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1/16/16

IKN presents its brand new mascot

Once upon a time we loved the STFU army guy. Then for a long time the famous O RLY? owl was greatly favoured by these pages. Now we get to enjoy the wonderful WTF parrot.



Please make sure your sound thingy is turned on before hitting the play button on this 13 second Youtube.

All thanks to a regular and kind reader who sent in the link and obviously wishes to remain anonymous. Who'd want to be known as a regular reader of IKN anyway?

1/15/16

The Friday OT: Urban Dance Squad; Demagogue

I've had an earworm about this song for weeks. Your turn now.



So I dug it out this week and yeah, it hasn't aged. That's good.

Urban Dance Squad were formed late 80s in Amsterdam (yeah that one in Holland), came before Rage Against The Machine (little known music trivia fact) and RATM has called them one of their influences. The lead guitaring is average, the bass and drums drive the sound, the rhymes are tops and overall some fine rap metal for your aural discernment. I owned one of their albums in '93 or '94. Played it a lot. They must have spent around two hundred dollars making this promo vid. The other song of theirs I always liked is Good Grief.

IKN may begin specializing in larger-cap US-listed mining stocks

This today from the SEC:

Washington D.C., Jan. 15, 2016
The Securities and Exchange Commission today announced a whistleblower award of more than $700,000 to a company outsider who conducted a detailed analysis that led to a successful SEC enforcement action.
“The voluntary submission of high-quality analysis by industry experts can be every bit as valuable as first-hand knowledge of wrongdoing by company insiders,” said Andrew Ceresney, Director of the SEC’s Enforcement Division.  “We will continue to leverage all forms of information and analysis we receive from whistleblowers to help better detect and prosecute federal securities law violations.”
Sean X. McKessy, Chief of the SEC’s Office of the Whistleblower, added, “This award demonstrates the Commission’s commitment to awarding those who voluntarily provide independent analysis as well as independent knowledge of securities law violations to the agency.  We welcome analytical information from those with in-depth market knowledge and experience that may provide the springboard for an investigation.”


Whole thing here

Uranium Energy Corp (UEC): Even IKN gets them right on occasion

Let's not be different to the pack, let's play the game, let's conveniently ignore this humble corner of cyberspace's pathetic call on B2Gold recently and do what any self-respecting BS self-absorbed ego-monster perma-winning promo-pusher does; highlight the good calls. The IKN post "The financial joke that is Uranium Energy Corp (UEC) (a.k.a "What Casey Research can do for your portfolio" part 429)" dated December 9th (month and a bit ago) finished its purple prose in this manner:
At its current share price of U$1.03, UEC has a market cap of U$101.86m. Its book value is $27.5m (give or take the change) which means this company is running a price/book of 3.7X.
  • Price Book at three point seven times.
  • In this market for miners.
  • For a company with dwindling cash.
  • No production.
  • Every intention to dilute the share count and finance.
  • And $20m of real financial debt on board.
This is the type of bovine excrement that Casey Research recommends to people. A more obvious short in the mining space is difficult to envisage.

Here's how UEC has traded since then:



Or for comparative purposes, here's its performance sat next to Uranium Participation Corp (U.to) which gives a solid benchmark on the metal's movements:


On these things it's just a case of waiting. Financing soon, Amir?

Largo Resources (LGO.v) pays its CEO a $50,000 bonus for lending it $1m for a month

This links to my fave NR since the close yesterday, one after the bell in the evening which outlines how Largo Resources (LRO.v) is getting a $1m bridge loan from its CEO Mark Smith in order to tide it over until a debt deal gets closed with a bunch of Brazilians. But the fun bit is the terms of the bridge loan deal which include:
  • Secured on company assets.
  • One month duration at 12% interest per annum...i.e. 1% effective interest.
  • A $40,000 "establishment fee" paid to Mark Smith for being nice and writing his cheque.
In other words, he stumps up $1m for a month's fun, guaranteed on his own company assets, and gets $50k in his pocket for his troubles. Heads I win, tails you lose.

