Small Miners: A 52-Week High and Tons of Drilling
Gold managed a weekly gain of approximately 1%, closing at $1,234 per ounce. I’ve called this move the last head fake but, admittedly, it has lasted a bit longer than expected and has thus far gained a bit over 7% for the year.
Impressively, it managed that gain despite a weekly gain of approximately 1% in the dollar.
I’ve repeated that I believe when the real rally in gold starts it will be accompanied by new highs in the dollar and the major U.S. stock indices.
The major stock indices continue to hit new highs and the dollar was higher this week but I still believe in one last pullback that shakes weak hands out.
Silver put in a weekly gain of nearly 3% while copper surged nearly 6% for the week, with each closing at $17.97 per ounce and $2.77/lb.
Platinum eked out a small weekly gain of approximately 0.5%, closing at $1,009 per ounce while palladium rallied 5% this week, closing at $782 per ounce.
Uranium continues to rally and is now flirting with $27/lb. and zinc continues its march higher, closing at the $1.33/lb. level for the week.
U.S. West Texas Intermediate closed near $54/barrel, a small weekly gain of approximately 0.3%. Brent crude, meanwhile, finished nearly flat for the week and closed at $56.70.
The Week In Juniors
Tinka Resources (TSX-V: TK) (OTC: TKRFF)
On February 10, 2017 Tinka Resources announced that the Ministry of Energy and Mines in Peru has granted to the company the permit to initiate drilling activities at Ayawilca. A drilling contractor is now mobilizing from Lima to site, with diamond drilling expected to commence on or about February 15, 2017.
The company saw shares surge and hit a 52-week high last week as zinc hit a 2-1/2 month high on Friday the 10th.
Shares also benefited from a recommendation from a legend in the newsletter business.
The drill program will initially utilize one rig, with a second rig expected to mobilize in April. The focus of the drill program will be to expand the existing Zinc Zone mineralization within newly permitted areas along strike of existing mineral resources, as well as testing new zinc targets outlined by recent geophysical and geochemical programs.
Dr. Graham Carman, Tinka's President and CEO, stated:
“We are very pleased to commence our 2017 drill program at Ayawilca, which will focus on the discovery of additional high-grade zinc mineralization beyond the existing resource boundaries. I wish to thank our Peru staff and consultants, as well as our local stakeholders, for their tireless efforts in getting these permits finally approved. Going forward, Tinka has a minimum 3 year window to advance the project under the conditions of the EIA. Ayawilca is already a significant zinc resource, and we intend to advance the project as quickly and efficiently as possible through an aggressive step-out drill program throughout 2017.”
“Phase I of the drill program will target extensions of the highest grade and thickest parts of the existing Zinc Zone resource at West Ayawilca. Mineralization there remains open to the south and west. Phase II of the drill program will target the Zone 3 and Chaucha areas, which are two of our highest priority anomalies outside of the resource foot- print. This second drilling phase is expected to commence in April 2017, when at least one additional drill rig will be deployed at the project. We look forward to providing updates on drill results as the program progresses. We expect the drill program to continue until at least July 2017.”
Tinka is an exploration and development company with its flagship property being the 100%-owned Ayawilca Property in the zinc-lead-silver belt of central Peru, 200 kilometers northeast of Lima.
The Ayawilca Zinc Zone has an Inferred Mineral Resource of 18.8 Mt at 8.2% Zinc Eq, and a Tin Zone Inferred Mineral Resource of 5.4 Mt at 0.89% Tin Eq, both open for expansion.
The Silver Zone at Colquipucro, 2 km north of the Zinc Zone, has Indicated Mineral Resources of 2.9 Mt at 112g/t Ag for 10.4 Moz Ag and Inferred Mineral Resources of 2.2 Mt at 105g/t Ag for 7.5 Moz Ag hosted by oxidized silver-rich lenses less than 80 meters from surface.
Tinka has a great asset, and although I thought the latest financing was a bit too dilutive, there are simply very few quality zinc plays in the resource space.
Tinka has great people, cash on hand, an excellent asset base, and now permits in hand. Should be a good 2017 for the company.
