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Canaccord's Junior Mining report, 15 Aug.


drbubb

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"We continue to see clear evidence of base-building in the junior mining sector which bodes well for a new bull phase late in Q3/06. This said, volumes still remain light and an improvement is required to confirm this

potential."

 

We have been suggesting that the sharp Q2 sell-off in the junior mining sector had

reached a level where base-building was commonplace. In other words, the selling

pressure has abated and selective buying now has to begin to consider chasing the offers

in order to build a position. Volumes on the TSX Venture have based in the 85-100

million share per day range. Our gold in situ weekly value is basing. Individual charts,

more and more, are demonstrating this action and appear poised for a late Q3/06

attempt at a rally into a new bull phase for the sector. Last week we demonstrated this

action with the charts of Atna Resources, Corriente Resources, Nevsun Resources, and

Western Keltic Mines. This week we will add a few more charts for visual confirmation of

this emerging pattern. We include the following below: Committee Bay Resources, Grayd

Resources, Linear Gold, Orezone Inc., Sunridge Gold, and Wolfden Resources.

 

Some worth a closer look, basis charts or comments:

 

Committee Bay (v.CBR) : comment, chart at c$0.50 ... update

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Grayd Resources (v.GYD) : chart, at c$0.50-0.60? ... update

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Linear Gold (t.LRR) : chart, at c$4.60? ... update

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Orezone Resources (t.OZN) : chart at c$1.40 ... update

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Wolfden Resources (t.WLF) : chart, at c$2.50 ... update

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American Bonanza Gold Corp. BZA : TSX 85.8 Copperstone gold project, Arizona ... update

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New Phase 1 drill program commenced with 35 holes on 10

targets for 45,000 feet drilling.

 

Gold Canyon Res. GCU : TSX-V 35.3 Cordero gallium project, Humboldt Cty, NV ... update

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25,000 feet RC drilling commenced on to expand resources

at Cordero, largest known primary gallium resource in North America.

 

Sutter Gold Mining Inc. v.SGM : TSX-V 52.0 Sutter Gold Project, Sutter Creek, Cal. ... update /1907058

 

Phase 2 surface diamond drill program commencing for approx. 9,000 feet.

 

 

SOME COMPARISONS==

Sh o/s Price C$ Mkt. Cap Sum Oz Mkt Cap/oz Mkt Cap/oz

Company Sym M 10-Aug-06 $M Project Name Country per co. M/oz C$ M/oz US$

American Bonanza BZA : T 85.80 0.42 36.04 Copperstone US 2.074 17.37 14.77

(+Fenelon Canada, +Gold Bar US, +Northway Canada, +Taurus Canada)

 

Aquiline Resources Inc. AQI:T 42.25 4.55 192.24 Calcatreu Argentina 5.499 34.96 29.71

(+Navidad Argentina)

 

Committee Bay Resources CBR:V 54.87 0.58 31.82 Three Bluffs Canada 1.302 24.45 20.78

(+RJV Australia)

 

Kimber Resources KBR:T 47.10 2.49 117.28 Carmen Mexico 1.659 70.70 60.09

(+Carotare Mexico)

 

Nevsun Resources NSU:T 102.60 3.50 359.10 Bisha Eritrea 5.287 67.92 57.73

(+Tabakoto Mali, +Segala Mali)

 

Wolfden Resources WLF:T 74.60 2.73 203.66 High Lake Canada 2.086 97.63 82.99

(+East Bay Canada, +Ulu Canada, +Izok Lake Canada, +Lupin Canada)

 

Committee Bay (v.CBR)

Last week CBR announced the results from the first six drill holes at the West Plains

area. Hole 6WP06 intersected 13.14 g/t Au over 8.0 metres and was drilled parallel to

and below Hole 5WP04 that was drilled in 2005 and had intersected 36.8 metres grading

6.04 g/t Au including 8.73 metres grading 14.76 g/t Au. Hole 6WP10 was collared at 50

metres northeast of Hole 6WP06 and intersected 8.44 g/t Au over 7.0 metres, including

2.0 metres grading 19.65 g/t Au. These intersections have extended the high-grade

mineralized zone to over 200 metres in strike length and to 80 metres vertical depth,

with the latest drilling having high grade intersections flanked by lower grade zones

within a mixed assemblage of mafic and ultramafic volcanics, and sedimentary rocks,

with interbedded silicate iron formation. The gold mineralization is associated with the

strongly sheared and sulphidized iron formation rich sediments adjacent to the mafic

volcanic layer. Drilling is continuing at West Plains on the sub-parallel structures defined

by the Mag-EM surveys that have defined the structures for over five kilometres. The

addition of a second drill is currently being considered for the remainder of the field

season.

 

CBR’s other main focus is in Western Australia on the Redemption Joint Venture (RJV)

which is a 50/50 partnership with Focus Minerals Ltd. (FML : ASX), and has the mineral

rights to more than 210 kilometres of greenstone tenements, located just west of the

Kalgoorlie gold belt, one of the world’s most significant gold mining regions. The

tenements contain Indicated resources of 315,720 ounces gold (5.32 million tonnes at

1.8g/t Au) and Inferred resources of 1,080,825 ounces gold (13.7 million tonnes at 2.5g/t

Au). The RJV also has a 100% interest in the fully permitted, 1.2mtpa, Three Mile Hill

Mill processing plant. A scoping study has been initiated to determine the viability of

reactivating the Three Mile Hill Mill in the near term.

