like what you read, feel free to forward these emails or tell you friends to subscribe themselves.

5. If you're not an email type person, I also have a rss/yahoo/google feed powered by feedburner that you can use any rss reader you use. If you don't know what these are, no worries, just use the email update option.

Remember, just click the "Get Firefox with Google Toolbar" button below right now to start browsing the web faster. Not only are you helping yourself but you are helping me out a little because I get 50 cents for every download.

Re: The Cathy Factor

2006-02-26T11:31:00.000-07:00

qbit suggested that Cathy would want to get me killed for giving her email address out. Au contraire my friend!

I expect that she be extremely happy because I am letting potential investors know about her company. If those investors decide to buy Silvercorp, they knock the price up.

I'd like to remind you that according to Sedi files, she now owns 350,000 shares herself!

When you know about this information, I think it is easy to figure out why she is trying so hard to inform every investor that contacts her.

For your information, every $2.86 move in the stock makes her another million dollars. If you knew this was the case, wouldn't you try to do everything legally possible to get the share price up?

On a second note, there were 2 comments asking when would be the best entry point into Silvercorp.

To tell you the truth, it is impossible (except by luck) to pick the "perfect entry point".

All I can tell you is that Silvercorp will be much higher by the end of 2006. I am suggesting a $17 price target.

Is that too high? I don't think so. Silver Wheaton trades at ~50x p/e. Silvercorp is on track to earn around $35 million next year so for them to trade at those multiples, their share price would have to rise to around $40.

Now I'm not going to say my target price is that number because that seems awful high right now (even 17 is pretty outlandish). But rest assured that if things keep going well, I can always raise my target price.

I threw that $17 number a month ago when Silvercorp was around $6/share. It seemed high then but now seems more feasible with their price flirting really close to $10.

But there are too many catalysts over the next year that can boost the price: Amex listing, more land acquisitions, permit approval, good press, more great vein drillings, silver going up etc.....

So although it would make sense for Silvercorp to take a breather after a strong week or two, often stock movements don't make sense.

If you're dealing with enough money, don't buy all at once. I suggest you buy some on monday. Then see what happens and add more as you see the price moving up.

Of course, you're responsible whether you make money or not, I am just putting this information out there for you to digest and use it as you see fit....

The Cathy Factor

2006-02-25T23:02:00.000-07:00

If you been reading my musings a while, you know by now that my favorite silver stock is Silvercorp. (t.svm)

I believe they are massively undervalued compared to peers and they will continue to rise, especially when they finalize their mining permit and begin production.

But a lesser known cause of silvercorp's rise I feel is their IR person: Cathy Fong.

I have been phoning many IR people of junior exploration companies and I've had experiences all around the board. Most are either average or terrible.

The two best IR people that I've dealt with so far have been Nova Uranium's and Silvercorp's. (Nova was good but Cathy was even better).

Cathy tries very hard and she will spend as much time as it takes to explain all the aspects of Silvercorp's operations.

Does IR quality affect share performance?

I think so! Nova and Silvercorp are among my best performing picks.

Although you have probably read my Silvercorp IR notes, reread that article if you haven't invested in silvercorp yet.

Better yet, email Cathy for yourself: cfong@silvercorp.ca She told me that's the best way to get a quick response from her.

She has a blackberry by her side all the time so you should definetely expect a reply within 24hrs. In my experiences it has been much quicker.

Glamis to buy Western Silver for $1.2-bln

2006-02-24T13:53:00.000-07:00

Glamis Gold Ltd. said it struck a deal to acquire Western Silver Corp. for about $1.2-billion.

Each Western Silver stockholder would receive 0.688 of a Glamis common share and one share in a new exploration and development company for each Western Silver share.

Vancouver-based Western Silver would transfer to the new company about $38-million in cash, its interest in the Carmacks copper project in the Yukon and an early-stage exploration project in Mexico.

The transaction is still subject to completion of a definitive agreement, approval by Western Silver shareholders and the receipt of regulatory approvals.

“Western Silver's Penasquito project is a world-class development asset that will significantly increase our gold and silver reserves and extend our sector-leading growth profile,” said Kevin McArthur, chief executive of Glamis.

The boards of directors of both companies have unanimously approved the transaction.

This is a very smart acquisition by Glamis. They are buying silver assets while they are still cheap. This will look like an absolute steal in a year or two when we look back.

Silver should top $10 within months and although gold should move up as well, I think there is more upward potential in silver because there is less of it yet more demand than gold.

The best silver company right now though is silvercorp. Today it's up another ~10%. This is a beast but it's still so cheap compared to its peers like silver wheaton.

Just a reminder that I first told you about Silvercorp on Jan 26. Guess how cheap it was back then...yup, only $5.82! Assuming a close of $9.42 today that would give you a return of 62%! That's great in such a short period of time because silvercorp is a larger cap pick than some of my other picks that have done wonderfully well too.

Next week, I expect a bit of a pullback on silvercorp (because it's gone up lots recently) so if you haven't established a position is should be a good time to do so.

Also, I strongly recommend you read my IR notes about silvercorp that will tell you about the company.

Saudi Refineries Target in Failed Suicide Attack

2006-02-24T12:35:00.000-07:00

LONDON (Reuters) - Oil jumped more than $2 on Friday after news of a suicide bomb attack at the huge Abqaiq oil facility in Saudi Arabia, which triggered worries about supply from the world's top crude producer.

At least two cars exploded at the gates of the Abqaiq site when security forces fired on suicide bombers trying to storm the facility in the country's eastern province.

"It's all about perception. Just the idea of an attack in Saudi Arabia is enough to make the market jumpy," said Glenn Murray, an oil broker at GM Oil.

Saudi Oil Minister Ali al-Naimi described the raid as a "terrorist attempt" but said oil exports had been unaffected. He said a limited fire at the site was being brought under control.

"This incident had no impact on oil and gas production in the kingdom," Naimi said in a statement carried by the official Saudi Press Agency. "The plant continued production at full levels and export operations are as usual."

Most Saudi oil is exported from the Gulf via Abqaiq which handles about two thirds of the country's output.

"This just emphasizes fears over global oil supply security when we're already facing major ongoing risks in Nigeria, Iran and Iraq," said Gary Ross, CEO at PIRA Energy consultancy in New York.

U.S crude prices hit a high of $63.00 a barrel, up $2.46. They later eased back to $62.88 at 1920 GMT.

London Brent was up $2.04 at $62.58 a barrel.

U.S. blue chip stocks edged lower after the surge in oil price which revived worries about high energy costs and inflation.

TUGGED BY TWO FORCES

Oil prices had risen a dollar earlier Friday as fears of deeper disruptions to Nigerian exports overshadowed the comfort drawn from brimming fuel stockpiles in the United States.

Attacks on Nigeria's oil network have already forced Shell to cut output by 455,000 barrels a day, shutting in a fifth of the country's exports. Militants holding foreign oil workers hostage say they will continue attacks in the next few days.

But oil's upside may be limited by brimming U.S. fuel tanks. Gasoline stocks rose to 225.6 million barrels, the highest level in seven years, according to weekly data. Crude stocks rose 1.1 million barrels to 326.7 million barrels.

"The market is being tugged by two forces -- data are pulling it down and political forces are pulling it up," said independent oil consultant Geoff Pyne.

Aside from tension in Nigeria, traders said Iran's nuclear ambitions and the possible ramifications for the nation's oil production also remained a worry.

The board of the International Atomic Energy Agency (IAEA) meets on March 6 to discuss the next step in resolving Iran's nuclear row with the West.

Iraq, which has been struggling to get oil output back to pre-war levels, is suffering the worst sectarian violence since the fall of Saddam Hussein, compounding the geopolitical risks in the Middle East.

Pretty scary stuff. They failed this time but you can be sure they will try again soon when everyone least expects it. Oil jumped up to 4% but it's cooled down a little since then.

But when/if those terrorists are succesful, there will be a oil superspike. Make sure you have some oil in your portfolio as a hedge. I own connacher (cll) myself...

Pescod on NUC and Playfair

2006-02-24T08:48:00.000-07:00

--but FIRST, look a Silvercorp--$9.20 today so far....
Also, Cathy Fong, Vice President for Corporate Development, and the PR person for
Silvercorp, has to be one of the nicest and most responsive corporate people on the
planet. Her responses to my emails have been delightful.

Regarding the note below: One caveat is that David Pescod works for Cannacord, and
700,000 shares of NUC become free trading on Feb 26. I dont think that will affect the price very much or at all, and I suspect the drilling results will only be afew
more weeks or so.

David Pescod's Late Edition February 23, 2006

NOVA URANIUM (V-NUC) $3.56 +0.04
PLAYFAIR MINING (V-PLY) $0.95 +0.01
WOLFDEN RESOURCES (T-WLF) $3.80 n/c
It’s probably getting a little scary. I swear, at cocktail parties
they are starting to talk about things such as the price of zinc, tungsten,
molybdenum and uranium. Who would have thought? But
obviously, people gravitate to whatever is hot and moving and let’s
face it, commodities have been. Even with the recent correction in
the junior resource sector, there are still pockets that are creating
excitement.
As we look at commodities, we note building inventories in copper
which suggests it may be near a peak, molybdenum prices have
dropped dramatically as production increases, but elsewhere it
looks like tungsten prices continue to go through the roof and with
zinc inventories dropping dramatically seemingly everyday, we
wouldn’t be surprised to see if after a correction, zinc start flying
again. This week we have yet another rise in the price of uranium
which steadily-eddily just keeps going up.
When you get to hot, there’s probably no one hotter these days
than Don Moore. The Vancouver Mining Man is the driving force
behind both Nova Uranium, just about to start drilling on their Mont
Laurier property in Quebec and Playfair Mining, which has put together
a package of very prospective tungsten plays that have
made him one of the most watched-guys in Vancouver mining circles
these days.
Don’t get the impression that he totally walks on water though.
There is always Rupert Resources to bring him back to reality.
Rupert Resources was the junior explorer looking for gold in the
Red Lake Camp which was trying to do it in a different way. They
were using new rig technology to drill from surface to depth almost
never drilled before of almost 6000 feet. The technology has
caused endless grief and they still don’t know what they have or
haven’t got on that play. What they do know is that they have a lot
lower stock price.
As to Nova Uranium, after the volume and the recent spike in the
stock, Don is more excited than ever. While he does have a bit of a
promotional side, he’s never given us a target on the play (unlike
Eric Coffin who has been quite bullish) and says simply that they
have labs lined up so that when they do start drilling, they’ll have a
very quick turn around.
Remember, this was drilled three decades ago and came up with some
rather significant results when people last cared about uranium prices.

So he suggests that within three weeks of the drills first turning,
they could have results on the first ten holes and one should know
then whether they are able to replicate results from three decades
ago...or not. Then he will give us a price target for the stock. That
would be about March 20, 06…..we’ll know if this is a hit or not…...
The one thing appealing to our sense of greed with NUC, is leverage.
It only has 17 million shares outstanding, so if they hit this
could be ultra-successful. Compare that to Paladin with 400 million
shares outstanding, UEX with 180 million shares outstanding…...
Meanwhile, being one of the more intriguing guys in the mining
industry these days, we ask him our favorite question. “If you
could only buy one mining stock today (other than your own and
not something that you are a director or otherwise have conflicts
in) what would it be?” And of course, we need at least a double!
Anything less than a double means that you owe us a bottle of
scotch (or a trip to Mexico).
Moore suggests Wolfden Resources and is quite confident about it.
With zinc/copper prices doing well and gold not doing so badly
either, he suggests that Wolfden’s recent deal to pick up the assets
of Inmet Mining Corp - the Northern Canadian zinc/copper projects,
plus having the gold assets in Red Lake camp and deciding to split
the company up means that the two smaller companies will probably
be worth more than the one larger company.

The Speculator's Secrets

2006-02-23T11:05:00.000-07:00

I was able to find the official publication of the 2006 Vancouver Resource Investment Conference.

Best of all, it's online so y'all can read it!

The first article there is a very good one by Doug Casey.

"An investor risks 100% of his money in the hopes of receiving a 10% gain. A speculator risks just 10% in anticipation of earning 100%"

This is a great motto and we should try to live by it.

Read the rest of the issue here.

Oh, and I think you'll be happy to see Nova's full page ad on pg. 29.

Two 100% returns:

2006-02-22T20:13:00.000-07:00

Nova really had another stellar day today. There are a lot of people watching this stock and many are starting to establish positions. The only problem is that Nova has a very small float. Big volume can easily push the stock up 17% in one day just as we saw today. My fearless prediction is that Nova will go up to ~$4.50 before settling at a new plateau around ~$3.50-4.00 until the next news releases start coming out with drill results. 2006 will be a very rewarding year for Nova investors. Are you one of them?

Arawak Energy, one of my Kazakh oil picks, moved up 11% today. They closed at $3.46. Remember though, I first told you about this company on January 4th. They were trading at $1.73 back then. Today's close makes for a 100% return!

Nova close of $3.52 makes for a 120% return since I told you about it on December 23.

Playfair Mining is another company that I'm very bullish on for 2006. Today's close puts them at a return of 84% since I recommended them on January 19th. They were up well over 100% but have recently cooled down a little. I don't mind because I sold half my shares at a 120% gain a week or two ago. But I'm confident my other half will still perform very well over the next year or two.

I hope I can tell you about more stocks that will give you returns like that but no guarantees! ;)

My Focus--Or Qbit's Two Bits....

2006-02-22T11:31:00.000-07:00

For what it's worth, my focus ( entirely personal and not a blog pronouncement from
a burning bush) is on SVM for silver, NUC, for uranium, and, surprisingly, on ABG
and CEK, for oil.( I still have the others, including CLL, and they are fine).
It is just that I see SVM and NUC as having the greatest prospects for a blowout.
And, AGB and CEK-- have been quietly increasing their SP in the wilds of Kazakhstan.
One never knows with commodities, but thats my take; and, to paraphrase Chevy Chase, the news anchor on Saturday Night Live, " I'm QBIT and you're not".

The Silver ETF Battle Rages On....

2006-02-22T08:51:00.000-07:00

The Silver Fund Battle Continues
February 21 2006 - Australasian Investment Review – (AIR)

"Last November, AIR reported on attempts by Barclay’s Global Investors to introduce an exchange-traded silver fund (or a silver ETF) in an attempt to capitalise on the success of equivalent gold ETFs.

In response, the US Silver Users Association (SUA) was up in arms from what it predicted would be a resultant substantial silver price-hike.

This expectation is based on the effect gold ETFs have had on the gold price. Put simply, if the silver EFT has anything like the success of the gold ETFs then suddenly Barclay’s will need to buy more silver than actually exists.

Not surprisingly, SUA anticipates this will mean the collapse of the silver jewellery industry as it will be priced out of existence, and this means manufacturing bankruptcies and loss of jobs. Representatives of other areas of silver usage have also registered their fears. SUA goes as far as to say it would have a negative effect on the US economy.

The Securities and Exchange Commission has tacitly approved the listing of the Barclays ETF on the American Exchange, pending the outcome of a 21-day period of public comment. SUA is using this time to state its case emphatically.

The editor of the independent Silver Stock Report suggests SUA has actually got the whole story exactly backwards. Rather than causing job losses at Tiffany’s, a rise in the silver price would likely open new mines and reopen new mines deemed unfeasible at the current price. In other words, the laws of demand and supply will prevail.

As part of its defence, SUA has made a point of saying it supports the buying and selling of silver for investment purposes, and highlights existing means of so doing.

The Silver Stock Report finds this amusing, as SUA is actually making its own bullish case for the metal.

History would suggest SUA is on a hiding to nothing. Opponents of any form of financial derivative or paper-trade equivalent are scattered like dust on the roadsides of the greatest capitalist nation on earth. Notwithstanding, if SUA is right, and the SEC is nevertheless happy to proceed, why hasn’t the silver price already shot up?

In fact it has risen since our article in November, but only in its traditional tracking of the gold price. Like gold, it has corrected this month, despite the SEC’s tacit approval for a silver ETF. One can fairly predict that the ETF will go ahead.

Next in line are platinum and palladium. More fun."

NUC onTarget

2006-02-22T08:47:00.000-07:00

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Feb. 22, 2006) - Nova Uranium (TSX VENTURE:NUC) is pleased to announce that it has received the required land use permit to initiate Phase One of its planned drill program on the Nova "A" and "B" zones at it's Mount Laurier Uranium Property.

Access roads are currently being cleared for Benoit Diamond Drilling's mobilization onto the property. The Phase One drill program, a planned 30 shallow (up to 100 metres deep) vertical large diameter core drillholes on the Nova "A" and "B" zones, will commence prior to month end.

Nova has received preliminary results of the property-wide Terraquest airborne radiometric survey which was flown in late October 2005. Combined with the November 2004 Sander Geophysics airborne radiometric survey, most of Nova's extensive property has now been surveyed. These geophysical surveys have successfully confirmed the location of surface uranium showings reported in historical documents and have also identified a number of new target areas. As a direct result of the recent survey, Nova has staked an additional 80 claims, increasing the size of the Mont Laurier Property from about 180 square kilometres to 228 square kilometres.

In addition to drilling the Nova showing, Nova's exploration program will involve follow up of the additional known 20 surface uranium showings on the property and investigate airborne radiometric and ground geochemical anomalies.

Nova's primary target is a straightforward and safely mineable open pit bulk tonnage uranium deposit with good access and infrastructure in the mining friendly regulatory environment of south central Quebec, Canada

ALSO: apparently the "6 Feet Under" Coffin brothers recommended Nuc again in Hard
Rock Analyst ( from BB--I dont have a subscription).

Petro Field Industries Report

2006-02-21T10:35:00.000-07:00

Ok, here's the stock I was teasing you with.

To me, it looks like a very small but very cheap, profitable oil & gas parts manufacturer.

This time, I made a fancy pdf file for your viewing pleasure: click to view

I was looking for a drilling company but this one looked too nice to skip over. I will keep looking for those drilling companies though.

(If for any reason that first link does not work, here is a second server: click to view)

It's Back!

2006-02-20T15:03:00.000-07:00

The raging canadian bull market that is.

Silvercorp was up over 13% today as was my oil fabrication company that I will tell you about tomorrow.

I am putting the finishing touches on my report on them but I want to make it look really nice for you guys.

Silvercorp is really moving well I must say. It exploded past my $8 target for the end of february so my new target for the end of the month is $10.

This is one of the most undervalued companies in canada I think.

I think we are discovering them very early in the run upwards.

It might take up to a year for silvercorp to begin to get its name published in the newspapers and on TV. Then the masses and mutual fund boys will start to buy but by then we will have the opportunity to continue to ride up on free shares (if you decide to sell half at a double).

On a side note, I hope you didn't sell much during that ugly correction we had. I told you to keep your cool and if you did, there should be some big smiles on your faces. We will continue to move higher because all those nervous fools who sold a week ago out of fear are now rebuying even more because the market is going higher again.

If you did sell, don't worry, you're only a fool if you don't learn from your mistake. Next time we get a correction like that (and trust me, there'll be many to come still), don't sell; hold tight or if you have cash, buy more!

Enron

2006-02-19T17:11:00.000-07:00

I watched Enron: the smartest guys in the room today and I was quite impressed.

This documentary was produced by Mark Cuban about the Enron bankruptcy.

It talks about how Enron cooked thier books and defrauded millions of investors for billions of dollars.

There are many insider tape and documents revealed that will shock you how a public corporation could have done such things.

Looking back, you could have made a killing shorting enron's stock from at least over $50 to $0!