Would it shock you to learn that the other Mark Smith company NioCorp (NB.to) was the one heavily pumped by Tommy Humphreys at CEO.ca last year? And that it's collapsed since then? It doesn't shock you? Oh wow...


The GMP job cuts: Harris Fricker's internal memo

As you may have heard, GMP swung the axe yesterday and cut many jobs. Here's how FP reported the move:
"...GMP Capital Inc. is pulling out of the United Kingdom and Australia and suspending its quarterly common share dividend to deal with the effects of weak commodity prices and increasing regulation.
Offices in London, Perth and Sydney will be closed, and 97 jobs will be cut, representing a 25 per cent reduction in head count.
In Canada, sales, trading and research franchises will be streamlined “in response to permanent structural and regulatory changes across the industry,” GMP said in a statement Wednesday.
“Our actions today arise from an exhaustive review of all aspects of our Capital Markets business,” said Harris Fricker, GMP’s chief executive.

Full story here.

So here's what GMP CEO Harris Fricker wrote yesterday to the people at GMP who survived the cuts, in the three page internal memo mail entitled "The Way Forward" (put in a PDF copy then ripped, we don't want these things traced). Makes for interesting reading, particularly for those readers of IKN currently sitting behind desks in other brokerages:


UPDATE: Kind reader A.N. Other sends in this:


The CIBC Whistler conference next week: Day One is not for people on suicide watch

Via reader M (ty sir) here's the top page of the CIBC agenda for its biz shindig at Whistler, as per yesterday:



And here's a twelve month (!!) price chart of Thompson Creek, HudBay and Capstone:


HudBay probably agreed to appear because it'll be able to boast how it's doing well compared to peers. Oh what fun.

1/14/16

Tahoe Resources (TAHO) (THO.to) and its "minuscule" gold pour from Shahuindo: The photo

Nice hats, Ira.


IKN brought you the news many many days ago, of course.

But notable how TAHO still refuses to admit how their staff tend to die in accidents while on duty. Nothing in the NR today, Kev. Why's that, Kev? (Also news brought to you many days ago by IKN, of course)

B2Gold (BTG) (BTO.to) reports production numbers after the bell this Thursday afternoon

Just so you know. That gives you an hour and six minutes to decide what you want to do, fellow B2 long (fwiw I'm staying long through the results). And to tie in two themes today, that of B2 and Placer, here's a line that reader D stuck in a mail to your humble scribe this morning:
"It would be a crowd hit if you could find someone who has an archived copy of the 2003 or 2004 Denver Gold webcast where Clive Johnson, then CEO of Bema, begs someone, anyone, to just take Placer Dome over and 'put it out of its misery.'"
We like readers with long memories, thanks D. What goes around comes around, or summink.

UPDATE: There ya go. 131k oz Au 4q15, which means they miss on guidance for 2015.

Pacific (PRE.to)

Now I'm going to take a wild guess and say that the financial advisory thing that PRE set up with Lazard just before Christmas isn't going so very well.


Hey, lucky the insiders sold so many of their shares at much higher prices before the price collapsed, isn't it? I'd hate to think of Fino and his pals short of a dollar.

UPDATE: Ahhhh, this is it. 17.5c on the dollar, which means that either a) there will be better offers out there or b) PRE shares still have a long way to fall. Thanks you-know-who.

The carnage in B2Gold (BTO.to) (BTG) continues

So much for my buying an extra chunk at 85c a couple of days ago (what's worse is that it's an add, i got more at higher prices from previous years). So much for the end of the Van Eck liquidation. And so much for the market pricing in a production miss, because it's on the way to pricing in defaults now. Sheesh, what a market, at least it's doing an excellent job of keeping my ego in check.

Lundin Gold (LUG.to) announce a deal with Ecuador...

...on burdens, and if you understand that windfall tax deal you're better at numbers than me.

What you really need to know is "Ecuador gets at least 50%", which fits in with the country's constitution. And fine for a rich deposit like FDN, but gotta wonder about the other explorecos there.