 

Committee Bay Resources currently has 69.2 million shares issued and outstanding (86.7

million shares fully diluted) with a market capitalization of $40.1 million. On July 31,

2006 CBR completed a brokered private placement for C$8.0 million in which Canaccord

Adams acted as an agent. Working capital is $7.8 million. Canaccord Adams has the

shares of the company rated a SPECULATIVE BUY with a $1.20/share target price. To

derive target we employ our in situ valuation method which is applied to both the assets

in Australia and in Nunavut.

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Grayd Resources (v.GYD) : the chart looks interesting

 

bigfl8.gif

 

Grayd Resources is an exploration company

...with a large land package next to Alamos Gold’s Mulatos mine. Its La India project covers 10kmof strike length along the mineralized Mulatos Belt. This is an area play and Newmont Mining recently recognized it. Newmont nowholds an option to earn a 51% interest in the project by spending US$7 million over four years, with US$1 million in the first.

 

It can earn upto 70% by completing a feasibility study. Newmont’s due diligence work and geophysical surveys identified 14 targets with the potential to host epithermal gold targets. Initial drilling intersected gold bearing structures including 85.3m at 2.6 g/t gold. Newmont sees similarities to this belt with its Yanacocha Minein Peru. We expect further drilling results from this program to generate more good gold intercepts on this play. With the support of Newmont, we believe this stock should attract further market interest.

 

- - -

 

BACK IN JANUARY...

Profit-taking was the story of the day for Grayd Resources. Last week, the Marc Prefontaine-led junior announced the discovery of a new zone of gold mineralization at the La India project in Mexico. The reverse circulation hole hit 85.3 metres grading 2.6 grams gold per tonne. Included in this section was a higher-grade portion averaging 7.2 grams gold per tonne over 9.1 metres. La India is located only 7 km from Alamos Gold's Mulatos open pit, and Newmont is funding the drill program as part of an option agreement where the major is to earn an initial 51% in the property by spending $7 million over 4 years. Grayd, which gained C$0.83 last week, ended this week at C$1.14, down C$0.24.

 

Alamos on the other hand continued to soar as the company reported that drilling on the Escondida Hanging Wall zone returned intersections of 28.97 metres grading 21.28 grams gold per tonne and 24.39 metres averaging 35.78 grams gold per tonne. Very nice and investors stood up and took notice as shares in Alamos added C$1.52 to close at C$9.35.

 

 

 

 

£££££££

GYD's website :

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YES.

GYD.v has fallen back into the gap- where selling has dried up.

 

BUYERS must be awaiting some news ...

 

Grayd Resources begins drilling at La India

 

2006-08-17 10:23 ET - News Release

 

Mr. Marc Prefontaine reports

 

GRAYD COMMENCES DRILLING AT LA INDIA PROJECT, MEXICO

 

Grayd Resource Corp. confirms that drilling has commenced today on Grayd's wholly owned La India project located in Sonora state, Mexico. The first target will be the La Cruz zone, following up from intersections in RC05-14 (85.3 metres grading 2.6 grams per tonne gold) and RC06-17 (51.8 metres grading 1.64 grams per tonne gold).

 

An initial 30 holes (3,000 metres) are planned. Most holes will be within a 1,600- by 800-metre area that contains three zones with potential for near-surface heap leachable deposits (La Cruz, Cerro de Oro and Viruela).

 

Drilling will also target the Nopal zone, a buried high-sulphidation system with only one drill hole to date, and the Espanola and Cieneguita zones in the north part of the property, which have potential for near-surface resource. Mapping and sampling will continue to explore other parts of Grayd's 24,515-hectare property. A map showing property location and exploration zones is available the company's website.

 

Drilling will be by Layne de Mexico, using a track-mounted reverse circulation rig. Hans Smit, PGeo, vice-president of exploration for Grayd, is the qualified person directing the exploration at La India. Samples are sent to the ALS Chemex facility in Hermosillo, Mexico, for sample preparation and then to the ALS Chemex laboratory in Vancouver for gold assay and ICP. Quality assurance and quality control procedures used include assay standards and blanks

 

= =

 

At C$0.72: x Shares Outstanding 47,988,670 = Market Cap $ 34,551,842

 

Corporate Website : http://www.grayd.com/s/Home.asp

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SOME OPINIONS on Brokers, as reported on RUG

 

One man's opinion:

 

Worst brokers for issuing bought deal/overpromoted crap:

BMO Nesbitt

RBC Dominion

Canaccord

Williams de broe

Paterson ord Minnett

Bolder Capital

 

Worst brokers for sheer promotion and bad analysis:

Canaccord

ABN Amro

Research Capital

Paterson Ord Minnett

 

Best brokers for analysis and research

Southern Cross Equities

Euroz

Hartley Poynton

Seymour Pierce

Hargrave hale (excluding Petra!)

Haywood

jennings

Mirabaud

 

Best brokers for market access and stock picking of early stage situations

Canaccord (specific guys)

Haywood

Mirabaud

Southern Cross

Hartley Poynton

Intersuisse

Jennings

Dundee

PI Securities

 

 

@: http://www.advfn.com/cmn/fbb/thread.php3?i...&from=18820

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