We'll have to be on the lookout for the next enron so we can profit on the way up and when things start to get bad, short them.

Stock Idea...

2006-02-18T18:19:00.000-07:00

Psst, if I told you I could tell you about a oil & gas parts fabricator in Calgary that has 23% margins, insiders own more than 42% of the float and it's trading at only 5x P/E, would you be interested? How about if it was a buck a share?

How much would you pay for that information? $100? $500? $1000? Ok, maybe not but I'm sure you'd like to know if I told you for free right?

Well I will tell you what it is. But I just need a couple more days to do a proper write up on them.

I am pretty sure they will have a great year that will reward shareholders very well...

Solid Day Up

2006-02-17T21:34:00.000-07:00

Today we had another day up on the TSX.

I'm feel pretty confident that the worst of our little correction is over. We should resume our solid up trend.

Here are some of the movers out of my recommendations:

connacher - up 4.98%
playfair - up 10%
urasia - up 7.6%

Most other picks were up a couple %.

I've been reading the Financial Post quite a bit this week and there wasn't much that caught my eye.

The only thing that interests me is that nearly every large cap oil/nat. gas company said in its earnings that their profits are being weighted down a little by drilling costs inflation. If I remember correctly, Encana said they are looking at 18% inflation in drilling for 2006.

That will probably be on the low side. This weekend and next week I will try to do some research on drilling stocks.

The thing that is so great about drillers is that they make money wheather the company they are drilling for makes money or not. They're like Levi Strauss during the Gold Rush in California selling jeans.

Stay posted for my drilling research in the next couple days!

More on Silvercorp:

2006-02-16T19:32:00.000-07:00

Qbit already mentioned today how well Silvercorp did. I want to elaborate a little and refresh your memories about Silvercorp's very bright future.

Silvercorp's goal this year is to earn just under $35million in profits. Of this, they plan to spend around $5million to earn another $50 million the next year. Their philosophy is to spend a dime, earn a dollar.

And remember, this is just off their first few veins at the Ying project. There are some rumours that they will be buying more land in the ying area. Cathy told me they were looking into acquisitions in within the next few years because there is a 5 yr. window to get good properties in china for a fair price so don't be surprised if we hear about new land acquisitions in the next few months.

Assuming, silvercorp does earn $35million this year, that will amount to around $0.80 in earnings per share. Based on today's price, they are trading at 9.2 times future earnings. That is mega cheap!

Silver Wheaton, another great silver miner, is currently trading at 52 times earnings.

If Silvercorp were to trade at the same multiples, they should be at $41.60 next year!

I hate to write that high targets but if I am to compare silvercorp to its peers, that's what I get.

So will silvercorp go that high?

I don't know; I sure hope so because I own a lot of shares but according to these very simple calculations, It could well go to $40. Maybe not this year but the next?

Bottom line is that Silvercorp is going higher, way higher.

Remember, I first recommended silvercorp on Jan 26 at 5.82. Now it's a 7.36, a new 52-week high. If you bought then, you'd already be up over 26%! Not too shabby after this nasty correction.

Make sure to read more info on silvercorp on these previous posts of mine: 1 2

Silvercorp DId Very Well Today

2006-02-16T14:02:00.000-07:00

As did SLW. There still are probably more headfakes with silver and gold, but
Silvercorp seems to be quite tightly held, and there is not alot on offer
in the sevens. Silvercorp, remember, also isnt a one-trick pony---one of their
aims is acquisitions.....( in addition to a mine that is like a "silver brick road".).
All the preliminary environmental permits have been ok'd, and they are waiting on
the mining permit ( within 40 days hopefully).

Collapsing Natural Gas Prices?

2006-02-15T20:02:00.000-07:00

National Post had a big article today on the front page of the Financial Post with the title: Natural Gas Flames Out.

To me, it has a very scary tone as if the price is going to collapse.

I DON'T BELIEVE IT!

The cold weather has started and even though a stupid energy analyst says that even a cold last 7 weeks of winter won't push price back up.

I think he's dead wrong. I think within the next few weeks we will have cold weather all over to make up for all the warm we've had so far.

The price should go up to around $10.

The main reason why I think this way is because whatever the analysts and media say, usually the opposite happens. They think the price will stay low, so I think it will go higher.

It might too early to buy natural gas now because remember, you're still dealing with a down trend. You never want to be against the trend. But when the trend reverses, you can be sure there will be some great gains to be made.

Link

Speaking about trends, the market keeps trending lower. It looks like I was right saying yesterday was just a sucker's rally. It might be a tough one or two more weeks but it will create a very solid base upon which we can climb past our all time highs.

It's nearly impossible to make any money short term right now unless you're going short.

My portfolio is consistently shrinking in size but I'm still holding tight. Anytime you want to push the sell trigger, think about October 2005.

That was one tough month but after we got through it, we had around 3 months nearly straight up!

Only a Sucker's Rally?

2006-02-14T17:15:00.000-07:00

Today we finally had an up day on the TSX.

My gut instinct is that this is just a sucker's rally. That means it will be one more day up maybe and then we go still lower.

I would rather be wrong than right but that's the way it looks to me right now.

I will be able to say some more maybe tomorrow.

Silvercorp had a very nice pop today; over 6% up. Qbit posted the good news earlier on. So now if I understand correctly, we wait up to 40 days and we will know wheather the mine permit will be granted or not. Judging by the management's preparations though, we shouldn't have too many difficulties.

My 40 day target on silvercorp now is 8$.

Silvercorp Update

2006-02-14T08:35:00.000-07:00

This is good news and definite progress re: the final permit.
I should have bought yesterday again, but have been looking, as has Mike for a
"sucker's rally".
Management is really on the ball at this company. I am impressed.
Silvercorp Metals Inc.: Environment Assessment Report for Developing the Ying Silver Project Receives Approval-Mining Permit Application Accepted for Filing
2/14/2006
VANCOUVER, BRITISH COLUMBIA, Feb 14, 2006 (CCNMatthews via COMTEX) --

Silvercorp Metals Inc. ("Silvercorp") (TSX:SVM) is pleased to announce it has received approval from the Department of Environment Protection Bureau of Henan Province, regarding the Environmental Assessment Report ("EAR") for mining and development of the SGX area of the Ying Silver project. The proposed mine development area covers the approximate 9.97 square kilometers (km) that has been the focus of Silvercorp's exploration and development effort, where over 25 km of exploration and development tunnels plus 11,500 metres of underground and surface drilling have been completed to date.

The key reports and their filing or approval required by regulation for the issuance of the mining permit were reported on October 3, 2005. The current status of these reports are:

1. The Resource Utilization Plan ("RUP") Report has been reviewed by an independent engineering firm certified by the Ministry of Land and Resource, with the Health and Safety section of the Report reviewed by the Provincial Safety Production Bureau. As required, the RUP together with positive review conclusions have been filed with, and accepted for filing by, the Henan Province Department of Land and Resources ("DOLAR");

2. The EAR has been completed by qualified engineering firm and has been reviewed and approved by a government-appointed independent review panel together with environmental protection agents from county, municipal, and provincial governments. The EAR has been submitted to and approved by the Environment Protection Bureau of Henan Province; and

3. The Geological Hazards Assessment Report has been prepared by a qualified geo-engineering firm and reviewed by a qualified third party, with the report and its approval filed with, and accepted for filing by, DOLAR.

With the completion and approval of all these required documents, including the key EAR, Silvercorp's subsidiary, Henan Found has filed the mining permit application with DOLAR. DOLAR has accepted the filing of the application, and in accordance with the Mining Law of China, now has 40 working days after accepting the application to make a determination on the issuance of the mining permit.

SILVERCORP METALS INC.

Silver Wheaton --Update

2006-02-13T19:53:00.000-07:00

Here are two News releases:

1.

Silver Wheaton to buy more silver from Goldcorp
Mon Feb 13, 2006 7:18 PM ET

TORONTO, Feb 13 (Reuters) - Silver Wheaton Corp. (SLW.TO: Quote, Profile, Research) will buy more silver production from Goldcorp Inc. (G.TO: Quote, Profile, Research), both companies said on Monday.

In return, Silver Wheaton will issue a $20 million promissory note as well as 18 million shares to Goldcorp, increasing the gold producer's stake to 62 percent.

© Reuters 2006. All Rights Reserved

2.

VANCOUVER, BRITISH COLUMBIA, Feb 13, 2006 (CCNMatthews via COMTEX) --
Silver Wheaton Corp. (TSX:SLW)(AMEX:SLW) -

FOURTH QUARTER HIGHLIGHTS

- Net earnings of US$7.0 million (US$0.04 per share) for the three months from the sale of 2.2 million ounces of silver (four months ended December 31, 2004 - net earnings of US$1.8 million (US$0.02 per share) from the sale of 1.5 million ounces).

- Operating cash flows of US$7.7 million (US$0.05 per share), compared to US$8.4 million (US$0.09 per share) in 2004.

- Cash and cash equivalents at December 31, 2005 of US$117.7 million and working capital of US$118.7 million (December 31, 2004 - US$20.0 million and US$18.1 million, respectively).

- In December, 2005, the Company raised gross proceeds of US$86 million by way of public offering.

- The Company is debt free, unhedged and seeking further acquisitions.

During the year ended December 31, 2005, the Company generated net earnings of US$25.3 million (US$0.15 per share) from the sale of 9.7 million ounces of silver (four months ended December 31, 2004 - net earnings of US$1.8 million (US$0.02 per share) from the sale of 1.5 million ounces). Operating cash flows for 2005 were US$30.0 million (US$0.18 per share), compared to US$8.4 million (US$0.09 per share) for the four months ended December 31, 2004.

I will continue to watch silver prices for afew more days, and then may either
buy SLW warrants or SVM when I believe that the selloff is over (easier said than done...).

Tough Market out There!

2006-02-13T17:52:00.000-07:00

Boy is this market looking more and more like October 2005! Fifth down day in a row!

But I'm not selling. I may be down on my new buys, but i'm not worrying at all. I might lose another 10-20% but I know that the market will rebound.

And it will do so at the moment you least expect it.

So my guess is that I won't be able to time that, so I'll just stick to my positions.

It might look bad short term but in a month or two I'll be smilling and in the black.

You see, I lost 30% in potential gains from my iunit xeg buys after october because I sold them then. This was a mistake I made, but if I learn from it, it was a good mistake to make.

Then just as now, it was scary to me. Almost everything you see is down. It is very hard to make money right now.

But I am very sure that in a month we will be testing those 12,000 tsx highs again and everybody will forget about this hard time. It will be resource mania all over again.

I wouldn't say to buy yet because like I said, it looks like there might be some more downside all around. But in a week or two I think it might be time to whip out the wallet and start bottom fishing for majorly oversold stocks!

The sky is not falling down! This is just people acting irrationally and panic selling.

O' Canada, Can We Have Alberta?

2006-02-12T23:03:00.000-07:00

I stumbled across a funny article today on msn investing. It's not like I read that stuff. I was looking through my site meter referrals and somehow I came to this article.

Basically, it's a arrogant american writing about how great Alberta's oilsands are and how great it would be for USA to annex only Alberta.

It's definetely worth the short read. I am very happy to see that some american writers are finally realizing how much oil canada actually has. Most are still clueless but the wise are starting to catch on.

This writer picks 4 stocks to benefit from this boom:

Encana
Nexen
Canadian Natural Resources
Suncor

Solid companies that will do well for a long time.

I find it very humorous that although he's hyping these companies it says at the end of the article that "At the time of publication, Jon Markman did not own or control shares of companies mentioned in this column."

Link

Snow storm hits US Northeast

2006-02-12T14:44:00.000-07:00

I was just looking over the news and I couldn't help but mention this.

News Story

And this isn't some puny little storm. There has been up to 60cm of snow dumped on the city. Thousands are without power. The temperature itself isn't that cold but because people aren't used to the weather, you can be sure they will be using tons of heating over the next few days.

I'm betting natural gas will be up huge tomorrow. This may be enough too to push up the rest of the energy stocks.

It will be very interesting to see what happens.

The Short Term Dilemma:

2006-02-12T11:55:00.000-07:00

If you've been watching the market carefully the past week or so no doubt it has made your stomach turn.

But most important thing think about right now is when will the market reverse and begin to move up again. This is a very difficult question for me right now because the market is reminding me so much of october 2005 and that was such a horrible time.

As you can see here, the market went below its 50 day moving average for nearly the whole month.

At that time I was holding nearly all my money in xeg energy iunits. I made a killing through the summer and up to october. However, at the beginning of October they started to slide. I had huge profits so I sold a week or two into October.

I thought it was a good idea because I avoided still quite a bit more downside for the rest of the month. However, october ended and people started to buy, the market exploded and we've had about 3 months of nearly straight up gains.

Those iunits I sold are up over 30% since I sold them. Do I regret selling them? Sort of although I did make more money recently with the uranium picks.

However, I think the lesson to learn is to stick with what you have. If you did a lot of research in your companies and believe in them, they should go up. We're in a commodity bull market you know!

In nearly all the books I've read about investing, they all mention the commodity markets as being volatile. We have a tendency to forget about this when things are going well but then to over-react when things turn a little sour.

Keep in mind that stock investing isn't all about fundamentals and what should happen.

I'd say it's at least 70% is mass psychology. People see the market going a little down and think that they should sell. They over react. Then they miss the bottom and they see the market doing well again. So they buy in a little late.

Warren Buffett says the worst reason to buy a stock is because it is going up. Could it be that the worst reason to sell a stock is because it is going down?

I heard a great comment on Money Talks this weekend: Michael Campbell said that even though the 90's were a great market, he said most people complain they didn't make that much money.

Why? I think it's because people were selling when the market was in a down trend and buying when it was going up. They were trying to time the market but that is impossible to do consistently and profitably.

I'd say that we are in a cyclical long term bull market in commodities. That means that overall, the direction for the market is up. These short term corrections are necessary and inevitable.

Now the dilemma for you is wheather to buy/sell/do nothing. If you get very obsessed about small fluctuations in your portfolio and have substantial gains, remember that no one ever got poor selling at a profit.

About buying, is it the right time? Is there still more downside? Once again, very hard to say.

I bought connacher and silvercorp last week. I am slightly down on both. But I think that these are truly great companies that will bring me great profits down the line.

They may be down for a while but they will bounce back.

Keep in mind, what is so different from 2-3 weeks ago? Did something shocking happen to bring the market down? I think this is just mass psychology at work again.

I think the most ideal thing would be to do nothing and start to buy more when there are signs the market is rebounding.

I need some feedback....

2006-02-11T19:41:00.000-07:00

I mentioned briefly a couple days ago that I will soon be moving local stocks to my own webhost and with a new name.

trust that the quality and frequency of my postings will be the same but i just want something more professional, popular, profitable and reliable.

however, i don't want to add things if you, my readers, won't find them useful.

here are some of the things i want to add:

-forums
-weekly podcast
-related posts (after each post)
-100% uptime
-weekly or monthly newsletter with other writers contributing
-more polls

these are just ideas so they might change. however, i want to hear from you. tell me what you want. tell me what you don't want. if you have any unique ideas how i could make some extra money, that's fine too.

so basically anything you have on your mind, just send me an email to localstocks@gmail.com

please do it now! i want this new site to be exactly what you want it to be. if you don't tell me what you want, how am i supposed to know?

By the way, if any of you are site programmers or know any good people, let me know as well. I have basic programming knowledge but my new site will be published using wordpress and i'm new to that format. so if you could help out or know someone who could that would be amazingly helpful!

I want to get at least 50 emails with comments! don't think your opinion doesn't count. it does. go to send me one right now!

localstocks@gmail.com

David Pescod's Most Recent Report on NUC

2006-02-11T13:52:00.000-07:00

grace a ulump, from the Stockhouse NUC BB:

"NOVA URANIUM (V-NUC) $2.85 -0.06
I think this is it! We are referring to this correction, that we have been mumbling
about for the last two or three weeks. The junior mining market has been incredibly
generous over the last few months and as we all know the “Market God’s” just don’t
let you make too much money without having to sweat about it….
Today, the commodity that everyone watches is gold and it gets pounded—down
$14.60 and it takes the entire commodity sector with it. Copper is down $0.08, Zinc is
down $0.07, Lead is down, Aluminum is down, well you get the drift.
If it is the correction we are looking at, I wouldn’t be surprised if it is like the oil
correction that we experienced back in October. It was swift and about two months
later it was as if nothing had happened at all! These commodity prices, even after
the drop today, are truly awesome.
Meanwhile, it is the same bad news for oil and gas—you know that we’re short
EnCana and we have been talking about that a lot. Who knew that there would be no
winter over North America and because of that, Natural gas prices have dropped
from $15 to $7.
I suspect next Wednesday when EnCana comes out with it’s results, a lot of people
are going to be surprised by lower than expected revenue (due to gas prices
much lower than expected) and the other concern in the oil & gas patch these days—
costs spiraling out of control.
We are going into spring when demand for oil & gas drops. A six week slide for
oil & gas stocks? But, for those who have also been worried and raised cash and
have taken some profits, this is going to be a great time, we think, for bargain hunting.
We hope that we have found the next great little zinc-copper play, that will give us
as much fun as Breakwater did before, but as far as the big play….it is time to take a
look at Nova Uranium.
Nova Uranium has already doubled since we wrote up Eric Coffin’s suggestion
back on January 4th when it was a mere $1.48, but Coffin is still saying that it’s his
top pick in the junior exploration game today. For those who subscribe to the Coffins
Hard Rock Analyst, you had a heads up at $0.60.
He suggests it has the chance to be the next Virginia Gold Mines (VIA), so with
that in mind, we figured it was time to take a look at it. The first thing a person
should be looking at these days is number of shares outstanding. It’s a question no
one seems to be asking and some of these junior mines out there are getting to a
level that makes you wonder.
The good news on Nova is that President Don Moore has been very tight with
issuing stock and an investor/speculator in this game has one big advantage going
for him – leverage! Fully diluted, Nova has only 17.6 million shares outstanding at a
time when every junior miner out there seems to have an outrageous 50 million, 60
million or 100 million (Tyler Resources) or 800 million (Tahera Diamonds) shares
outstanding. If this program works out…..there will be leverage. The best background
look at Nova is probably one done by Jim Dartnell, the mining analyst with
Wolverton Securities. (To get your copy, just e-mail Sandra at sandra_
wicks@canaccord.com).
Dartnell writes: “Nova Uranium Corporation is targeting a large bulk-tonnage
uranium deposit – the Mont Laurier Property which hosts a reported, historical
geological resource of 32.36 million tons of mineralization grading 2.4 lbs of
uranium oxide per ton”. That works out to 77 million pounds Dartnell suggests
and that would seem as if they already have a good start.
He notes that “this is a historical resource compiled by Bomet Mines in
1979, so it is pre-NI 43-101 and therefore non-compliant. However, we do consider
it relevant for analytical and comparison purposes. A resource by definition
has no demonstrated economic viability as contrasted to a “reserve” that
is an integral part of a feasibility study”.
The Mont Laurier play is in mining-friendly Quebec, 85 miles north of Ottawa
and about 125 miles north of Montreal and easily accessible from the
small town of Mont Laurier. Nova optioned the property in November of 2004,
just before the uranium exploration frenzy opened up and we saw uranium
centered junior exploration companies go from about three to over 200 and a
very pricey sector.
Dartnell writes: “they’ve completed airborne surveys and bedrock sampling
in the Nova A and B zones, which returned values ranging from 0.05 lb up to
9.43 lbs U308 per ton”. He suggests that two phases of exploration are
planned. “Phase 1 largely “consisted” of defining drill targets, geochemical
and geophysical surveys, radiometric surveys and trenching on the high priority
Nova and Tom Dick Groups. A big percentage of the $1 million Phase II
budget is towards diamond drilling on the Nova – 70 holes and Tom Dick – 30
holes with a portion earmarked for general exploration – another 10 holes”.
The interesting parts about this play is that we have to remember that it
was drilled 30 years ago and what current drilling could come up with is always
the chance that it could be quite different than with what was recovered
before. Also in 1985 a German company published a report entitled
“Economic Potential Study” and suggested that the grade on the property
could be as much as one third higher owing to the concept of the “bulk enrichment
factor”. There is also the knowledge that much of the drilling that
was done 30 years ago was only drilled about 30 meters to the water table and
what might be under that, could be something that could add significantly to
reserve resources…or not.
Company President Don Moore suggests the analogy for their property is
the Langer Heinrich property of Paladin. Theirs is more advanced, but has
roughly the same kind of resource as Nova might have, although they have
raised $90-odd million to build a mill and do have two other properties, but it
is an example to us of just how pricey uranium stocks can get. Paladin is currently
trading with almost ½ billion shares outstanding with a market cap of
around 1.4 billion. Ouch!
Moore mentions that they have got their drilling crews ready to go and all
they are waiting for is a forestry permit and then the drills can get at it. He
suspects the first two months are going to be very exciting to see if those first
drill holes can come up with numbers equaling 30 years ago, or possibly even
better. Or not!
There are also another 19 occurrences on the property Moore points out,
so over time, they are going to have to take a look at several of those, which
could provide additional good news again, or not.
Like most mining plays, he says “it all comes down to grade and size of
the deposit and it’s going to take the next 6-8 months to get an idea of which
way that is going.” Either way, the next 12-18 months for this particular play
is going to provide lots of excitement. We own a bunch!
As far as targets, again Eric Coffin suggests $10.00 should things work
out and Dartnell tells us, “should drilling indicate a success, $7.50 to $10.00
is possible”. Again for good background information, we have copies of
Dartnell’s report, just e-mail Sandra.
Also, for those who don’t follow the Hard Rock Analyst, you probably
should. It’s probably the most significant mining letter you really need. Simply
go to www.hardrockanalyst.com and click on “subscribe” and we suspect
your subscription fee will be paid for in good information in no time!
We call NUC “The Drilling Play of the Year”, because we have big expectations.
After all, they are trying to replicate some old results, plus the chance
to come up with some grades that are even higher and increase the tonnage
by going deeper plus with other locations that were never tested before,
there is always the upside and potential resource estimates.
As everyone knows, though, when you are looking at a drilling play, there
are so many things that can go wrong, which are usually things out of left
field that you never would have even thought of.
After experience with Bre-X, no one would be surprised to find numbers,
that were done years ago, weren’t somehow misleading….who knows about
any land claims, or drilling happening on time, core recovering, land disputes,
someone suing someone over what seems ridicules and delaying progress…….
There are so many things that can go wrong, but given all this...this is a
project that has been examined before with positive results in a mining
friendly environment that is close to most needed facilities and two pretty
good stock pickers that are suggesting they have big expectations for this
story.
Once again, the bottom line is the bigger reward you are looking for usually
entails the bigger risks."