The Placer Dome Club

Global Mining Observer connects the dots and shows how the people who came out of Placer Dome have carved up the Canadian mining scene between them and made themselves a lot of money doing so.

The shareholders who sponsored them? Less. A great piece, go check it out here.

Alan Rickman

Forget Harry Potter, his amazing ham on Robin Hood Prince of Thieves was the greatest scene-stealing by a support I can recall. A sad loss, way too early.

PS: I see Aaron Ramsey scored last night for Arsenal in the match vs Liverpool. That makes it Osama Bin Laden, Whitney Houston, Paul Walker, Muammar Gaddafi, Steve Jobs, Robin Williams, Richard Attenborough, David Bowie and Alan Rickman. Impressive. Google "curse of Aaron Ramsey" for more information, my internet-connected friends.

UPDATE: According to Newsweek this afternoon, people think Aaron Ramsay may die if he scores an own-goal.

Chart of the day is...

...two years of the gold price:


What goldbugs, gold supporters, gold owners and anyone who understands the basic common sense of having a percentage of your net worth in gold need to do is to be completely honest with themselves and others about that chart: It sucks.

Can anyone blame a chartist for looking at that sort of chart and saying "Yeah, going lower isn't it?".

Full disclosure: I own bullion and will continue to do so.

Guiding your CUM

Copper Mountain (CUM.to) released its 2015 production numbers this morning and the best bit is...

Copper production totaled 77.6 million pounds (95.6 million pounds of copper equivalent) for the 2015 year and was on track within 5% of the Company's guidance of 80 million pounds of copper.

On track within 5%. On track within 5%. Oh you guys!


Oh man, you can tell Marin Katusa was on the board, can't you?

1/13/16

Argentina and "The Macri Factor" on mining stocks

So I got to thinking about all this hype on Argentina being newly business friendly and welcoming and the new wonderful and after a bit, it occurred to me to put together an unscientific comparative chart of a few mining tickers against Yamana Gold (AUY) (YRI.to), what with that one having the most direct exposure to Argentina of its production mix (Gualcamayo, Alumbrera etc) as well as development projects (Cerro Moro, Suyai). And here's what came out:



Seems to be more hot air than substance. By the way, the one Tier 1 I left out was Goldcorp because it has its own significant exposure to Argentina and (but?) its own  unconnected travails right now. That one is about 20% down, just less than AUY.

Icahn and Freeport

Let's take a wild guess, be generous and say Carl Icahn paid a little over U$9 on average for his 88 million shares of Freeport McMoRan (FCX) which were filed on August 27th (the spike day):


FCX jJust printed U$3.72. That puts him half a billion (with a B) in the hole. Nice timing.

Mailbag on yesterday's Peter George post

After yesterday's post on the news about iffy geol Peter George, the following mail was received by IKN Nerve Centre from reader R, an industry pro and mailpal of long-standing. Permission sought and received to publish here because it's excellent comment, some very slight editing done to protect both innocent and guilty. 

I'll leave you with Reader R:

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

Good post on Peter George. 
The puny fine ($35K) when compared to the market cap collapse of BGM, SGR and RMX (PVG has continued to tap dance) speak to a toothless judiciary. That he has been banned from authoring a new mineral resource or reserve under 43-101 is simply laughable. What management or board in their right mind would consider retaining his service? What good is the Society of Professional Geologists if a series of clearly substandard reports can be published over the course of some years before the crime is even spotted, let alone held to account?

And what of the culpability of each of the Company’s respective management, Boards and advisers who not only accept these reports but act on them? Is universal incompetence now considered a viable defense? All those who were involved and in fact had their hands deeper into the proverbial cookie jar are free to work within the sector with impunity. 

I submit it is a scenario for the perfect white collar crime. Consider those that have gone completely undetected such as the teams behind (three company names redacted), to name a few. 

Make no mistake, there are thieves amongst us gentlemen. 

Argonaut Gold (AR.to) 4q15 production

NR here, chart here:

In line.