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Barkerville Gold Mines Ltd. (TSX-V: BGM)(OTC: BGMZF)
On February 10, 2017 Barkerville Gold Mines announced final results from the 2016 Phase I Island Mountain and Barkerville Mountain KL Zone exploration drilling programs and first results from the new 2017 drilling at the Company's flagship Cariboo Gold project.
Phase II drillhole IM-17-004 returned 13.03 g/t Au over 9.10 meters, 11.48 g/t Au over 3.30 meters, 67.82 g/t Au over 2.90 meters and 72.80 g/t Au over 0.50 meters ranging from the near surface to -350 meters vertical depth.
The release went on to highlight that the Phase II drilling program is underway on Island Mountain with five drill rigs while a sixth rig is located on Cow Mountain, where it is performing a closely-spaced grid program to collect material for an upcoming metallurgical test.
Metallurgical tests early on are good, ask Orex and Canasil.
Two additional drill rigs will be mobilized to the Wells project site imminently, with the focus being exploration and delineation of untested targets on Island, Cow, and Barkerville Mountains. During 2017, the Company intends to perform approximately 130,000 meters of diamond drilling in these areas with eight drill rigs.
That’s a lot of drilling.
The company is focused on developing its extensive land package located in the historical Cariboo Mining District of central British Columbia. Barkerville’s mineral tenures cover 1,164 square kilometers along a strike length of 60 kilometers, which includes several past producing hard rock mines of the historic Barkerville Gold Mining Camp near the town of Wells, British Columbia. The QR Project, located approximately 110 kilometers by highway and all weather road from Wells was acquired by Barkerville in 2010 and boasts a fully permitted 900 tonne/day gold milling and tailings facility.
As of the latest reporting period the company has approximately 332 million fully-diluted shares, C$32 million in cash, and a market cap of approximately C$148 million.
Pilot Gold (TSX-PLG)(OTC: PLGTF)
On February 8, 2017 Pilot Gold did not report results from drilling on its Kinsley Mountain project, which it commenced in April, but it did report results — decent ones at that — from 17 drill holes in the Peg Leg and Covington Pit areas, located south and west respectively, of the Main Zone, at the 100%-controlled Goldstrike project in southwestern Utah.
Highlights from the Peg Leg Zone (five drill holes) include:
• 1.78 grams per tonne gold (g/t Au) over 29.0 metres (m) including 3.54 g/t over 12.2 m in PGS179
• 0.90 g/t Au over 6.1 m and 0.76 g/t Au over 33.5 m including 1.47 g/t over 6.1 m in PGS183
• 1.33 g/t Au over 18.3 m in PGS187
• One of the remaining two drill holes intercepted 0.41 g/t Au over 12.2 m (PGS186), with 1 hole missing the target.
Highlights from the Covington Pit area (12 drill holes) include:
• 1.57 g/t Au over 6.1 m and 4.10 g/t Au over 7.6 m including 6.32 g/t Au over 4.6 m in PGS191
• 1.15 g/t Au over 10.7 m in PGS182
• 0.83 g/t Au over 3.0 m and 7.36 g/t Au over 1.5 m in PGS178
• 0.74 g/t Au over 6.1 m in PGS 185
• Three of the remaining eight drill holes intercepted narrow widths including 0.23 g/t Au over 4.6 m and 0.83 g/t Au 3.0 m. Five drill holes were lost due to ground conditions or crossed the south graben-bounding fault before intersecting the target basal Claron Formation. New drilling will be carried out at steeper angles in order to intercept the target.
• Four of the holes confirmed that higher grade mineralization is hosted in an east-west striking mafic dike located immediately north of the Covington Pit.
There are currently two drills operating on the project in the Aggie area and on the new Warrior Zone target.
Goldstrike is located in the eastern Great Basin, immediately adjacent to the Utah/Nevada border, and is a Carlin-style gold system.
Moira Smith continues to be one of the brightest geologists in the business. I look forward to follow-up work from Pilot Gold at Kinsley Mountain but, for now, I’d settle for a news release outlining the results from the drilling.
To your wealth,
For the past decade, Gerardo Del Real has worked behind-the-scenes providing research, due diligence and advice to large institutional players, fund managers, newsletter writers and some of the most active high net worth investors in the resource space. Now, he is bringing his extensive experience to the public through Outsider Club, Resource Stock Digest Premium, and Resource Stock Digest Trader. For more about Gerardo, check out his editor page.