IMHO I am betting on NUC over PDN and UUU ---I like the 17 million shares as opposed
to the myriad...but explorers are riskier.
I also am focussing on Silvercorp----these are only my gut choices, and I'm sure others more knowledgable than I may have other opinions.

Globe and Mail: Cameco and Uranium

2006-02-11T10:23:00.000-07:00

Article about Cameco and its long journey back into investing respectability

Key Points:

the International Atomic Energy Agency is now forecasting 60 additional plants will be added by 2020 to the approximately 440 currently producing power in 31 countries around the world

Note: China, India, Russia are my bets to lead the charge

The icing on the yellowcake has been the entry of hedge funds and other speculators into the spot market, buying up millions of pounds of uranium, betting the value will continue to rise.

Note: reference to new stocks like Uranium Participation Corp (U.TO), who will actually BUY uranium oxide, then STORE it in hopes that the price will go up.

The new speculative interest has had a significant impact in an industry that currently mines only about 108 million pounds of uranium a year, but where demand is running at 180 million pounds.

Note: the supply will eventually be there, but the key word is eventually. Uranium mines usually take a long time to open so the ones that are in production now are most likely to benefit. Uranium oxide in the ground is plentiful, it's just the transfer from being in the ground to being produced that's so difficult.

Analyst John Redstone at Desjardins Securities, a uranium bear, sees new supply creating a surplus by 2009. As a result, he said in a recent report that he expects prices to be capped at about $35 (U.S.) a pound. That is one of the reasons he also figures that Cameco's shares are overpriced and poised to finish the year about 25 per cent below today's price. By contrast, Greg Coules, managing director and head of research for Metropolitan Capital Advisors Inc., a New York-based hedge fund that has invested in the sector, is betting that $50 (U.S.) uranium is "very likely" over the next 12 to 18 months and that it has the potential to climb to the $70 range "over the next couple of years."

Note: $35/lb? Not likely with companies like U.TO swooping in and buying every last pound of uranium oxide on the market. I happen to believe more in the latter opinion, because I have seen no evidence to the contrary yet. This might change, of course, but I really haven't seen any signs of a slowing down in the uranium oxide spot price.

The uranium buy-and-sell market is very small and the whole sector can be evaluated with simply supply and demand so analysts actually think that investing in uranium is probably simpler than alot of the other base metals.

Mystery buyer marks record Alberta oil land sale

2006-02-10T23:12:00.000-07:00

The fattest bonus by far in the February 8 auction was C$465 million paid by a numbered company for oil sands lands in northeastern Alberta. That in itself was the largest amount ever paid for one package of lands in an Alberta sale, said Donna McColl, a spokeswoman for Alberta Energy.

A firm called 1122131 Alberta Inc. picked up a total of 10 leases in the Athabasca region.

Buyers often hide their identities behind numbered companies or use land brokers in auctions to keep corporate strategies quiet.

The mystery buyer created a buzz in Canada's oil industry, whose oil sands potential has recently grown in prominence among investors from around the world hunting for secure energy supplies against a backdrop of high oil prices.

Who could this be? My guess is that it's the chinese or indian government oil companies who completed this purchase. Why would they not reveal their identity right away? Well I think it's because this is some of the highest prices ever paid for properties like this. I think they want to wait for some more leases to sell for higher prices and then they will reveal their purchase and they will look awful smart.

I also read some comment today about an interview with the UTS CEO asking him about a possible takeover. He said they want to stay independent until production.

Notice the language. He did not say flat out they aren't considering it or wouldn't do it. There are so many possible buyers of UTS, it's bound to happen. (Petro Canada or Teck Cominco might want to get a higher stake or one of the chinese or indian companies might want a piece of the oil sands).

A quick google search turned up a very interesting press release from about a year ago that I'm sure most people have forgotten about.

UTS ENERGY ADOPTS SHAREHOLDER RIGHTS PLAN
Calgary, Alberta, Canada – UTS Energy Corporation ("UTS Energy" or the "Corporation") announced today that at a regularly convened meeting of the Board of Directors held on February 24, 2005, its Board of Directors adopted a Shareholder Rights Plan (the "Plan"), similar to existing shareholder rights plans adopted by other Canadian public companies. Based upon a plan of development for the Fort Hills oil sands project (the "Project") which spans five years and is expected to result in first commercial production in 2009, together with the size, complexity and integrated nature of the Project and the previously announced partnering process, the Board of Directors determined that it is in the best interests of UTS Energy to adopt the Plan.

The objectives of the Plan are to ensure, to the extent possible, that all shareholders of the Corporation are treated equally and fairly in connection with any takeover bid for the Corporation. The Plan discourages discriminatory, coercive or unfair takeovers of the Corporation and gives the Board of Directors time if, in the circumstances, the Board of Directors determines it is appropriate to take such time, to pursue alternatives to maximize shareholder value in the event an unsolicited takeover bid is made for all or a portion of the outstanding Common Shares of the Corporation.

In order to implement the adoption of the Plan, the Board of Directors of the Corporation authorized the issuance of one right in respect of each Common Share of the Corporation outstanding at the close of business on February 25, 2005 (the "Record Time"). In addition, the Board authorized the issuance of one Right in respect of each additional Common Share issued after the Record Time. The rights trade with and are represented by UTS Energy's common share certificates, including certificates issued prior to the Record Time. Until such time as the rights separate from the common shares and become exercisable, rights certificates will not be distributed to shareholders.

If a person, or a group acting in concert, acquires (other than pursuant to an exemption available underthe Plan) beneficial ownership of 20% or more of the Common Shares, rights (other than those held by such acquiring person which will become void) will separate from the Common Shares and permit the holder thereof to purchase Common Shares at a 50% discount to their market price. A person, or a group acting in concert, who is the beneficial owner of 20% or more of outstanding Common Shares as of the Record Time is exempt from the dilutive effects of the Plan provided such person (or persons) does not increase its beneficial ownership by more than 1% (other than in accordance with the terms of the Plan).

At any time prior to the rights becoming exercisable, the Board of Directors may waive the operation of the Plan with respect to certain events before they occur.
The issuance of the rights is not dilutive and will not affect reported earnings or cash flow per share until the rights separate from the underlying Common Shares and become exercisable or until the exercise of the rights. The issuance of the rights will not change the manner in which shareholders currently trade
their Common Shares.

The Plan is subject to subject to approval of the Toronto Stock Exchange, and requires confirmation by UTS Energy shareholders within six months of the Plan's effective date, being February 25, 2005. If the Plan is not confirmed by shareholders, the Plan and all outstanding rights will terminate and be void and of no further force and effect. It is intended that the Plan will be considered by shareholders at the annual and special meeting of shareholders scheduled for May 26, 2005.

In furtherance of its stated objectives, UTS Energy is actively engaged in partnering efforts and these efforts have resulted in significant interest in the Project. This process has involved discussions with potential operational or working interest partners and strategic and financial partners. The Plan is not being proposed in response to, or in contemplation of, any specific takeover bid for UTS Energy.

The Board of Directors did not adopt the Plan to prevent a takeover of the Corporation, to secure the continuance of management or the directors in their respective offices or to deter fair offers for the Common Shares of the Corporation.

I think that by putting forth such plans/restrictions, UTS is quietly setting itself up as a very likely takeover target in the next few years.

By the way, this would be great for Connacher because for one it would greatly increase the value of their shares. If the buyout was a cash offer, I am such a lot of that money would be reinvested in the most similar company and in my mind that's Connacher.

Spelunca's 3rd Pick: International Uranium Corporation (IUC.TO) Part II

2006-02-10T15:28:00.000-07:00

First off, a note about this week's carnage:

Paladin (PDN.TO) has shown remarkable resistance to the massive profit-taking that's been going on this week. It's a fairly good sign that people are optimistic about this company and are willing to stick it through knowing that there are going to be a few inevitable corrections.

Although the losses in the market for gold and resource companies were almost uniformly staggering this week, the fundamentals have not really changed all that much and I will personally ride things out. In fact, opportunities often arise during these times in the form of bargains.

Now onto the main event.

At the beginning of the week I profiled IUC's various assets. Now I'd like to talk a little about their management.

Chairman of Board of Directors: Lukas Lundin

Lukas Lundin is the son of Adolf Lundin, as in Lundin Petroleum and Lundin Mining. Lukas is on the boards of many resource companies of various sizes; this list is extensive: Atacama Minerals, Canadian Gold Hunter, Canmex Minerals, Fortress Minerals, Lundin Mining, Newmex Minerals, Red Back Mining, Tanganyika Oil, Tenke Mining, TNR Gold, Valkyries Petroleum. He and his family have connections all over the place and represents a powerful force behind IUC.

President and CEO: Ronald Hochstein
Hochstein has been President of IUC since April 2000. He was previously a manager of Agra-Simons Mining Group operations in Toronto and before that, was with Noranda Inc. for 12 years. And according to SEDI, he has not sold a share of IUC in 11 months.

Mutual Fund Backing
Resolute Funds, including Resolute Growth and Resolute Performance, are two of the best performing Canadian funds (Resolute Growth gave a 130% return in the past year). Collectively, they own >10% of IUC.

When to Get In?
Recently, IUC has experienced weakness, with its 10 day moving average dipping below the 50 day average. Share price is approaching its most recent low of 5.44 on October 28, 2005. Resolute Funds filed on February 8th to sell 184,100 shares and reduce its holding of IUC from 13.12 to 12.91% of all outstanding shares. This, along with the market weakness in general, has eroded IUC's share price.

However, as I prefaced this post already, the fundamentals really have not changed and IUC should be bought when its technicals start to rebound. The key will be observing if IUC crosses its 100 day moving average, and to observe the MACD as it reverses its negative descent. Until then, keeping a close eye on this good company would be the recommended plan.

I will be providing constant updates on IUC and PDN as they occur.

Is the Horse Out of the Barn and Galloping on the Steppes of Kazakhstan?

2006-02-09T19:58:00.000-07:00

When I looked at Mike's summary of his picks' gains,I was reminded of two oil companies operating in Kazakhstan---Arawak and Caspian ( ABG and CEK)---I think CEK was one of the
few stocks that were down--Well ( and that is a play on words), things have changed----
Caspian struck oil in its first well at 2500+barrels/day---and that is just in one of two levels.
The stock is up .66 today to 2.99.
Afew days ago, I bought some ABG ( I always back the wrong horse :)---but maybe this one will
show...). Caspian has a smaller float than ABG ( still large-88 million) I think I shall get some if it doesnt gallop away tomorrow.
Another company to WATCH ( not buy--risky-) is SOR because its shareholders have been waiting since November for an announcement on whether or not its Guaraquies well in
Colombia is a gusher or a duster. There has been about a 2 month delay in the announcement
which now is expected by Feb 15. The reason this is interesting is that Joseph Schacter, on
ROBTV( late Nov), said that SOR had struck a gusher ( in so many words) triggering a rush on the stock--
since then----NOTHING from SOR--no NR---today over 700 000 shares traded----This one is for entertainment
value only, unless you like playing roulette ( Tristone and Cannacord have been buying, so there
are tantalising hints that they may have hit oil, but I am passing on it--I have PDP)

The reason I am interested in the Kazakh plays is that I did phenomenally well on
Petrokazkhstan ( formerly Hurricane) which was taken over by the Chinese.
The leader of the country is a benign (probably) "Father of the Country" figure-
Nursultan Nazarbayev--there was a great article on him and the country in, I believe,
the Atlantic Monthly, called "Sultan of the Steppes".

What did I buy today?

2006-02-09T15:37:00.000-07:00

Most stocks were still down today but less than the past 2 days. Tomorrow should end even or up. Then next week should be very profitable! :)

I established positions in Connacher Oil & Gas and Silvercorp.

I was happy to pick up Connacher at around 20% off its all time highs. Soon we will beat those all time highs and I'm thinking we end the year at between 12 and 15 dollars a share. (Anybody investing in our stocks or is thinking about doing so must read Qbit's recent article on why oil will go up and how to profit from it.)

Silvercorp is just below its 52 week high and the future looks very good for them. Within one or two months they will announce if they got their mining permit or not. In my talks with Cathy (Silvercorp IR), she assured me that the company worked very closely with state officials in all aspects and she is confident the approval will be granted. I am looking for a year end price around 17 dollars a share.

Playfair Mining, another one of my picks, lost over 12% today. Honestly though, it needed to take a breather after its steep climb up. This is actually good for the stock and at these levels it looks like a good buy to me. I am looking for over 2 dollars a share in 1-2 months and then I make a year end target for it. I first recommended it at $0.51 so it would have been smart to sell half at the 1 dollar plus level. Then you wouldn't be losing any sleep over declines like this. If you bought in a little later, I still think this company has too much potential as an emerging Tungsten producer to stay at share prices this low.

As you can see, Playfair is quite oversold judging by the W%R indicator. I am sure that lots of momentum people were holding this stock and as soon as they saw it trend just a little down, they started bailing out. The people who bought their shares will have big smiles on their faces in a couple weeks!

"Since Brevity is the Soul of Wit, I will be Brief"---A Short Oil Sands Note

2006-02-08T19:30:00.000-07:00

Interesting, isnt it, that Shakespeare puts those words in the mouth of Polonius, a pompous old fool who noses into every corner of Hamlet's Court, giving out annoying, gratuitous advice...hmmmm

Well, back to Oil sands and a favorite company of mine, Connacher Oil - CLL:
Like most commodities stocks today, it briefly got hammered down. This was for two reasons---
1. the general market.
2. It did a P.P. financing issuing another 15 million shares ( more or less---most figures fall into
my "close enough" edict.)

Now generally one does not like dilution, but in this case it is brilliant----CLL just raised
100 million dollars to fund oil sands projects or acquisitions. They are in advanced negotiations to also buy a refinery in the US( "anonymous" says it is to hedge refining costs not to process their bitumen). ( NOTE: ENCANA is so desperate to
get a refinery that they have offerred refineries up to 50% of their project in a JV to refine their
bitumen.)
I am likely getting more CLL tomorrow. Even with the additional shares ( the pp was oversubscribed) the float is still only about ( close enough) 1/3 of that of UTS.

Clouds with a Silver Lining

2006-02-08T15:55:00.000-07:00

Despite a big correction for silver, Silvercorp closed UP .27, and is close to an all
time high----one UNUSUAL junior silver stock, as they usually fall sharply when silver
gets hit. I used today as an opportunity to buy more svm, and slw.wt ( didnt do as well on them ).
Perhaps it is premature---I am not the most patient creature----but I have no regrets.
Now I must hunker down and not be too reactive with my trading finger. I think oil and
silver will be back up quickly ( CLL and PDP were down too, but are rebounding).
If anyone has any other good silver stocks, leave a comment.

qbit

Part 2 of Interview with Sprott:

2006-02-08T08:35:00.000-07:00

StockInterview: How do you feel about uranium, which fuels nuclear reactors and generates electricity, and the uranium bull market for stocks that we’re in right now?

J-F Tardif: We are very bullish. We’re extremely bullish on uranium as a firm, not only for uranium, but we’re also very bullish on energy. Everything is inter-connected because we believe in the peak oil theory. That means the production of oil around the world will eventually peak, yet the demand will continue to increase. That puts a tremendous pressure on oil. With oil going up and natural gas price going up, then this has an effect on coal and uranium prices as well. So that’s why we’re very bullish on uranium.

StockInterview: Isn’t there a special situation, though, with uranium?

J-F Tardif: In the business of uranium, you have a huge shortage of production versus demand. Very close to half of the annual demand is produced from mining. The other half is coming from above ground inventories. Eventually, those inventories go down. Eventually, they go to zero. Obviously, you can not have a zero inventory. So that puts an additional pressure on the uranium price. The fact is we don’t produce enough uranium versus the demand. Rising oil prices puts pressure on the cost of energy so people are looking at alternatives. A lot of the growth in Asia, for example, is in terms of nuclear energy. So there are many reasons to be bullish.

StockInterview: Are uranium stocks still to be held at this time, or is time to circulate money elsewhere?

J-F Tardif: It depends on your view. Our view is to redeem in the long term because we have a bullish view on energy, and uranium. We’re comfortable owning uranium here even though they’ve gone up. But, short term? Who knows the short term? The short term is probably the toughest thing to predict.