And by the way, I'd care more about the stupid way in which they calculated their silver/gold ratio at 55/1 last year and the even more barefaced 65/1 for 2016 if they produced more silver. As it is, silver is a very small part of the revenues mix so the ratio doesn't matter much, but it does show the pissy-obsfucating attitude of the management team.

Anyway, as blurted above the Q4 from AR.to was in-line. Then again this isn't the problem at this company, it's the fact that it's not making a single buck of profit from all that production. And the mess of a balance sheet with working cap propped up by accounting magic in the inventories column plus the crappy worthless assets it insists are still worth big bucks. Time to impair on Magino, sophists.


McEwen Mining 4q15 production

Here's the link to the NR, here are three charts:

El Gallo 1 had a soft quarter. MUX today told us it was deliberate, so why wasn't there any guidance on this Rob?

Meanwhile, San José had an excellent quarter:

Overall I'm okay with these numbers. And MUX is again guiding low-ish for 2016, almost certainly to get one of those flashy "look how much we're beating by" things going again later on, same as every year. And that's yer lot, people. More Sunday, subbers.

1/12/16

Peter George has been a naughty boy

My thanks to reader K for the headsup on this one. Check out this little section of this news release dated January 12th 2016 (your humble scribe's highlights):
Mr. Peter Thomas George, P.Geo., was the QP for the Barkerville Project in B.C., owned by Barkerville Gold Mines Ltd. Faced with a public hearing, Mr. George entered into a Consent Order with APEGBC by which Mr. George admitted to unprofessional conduct in producing a substandard technical report for Barkerville Gold Mines Ltd. that failed to meet the requirements of NI 43-101.
Mr. George also admitted to producing two substandard technical reports for Rubicon Minerals Corporation for its Phoenix Gold Project in Ontario. Mr. George must pay a fine of $15,000, costs of $20,000, and is subject to a number of conditions on his membership with APEGBC, including the requirement that he not perform mineral resource or reserve estimations as defined by NI 43-101.

Barkerville, ya say? Failed to meet 43-101 requirements, ya say? And Rubicon, ya say? Problem with the geological model at Phoenix, ya say? Now why does that one suddenly spring to mind...

Oh by the way, Peter George is the very same geol who brought us the Pretium (PVG) gold resource numbers but hey....fuggetaboutit.

PS: Reader MZ also reminds your author that Peter George was the man behind the Sans Gold resource. Spot any connections yet, Canada?

PPS: And reader JM notes that, "Peter George did Gold Eagle Mines "geologic potential" in Red Lake right before Goldcorp paid $1.5B for the company. You could ask Goldcorp how well there Cochenour (Bruce Channel deposit) project is going but there is a pretty common theme forming here".

UPDATE: Good mailbag received on this from reader R, here.

UPDATE 2: IKN receives this from PretiVm investor relations:
In regards to the post Peter George has been a naughty boy  January 12, 2016
It states: “Oh by the way, Peter George is the very same geol who brought us the Pretium (PVG) gold resource number”
Peter George has had no association with Pretium’s Brucejack project and has never worked for Pretium Resources Inc. so the details you have posted are misleading.
I would request you make that correction or let me know how you substantiate that claim so I can address it.
Thank you
Troy
 
Troy Shultz, MBA
Manager, Investor Relations & Corporate Communications
Pretium Resources Inc. | Pretivm Value Through Gold
Direct Tel: 604.566.8758|Mobile: 604.561.5668
Suite 2300, Four Bentall Centre | PO Box 49334
1055 Dunsmuir Street | Vancouver  BC  Canada | V7X 1L4
Tel: 604.558.1784 | Toll Free: 1.877.558.1784 | Fax: 604.558.4784

So there you go, duly corrected.

The C Word (updated)

DON'T MENTION THE C WORD!

YOU CAN'T SAY THE C-WORD OUT LOUD!

POLITE SOCIETY PROHIBITS THE C-WORD!

