"The history of Eureka lies in its future." - Lambert Molinelli, 1878


The author/editor of the Eureka Miner owns common shares of local mining stocks, General Moly (GMO) and Newmont Mining (NEM); together with benchmark miner Freeport-McMoRan (FCX). Please do your own research, markets can turn on you faster than a feral cat.

Friday, October 23, 2009

A Big Step into the Future for Eureka County?

Morning Miners!

It is 5:51 AM. Let me pour you a cup of that famous Raine's TGIF coffee and tell you about some exciting news for Eureka County. This morning I received a news wire from Western Lithium (WLC) announcing their intention to acquire Rocky Mountain Resources. Here's the link:

Western Lithium to Acquire Rocky Mountain Resources

Why has this got the ole Colonel on his third cup of Scott's red label brand? Allow me to connect the dots. On September 28th the Report told you about Western Lithium and their lithium carbonate project in Kings Valley up in Humboldt County (The Next Big Thing in Northern Nevada?). This may become great news for Nevada because "Western Lithium is positioning itself as a major U.S.-based supplier to support the rising global demand for lithium carbonate that is expected from the increased use of mobile electronics and hybrid/electric vehicles."

In our September article we learned that WLC has potentially the world's largest source of high quality lithium carbonate which is accessible by low cost open pit mining. The more traditional technique is brine extraction used to recover lithium from salt flats. A good example of this is the Foote Mineral deposits, currently operated by Chemetall, in the Clayton Valley just west of Goldfield. Presently, Bolivia has the most known reserves of this variety but their Uyuni salt flats have a fairly poor magnesium-to-lithium ratio. Although the Chinese are trying to scoop up this resource the poor ratio makes extraction economics costly (Not So Hotsi in Potsi, Cap and Trade Stumbles, 8/18/09).

What has all this to do with Eureka County? If the WLC acquisition of Rocky Mountain Resources succeeds, they pick up their Gibellini development stage Vanadium project in the southeast corner of our county. The Gibellini mine site is south of Fish Creek in the western foothills of the Little Smoky Valley.

This is an important tie because in their words, "Vanadium has the potential to become an important element for future battery chemistries together with lithium-ion chemistries. The companies believe that a combination of Nevada based strategic metals for applications in electrical storage and other industrial uses will provide operational and corporate synergies, and accretive value to shareholders."

So folks, we may be joining Humboldt County on a long but exciting journey to the electrical future of our country, a future not dependent on foreign resources but supported by strategic materials in our own backyard. That deserves a Colonel Yee-ha for our state, our county and its future generations.

Let's wish Western Lithium and Rocky Mountain Resources the best of luck on this very important first step.

The thumbnail photo today shows a specimum of Huemulite, an
anhydrous vanadium oxysalt taken from the Gibellini Mining District.

Enough talk, let's walk the walk:

4-WD is OFF - the VIX or "fear index" is below 25, smooth markets expected in the near term (what's this?)

Yellow light is ON for our fuel gauge (oil over $80/barrel)

Yellow light is ON for possible adverse regulation/legislation (mercury emissions)

Otherwise, all lights are green on the Eureka Outlook Dashboard (upper right, what's this?)

Oil is up $0.10 in early trading to $81.92 (December contract); Gold is up $9.0 to $1067.0 (December contract, most active); Silver is up $0.330 to $17.875 (December contract); Copper is up $.0520 to $3.0500 (December contract); Molybdenum drops to $11.75.

The DOW is down 88.95 points to 9992.36; the S&P 500, down 3.46 points to 1082.87. The miners are crabby:

Barrick (ABX) $37.68 down 0.66%
Newmont (NEM) $45.37 down 0.33%
General Moly (Eureka Moly, LLC) (GMO) $2.74 down 2.49%
Freeport McMoran (FCX) $82.45 down 0.64% (a bellwether mining stock spanning gold, copper & molybdenum)

Steel stocks are grumpy, (a "tell" for General Moly):

Nucor (NUE) $44.07 down 0.25% - domestic steel manufacturing
ArcelorMittal (MT) $38.11 down 1.78% - global steel producer
POSCO (PKX) $113.13 down 0.21% - South Korean integrated steel producer

The Eureka Miner's Grubstake Portfolio is is down 1.95% to $1,251,937.93 (what is this?).


Colonel Possum

Headline Photographs by Mariana Titus; "Courthouse Reflections"

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