Kevin Bambrough: I think a lot of these stocks have run a lot in the short term so that makes us more cautious. There are not as many stocks that have a significant upside like we saw a couple of years ago. It’s not the same picture out there, but there are still a few select companies that have a lot of potential. A lot of companies have gone up. Companies, which we think may not be as good, have also gone up. Perhaps, now is a better time to really focus on the companies we believe are better than others. That is actually something we’ve done here. We’ve started selling those we’re not as confident in as others and have bought other uranium stocks we actually feel more confident in the quality.

StockInterview: It appears the recent uranium market was a bit overbought. On a day-to-day basis, what do you look for when isolating the stocks you want to hold?

J-F Tardif: I cannot say that we’re traders. We do trade. We do buy and sell, sometimes, but we do have a mid-to-long term view about energy. We buy heavily when they’re oversold. We have very important core holdings in the uranium business –

Kevin Bambrough: You could say we have belief in the fundamentals of different companies. If one seems to get overextended relative to another, we may do a switch, but that’s pretty much it.

J-F Tardif: We’ve bought and sold different companies, reduced positions and increased positions. If you look back since we’ve started to invest in uranium, we’ve probably had more dollars invested in uranium every quarter. We keep adding to it, and the value of those holdings actually increased as well. In dollar terms, we’ve got more uranium today than we’ve had six months ago.

StockInterview: How you determine the quality of a uranium stock?

J-F Tardif: The first thing is a high quality resource in the ground or in production. If somebody is already producing, obviously we know they have it. If a company is not producing, but they have a resource, it has to be a high quality resource. This can be done by engineering work and drill holes and experts. I’m not a geologist so I cannot be a technician myself, but other people can. They can say there is X amount of uranium in the ground with X amount of certainty. Those, then, would be the type of stocks in which we would be interested.

Kevin Bambrough: And at a grade that we feel is in economic concentrations at various prices.

StockInterview: But there is such a spread on those concentrations, or grades. It can’t always be the high-grade uranium found in Athabasca. What grades make you comfortable?

J-F Tardif: It’s very different if you have an ore body or a deposit that is very deep in the ground. Obviously, it will be at a different cost than if it’s an open pit.You have to understand how it’s going to eventually be mined. Depending on the grade, let’s say it costs $100/ton to mine somewhere. Your value in the ground is $200/ton. To value the uranium, you then have a $100/ton of gross margin potential. You then figure out the cost per ton and the revenue per ton. Revenue per ton obviously is driven by the grade. Then, you try to figure out who has the best gross margin out there. Then you look at the gross margin versus the market cap and you compare. It’s a lot of analysis and thinking about numbers and guessing. It’s a guessing game as well. Finally, you try to guess the best you can, make an opinion, and make a decision.

StockInterview: How do you size up the geological team running the show, and how big a role do they play in your investment decision?

J-F Tardif: We certainly prefer people that have been involved in uranium for a long time – people that were actually involved in uranium in the 1970s. A guy with 40 years of experience in mining, and 10 years of that in uranium is certainly better than another type of guy who has never dealt with uranium. Management is important, but the deposit is more important. Either they have it or they don’t, right? Obviously we don’t want to go with a company that has management that we don’t like and .with no deposit.

Kevin Bambrough: Early on, when we first started looking at uranium, and the land grab phase was on, we valued management a little more highly then. We were talking to people who were saying things like, “Give us some money, we’re going to go and try and stake some things.” Or they’d say, “We’ve bought a database so we know people who know where these deposits are, and we’re going to get them.” Back then, we were in an early stage. Now, a lot of the most prospective properties have been snatched up. So, now it becomes more about the mining team than it was in the early stage, during the acquiring phase.

J-F Tardif: We want to invest in companies that we think have a good chance at actually producing. One of our successes did happen. The management was very knowledgeable of uranium. They were very knowledgeable of mining. They built a team. They’ve done feasibility studies. They are in the process of building a mine. And they will produce uranium. That company is called Paladin Resources (TSE: PDN)

Kevin Bambrough: From our initial investment we made almost – from the initial investment to the peak that it hit just in the last month, I think we’re up 40 times our money.

StockInterview: Mr. Tardif, in your fund, what percentage do you hold in uranium versus gold?
J-F Tardif: In the fund that I run, the Canadian fund, we have, as we speak today, 3.8 percent in gold and 10.5 percent in uranium. (Editor’s Note: StockInterview.com interviewed Mr. Tardif on February 3rd, 2006.)

StockInterview: Mr. Bambrough, in an earlier interview, a number of investors apparently read the headline, but not the rest of the article, entitled “Uranium to Head North of $500/pound?” Some may have misinterpreted your remarks.

Kevin Bambrough: That price was mainly to illustrate the point of how cheap and how irrelevant the cost of uranium is in the production of nuclear power. What is possible and what is likely are two different things. That pricing was not what really could be, but what price the utilities could afford to pay, or would pay, before they would be willing to shut down a facility. For the long run, I’d agree that prices are going to have to be higher and that they’ll be set by the more marginal mines that will have to come on. When I say marginal, I mean, higher cost, higher risk mines that will have to come on in order to fill the gap.

StockInterview: What pricing do you see in the spot uranium market?

Kevin Bambrough: I think that prices may be more than $50 as a sustainable level. Again, I’m looking at a few years, and it’s really hard to even make these predictions. Look at the cost of mining inflation, the costs keep going up. There does seem to be quite a lot of low cost uranium production that’s available to come on in the world given the passage of time. But, because of the excessive demand we believe that’s going to be out there in the nuclear industry, it’s going to require more than just the low cost mines coming on. We’re going to need a lot of these higher cost mines, those that need like the $40 or $50 spot uranium prices in order to justify the investment required to bring these properties on.

StockInterview: Do you believe we’re still going to see a uranium shortage?

Kevin Bambrough: I think it’s clear that there is a uranium shortage right now. I think it’s going to continue for some time.

StockInterview: Mr. Tardif, what else do you invest in besides gold and uranium?

J-F Tardif: We invest in energy service companies, oil and gas producers, what we call in Canada Business Income Trusts (companies that distribute all of their earnings to shareholders). Some of those companies can give as high as a 10-, 12-, or 13-percent yield on distribution. We also invest in technology, consumer products and so on.

Kevin Bambrough: We also have a gold fund at our firm with over one-half billion dollars invested in gold companies.

StockInterview: When making your general investment decisions, what do you look for?

J-F Tardif: Typically, we buy companies that have rising earnings, rising sales, hopefully rising margins as well. On top of it we try to buy stocks very cheaply. Hopefully, we can see a multiple expansion on top of all of those items. That’s on the long side. When the ratio is very attractive, then we try to take larger positions. On the short side, we try to do the opposite, try to find companies that have earnings growth slowing down, or earnings actually going down. The same with sales: sales growth slowing down or sales going down, margins going down and hopefully a multiple contraction. Basically, there are really two sides to the portfolio.

StockInterview: What strategies do you use before taking the leap?

J-F Tardif: We have many strategies. With oil and gas producers, in Canada with the ones we own, we look at growth of production, growth of cash flow and growth of earnings. We also own some energy services companies. With those companies, we project them to still grow their earnings and sales. We feel that they’re not very expensive. Some income trusts that we own, business income trusts, they’re growing their earnings, growing their sales, and at a multiple we feel they’re not that expensive.

StockInterview: Can you share with us a name one of those stocks you’ve owned for a while?

J-F Tardif: One is called Total – not the big Total. This one is a business income trust in Canada. They actually are an energy service company, providing services to produce oil and gas. The stock actually was around $2, three years ago, and today it’s still trading around 10X earnings for 2006. (Editor’s Note: Total Energy Services Trust trades on the TSE with the ticker symbol of TOT.UN. Website: http://www.totalenergy.ca/)The company has been growing around roughly 50 percent per year for the last few years. We expect them to grow at least 30 percent for the next two to three years, maybe more.

StockInterview: Care to share another favorite with our readers?

J-F Tardif: In the fund that I run, we’re long a company called Aastra Technologies (TSE: AAH). (Editor’s note: http://www.aastra.com/) We like it because management has created a lot of value in the past. We feel they’re still creating value today by buying businesses that have problems. After cutting costs substantially, and making them much more efficient, they then try to grow those businesses going forward. Their business is doing well now. Actually, most of their divisions are growing now, and their earnings now are on the rise. The stock should do well and is a very special situation.

StockInterview: How does your fund move with the market to capitalize upon the market’s momentum?

J-F Tardif: Obviously, the firm has a view about the market, but we try not to apply it too much in this fund. We just go stock by stock. As long as we find good stocks that we like, we buy them. And as long as we find shorts that we like as shorts, we short them. The portfolio ends up being what it is in terms of how much we’re shorting and in terms of how much we’re long. So we don’t go with, “Oh I want to be short or I want to be long.” It’s rather ideas driven, stock driven.

Kevin Bambrough: When markets go to an extreme, I remember lots of times at major market peaks, J-F, would say, “I can barely find anything I like now. I have hardly any new long ideas. I can’t seem to find anything, anything with real value here.” And he finds himself taking profits, looking at more things that look negative and shorting more. It just seems to evolve that way.

J-F Tardif: We use pair trading at times. It’s not a significant part of the fund but it helps in reducing some sector risks and volatility at times. For instance, if we feel that we have too much exposure to energy on the long side, we could short some energy stocks that we don't like. This reduces the sector exposure. That partially explained why in October 2005, our fund was only down 0.99% in a very tough environment. Short positions and the short side of pair trading help in tough environments.

StockInterview: Earlier, you mentioned about taking large positions in stocks with an attractive risk-to-reward ratio. I have read that Sprott Asset Management sometimes takes very large percentage positions in some companies, occasionally more than 10 or 20 percent?

J-F Tardif: It happens that some stocks we own in multiple funds. In the Opportunities Fund, we do own some stocks that are owned by other funds. In total, the firm owns more than 10% of a certain number of companies.

Kevin Bambrough: Sometimes it’s a team that will find something, and everyone agrees that they love the company. We go and try to buy 20 percent. Up to 20 percent is usually our limit that we buy in the company. And then, to be fair to all the funds, we spread it around equally across the funds. That’s typically how it happens.

(Editor’s Note: In reviewing uranium holdings, we contacted Strathmore Minerals and Energy Metals about the current percentage holdings in their companies. Ran Davidson, Corporate Communications for Energy Metals (TSX: EMC) reported Sprott Asset Management owned 15.2 percent of EMC. Craig Christy, Investor Relations for Strathmore Minerals (TSX: STM; Other OTC: STHJF) reported Sprott Asset Management owned 21 percent of STM.)

StockInterview: From what I’ve heard, the Sprott Asset Management firm works together as a team in finding your next success.

J-F Tardif: We’re a pretty good team here. I’m part of the team, so I do my best. Some people succeed in finding stocks more than others. So far, so good. We’ve had good returns, so obviously we’ve been successful at finding good stocks.

From: Stockinterview.com

Interview with Sprott:

2006-02-07T20:56:00.000-07:00

An Interview with Kevin Bambrough,
Market Strategist for Sprott Asset Management

StockInterview: What do you look for in an exploration play before you even consider it?

Kevin Bambrough: There’s different things you could do. With some exploration plays, you focus on management history. A lot of it is a belief in management. Sometimes you’re looking at your belief in a region, the success of a region, what is called “closeology.” Somebody’s staked around an area where there was a recent strike by another. Or, a major dropped a bunch of land that was prospected around an existing deposit, which another company picked up that land during a market low and is now going to explore.

StockInterview: When you say a good management team, are you referring to the geological team?

Kevin Bambrough: Typically yes. I get more comfort from guys that have worked for some of the larger companies. For example, some of them have been employed with a larger company for a long period of time in a prominent role. Then, they decide to go on their own because they feel that they can. They’re excited to go and try to develop their own company. They think that they can go and hopefully strike it rich.

StockInterview: Aren’t there, however, a lot of failures in that area?

Kevin Bambrough: A lot of successes, too. It’s a risk-to-reward ratio.

StockInterview: Because the last uranium boom was thirty years ago, aren’t many of the exploration companies having a tough time finding talented experts?

Kevin Bambrough: There are not a lot of people out there. There are some people who have been trained. The Altius (TSX: ALS) people were fortunate enough to work with Cameco and have access to their lab back over last decade and are very close in that area. A lot of different people out there have skills, and people are developing them. Some would argue there’s still a lot of people that are going to retire over the coming years and this skilled labor could get somewhat worse. But at the same time, there’s a lot of new interest moving into this sector.

StockInterview: How do you uncover the “hidden value” during a company in which you consider investing?

Kevin Bambrough: When we first started look at uranium companies at the start of this bull market, we looked at different things they had. With a company like Western Prospector (TSX: WNP), it had a mine shaft. An existing shaft costs huge dollars to build today. Their market cap was less than the value of the shaft when we first started investing in it. Another company might have a database with drill data they can use. They just have to drill a few holes to be able to qualify their resources and bring things forward. So, it’s a huge considerable cost and time savings. When you have access to that data, it’s a type of hidden value. Sometimes, there are companies which have a mill that can be rehabilitated. In comparing the value of an explorer, in terms of one who’s got a very little bit of drilling done on their property, you find out what it costs for the average drill hole. Depending upon where you are, it can be quite expensive. That also helps put a baseline value in the company.

StockInterview: What about exploring in a remote area, such as Namibia, where Paladin Resources (TSE: PDN) has had success?

Kevin Bambrough: It really depends upon your distance from infrastructure. In Namibia, there is a real shortage of water. It can be an extreme problem. It can be an extreme cost to get access to water that’s required in the mining process. It doesn’t kill the exploration, it just means you’re going to have to find a lot more uranium in order to justify the capital costs. If you believe there’s some uranium in this remote area, well there better be a lot of uranium. That’s because the cost to build a mine there is extreme. It’s not like you can truck the ore out, because it’s out in the middle of nowhere. So you’re going to have to build a mine and a mill, and it becomes a lot more difficult. You also have to make sure there is a long enough reserve life so you can spread the capital cost of the infrastructure out over time.

StockInterview: Do you still believe we can find strong price appreciation in the uranium sector?

Kevin Bambrough: Personally, I think there’s a lot of speculation going on in the sector and some things maybe of lesser quality are… well, the access to capital seems quite easy right now in the sector. Some of these stocks have already had 30-50%, like Paladin, on the year. It’s a little staggering and obviously you get a little uncomfortable when things move up so fast. For certain stocks whose projects I believe are real, they can move forward, go into production and generate profits. We think they’re going to do really well. At the same time, I’d caution people that investing in mining is difficult and is a risky business. For us, we get comfort in investing in more of the known projects where we consider the economics and justify the price we pay.

StockInterview: You mentioned that “access to capital was easy right now in the sector”?

Kevin Bambrough: The money is just pouring into this sector with all of the financings. In some ways, it’s good for the industry as a whole. It may not be the best thing for the uranium price long term, but the investments that have come in recent months are going to help the find, or might find, new deposits and solve the (supply) deficit at some point. We’re talking way off here, because it still takes a long time to find new deposits.

StockInterview: Sprott Asset Management has invested heavily in the uranium exploration sector, and many have done well. Will you continue to support these companies?

Kevin Bambrough: What we have been doing is basically sticking with our winners and helping to finance them to take their project forward. We still believe we were fortunate enough that most of the projects we found and invested in early are the ones that are still the most likely to come on in the future. We feel we’re backing the right horses, and we’re going to sort of stick with that philosophy.

StockInterview: How do you keep everything balanced in your funds with each of these investments?

Kevin Bambrough: We try to stay close to the stories that we follow. We always evaluate and try to make sure we can justify the prices. Sometimes, one stock may get ahead of itself relative to another, and we’ll look to move money from one to another for awhile. Maybe one of the plays catches up, and the other one has a setback, so we can move in. That’s basically what we’ve been doing for the longest time now, mainly moving money around in the sector. Every now and then, some new prospective play comes along, or we see some drill results. Or something like Tournigan (TSX: TVC), which was a fairly recent new one that we got onto. I believe that one has great exploration potential so that is one that we’re following. We’re helping to fund them to do more exploration in the area.

StockInterview: Many companies approach you with presentations to fund their exploration or development programs. What red flags show up that make you shy away from their projects?

Kevin Bambrough: There have been a number of presentations, where a lot of the uranium companies just come in right away and say, “We’re in the Athabasca Basin or whatever and we hope to find … Or, they don’t really have anything to talk about in terms of why we should believe that their properties are that prospective. It makes me nervous when I see people that are very promotional like that. They just think that they’re going to go and find one of these things. They just seem to be such optimists. I prefer to go with guys that are more conservative and say, “This is our plan.” And, they seem to have a very well thought out plan of how they’re going to try to find something. We want to see some drill holes with results that really give us some encouragement that there is something there.

I’d rather get away from them trying to tell me about the history of the Athabasca Basin. Typically, we’ve shied away from investing in just pure land plays in the Athabasca Basin. It would be interesting to know – and I’m not aware of – how many conductors have been drilled in the Athabasca Basin that have found nothing. There has been a lot of exploration over there, over time. It’s tough, it takes time, and it takes a lot of money. All these guys that have tried to find it and don’t find anything? The stocks just get crushed, and they keep having to come back to get more money to drill more.

From: stockinterview.com

The Ten Tips Investors Should Know About Investing in Uranium Stocks:

2006-02-07T20:51:00.000-07:00

One of the best indicators of a project’s potential success could be past ownership. It's best to try to buy any mining stock early in the cycle. Try to pick up properties that were worked by majors during the last bull market but which eventually dropped during the lows of the bear market. During the last uranium boom of the 1970’s, many majors decided to completely exit the uranium sector.
Study the value of ore body with regards to its value per tonne, or its recoverable metal. Estimate the “all in” costs and feel comfortable with what you are paying. Risks-to-reward doesn’t favor pure exploration. Typically, we avoid pure exploration plays unless management is excellent, they have a large prospective land package, and the company is well financed.
Look for good, proven management, which has been successful in the past.
Look for solid shareholders. It is always nice to see that management has a large stake in the company. Often, this makes them value their paper more, and they will be less likely to engage in reckless stock issuance. If not management, I get comfort seeing that successful fund managers have large holdings. It is even better to see that a major company in a related industry has taken an interest in the company.
Look at the property’s infrastructure. Find out about electricity and water costs required for exploration, development and production. Find out about roads, rail, trucking, access and proximity to a mill.
Look for hidden value in the company. We always consider the value of existing infrastructure. From time to time we have been able to buy companies where existing facilities, perhaps a mill or shafts more than justify the entire market cap of the company. Past drilling for uranium will save money. Some companies have properties with very expensive shafts and/or mills. There are also companies with large extensive databases like Energy Metals Corporation (TSX: EMC) and Strathmore Minerals (TSX: STM). These databases of past drilling on various properties can be used to continue to acquire good prospects as well as sold in pieces. I would expect that they will also be able to use the data to farm in on other properties or sell other property owners valuable drill-hole data.
Buy emerging stories. It is great to find a company before it has any analyst coverage or even covered by letter writers.
Find out if the property is in a pro-mining environment. Ultimately, you need to mine. It's best to have a property in a location where government is pro-mining. We will still invest, though, as long as this factor is discounted in the stock. Some countries are so hungry for investment they will offer favorable tax rates and other incentives. Permitting can be costly and take a long time so this is very important.
Study the capital costs for the project and the currency in the country where the project is located. Typically, the lower the capital costs, the less risk in the project. The less a company risks, in time and money, to find out if the mine is economic, the greater its chance of success. Larger capital intensive projects usually take longer to bring on, and you could risk missing an important part of the cycle. I also like to consider currency moves and their possible impact. A strengthening local currency can drive up costs and destroy margins. A falling currency can dramatically improve the economics of the project.
Funding can improve the story or outlook. Make your cash work. It's not really an option for a small investor but as an institution we love to invest in companies when we think our cash is going to make a huge difference. Examples include when Aflease (now SXR Uranium One – TSE: SXR) had cash problems and was being deeply discounted, or our recent Tournigan (TSX: TVC) funding to pay for confirmation drilling and exploration on the Jahodna uranium deposit in Slovakia.