Yes indeed, you can't possibly mention that your company depends on the price of c....of c....of....copper (there, I said it). For example this from Colorado Resources (CXO.v) that made me laugh:



Hey honest, we're not just copper, we're gold as well! We got the grab samples!

UPDATE: With impeccable timing, Valterra Resources VQA.v brings us another example this very evening. Please note the difference between the title line of this NR dated September 2014...


...and this NR out tonight:


As if by magic, one minute Swift Katie is a copper project with a gold kicker, the next it's a gold project with The C-Word as its potential byproduct. SeeYouNextTuesday, Larry QC.






LADB rounds up the Chapo fallout

Language trivia: "Chapo" is Mexican slang for a male of reduced 
physical stature, e.g.  De Vito. Or Joaquín.

The usual good stuff from Latin America Daily Briefing today, this time the title is "El Chapo Fallout" which succinctly tells you want you're about to read. All the angles and corners of Señor Guzmán's arrest, a ton of links, one-stop news shopping and all for free. 

Far better than reading IKN. Go now.

The conclusion section to the piece on Continental Gold (CNL.to) in IKN348, out last Sunday

About two and half pages of last Sunday's 31 page Weekly were dedicated to a discussion of the recent ups and downs at Continental Gold (CNL.to). Here's how that note ended:

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Discussion and conclusion: To sum up, we have a company that hides the fact its EIA permit application was denied but now swears blind that evrythin’ gonna be alright, a sellside brokerage world that’s keen as mustard to promote this stock using any sort of conjecture it can lay its hands on (but neatly ignores passing on hard facts when they’re negative to the storyline) and then just after Corantioquia gives its side of the story to the press and directly contradicts the neat CNL narrative, a key member of the permitting and legal team who bails at an optically awful moment citing a weak reason for the decision (effective immediately).

And on top of all that, this is the company run by the very same team that blew up hundreds of millions of dollars in the Colossus (ex-CSI) debacle at Serra Pelada in Brazil, in which everyone (including the main and bigtime insto investors such as ARC Fund and Sandstorm) was kept totally in the dark about the massive and very fatal flaws in the project until it was way too late to do anything about it.

I continue to marvel at the way in which the world of mining will believe anything told to them by anyone, just as long as there’s some shiny metal dangled as the prize at the end of the narrative. CNL.to isn’t an investment opportunity, it’s roulette. Whether it’s the traditional casino or Russian version is up to you to decide.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

For successful living, avoid ownership of this company.

A few bits and pieces of slight interest regarding a few mining companies that have come to be known by this desk

Buenaventura (BVN) has nearly completed its U$500m debt refi deal that will boot its 2017 maturities into the future. The haggling is over the coupon, but the cash is there and once closed will make the working cap look a lot healthier. I don't own any, but I've been thinking about it.

I bought some more B2Gold at U$0.85 yesterday afternoon. It's really cheap after all that Van Eck liquidation, overdue a bounce. Near-term fliptrade planned for this chunkette.

Frank Holmes is the big seller of Gran Colombia Gold (GCM.to) via that Global fund of his. He's getting about 1% of the price he paid for the shares way back when (with Other People's Money of course). But hey, just keep reading his permabull crap and pretend he knows what he's talking about.

Metanor (MTO.v) is looking to run yet another equity financing, trying to raise around CAD$5m and is already trying to discreetly shop the ideas around the usual suspects. At least one of them has rejected the idea (after being takers previously, seen the light it seems). More dilution on the way, suckers.

Tahoe Resources (TAHO) still hasn't told anyone about the death of its employee at Escobal. There's obviously something it's hiding about this unfortunate event and shareholders should ask the company before there's a big legal complication from it. That's IKN's considered advice this happy Tuesday morning.

Gossip over. Have nice day.

UPDATE: Reader and close follower of all things Colombia resource, reader SB chimes in:

"hard to believe frank is getting 1%. that sounds very high"

Well yeah, agreed, I was rounding up.




Y'know if I were a major shareholder of Goldcorp (GG)...