From: Stockinterview.com

Kazakhstan's Uranium Ambitions

2006-02-07T20:49:00.000-07:00

From the Russian News and Information Agency (RIA) Novosti:
February 7, 2006

"The prime minister of Kazakhstan called Tuesday for the country to become one of the world's top uranium producers.

Speaking at a Cabinet session, Daniyal Ahmetov said: "Kazakhstan possesses 25% of the world's uranium reserves, and we [Kazakhstan] could become one of world's largest uranium powers."

The former Soviet country is already a key oil producer and has enjoyed dynamic growth in recent years on the back of high crude prices. The production of the radioactive element, which is used in nuclear power plants, could prove another profitable avenue for the Central Asian republic.

"We need cooperation projects, primarily with Russia, on developing of uranium deposits," he said, adding that the country had already had its own projects.

Neighboring Russia has an extensive network of nuclear power plants and the head of the agency overseeing the industry recently called for a greater role for nuclear energy in the country."

Analysis: Kazakhstan, sandwiched between Russia and China, is in a great position with its natural resources. Correspondingly, uranium companies that do business in Kazakhstan stand to benefit with a very amenable government that will always keep a cut of the profits because of the joint venture system. Few countries have a combination of large uranium resources and cooperative mining regulations (see Australia).

In Kazakhstan, there are only a few companies with uranium mine relations, and fewer that are stock-listed in North America. Cameco is one, Kansai Electric is another (mine not constructed, trades only on Pink Sheets). The one other company will be profiled as my 1st stock pick (1st not because it's my favorite, but first chronologically based on my previous blog). I will post it after I am done discussing IUC..

(Hint: Mike has recommended this stock before!)

By the way, just like China, Russia's energy minister says that his country needs to build 40 nuclear reactors too. Food for thought..

Nice Nova News Today

2006-02-07T16:11:00.000-07:00

While the entire market was getting hammered, Nova Uranium managed to stay in positive territory.

The initial drill program will test limited portions of the Nova "A" and "B" zones with 25 to 30 large diameter HQ drillholes. Historical estimates for the Nova "A" zone by Bomet Mines in 1979, based on core and rotary air blast drilling together with shallow bulk sampling, estimate that it contains 77 million pounds of U3O8 in 32.36 million tons of material grading 2.4 lb/ton (0.12%) U3O8 (1). No historical resource calculations are available for the Nova "B" zone.

I am happy that they have finally chosen a drilling company. These first drill tests will be vital. If they are bad, I think the stock will go down a lot. But if they are good, we will go up very fast.

If I remember correctly, the first results will come out sometime in march, depending on how busy the labs are.

http://stockhouse.ca/news/news.asp?newsid=3424161&tick=NUC

Spelunca's 2nd pick: Paladin Resources (TSX:PDN/ASX:PDN)

2006-02-06T23:40:00.000-07:00

As evidenced by the chart, Paladin has almost tripled since the 2nd quarter of 2005. An impressive return, and one that, when examining significant milestones for the company, would lead to the conclusion that the risk involved in buying this company is not as great as it seems.

Having been stymied for years by their own government, Paladin decided to branch out into the more exotic parts of the world: Namibia and Malawi. Their project in Namibia is known as Langer Heinrich and the one in Malawi as Kayelekera.

Namibia's Langer Heinrich: A Little History

In August 2002, Paladin acquired 100% of Langer Heinrich Uranium (Pty) Ltd., the Namibian company holding the Project rights and completed a Pre-Feasibility study at a cost of US$ 1.26 million. This study was followed by a US$ 3.0 million Bankable Feasibility Study (BFS) that was completed in April of 2005. After full management review of the BFS, the Board resolved on May 9, 2005 to proceed with development of the project.

May 9, 2005 Press Release (Paladin Close $1.22Cdn)

Preamble: When I re-read all of Paladin's press releases, the one that's most interesting to me by far is this one, the day they gave the go ahead for development of Langer Heinrich.

The BFS document covers all aspects of the Project including resources/reserves detailing, mining, production, tailings disposal and uranium marketing. The BFS is supported by comprehensive environmental studies and management plans. The Project is designed to produce 1,180 tonnes (2.6M lbs) per annum (tpa) of uranium oxide concentrates (U3O8) from 1.5 M tpa of calcrete associated ores by ore beneficiation, alkaline leaching (heating to 750C), counter-current decantation, ion exchange, precipitation and calcining to produce saleable U3O8.

Using the ore reserve base of 22.24Mt at an average grade of 0.071% U3O8 the BFS has a scheduled mine life of 11 years and a process plant life of 15 years. Based on the mill throughput design of 1.5Mtpa of ore, the BFS shows 1,180tpa U3O8 can be produced for the first 11 years at a head feed grade of 0.0875% U3O8 and 401tpa U3O8 over the last 4 years, using the accumulated low grade stockpile grading 0.032% U3O8. The operating costs for the reserve defined BFS averages US$14.18/lb U3O8 over the life of the project and for the first six years costs average US$12.20/lb U3O8. The capital costs total US$92M including a 10% contingency plus an "accuracy provision" totalling US$10M. The capital costs have increased from that which were previously stated.

The BFS clearly indicates that the Langer Heinrich Uranium Project can be developed into a profitable mining operation. The BFS incorporates a uranium pricing schedule for U3O8 ranging from US$26/lb to US$35/lb over the 15 year period. The BFS financial modelling shows highly attractive returns can be achieved based on using defined reserves only. Paladin is currently unable to release the economic analysis resulting from the BFS work, which incorporates 50% of the Inferred Resources, due to restrictions under Canadian securities laws respecting disclosure of results of economic evaluation which uses Inferred Resources. Paladin intends to apply for an exemption order from such restrictions from the Ontario Securities Commission so as to be able to release this information.

Nevertheless, even on the reserve constrained BFS model and the conservative pricing schedule, the Project is able to pay back initial capital and working capital 3.5 years after commencement of operations (scheduled for start up for September 2006) showing the robust nature for the Project.

Analysis: there are several things to like about the last couple of paragraphs. First of all, rough mathwork would tend to agree with their calculations. Let's assume that within the next 3.5 years their projection of uranium oxide price was $27/lb (first three years of a 15 year price projection would be closer to $26 than $35 of course). So, 3.5 years 2.6 million lbs/yr * ($27/lb - $12.2/lb for operating costs) = $134 million. Enough to pay the capital cost of $92 million + 10% contingency. However, there is one happy flaw. Uranium is at $37/lb already. $113 million becomes $225 million. Paladin's transparency with their rojections and the direct way in which investors like I can pick up on what, when and how to best achieve their goals are is one that lends confidence.

All documentation for the Langer Heinrich Mining Licence Application, including the BFS, Environmental Assessment Study and Management Plan, has been prepared and presented to the Ministry of Mines and Energy in Namibia for review and approval. The application has been made for the maximum of 25 years. Initial responses have been favourable and approvals to allow the Project to proceed to development and mining are expected by the end of the 2nd quarter 2005.

Analysis: Excuse me? Did they say 2nd quarter? Indeed, remember this press release is dated May 9th! Apparently, there is a HUGE difference between obtaining uranium development and mining permits in Namibia than in Canada, let alone Australia. This was exactly the reason why Paladin came here.

September 16, 2005 Press Release (Paladin Close $1.97Cdn)Paladin announces that the Namibian Minister of Mines and Energy, The Honorable Mr E Nghimtina at a ceremony held at site yesterday, September 15th, officially initiated the commencement of construction activities for the Langer Heinrich Uranium Project. The ceremony was attended by a number of Namibian Government officials, local community representatives, as well as Namibian media. In welcoming the Minister, Paladin Resources’ Chairman, Rick Crabb, noted that Langer Heinrich will be Namibia’s second uranium mine and will make Namibia the 4th largest uranium producing country in the world.

Analysis: May 9 to September 16. Shade over four months. Crazy.

November 9, 2005 Press Release (Paladin Close $2.03Cdn)Paladin Resources Ltd (Paladin) is pleased to advise that drilling of the previously untested palaeochannel, extending west from the Detail 1 orebody, has returned very encouraging results. Compared to the previously reported Mineral Resources (estimated with the 300ppm cut off) the new resource estimates at 250ppm cut off represents an increase in contained U3O8 as follows:· A 24% increase in the Measured and Indicated Resources (from 17,100t to 20,200t U3O8).· A 52% increase in the Inferred Resources (from 15,700t to 23,800t contained U 3O8).

Analysis: That's quite an increase in reserves, although I do not think they are planning to pump more uranium oxide out each year. Rather this will probably lengthen the mine life.

December 21, 2005: Paladin Resources Ltd (Paladin Close $1.70Cdn)Paladin has secured the services of Mr. Wyatt Buck, a top uranium operative who will assume the position of General Manager of Langer Heinrich mining operations based in Swakopmund, Namibia. Mr. Buck qualified as a Mechanical Engineer at the University of Saskatchewan in 1981 and was later a senior executive for 15 years with the Cameco Corporation, a Canadian company that leads in uranium production. For the past 2 years he held the position of General Manager of the McArthur River Mine and the Key Lake Mill, the highest producing uranium operation in the world.

Analysis: Quite an impressive resume, good move by Paladin to bring in a uranium specialist with this much experience. Another confidence builder.

January 19, 2006: Paladin Resources Ltd (Paladin Close $2.34Cdn)Paladin has secured its first sales contract for a portion of its yellowcake (U3O8) production from the Langer Heinrich Uranium Mining Operation, scheduled for commissioning in September 2006. This sales arrangement with a major US utility is subject to finalisation of all necessary legal documentation. The sales contract is for the purchase of 2,145,000lbs U3O8 for delivery between 2007 and 2012. Pricing will be market related to be determined at time of each delivery with escalating floor and ceiling price components.

Analysis: Speed and efficiency seems to be the modus operandi for this company. Impressive how they haven't even began production an already has secured a contract that is NOT hedged, but will take advantage of the uranium price increases.

January 19, 2006: Paladin Resources Ltd (Paladin Close $2.34Cdn)Paladin is pleased to advise that infill drilling of the Kayelekera Deposit, has returned very encouraging results. This work has produced a twofold benefit:· Firstly, the results have added significantly to the presently stated Mineral Resource estimates for Kayelekera; and· Secondly, have allowed most of these resources to be classified into the Measured and Indicated Resource Categories with a small percentage retained as Inferred Resources. As can be compared from the above, the resources for Kayelekera have been increased substantially. At the 300ppm cut -off limit, Measured and Indicated Mineral Resources identified amount to 15.31Mt grading 0.09% U3O8 and 3.4Mt of Inferred Resources at 0.06% U3O8 versus the previously stated 9.4Mt grading 0.12% U3O8. The resource estimates for both the 300ppm and 600ppm U3O8 cut-offs are provided herein because at this stage the economic cut -off that will be applied from the mine modelling work is unknown but is expected to be between these two cut -off limits. These results do show, however, that a 10 year mine life producing approximately 1,000t U3O8 per year is likely as a minimum and that the possibility exists to extend this mine life and/or annual production depending on the final economics that are determined from the BFS. The increase in tonnage and decrease in grade from the previously stated resources is due to the fact that the high grade core of the deposit was well defined by previous drilling and the new drilling focussed mostly on defining the peripheral zones of the deposit. Consequently, this work added mainly lower grade material to the resource estimations. In total, however, the new estimate has increased the contained uranium metal in the deposit by 4,820t U3O8 or 45%, by Paladin directors which is regarded highly significant.

Analysis: I do not have the space to go into Paladin and the Kayelekera project in Malawi, but this certainly sounds like good news.

January 27, 2006: Paladin Resources Ltd (Paladin Close $2.85Cdn)

Paladin has secured a second sales contract for a portion of its yellowcake (U3O8) production from the Langer Heinrich Uranium Mining Operation, scheduled for commissioning in September 2006. This latest sales arrangement with a US utility is subject to finalisation of all necessary legal documentation. The sales contract is for the purchase of 2,080,000lbs U3O8 for delivery between 2007 and 2012. Pricing will be market related to be determined at time of each delivery with escalating floor and ceiling price components.

Analysis: Unless my math is horribly off, 2007 to 2012 encompasses six years of production. The sum of two sales contracts announced January 19th and 29th is a year-and-a-half's worth of production (remember, Paladin projects 2.6 million lbs/year). So they have managed to sell a quarter of their six year inventory before even mining a single pound of it. I'll leave everyone to draw their own conclusions about this..

Conclusion: To this day, Paladin has kept everything on track, met its deadlines, and have given me no sense that they do not have full control of the situation. I like their straightforward, easy-to-understand presentations, and am fairly confident of the people they have in place. I will not say whether or not to buy it at this moment in time as I am not a chart analyst, but if you are like me and am investing for the long run, Paladin would be a worthy inclusion into the uranium portfolio.

As always, please do your own due diligence. Scrounge for info and know more about the company you want to place your hard-earned money into!!

comments and suggestions are very welcome as always!

Spelunca's 3rd Pick: International Uranium Corporation (IUC.TO)

2006-02-06T23:11:00.000-07:00

Spelunca and Uranium on DCSB!

First, I'd like to thank Mike for letting me into the DCSB crew. Second, I'd like to welcome all the readers of my old blog for sticking with me through the transition. And third, I'd like to introduce myself to all the DCSB readers who are not acquainted with me yet. I will be focusing mostly on uranium stocks and will provide as much research on my favorite picks as humanly possible! So sit back and enjoy!

International Uranium Corporation (IUC.TO)

One of the more intruiging uranium plays out there is a company with wide-ranging assets. This company is IUC, headquartered in Denver, Colorado and poised to capitalize on the growing interest in reviving uranium production in the United States

Assets

White Mesa Mill
This mill is located in Southeastern Utah and is used to recycle waste material. While doing so, it can extract uranium and vanadium. In 2006, White Mesa is expected to extract half a million pounds of uranium, which IUC will sell at its own leisure. Vanadium, by the way, is used to reinforce steel among other things. Ferrovanadium, an alloy containing 50-80% vanadium, is selling at about $59/kg.

American Mines
IUC owns two adjacement mines in Utah, Bullfrog and Tony M, which combine to form the Henry Mountains Complex. There are an estimated 24 million lbs of uranium oxide in these two mines, although they are not confirmed by industry NI 43-101 standards yet. IUC has stated that due to increased mining and milling costs that they would postpone the restart of production in Tony M until uranium prices were higher.

IUC also own several mines in Colorado and Arizona, and does exploration there, although these do not be significant.

Canadian Exploration
The jewel for IUC here is a 75% stake in Moore Lake, located 35 kilometres southeast of Cameco's McArthur River uranium mine, aka world's biggest uranium mine. Results posted on December 21, 2005 validated the existence of fairly concentrated uranium in Moore Lake: ML-100 returned 2% U3O8 over 7.75 metres, including 4.54% U3O8 and 3% nickel over 2.75 metres. ML-88 returned 0.66% U3O8 over 4.8 metres, including 1.58% U3O8 over 1.5 metres. Five days ago IUC announced additional drilling plans for Moore Lake, including areas previously untouched that are adjacent to McArthur mine.

Mongolian Exploration
IUC has an option to earn a 65% interest in Erdene Gold's (ERD) 32 uranium licenses in Mongolia. On top of that, it owns a 70% stake in the Gurvan-Saihan Joint Venture and is continuing to conduct exploration. Historical references suggest Gurvan-Saihan could contain 17.5 million lbs of uranium, but nothing has been proving with industry standards yet

Fortress Minerals Corporation (FST)
Ron Hochstein, the president of FMC is also the president of IUC. In 2004, FMC acquired some of IUC's mineral assets in Mongolia. IUC has about a 40% stake in FMC, valued at ~$40 million based on market capitalization.

Standard Uranium (URN)
Just today, IUC announced that it has doubled its stake in Standard Uranium, owning 11.7% of the outstanding shares and using it as an investment vehicle. That's about a $3 million dollar investment.

Part II will be a discussion about, among other things, IUC's management

Introducing our newest contributor:

2006-02-06T22:30:00.000-07:00

DCSB is growing very quickly. Now to add to myself and qbit writing articles, I am very pleased to announce that Kelvin (spelunca) will from now on be writing articles here.

He had a quite succesful blog going about uranium stocks but decided it would be best to join us here to create a canadian stock blog powerhouse!

He will begin by posting his best posts from his previous blog. I think you will enjoy his depth of analysis of various companies and topics.

Welcome!

ETF's Are Not A Real Asset!

2006-02-06T19:39:00.000-07:00

I was just browsing the web now and I came across a great article that sheds more light on the upcoming silver etf:

"There is news out for a while about a proposed silver ETF. The industrial users of silver have indicated to the SEC that they are concerned that there is not enough available silver for ETF demand. They believe that a silver ETF will raise their cost of silver drastically, or worse, take all the available silver off the market. Silver is used in a great many industrial and commercial processes.

An ETF is an exchange traded fund that people buy into, the idea being that the principals of the ETF then would go buy the real material, or assets. In the case of silver, there is barely enough metal available at COMEX and other trading houses to create enough liquidity. We are very near the point where there will simply not be enough silver to keep things liquid, ie supply dries up. Of course the silver speculators would love that, but all of the industrial processes needing it would have to find some way to get the silver they use every day.

If liquidity were to dry up, then of course the claims an ETF has on some gold or silver will sky rocket in value, but how are they to get more silver or gold, if it becomes hard to get ?(more so for silver). They would have to stop taking new money wouldn't they?

But you bought that ETF claim, based on some kind of economy that was working when you bought in, a financial system that was working at the beginning, and later, a national currency crisis, banking crisis, market liquidity crisis, or another crisis changes everything, and now all the laws are subject to change, and the best outcome for the ETF would be probably payment in…. you guessed it… in dollars."

This article is a great read. Based on it, I would rather own silver producers like silver wheaton and silvercorp than the silver etf. I also recommend you look into silver coins. I own a 1884 silver morgan dollar. It is in great condition. I bought it a couple months ago for ~$300. The prices greatly depend on the condition and rarity. But look into it if you think it might be for you.

TSX at 12,000!!!

2006-02-06T17:47:00.000-07:00

Despite the neutral stance of so-called analysts at the beginning of the year, the TSX has been exploding to the upside. Today is the first time ever it has hit 12,000!

This is very exciting times and I think we will see much more upside in the next couple years.

Remember, I posted those foolish analysts predictions and I myself stated that they will be completely wrong. I said to expect 15% from the market this year but so far it looks like we will beat last year's return of over 20%.

Also of note was today the huge upside in oil sands stocks. I think the very smart americans are finally realizing what great potential the oil sands in alberta actually have. But only the very smart ones. We will need a couple more 60 minute specials to really get the word out.

But when the average american investor does smarten up, the TSX will go higher, much higher because there are 10 times more people in the US than Canada. If even a small purcentage of those people start investing in canada, I'm telling you we will have some of the best stock market returns in the world.

On a side note, I am getting frustrated with blogger's uptime and formatting. I bought today a large web hosting package and a brand new domain name. Why large when I could get by with something smaller? Because I know this site will become extremely popular and I will eventually have to even upgrade from this package!

When I go online with this new site, you will be amazed at the professionality and usability. This new site will be huge. I will have message boards, a blog and all sorts of other interesting features...and of course my money-making stock picks!

I know you're gonna love it!

But unfortunately until then we will have to do with this inferior free blogger tool for up to a month.

If you have any suggestions for the new site or can offer to help in coding please email me: localstocks[at]gmail.com (replace [at] with @)

I hope you'll stick with me through the transition and we will all become wealthy by investing in the canadian small cap resource sector together!

NUC redux:

2006-02-06T13:26:00.000-07:00

from kidl2-stockhouse Nuc BB

From David Pescod's Late Edition 2/3/06

We think that one of the most exciting drilling programs to start shortly will be that of Nova Uranium. It’s the number one pick by one of our top stock pickers—Eric Coffin of the Hard Rock Analyst. When they start drilling to see if they can’t duplicate what was discovered 30 years ago, and if successful, this stock could do an awful lot of traveling, considering how leveraged Nova Uranium is. There’s hardly any stock out. Today by snail mail, we send Wolverton Securities analysts Jim Dartnell’s research background report on Nova to all clients who own some. For those who want a copy, email Sandra at sandra_wicks@canaccord.com.

qbit

Time to look back at some of my picks/mentions:

2006-02-05T20:09:00.000-07:00

The most important thing to readers of any financial blog/newsletter/paper has to be performance and results. You might read some writer who will give you the most in depth 50 page report on a company. But if it goes down or underperforms the market, who cares?

I am sure readers would rather have someone who gets to the point and keeps it short but his performance keeps you coming back.

I want to be that guy. I am working hard on finding stocks that will give you the best possible chance of making more than you could socking it away in an index fund. If I don't do that, am I wasting your time (and mine)?

Anyway, enough of the philosophical BS. I haven't been around that long (on the internet at least) but here is a table of how stocks I mentioned/recommended have performed since I recommended them:

STOCK	DATE	$ PRICE	$ NOW	% RETURN
PDN	DEC 8	1.70	2.76	62
ABG	JAN 4	1.73	2.75	59
BSKO.OB	DEC 11	1.30	2.40	85
CNR	DEC 11	1.35	1.31	-3
CEK	DEC 11	2.28	1.91	-16
GILD	DEC 6	53.36	60.70	14
RCS	DEC 6	6.79	7.80	15
GPP	DEC 7	4.85	4.95	2
VTI	DEC 7	1.64	1.74	6
BD	DEC 7	1.39	1.70	22
KCO	DEC 9	15.20	14.41	-5
DDV	DEC 9	45.63	45.72	0
ENB	DEC 12	35.46	36.20	2
CNS	DEC 17	0.90	1.65	83
POE	DEC 17	2.22	3.25	46
UUU	DEC 22	1.93	2.80	45
NUC	DEC 23	1.60	2.95	84
SAN	DEC 27	0.45	0.64	42
FRG	DEC 29	3.67	4.43	21
HBE	JAN 6	0.37	0.345	-7
CCO	JAN 3	74.36	80.41	8
WLE	JAN 3	17.27	19.86	15
SLW	JAN 3	6.85	8.60	26
SVM	JAN 26	5.82	6.80	17
PLY	JAN 19	0.51	1.25	145

*As of Feb 5,2006 using closing prices of day recommended.

As you can see, over this short period of nearly 3 months, I have had some great recommendations and I profiled some great stocks you should look into yourself.

My average return for these 25 stocks is 30.72%! No matter what way you look at it that's impressive. Another thing I'm very proud of is that only 4 stocks out of 25 are negative; and they are small losses, not bombs.

Maybe I should retire and call it a day with stock blogging? No, I want to do even better. It won't be easy and there will be times when my picks won't do so well. But by the end of the year, if we have a few 3 and 4 digit returns, I think that will be great!

Now I want to ask you a favour. There are over 160 of you registered to receive daily email updates. That's great! But, please tell you friends about my blog here. The easiest way to do this is to click the little envelope button at the end of this post and enter in your friends email.

This will only take a minute but by increasing my traffic, you're telling me you value my information.

Also, if you have bought a stocks from my recommendation and sold it for a profit, consider donating to me a "recommendation fee" of 1-2% (or more if you like). For example, if you made $1,000 off one of my stocks, is it too much to ask to send $10-20 my way? The easiest way to do this is with the little paypal donation button on the top right.

Thanks for your support so far and I hope will become very wealthy together during this secular commodity bull market over the next few years!

P.S. If you think I'm making these up, use the search bar at the top of my page to verify and see what I wrote that given day.

Some Interesting Speculative Gold Plays in James Bay

2006-02-05T17:26:00.000-07:00

Last week there was frenetic activity in a small company called stellar pacific (spx) which has
a small claim in the Opinaca area of James Bay in Quebec...This piqued my interest enough to
sniff into the area-----check out and refer to the map:

http://www.stellarpacific.com/english/news/060131.pdf

Now I do recall hearing that Goldcorp had taken over Virginia Gold recently (VIA $13.40), but didnt have a clue where or what that was....now I know. They have a high grade gold discovery ( Roberto zone) on the property.
Now the usual murder of crows ( other companies flocking to the area) are benefitting from
the takeover in that investors want a piece of the action...and some of these companies look
pretty good to me
1. Beaufield Resources BFD .81 -----Goldcorp just bought around 9% of the company and looking at the map ( virginia is red, beaufield is purple), BFN is largely embedded in Virginia's claim. If I were Goldcorp, I would want to take over this company.

2. Everton Resources EVR .98 Rob McEwan, former head of Goldcorp just bought $1.5 million
shares and warrants of EVR personally. Its property also abuts Virginia's.

3. Golden Valley (GZZ-.38) has very large landholdings in the region.

4. Azimut (AZM-$1.60) and Sirios (SOI-.26) also have surrounding holdings.

For some reason spx ( Stellar Pacific-.29) has the hype and momentum, but as you can see,
its propery ( around 400 hectares) looks like you might have trouble fitting a drill on it :)
It still may be good, but I like the look of BFN.

I hesitate to post this on the blog, because I am improvising on the fly and to my mind these
are fairly highly speculative. I have yet to decide if I will buy, and I havent run these by Mike,
so "caveat emptor"----these are musings, not recommendations.

qbitgaw

How to Browse DCSB in Style!

2006-02-04T12:15:00.000-07:00

While checking my site out at work using their Microsoft Internet Explorer, I was very displeased to see that my blog shows up with messed up formatting.

However at home, my browser is Mozilla Firefox and my blog shows up perfectly fine.

I am not an expert at web page design, I just know my basics so I cannot figure out why my pages do not show up correctly in Microsoft Internet Explorer.

However, I have an extremely simple solution to the problem. I suggest you download Mozilla Firefox. Now before you get scared that I'm going to put viruses on your computer, let me explain the advantages of Firefox:

A Better Web Experience

Firefox 1.5 has an intuitive interface and blocks viruses, spyware, and popup ads. It delivers Web pages faster than ever. And it’s easy to install and import your favorites. Packed with useful features like tabbed browsing, Live Bookmarks, and an integrated Search bar, Firefox will change the way you experience the Web, for the better.
Faster Browsing: Enjoy quick page loading as you navigate back and forward in a browsing session. Improvements to the engine that powers Firefox deliver more accurate display of complex Web sites, support for new Web standards, and better overall performance.
Automatic Updates: The new Software Update feature makes it easy to get the latest security and feature updates to Firefox. Firefox automatically downloads these small updates in the background and prompts you when they are ready to be installed.
Tabbed Browsing: Use tabbed browsing to open multiple Web pages in a single browser window, and quickly flip back and forth. Drag and drop open tabs to keep related pages together.
Improved Pop-up Blocking: Firefox’s built-in pop-up blocker has been enhanced to block more unwanted pop-up and pop-under ads.
Integrated Search: Tap into the power of the Web’s most popular search engines with the built-in Search bar, and easily add new engines.
Stronger Security: Firefox keeps you more secure when you’re browsing the Web, closing the door on spyware, worms, and viruses. The Firefox community of developers and security experts works around the clock to monitor security issues and release updates to better protect you.
Clear Private Data: Protect your privacy with the new Clear Private Data tool. With a single click, you can delete all personal data, including browsing history, cookies, Web form entries and passwords.
Live Bookmarks: Stay up to date with your favorite Web sites and blogs. Use Live Bookmarks that update themselves automatically with the latest content from the Web.
Accessibility: Firefox 1.5 delivers easier navigation for everyone, including those who are visually or motor-impaired. Firefox is the first browser to support DHTML accessibility, which, when enabled by Web authors, allows rich Web applications to be read aloud. Users may navigate with keystrokes rather than mouse clicks, reducing the tabbing required to navigate documents such as spreadsheets. Firefox 1.5 (Windows version) is also the first browser to meet US federal government requirements that software be easily accessible to users with physical impairments.
Customize Firefox: Select new button controls for your toolbars, install extensions to add new features, or change the look of your browser with themes - the way Firefox looks and works is under your control.
Next Generation Web Support: Innovative new Web applications and services deliver a richer Web experience. Support for open Web standards in Firefox ensures you can get the most out of this emerging class of Web-based tools.

I have been using Firefox for more than a year and I absolutely love it. I have not seen a pop-up for that whole time and I swear it's faster and safer than Internet Explorer.

In looking through my stats, I see that 60% of you, my readers, are still using Internet Explorer! I strongly urge you to download Firefox using the link below. It will even import all your bookmarks from Internet Explorer right after you download it.

Right before you download, I will admit that google will pay me $1 everytime someone downloads using this link. So if you want to thank me for making you money, this is the easiest way to do it! Do it now!

PLY Showing Strength

2006-02-03T15:57:00.000-07:00

I was not able to follow the market today closely but looking at the intraday chart just now, I saw that Playfair Mining was down for most of the day but ended up closing up on (still!) much higher than average daily volume.

Almost everyday this week that I have been reading the national post, I've seen Playfair show up in the new 52-week high section.

I think new 52-week highs are very bullish and to have several in a row is even better.

I am looking at a double from these prices hopefully by the end of february but hey, it's a short month so it may take a little longer (or shorter).

But the fact is that Playfair has acquired some very good properties and is being led by one of the hottest management teams out there right now is never a bad thing.

One of the few minuses about this company is that insiders only own 13% of shares/options fully diluted.

Looking next week, I think we might have a correction up to 20% but the stock should show strength and the run should start up again on thursday or friday.

That's my bold prediction. Wheather it will be right or wrong, we'll have to see!

Worth Reading--David and Eric Coffin

2006-02-03T09:09:00.000-07:00

These two publish Hard Rock Analyst, and have a good track record.
This is from Kitco's Commentator's Corner today:

Now What?

Since this is the inaugural entry in a new service for our friends at Kitco, we want to make a few “big picture” comments. There will be plenty of time to go into specific issues surrounding the precious metals markets at length in later columns.

As 2006 progresses, the market will force gold bugs (and silver bugs and platinum bugs and…) to rethink things. Not because unfolding history is going to prove them to be wrong. Just the opposite, in fact. As the next few years unfold we expect believers in metals to be proven SO right that they will have to rethink their own valuation models. We’ve thought that for some time now. We can recall talking to audiences three and four years ago about the reasons we were convinced we had entered a commodities super cycle. We said then that we fully expected prices to get to levels even we couldn’t and wouldn’t believe before it had run its course. Over three years and almost $300 on the gold price later we still believe that. And no, we don’t think it’s over yet. Not by a long shot.

Back then, we were watching the US Dollar finally topping, knowing that would put metals and especially gold and silver at the starting gate. A falling Dollar carried commodity indices for close to three years but when the US$ strengthened again in 2005 most “mainstream” commentators declared the bull market in gold, silver and other metals over. To us that proved nothing other than the fact those commentators didn’t understand the underpinnings of the market. As happy as we and our readers were about the gains a faltering greenback provided we were still waiting for the main event.

The curtain rose on the latest phase of the bull market in the second half of 2005 when gold and many other metals started moving up with the Dollar and, indeed, with virtually all other currencies as well. This move was cheered by gold’s followers as a sign that gold’s day in the sun as the latest and greatest currency had arrived.

Well, not quite. You see, we’re not gold bugs in the strict sense of the word. Yes, we understand and appreciate gold’s value and agree that it’s on an uptrend that is far from over. But we think that the latest moves in the gold price demonstrate a potentially much more important change. Not just precious metals becoming viewed by some as currencies in their own right, but more importantly as an indispensable asset class.

What’s the difference? As a currency, gold can and will move against all other currencies and will be subject to some of the same variables, notably things like the spread between interest rates for gold on deposit and “risk free” interest rates mandated by various central banks. As an asset class, precious metals will also have added demand from retail and institutional investors who feel it’s mandatory to hold at least a percentage of their assets in metals. Don’t underestimate the potential size of this demand driver. It has been argued many times in the past the index and market funds played a part in underpinning the value of equity markets even when logic dictated they should fall. Funds that had to be fully invested by charter were there to pick up the slack when other investors backed off. Now apply that same idea, through both mainstream and commodity funds (a fund class we expect to explode in popularity in the next few years) and what do you get? A buyer for metals with the potential to dwarf almost anything else on the demand side. “Buy and hold” investors are a rare thing in most commodity markets, even gold. The arrival of a new class of buyers with almost limitless funds and a propensity to buy and forget may well take precious metals values to a new plateau. It’s a wave you want to be riding, not swimming against.

David Coffin and Eric Coffin

qbitgaw

Cannacord Buying KLM up

2006-02-02T12:08:00.000-07:00

Cannacord capital is buying up klm very aggresively. Where did they find out about this company. Well probably from Briggs and Moore. They are the people who run this company. But the exact same management team runs 4 companies. Nova Uranium, Playfair Mining, Kermode Resources, Rupert Resources.

Kermode Resources Ltd. (TSX.V:KLM) is dedicated to the discovery of gold in the prolific region of Newfoundland, Canada.

The company is involved in a comprehensive, well-funded, phase three drill program on its Jackson's Arm property, an area rich with extensive historical exploration revealing significant gold values. Samples overlooked and ignored by explorers in the past now provide Kermode with a tremendous opportunity.

Kermode's management and geology team have extensive experience in gold exploration and in the development of high profile mines, each principal contributing over 35 years of geology, management and finance experience.

Utilizing expertise and advanced exploration technology, Kermode will explore the Jackson Arm region with the exciting prospect of realizing a world class gold deposit.

I will see what happens the rest of the day today and decide what to do tomorrow. If it keep going up, I'm in and we're in for another double just like playfair.

Time & Sales

Price	Size	Time	Buy	Sell
0.54	5000	13:46:46	033	033
0.54	5000	13:46:46	033	057
0.54	10000	13:38:39	033	033
0.51	10000	13:38:18	033	033
0.55	3000	13:33:30	002	007
0.50	1000	13:25:29	033	085
0.50	5000	13:25:29	033	085
0.51	10000	13:25:24	033	007
0.50	5000	13:25:02	033	006
0.50	10000	13:25:02	033	033
0.495	10000	13:23:04	033	007
0.49	11000	13:22:50	033	033
0.49	20000	13:22:50	033	007
0.49	5000	13:22:50	033	007
0.48	10000	13:18:45	033	007
0.49	10000	13:18:04	033	033
0.48	5000	13:18:04	033	007
0.48	5000	13:18:04	033	033
0.48	5000	13:16:48	033	033
0.475	10000	13:16:48	033	007
0.47	34000	13:15:54	033	033
0.465	3500	13:15:54	033	007
0.465	6500	13:08:54	046	007
0.465	10000	13:08:54	046	007
0.46	3500	13:08:54	046	085
0.435	11000	13:00:42	033	033
0.44	10000	13:00:42	046	033
0.45	6000	12:38:54	033	007
0.46	6500	12:19:39	141	085
0.46	10000	12:11:17	141	007

Note: 033 is cannacord

Get free market depth here

PLY Making all the Right Moves

2006-02-02T10:43:00.000-07:00

I've been watching PLY all morning and it is acting wonderfully. I hope you got it when I recommended it under $0.50.

I sold half of my original amount at 120% gain this morning in my education fund but just bought more for my trading fund at $1.14.

I told you it would hit $1.00 and it has, however, it's moving so strongly that I am now looking for another double off my buy at 1.14.

They announced some great news today regarding some property acquisitions and I think this will pay off in the future.

However, short term this company is moving just like Nova did a month or two ago.

Don't think it's too late to get in now though. I see much upside over the next few weeks and months.

My short term price target is 2.40 which give me a 120% gain at which point I sell half for my guaranteed 10% gain.

Financial Post Re-Cap

2006-02-01T22:11:00.000-07:00

Most days the Financial Post is worth the read, especially if you can get a copy for free like I do. But today's copy was quite outstanding. It had 6 articles that I consider very important to our investing strategies and predictions.

1. Base Metal Prices in 'Uncharted Territory': Base metals prices are moving up so fast that analysts can't keep up. As soon as analysts set targets, the metals surpass them and the analysts have to scramble to catch up.

"The big thing simply is that demand from China for key base metals is rising by more than 20% a year and there is just not enough new product coming on -- so it's economics 101," said Donald Coxe, global portfolio strategist at BMO Financial Group.

So far, observers appear to believe that the metals mania is well-grounded. For example, Ms. Mohr noted that zinc has outperformed aluminum recently, even though aluminum has a bigger weighting in most large index funds, meaning that metals may still be moving on supply and demand issues.

Mr. Coxe said that the stocks of most base-metal producers trade at very reasonable valuations, based on their earnings per share. As well, rather than hyping base metals, analysts continue to give cautious forecasts for most commodity prices.

"My basic thesis is that the analysts and the companies are still scarred by the triple-waterfall crash that occurred in the mining industry, which took 20 years. And those few who survived did so by being very cautious," Mr. Coxe said.

2. India Plans Major Oilsands Investements: A top indian official said yesterday that india plans to invest 1 billion dollars in the canadian oil sands.

3. OPEC to keep oil output high amid concerns over iranian supply: Iran produced 3.9 million barrels of crude oil a day last month, almost 5% of the world's output...Saudi Arabia, the world's biggest oil exporter, has 1.3 million barrels of spare production capacity.

4. Venezuela boosting exports to China in bid to reduce dependence on U.S. sales: Venezuela, the 5th largest oil exporter wants to double its exports to china.

5. World heading for Silver Squeeze: Like many metals and commodities, silver is on a tear, largely based on rising demand. London-based GFMS Ltd. estimates industrial demand for silver rose by 6% during 2005, largely due to continued strength in the electronics sector.

Silver is used in a diverse range of applications, from plasma TV screens to solar panels. Silver even has anti-bacterial properties, leading to its use in a line of odour-eating gym clothes and bacteria-killing bandages.

Consumer and industrial products use up more than 40% of the world's silver. Photography remains a strong component of demand, with 21% of the market, while another 28% is used to make silverware and jewellery. The remaining 10% of silver demand is taken up by investments in coins, medals or silver itself.

However, another driver of the silver market now is the tantalizing prospect that the Barclays Global Investors silver-backed exchange traded fund (ETF) may soon trade in the United States. Traders are taking positions in silver ahead of the launch of the ETF, anticipating that the new fund will boost demand for the metal.

"The actual launch of an ETF could see prices gaining a further US$1.50 an ounce as small- and large-scale investors are expected to flock into the market," said James Moore, London-based publisher of TheBullionDesk.com.