...I'd have stared hard more than once at the HudBay (HBM) share price performance chart more than a few times in the last couple of weeks and thought "WTF are we doing?":



The Alan Haircut isn't the only story in that squiggly line. The main one is how a CEO overburdened his company with debt and has failed to return any sort of advantage.

That and the more prosaic parts of running a company, like the way Constancia is producing plenty of concentrate but nobody thought about how they'd be able to get it down the hill in Peru and onto a ship. The bottleneck is still pretty crazy, we hear.

1/11/16

Catching up with Gold Resource Corp (GORO)

The last time GORO got a mention on the blog was December 28th (i.e. last year) on the news of its wonderful BS made up excuses for cutting its divi to virtually zero. Since then...


...my stars, no New Year's rally for this one.

The 2015 Puskas Award

Sure Messi wins the Ballon D'Or tonight, that we all know (including CR7), but Leo will also win this award for Goal of the Year. The three finalists on this link and your humble scribe's 100% record on calling the winner of this award over the last four years is on the line. 

Well in fact it's not because Leo's is bound to win, it's the easiest forecast of the year. And what you see on the FIFA clip is only part of this because it wasn't just the sublime  moment but the build-up to it, in which he was being tightly man-marked and suffering niggly fouls. And then this.



The greatest footballer I've ever seen.

UPDATE: Ha, shows what I know. Wendell Lira was given the prize. Another FIFA fix, dammir!


Life on mars

This is a very good piece of music.



Chart of the day is...

...copper, dailies:



Obligatory chart today, folks.

Louis James of Casey Research, early 2015: "If I could buy only one stock this year, Rubicon would be the one"

Yup, Louis Lobito Little Wolf James, chief pretend geologist at Casey Research, said exactly that to his subscribers when choosing Rubicon Minerals as his top pick stock of the year. And the thing that really gets me is that he said that AFTER visiting the mine, the site, checking the deposit and looking at the business and the problem there is clear: James is dangerous because he has no training at all in geology, he just pretends to know what he's talking about and so when he's on a site visit he has to trust the word of the people running the scam company, he has no way of independently verifying if they're telling the truth about the rock because 1) he's not a geologist and 2) he's too full of himself to ask for advice, help or suggestions from a professional geologist because he thinks he knows. And this means that he can apologize all he wants for making a bad call but the problem remains and he's going to do the same to you next time, and the time after that, and again  et cetera. And this is the type of brainlessness that you're supposed to trust the next time he makes a call on an exploreco. And you're paying for his advice, too!

Anyway, really looking forward to Louis Lobito Little Wolf's considered thoughts on today's NR from his 2015 top pick. Here's a table:

 
And here's your No Shit Sherlock quote from the NR:
"The 2016 SRK Geological Model demonstrates that the F2 Gold Deposit is more geologically complex and the high-grade gold mineralization is less continuous than previously understood"


David Bowie

Planet Earth is blue.

And there's nothing I can do.

1/10/16

The IKN Weekly, out now



IKN348 has just been sent to subscribers. We're back to post-vacation rhythm with 31 pages and 17,776 words of guff and nonsense (according to the computer word count thing, I didn't count them myself y'know). I enjoyed writing this one too, which fits with my new-found optimism about the metals market I suppose.

The top three most visited IKN posts this week are...

...in reverse order, as we ease into the swing of this tender new year:

Third Place: "Continental Gold (CNL.to): Scratching an itch". This post had nothing at all to do with the resignation of a CNL.to director on Friday. Nothing at all. 

Second Place: "Kip Keen leaves Mineweb, joins CEO.CA". Another dynasty of paid-for pumping in the making. Give Canada credit, they're good at this growth industry.

First Place: "Tahoe Resources (TAHO) (THO.to) pours gold at Shahuindo, tells nobody" and I'm happy about that, because this and the follow-up post of the next day (Hi Scotia!) were my personal faves of the week (in their minuscule way). Not so often that the good'uns are the popular ones.

Sean Penn interviews El Chapo

Right here. And have to say that Penn writes very well.