In 2004, miners produced only 634.4 million ounces, despite global demand of 879.2 million ounces. The gap was filled by the scrap market and government sales. A silver ETF would scoop up a significant chunk of available silver stockpiles, reducing the pool of above-ground silver and arguably making the metal more expensive for industrial buyers.

In fact, analyst George Albino of Orion Securities Inc. estimates that a US$300-million ETF would take up 25% of the world's deliverable silver.

"The silver price, we believe, is presently reflecting some possibility of the formation of a silver ETF," his report said. "The impact of the silver ETF on the silver market could be staggering, as would be the resultant upward pressure on silver-related equities."

Most of the world's silver is produced as a by-product from mining other metals, such as gold or zinc. The world's biggest silver producer is also the world's biggest mining company, BHP-Billiton PLC. The biggest Canadian producer is Toronto-based Barrick Gold Corp.

6. HOT STOCKS Canada may represent a tiny fraction of the global equity market, but it may have a far bigger share of the world's hot stocks.

"As expected, the 'world-class' TSX companies are found in the financial, energy and materials sectors, which is consistent with the strong profit growth driving these areas," he said in a note yesterday.

The energy sector has four of these top stocks: Husky Energy Inc., Talisman Energy Inc., Canadian Oil Sands Trust and Arc Energy Trust. The materials sector has five top stocks: Potash Corp. of Saskatchewan Inc., Teck Cominco Ltd., Labrador Iron Ore Royalty Income Fund, Inmet Mining Corp. and Norbord Inc.

And the financial sector has four top stocks: Bank of Nova Scotia, Great-West Lifeco, Royal Bank of Canada and Northbridge Financial Corp.

Read them all to make your own opinions but mine are that the commodity boom is only now becoming apparent to the mainstream media and the average investor. Nonetheless, the average person won't start buying in until at least a year from now. 2006 will be the easy money for uranium and silver. Last year was easy for oil. You will still be able to make money in oil but it won't be as easy as last year.

The silver squeeze is very real and you must have some (or a lot) or silver exposure in your portfolio. My 2 favorite companies right now are silver wheaton and silvercorp.

Cameco bargains:

2006-02-01T10:12:00.000-07:00

Today I see Cameco trading down about 7%. If you want to buy the most conservative pulse on the uranium market, this is the company. They have much of their production hedged at the moment but soon these hedges will start to expire and they will probably opt for open contracts are even higher prices.

Despite this hedging, Cameco today reported much higher earnings and profits for the last 3 months. The most stark imporvemnt for me is the unbelievable growth in earnings per share $0.47. That is an improvement of 124% since last quarter.

For the year however, their earning per share decreased 22% because of high costs and other factors dealing with bad luck, bad timing, one time costs etc.

In 2006, Cameco expects consolidated revenue to grow by more than 40% over 2005 due to the improved uranium market and the proportionate consolidation of BPLP revenue. On a consolidated basis, our gross profit margin is projected to improve from 23% reported in 2005 to about 28% in 2006.

In the uranium business, we expect revenue to be about 20% higher due to a stronger realized price and increased sales volumes. We also anticipate that revenue from the conversion business will be about 20% higher than in 2005 due to an anticipated 15% increase in sales deliveries and an increase in the average realized selling price.

BPLP earnings in 2006 are projected to be marginally higher than in 2005 mainly as a result of fewer outages. This earnings outlook assumes the B units will achieve a targeted capacity factor in the low 90% and that there will be no significant changes in our current estimates for costs and prices.

Gold production in 2006 is forecast at 729,000 ounces, a decline of about 7% from 2005. Unit costs are expected to increase primarily due to lower ore grades at the Boroo and Kumtor mines.
This financial outlook for the company is based on the following key assumptions:
- no significant changes in our estimates for sales volumes, costs, and prices,
- no disruption of supply from our facilities or third-party sources, and
- a US/Canadian exchange rate of $1.15.

For 2006, the effective tax rate is expected to be in the range of 15% to 20%. This range is based on the projected distribution of income among the various tax jurisdictions being similar to that of 2005.

Stock Split and Dividend Notice
Cameco announced today that its board of directors has approved a two-for-one stock split of the company's outstanding common shares. This will be completed through a stock dividend with all shareholders receiving one additional share for each share owned on the record date of February 17, 2006.

Cameco's common shares are expected to begin trading on a split basis on February 15, 2006 on the Toronto Stock Exchange and February 23, 2006 on the New York Stock Exchange. The stock split will have no unfavourable tax consequences to shareholders in Canada or the United States.

Cameco also announced today that the company's board of directors approved an increase in the annual cash dividend from $0.24 per share to $0.32 ($0.16 post-split) beginning in 2006. The quarterly dividend of $0.04 per common share (on a post-split basis) is payable on April 13, 2006 to shareholders of record on March 31, 2006.

"Cameco had a very successful year and is now well positioned to benefit from the resurging interest in nuclear energy," said Jerry Grandey, Cameco's president and CEO. "Our decision to split the stock and increase the dividend reflects our continuing confidence that we can continue to grow as a nuclear energy company producing uranium fuel and generating clean electricity."

Things are looking good for the future for Cameco in my opinion. Being one of the few ways americans can buy uranium, i think cameco will get huge boosts when uranium mania really sets in. A boost in dividend and a stock split are nice bonuses too i think.

Today's drop is a good opportunity to buy at a nice discount and hold for a couple years.

Want a glimpse into the world of the big players?

2006-01-31T16:41:00.000-07:00

Today I found a very interesting web site that allows us to see what the big money is doing in the canadian stock market.

The page is the National Post's daily block trades update. This shows all the huge block trades that went through during the course of the trading day.

Here are some trades of interest to us:

Connacher Oil & Gas Ltd	com	CLL	5.55	295,000	GMP Secs	GMP Secs	09:36
			5.63	100,000	First Assoc	First Assoc	10:54

Paladin Resources Ltd	ord shs	PDN	3.03	100,000	Dundee Secs	Dundee Secs	09:38
			3.03	100,000	Dundee Secs	Dundee Secs	09:40
			3.03	680,000	TD Secs	TD Secs	09:44
			3.03	200,000	TD Secs	TD Secs	09:51
			3.04	101,300	Canaccord Cap	Canaccord Cap	11:00
			3.05	200,000	Haywood Secs	Haywood Secs	11:28
			3.05	300,000	TD Secs	TD Secs	11:29
			3.05	259,000	TD Secs	TD Secs	12:00
			3.05	635,000	TD Secs	TD Secs	12:07
			3.05	300,000	TD Secs	TD Secs	13:50

Silver Wheaton Corp	com	SLW	9.00	100,000	GMP Secs	GMP Secs	09:39
			9.00	882,400	GMP Secs	GMP Secs	09:39
			8.97	150,000	Haywood Secs	Haywood Secs	10:21
	wt A	SLW.WT.A	0.88	230,500	GMP Secs	GMP Secs	10:24
			0.88	144,500	GMP Secs	GMP Secs	10:56
Silvercorp Metals Inc	com	SVM	6.45	100,000	GMP Secs	GMP Secs	10:25

Pan Orient Energy Corp	com	POE	3.05	100,000	Research Cap	Research Cap	10:13
			3.05	500,000	Wellington Mkts	Wellington Mkts	10:21

UrAsia Energy Ltd	com	UUU	2.79	100,000	Canaccord Cap	Canaccord Cap	10:23
			2.77	100,000	Canaccord Cap	Canaccord Cap	14:23
			2.75	100,000	Canaccord Cap	Canaccord Cap	15:20

I just found this page very recently but from now I'll be watching it closely to see what kind of action my picks are getting.

Of course I'm also watching because someday my own trades will be showing up on that page. Hey, with the performance of my picks so far it's not impossible! ;)

On a side note, Pan Orient makes me more interested in it everytime I look at it. I wrote about them first on Dec 17 05. They closed that day at $2.22. Today they closed at $3.12 on nearly 10 times average volume. Something good is going on there. By the way, if you bought when I recommended it, you'd be up 41%!

Glad to see

2006-01-30T22:00:00.000-07:00

Paladin finishing the day today being the 3rd most actively traded stock (on no news) on the TSX on volume of 7,462,184 shares.

The Paladin story I have been telling you all about for nearly 2 months is being uncovered the many other people.

But not everyone. Some smart money is moving into the stock but this is just the beginning.

You can (as we do with great success) speculate on the tiny uranium juniors with (only) land claims but no matter what way you put it, Paladin is the real deal.

They have already secured the sales of over 4 million lbs of uranium to American utility companies. Thier mine will begin production in September and they will continue to rapidly grow production until at least 2008.

But between now and 2008, I'm sure we will see many more catalysts for major jumps in the share price.

Yes, they do have a large float but as more and more of it will be stuffed away by smart long term investors (like me), less will be available to trade knocking the price up. Keep in mind that a large float makes Paladin an ideal buy for fund managers all around North America.

Paladin is one of the greatest picks I could think of for a conservative investor to reap very impressive returns over the next 2-3 years. I don't think you should treat Paladin as a trade. Treat it as an investment!

I hope you got in...

2006-01-30T21:57:00.000-07:00

to Playfair Mining when I recommended it on Jan 19. The closing price for this stock that day was $0.51.

Today is was up over 33% to close at $0.87. That makes for a 71% gain in less than two weeks!

In that write-up I suggested it might hit one dollar last week on the Vancouver Resource Investment Conference speculation. I was a bit over enthusiastic but as long as my trend (up) is in line I feel good.

My prediction (which might be totally off) for this week is this: based on the price history (look at that page yourself and see if you can't find some consistent patterns in price movement and volume) over the past few weeks, I predict that we will see even higher volume than today on tuesday with solid gains once again. Then on wednesday we should see a little more upside on slightly lower volume followed by some consolidation on thursday and possibly friday.

It's nearly impossible to be right on day to day movements like that but I'll try anyway so I can look back in a while and use 20/20 to evaluate what I did wrong or right.

I myself bought ply at 0.475 and you can be sure that if it gives me a ~120% gain I will sell half. This is not because I've given up in the company. It's just because I don't want to lose money. If I sell half at 120% return, I have a GUARANTEED 10% return on my money, no matter what happens.

Investing is a game of trying to cut your losses and let your winners fly. This is my way of doing it.

Before I forget, some of the gains today may have been associated with the appointment of James Robertson to the PLY Board of Directors. Neil Briggs, Playfair's President said, "We very pleased to add an executive of Mr. Robertson's caliber to the Company's board, particularly given his extensive experience in the tungsten mining sector. His experience should prove invaluable as Playfair pursues its goal of becoming one of the world's principal developers of new tungsten resources."

Read the entire press release here.

The good times go on (for now)...

Ways to Buy Silver Wheaton--The Warrant Puzzle

2006-01-30T10:22:00.000-07:00

Do you buy the stock or the warrant? And with Silver Wheaton, which one?
There are recurring questions about the warrants on the stockhouse BB.
In short, from SLW's website, the warrant structure is as follows:

As of Dec. 22, 2005
Shares Outstanding Fully Diluted	183,314,998 228,655,522

Toronto Stock Exchange:

SLW - (Cusip # 828336107): 167 M

SLW.WT - (Cusip # 828336115): 117.5 M (or 23.5 M consolidated)
Terms: 5 warrants for 1 common share, Exercise price C$4.00, Expiry Aug 5 2009

SLW.WT.A - (Cusip # 828336123): 40.5 M (or 8.1 M consolidated)
Terms: 5 warrants for 1 common share, Exercise price: C$5.50, Expiry Nov 30, 2009

SLW.WT.B - (Cusip # 828336131): 7.8 M
Terms: 1 warrant for 1 common share, Exercise price C$10.00, Expiry Dec 22, 2010

American Stock Exchange:

SLW - (Cusip # 828336107)

View Quotes:

TSX: SLW | SLW.WT | SLW.WT.A | SLW.WT.B
AMEX: SLW

I own the stock and the SLW.WT.
First, look at the expiry dates--2009 and 2010----GREAT!
What do you think the price of silver and the price of a share of SLW
will be then?
Then, look at how it plays out.
For example, for the WT, if SLW is at, say $12, the warrants should be around
$12-$4=$8 Divide by 5=$1.60. They currently trade in the .80 range.
Finally look at the number of warrants out. The B warrants are one warrant per share at
$10, but the number of warrants out is small. You will do well on this if the share price
goes up alot from here BUT when I have tried to sell warrants, sometimes they are not
very liquid and the bid/ask spread can be fairly large. The WT are the easiest to trade.

"You pays your money and you takes your choice"

Some Oil Sands Thoughts

2006-01-29T15:45:00.000-07:00

Mike has covered the fissionable juniors, but another commodities bubble is inflating
in the oil sands. Since the Universe is an inflating bubble, my philosophy is to go for the ride.
Oil is an even hotter button than uranium in the short term:
1. Iran is a major destabliser, and if you look at the Strait of Hormuz, it is extremely vulnerable
2. Iraq is occupied and its newly elected parliament is dominated by Iranian-tied Shiites.
3 Hamas won US backed elections in Palestine and is busy setting up a military.
4. Russia is using gas and oil as a weapon ( Ukraine and Europe), and its major companies are allegedly notably corrupt ( Lukhoil, Gazprom).
5. South America is following the domino effect---falling under the influence of Hugo Chavez...
Venezuela. Argentina, Bolivia, and soon likely Peru and Brazil are either passively or actively anti-American and are perhaps at risk of nationalising resources.
6. C.A.F.T.A. , the Central American Free Trade Agreement promoted by Bush is at risk of not happenning due to 5. In any case, to me it seems like an attempt by Bush's old company, Harken Oil to get Central American oil leases.
7. The house of Saud is incredibly vulnerable to Wahabi extremists, and even without a possible coup, OPEC is, I believe NOT able to ramp up prodcution without depleting field pressures.
8. The North Sea fields are winding down.
9. Canada is stable, and a Conservative Govt will impress the US.

For these reasons, and more, the oil sands are a good place to have some of your portfolio.
The oil sands are in and out of the news every few weeks. Dick Cheney was to visit before
the Louisiana hurricane, and likely still will. China and France have taken positions. Majors
like Suncor and Encana and Petrocan are there.

And, some select juniors managed to stake fairly large claims before the good stuff was gone.
In particular, Connacher (CLL) and UTS Energy Corp (UTS). Both have large floats ( 134 million and 400 million respectively), so are easy to trade ( sort of like PDN and UUU)
UTS has JV with Petrocan, and, so far CLL is going it alone.
I like CLL because its CEO, Gusella, has been aggressive and lucky---CLL has a large stake in
Petrolifera ( PDP) which has stuck well after well in Argentina and went from IPO of 1.50 to
now over 12.00 and climbing, so they have lots of money to develop their Great Divide oil sands
property. They have large reserves in Pod 1, but they have multiple pods to be delineated.
Their property is VERY close to existing pipelines and a major highway.
Also, they plan on being in production in a year or two---UTS plans on 2010, I believe.
Afew other interesting oil sands stocks are PBG, Petrobank, which has patent on a new extraction technology called THAI ( the others use SAGD--Steam Assisted Gravity Diffusion--which requires natural gas to produce the steam), CWPC ( OTC:BB)
and , perhaps PWII (OTC:BB)--a new player which supposedly is going to announce a new
consortium ( a high spec).
Here is a map of oil sands and claims---just click on the map to enlarge it.

http://www.assemblingvalor.com/opti.jpg

So, in short, personally, I suggest looking at CLL. I own CLL and PDP presently, along with
PDN UUU NUC SVN SLW SLW.wt and Ply, as my spec. I dont think you'd do too badly on UTS either, but it has
over 3x the float of CLL.
------------------------ The Sandman (qbitgaw)

We're getting better!

2006-01-29T14:26:00.000-07:00

Well it's only been about 2 months since I've went live with this blog and I'm very happy with the results so far. The picks have done well and everyone is happy.

I fiddled with the template this weekend and I've gone wide screen. Yes, that's right now you can read dcsb in wide screen. I think it looks better than before.

I've also added a couple of small banners that give links to some great products you guys should check out. They work by affiliate ways so if someone buys through my link, I get a portion of the sale.

Third, I would like to announce that Gordon (qbitgaw) might start posting some of his opinions right on the front page. He has been posting great comments and opinions for almost as long as i've been up so this is the logical next step up. We think alike so I think you guys will enjoy another point of view.

I will soon post the performance of my picks/mentions so far. All I can say is that the average return is over 23%!! Don't trust me, I post a table pick by pick as soon as I can get the formatting right.

Happy Investing,

Mike

Silvercorp IR Notes

2006-01-28T21:07:00.000-07:00

Just two days after my bashing of Silvercorp IR for not phoning me back, I get a call this morning from someone wanting to speak to me. What do you know, it's Ms. Fong from Silvercorp IR!

She said she'd been trying to call me many times but that either my phone was busy or my answering machine wasn't working (both highly likely, I have to fix that stupid answering machine).

Ms. Fong ended up being very nice and answering all my questions and more about everything to do with Silvercorp. She even admitted to me she was phoning directly from New York on her Cellphone. She said she had some meetings planned with investment firms. [On a side note, she said that she received a call from a gentleman in Pasedena California a few months ago who wanted more information about Silvercorp. Ms. Fong said that if he could gather a large enough amount of people, she would come personally to make a presentation. Sure enough he 40 people together and she flew down to make her presentation including core samples etc.]

If you remember, I was very happy with Nova Uranium's IR compared to other junior exploration companies. Well, right now I have to say that Ms. Fong was even better than Nova. I talked to her for at least 40 minutes pestering her with question after question and I never even got the slightest hint that she wanted to get my call over or that I asked a stupid or irrelevant question. Honestly, top marks in effort, patience and quality of information.

Now let's get to the information that makes or breaks investments:

First of all, I asked about the status of the license they need to begin production at their Ying Silver property. Ms. Fong said there are 3 major submissions which among them is an environmental one. The previous 2 have been conditionally approved but the last environmental one is still being looked at. She expects a decision by the end of February with the eventual permit being granted March 31st.

She noted that the decision must be made by the Provincial Government there. Even if the application is not accepted, it's not the end of the world. She said Silvercorp would simply look at the changes needed to be done and do them. This would cause delays but the project would eventually go on. She did mention that through all the steps Silvercorp worked very closely with Government officials to ensure everything was done to their liking.

Next, Ms. Fong told me that Silvercorp wants 2006 to be a signature year for them. Here are the 3 objectives they want to achieve:
1. Of course they want to get their mine permit approved for the Ying Silver project.
2. They want to increase their resource estimates through several drill tests.
3. They want to be granted an American Listing on the AMEX.

Numbers 1 & 2 are obvious for any resource company. However, #3 excites me so much. This will give Silvercorp an American exposure and more proof that Silvercorp is serious about making investors rich. The preliminary steps have already been taken and the applications have already been sent. There will not be any new shares created for the Amex listing. The shares will trade ADR. After telling me all this she mentioned that any dilution is of course not good.

Next Ms. Fong told me that Silvercorp is quite busy looking for an acountant that understands Chinese. An interesting fact is that Silvercorp has hired 10 geologists whose only job is to scour all of China to try to find more properties similar to their Ying property that could be major silver discoveries.

Why? Isn't that a waste of money? No, says Ms. Fung because Silvercorp feels that there is a 5 year window of opportunity right now to buy up Silver properties for fair prices in China. In 5 years, mining properties will be too expensive for Silvercorp's motto of "spend a dime, earn a dollar".

Getting into more detail about the Ying project, Ms. Fong confirmed that according to all drill tests, it will produce 5 million ounces of silver, 30,000 lbs of lead and 9,500 lbs of zinc. This is the equivalent of 10 million ounces of pure silver.

If the permit is succesful, Silvercorp aims to make a $50 million profit in the 2006 fiscal year (which runs from April 1, 2006-March 31, 2007). Of this 22.5% would be transferred to the government because it owns that share in the project. Therefore after all costs (salaries etc.), $34.7 million would be available to give to shareholders (if chosen to do so).

Ms. Fung said that they would be looking at spending about $4.5 million of those profits to make another $50 million. However, she admitted that Silvercorp is considering how best to reward shareholders. She said a dividend, a share buyback or acquisitions are all posibilities management is strongly looking into.

I then asked Ms. Fong how they came up with a silver production cost of less than $0.01. She said that their total cash cost of production is actually $6.50. However, you can minus $4.50 off that price because of the Zinc and Lead. There are a few other deductions (sorry I can't remember them all) which bring you to a real cash production cost of $0.55.

Silvercorp will choose not to smelter and refine their silver themselves so they will give up 24% of the price of silver to pay someone else to do it.

To sum up how much money they will make: Silver corp will be paid at the time of shipment 76% of the spot price. Their cost is $0.55/ounce so you deduct that. If they were to ship silver today, they would make $6.72 profit on every ounce of silver. However, I'm very bullish on the price of silver so it should be much higher in the years ahead.

I then asked the direct question of why does she think Silvercorp is so undervalued compared to its peers. Ms. Fong was direct and said she agreed with me and gave me a few possible reasons. First of all, she said Silvercorp is still an unknown brand and entity. People just haven't heard of it enough. Next Ms. Fung (suprisingly) admitted that she is not from a marketing background but from a geology one. Although a marketing person might get the word out better, she said they chose her because she actually knows what she is talking about when referring to core samples, material grades etc. I take this as a huge opportunity for us early investors because this company is still undiscovered. But it won't last forever...

Additionally, she told me that currently there are only 3 people working full time for the company. The CEO, director and herself. All others are only consultants. This is smart because there are only 3 permanent salaries and the rest of the people are only paid if they are needed keeping costs under control.

That's everything I scribbled on my note sheet. Ms. Fong reassured me that if I have any questions at all in the future to contact her through email cfong@silvercorp.ca. She said she has a Blackberry so she can often respond very quickly no matter where she is on earth promoting Silvercorp.

Here is some extra info you should know before investing in Silvercorp:

-listed on TSX symbol SVM
-has 48.1 million shares outstanding fully diluted
-has about $8.1 million in cash at hand
-current market cap of 275,673,072
-insiders own 5,946,256 shares/options according to most recent Sedi fillings
-that is 12.4% of shares outstanding
-Official website: Link
-Chart:

Conclusion: I was honestly extremely impressed with Ms. Fong and her effort in educating only one investor about Silvercorp. I had a small position in Silvercorp prior to today but you can be sure that I will be increasing it substantially over the next year. Any price below $6 is a strong buy and if it ever approaches $5 you have to buy hand over fist!

I have a price target of $17 on Silvercorp. Isn't that too high? No, let me use Silver Wheaton as comparison. SLW's current market cap is 1,353,092,950. This is nearly 5 times larger than Silvercorp. Silver wheaton will produce 11.5 million ounces of Silver in 2006 at a cash cost of $3.90. Remember silvercorp will sell the equivalent of 10 million ounces silver (76% of spot price) at a cash cost of $0.55. Based on these simple assumptions, slw could make about $65 million (a p/e of 20.7).

If silvercorp was to make $34.7 million in 2006 based on a price of $17/shares, their p/e ratio would also be 21.

I know this is extremely rudimentary and inexact but I am just using it to show you how undervalued Silvercorp is.

Buy it, especially on dips!

More Great Paladin News!

2006-01-27T18:14:00.000-07:00

Paladin was the first uranium stock I bought. I bought it about 4-5 months ago at $2.14. I had been watching it closely while it kept running up so I finally pulled the trigger. It kept going up but only for a short time. It then weakened and fell all the way down to $1.54. But I stuck with it because I knew the uranium story and knew how rare it would be to find a uranium junior who would begin production in about a year's time. I'm now up 33%.

Now I am finally starting to see momentum and awareness breaking through in Paladin. Today they released another important press release stating they have signed another contract for over 2 million pounds of uranium to be delivered to an un-named American utility provider between 2007 and 2012. This shows the confidence other companies are putting in Paladin.

Ideally, they will have all their production bought up in contracts prior to completed construction of their mine in Namibia.

Logically, the stock today traded up nearly 9%. However, even more importantly, it was the 5th most traded stock on the TSX. People are starting to take note and they want a piece of what they see.

I must add that at the very end of the day a 300,000 share order was processed at $2.85.

Some big money is coming in and $5 is my price target for 2006. This is quite conservative but I will revise it if I see Paladin getting even more active. If you aren't in Paladin yet, you should be! This is a great probability bet for a double in a year because they will begin production and sales by the end of the year. I don't know of any other junior like this.

Keep in mind, I consider all my other junior uranium plays speculations, but Paladin is a stable investment!

Press Release

P.S. Keep in mind that I first recommended Paladin on Dec 8 05. It closed that day at $1.70. If you had bought then, you'd be up 68%!! Stick with me and we'll make tons of money!

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Something Fishy Going on With Silver Stocks!

2006-01-26T19:46:00.000-07:00

Since the beginning of the year, I've been touting Uranium and Silver as my top 2 sectors for 2006. Uranium juniors have gone on to a scorching start. I hope you've made some money (it'd be hard not to). But silver has been a little slower.

Today though, I think we have begun the bull run. Most silver stocks posted big gains on enormous volume on no news! Hmmm...why?

Just look at this 5 day chart of Silver Wheaton:

Right at the open there was huge volume. At the end of the day, 4,946,342 shares traded hands. In contrast, the average is closer to 700,000!

For there to be such a big difference without any news, something has to be up. My guess is the big money has decided to get in early into silver before some big news in the near future.

What could that be? Well today silver itself rose nicely: "March silver rose 9.5 cents to close at $9.605 an ounce in New York, after trading as high as $9.67 -- levels not seen since 1987. "Silver is taking center stage ... with the news of Barclays' silver ETF a step closer to possible approval," said Peter Spina, an analyst at GoldForecaster.com. "We have some gold investors moving into the silver market," he said, adding that he expects silver to target $9.80-10 an ounce in the short term. February gold fell $2.60 to close at $559.90 an ounce, but finished well above the session's low of $554.40"

If the silver etf is approved, they will hog most of the supply off the market and there will be a huge shortage in comparison to demand, spiking the price like crazy.

I read a great article about the possible silver etf here. Make sure you read it.

The author suggests that if the etf is approved that is great news for silver investors. However, if it is not approved, that is even better! "Because it will prove for all to see just how critical the supply/demand and inventory situation is in silver. If the government says no way to this ETF, it will be for one reason only – there is not enough real silver in the world to fund it. There will be no other way to spin it."

So in the next few years, the only way for silver is up, way up. Make sure you don't miss the boom. Buy into silver soon. But don't chase, keep in mind that silver goes up the most at the end of commodity bull markets. So when silver is going up like crazy, more than any other commodity, that will be the time to start pulling out all our profits.

One of the best silver plays is Silver Wheaton. They are extremely solid and consistently go up. I profiled them on Jan 3rd as one of the stocks that seem to consistenlty go up. Will that change anytime soon? I don't think so. They're only up about 10% since then so you haven't missed too much upside. But remember, they consistently go up so next month, they'll probably be up another 10%!

The second way to play silver carries more risk but more potential reward (as is often the case). I hinted at this company as a "secret stock" of mine. The company is Silvercorp. Basically, they have a mine in China they are awaiting approval on. If they do get approval, they will hit the jackpot. Their mine will produce 5 million ounces (in addition to 40,000 tonnes of lead and zinc) at a cost of under $0.01!! That's not a typing error! Almost free!

That could give them cash flow of over 45$ million++ before the end of the year (solely based on silver production). Pretty big for a company with a current market cap of only 273,928,306.

Please look at their presentation here. It has several comparison graphs starting on page 18. Check them out.

Curiously, insiders only own 13.1% of the shares/options fully diluted. I would think they should own more if this company is as undervalued as they make it seem.

It almost seems too good to be true. (Another thing that leaves a bad taste in my mouth about it is that I phoned IR last week but they were away but said they would call me back. Still haven't called me. Will have to try again soon. Edit Jan 28: Silvercorp IR called me this morning. She said she couldn't reach me even though she tried many times before. She said she was calling from New York by Cell phone. I talked to her for at least half an hour. I am very impressed. I will post my IR notes very soon.) Please tell me if I'm overlooking something!

I hope I'm right with silvercorp but silver wheaton is a lower risk play that I feel strongly might double this year to about 14$.

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Athabasca Basin Uranium Claims Map

2006-01-25T19:34:00.000-07:00

I came across this a while back but I finally decided to share this with you. It basically shows how many uranium claims all the companies have in the athabasca basin.

http://www.explorationgis.com/AB_claims_detail.html

Some notable mentions (of small companies) are canalaska ventures, dejour enterprises, international uranium, jnr resources and uex.

Will be doing more dd on those because having a lot of claims is not a bad thing (since this is the region where the most uranium in the world is mined)!

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Vanouver Resource Investment Conference Notes

2006-01-24T11:48:00.000-07:00

Because I was not able to attend the VRIC, ulump covered my back. Here are some of his comments:

The Vancouver Show was very very busy. I am still taking it all in and I have been home for a while now! I got there about 9 or so this morning and took in some of the talks and visited quite a few booths, including PLY and NUC. One guy I talked to had been there since the first talk (7 am - way too early for me on Sunday morning) he said that the main speaking hall was packed full with standing room only before 7 am!!

All the anlysts and Newsletter writers were positive about the market and thought that we are in for several good years. Eric Coffin thought we might have a couple of sharp downshocks in a generally good year. Everyone I heard speak was very positive about Uranium, Jim Dartnell (mining analyst for Wolverton) picked NUC as his top overall pick. Dave Coffin, in response to a question, said don't sell NUC but maybe don't buy now, wait for drill results or a pullback. Dave Coffin also specifically mentioned tungsten as a metal to watch and said that there are very few tungsten companies but they are all good buys. John Kaiser said he had missed PLY as a bottomfish but was adding it to his list.

The PLY and NUC booths were together with RUP and KLM (all the same management) - 4 booths in a row! When I was there they were very busy, especially NUC. NUC already has 3 bids in from drill companies expects to start drilling in 3 weeks or so. They had a detailed map of the rock sampling and the results look quite consistent. IR and the geo were polite, thorough and really seemed to know what they were talking about. One IR comment was that people who are buying NUC now at $3 plus are a very different group than those who bought earlier. The recent buyers are more longterm and less quickflip. They see less shortterm trading. When I was there 3 IR guys, 1 geo and Don Moore were all individually busy answering questions. I kind of stood on the fringes and fired in a couple of questions. All in all I was impressed.

At PLY the geo from NFLD was there - Jim Harris - he was very much a straight forward non-promotional bush geo. He is absolutely convinced that Grey River has what ASARCO says and probably several times more than that. He expects to be drilling there in March. President Neil Briggs was also there, he is a geo too and spent 7 or 8 years in NFLD. He had a bunch of Granite Lake maps and a report - looks impressive.

Thanks a ton ulump!

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Fronteer IR Notes

2006-01-23T20:37:00.000-07:00

Fronteer Development Group is another one of the companies I phoned last week. Here is some of the info:

They have $15 million in cash.

About 65% of their shares are owned by institutional investors. 10% is owned by insiders and the rest are retail investors.

IR told me they are putting equal time and effort into their two prized territories.

The first is their gold property in Turkey. They will spend about 8$ million on drilling this year with the goal of production in 2007.

The second is their uranium property in Labrador. They want to prove that it has in excess 100 million lbs of uranium in it. They want to develop this into a mine but this would be in a 10 year out time frame.

He mentioned that any of these properties could be at any time sold off to the highest bidder.

This IR man was average but helpful in telling me the facts and plans for the future.

I liked Fronteer more before this phone call because I thought that management had greater convictions in their company. By only owning 10% of the shares, this tells me they're not entirely confident. Decent company, but I want to buy better for myself.

Official Web Site

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How to Buy Gold 7.2% Off!

2006-01-22T16:05:00.000-07:00

I have uncovered an excellent money making scheme that allows you to buy gold at 7.2% off its current price.

How?

Well all you have to do is buy Central Gold Trust which trades on the TSX.

In Canadian $, they currently own $25.10 worth of gold. However, they're trading at only $23.30. That's 7.2% off!

As good as this sounds, I'll make it sound much better for you. The people behind the creation of this are the same people behind sprott asset management who are some of the best hedge fund managers in canada. Eric Sprott and John Embry each own 199,800 shares. In total, insiders own 425,700 shares out of (only!!!) 3,277,500 shares outstanding! It's about 13% insider ownership but look at how few shares there are.

Once this starts going up, it will go up very fast!

Just for comparison, Uranium Participation is a very similar stock to this. They are buying and holding uranium simply because they think it will go up. The only difference is that UPC, has a 31% higher price than in Net Asset Value!

Using this simple comparison, Central Gold Trust should go up 38% to be at a similar Nav/price ratio (or UPC should go down 38% but I doubt this).

I have not bought CGT because I think I can make more money in the Uranium juniors right now but if you are a more conservative investor with a quite large portfolio, I think buy 5-10% in CGT could be a very wise and profitable decision and it is a simple and quick way to buy actual gold.

Visit their web site for daily NAV updates!

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Strathmore IR Notes

2006-01-21T17:19:00.000-07:00

Last week I phoned a bunch of IR departments to see what they can tell me about their companies.

Today I will outline what I got out of Strathmore IR. When comparing to other companies, the IR here was second best in quality to Nova.

The first thing I found out was that they have about $21 million in cash. Nothing I didn't know but sometimes it's nice to get confirmation.

Next, I asked who the largest shareholders are. I was very surprised to hear that the man told me that Sprott Asset Management owns 26% of the company right now.

The CEO, Davinder Randhawa, owns 2,545,910 shares according to Sedi but IR told me he owns closer to 3 million. Oddly, since Jan 12, he has sold over 150,000 shares in the open market. (In total, insiders own 6,462,781 shares/options or 9.4% of the company)

This is despite the fact that IR told me management strongly feels the shares are undervalued. This is why they have hired National Bank to look into way to increase the share price.

I think this is why we have seen their management on RobTV a few times lately.

IR also told me that some Maverick's Fund owns 747,000 shares.

I then asked what their goals for 2006 are. He said they want to get permits from the New Mexico regulatory board for a uranium mine (iirc).

They have the 2 properties in the Athabasca basin that they want to update drill status on.

They also want to get some drill stats on their Dieter Lake property in Quebec.

The last interesting note he made to me was that they are looking to sell their non-core assets to free up some cash.

Strathmore seems like an interesting company due to its huge land positions and it should do fine in 2006 but its relatively low insider ownership (9.4%) don't make me want to own it.

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End of Survey Results:

2006-01-20T18:51:00.000-07:00

I've had the poll up for a couple of weeks now and since it's over 100 votes, I'd like to reveal the results:

What will be the best performing sector for 2006?

Uranium 52.4%

Oil 4.9%

Natural Gas 5.8%

Silver & Gold 29.1%

Other Precious Metal 1.9%

Financials 3.9%

Other 1.9%

total votes: 103

Ok, great, more than half of the readers feel uranium will be the best performing sector in 2006. So do I! Must mention Silver and Gold making a solid showing and I think you need some of that in your portfolio too.

If what we've seen in the last month or so is I sign of things to come, we'll make tons of money by the end of the year.

Thanks for voting and if you have any ideas for the next poll please post a comment!

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Looking for Someone going to Vancouver Resource Investment Conference

2006-01-20T14:37:00.000-07:00

If you are planning on attending the 2006 Vancouver Investment Conference, please email me [ssnajper(AT)hotmail.com].

It will be held in Vancouver January 22nd, 23rd.

I wanted to go but I have some previous arangements this weekend that I could not cancel.

Official Site

Attendance is free if you pre-register so especially if you live in Vancouver, it would be great for you to email me your thoughts/notes/interviews so I could post them to our readers.

Nova and Playfair will have booths there among many other resource companies fyi.

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New Pick: Playfair Mining

2006-01-19T12:59:00.000-07:00

When I was talking to Nova IR, the man mentioned what other companies the management is involved with. Among them was Playfair Mining. Hmmm, what is this? I decided to check them out.

Turns out they have a huge Tungsten mining claim in Newfoundland called Grey River. Historical estimates are somewhere around 520,000 tonnes of Tungsten.

However, this is just the start. Based on geological scans, there may be copper, zinc and other good stuff in the same vicinity.

They also have two other claims that look good too: Granite Lake and Gregory River.

This is just a short summary but make sure to watch this interview with the CEO and read the report to see if this excites you.

I think this stock will hit $1.00 after the Vancouver Expo this weekend. They will have a booth there and will be "showing off" their properties.

And the price is gaining very fast on major volume that is over 10 times the average! Momentum is growing and management has bought more shares recently in the public market.

What's not to love? I bought in today and you should too today or tomorrow (if you want to get in before the heards next week after the expo).

Extra Info:

Shares Outstanding (Fully Diluted):33,760,265
Symbol: TSX VENTURE:PLY
Official Website: Link

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Huge Paladin News Today!

2006-01-19T10:39:00.000-07:00

Paladin released the following News Today:

Paladin Resources Ltd ("Paladin" or "the Company") (TSX:PDN - News; ASX:PDN - News) has secured its first sales contract for a portion of its yellowcake (U3O8) production from the Langer Heinrich Uranium Mining Operation, scheduled for commissioning in September 2006. This sales arrangement with a major US utility is subject to finalisation of all necessary legal documentation.

The sales contract is for the purchase of 2,145,000lbs U3O8 for delivery between 2007 and 2012. Pricing will be market related to be determined at time of each delivery with escalating floor and ceiling price components.

This sales arrangement signifies a very important occasion for Paladin and the uranium supply industry generally. Few new companies have entered into the uranium market in the past 25 years, reflecting a period of dismal outlook and a uranium mining industry essentially in retreat. The timing of new production from Paladin's Langer Heinrich Mine in Namibia, which is expected to be followed into production in 2008 by its Kayelekera Project in Malawi, provides Paladin with a unique window of opportunity.

The price of uranium has been increasing steadily over the past five years and significant upward price pressure remains as a result of forecast shortages of supply. In a situation where new mine production is now essential to meet increasing demand, this places Paladin in an excellent position to become a significant player in the global uranium market.

Paladin Resources Ltd is an Australian uranium exploration and development company listed on the Australian Stock Exchange ("PDN") and the Toronto Stock Exchange ("PDN"). Paladin is involved in the mineral resource sector with projects both in Australia and Africa. With the Langer Heinrich Uranium Project in Namibia currently under construction, the Kayelekera Project in Malawi undergoing a Bankable Feasibility Study, Paladin is well placed to become a major supplier of primary uranium to world markets.

The best parts about this contract are that it is long term and unhedged. Therefore the price is decided right before shipment.

The current price of uranium is $37.00. It keeps moving up everyweek so by the time the first shipment is sent out, the price could be over $40.00! And in five years it could be $80.00! And paladin gets whatever the price is at the time of shipment.

The release also briefly mentions that in 2008, Paladin will open their second mine in Malawi providing further profits and revenue.

If you had bought Paladin when I first mentioned it on Dec 8 2005 ($1.70) you'd be up ~36%. ($2.32)

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