*** Local Mining News ***
The Liberty Starter Pit Project (Press release, 4/8/2014)
Midway Gold Newsletter (March/April 2014)
Latest Nevada Gas Prices (click this link)
My latest Kitco commentary:
Oil, Copper & Gold Transmit a Distress Signal (Kitco News, Mar. 18, 2014)
My latest column in the Mining Quarterly:
Major McCoy and the Rebellious Ores of Eureka (p. 83-87 online, MQ Spring Edition 2014)
Or in the Elko Daily Free Press: Major McCoy and the rebellious ores of Eureka: How one man helped a small Nevada mining town boom (March 18)
Paintings by Mariana Titus, The Three Anas & The Three Moon Anas, are presently at Lafitte Guest House & Gallery, New Orleans
Mariana's fine art prints are featured in Fine Art America: Mariana Titus
Friday's AM prices used for this morning's early analysis:
COMEX Gold price = $1,317.9/oz (June contract most active)
COMEX Silver = $19.990/oz (May)
COMEX Copper = $3.0670/lb (May)
NYMEX WTI crude = $103.42/bbl (May)
ICE Brent crude = $107.35/bbl (June)
Eureka Miner’s Gold Value Index© (GVI) = 89.25 (gold value relative to a basket of commodities that include oil, copper and silver; 100 is a high gold value)
Value Adjusted Gold Price© (VAGP) = $1,233.9/oz
COMEX - VAGP = +84.03/oz; gold is trading at a premium to key commodities (bullish implication - "bottom is in for gold")
As of 9:30AM PDT (percentages are from yesterday's closing prices; parentheses are a comparison to last Friday's morning price):
Barrick Gold (ABX) = $18.83 up 0.21% (Last Friday AM $18.70)
Newmont Mining (NEM) = $24.35 down 1.77% ($24.42)
Midway Gold (MDW) = $0.96 down 2.04%% ($0.9997)
General Moly (GMO) = $0.92 up 5.75% ($0.9299)
Timberline Resources (TLR) = $0.1599 up 6.53% ($0.153 )
Gold prices had a good week, plain and simple (input to the weekly Kitco Gold Survey, full report below):
Favorable conditions re-emerged for gold price this week: safe haven status was boosted by a falling U.S. dollar, a tech-led selloff in U.S. equities and a lingering Ukraine crisis which heated up along that countries’ eastern border. Some traders also sense a hint of rising U.S. inflation from this morning’s higher-than-expected PPI number - whether this translates to next week’s CPI is, however, far from certain. China’s worse-than-expected CPI/PPI data and a Euro zone slipping toward deflation make an inflation-fueled argument for the yellow metal suspect from the global perspective. On balance, there are probably more legs to the gold rally if the tech contagion spreads to a broader and deeper sell-off in stocks. There is also at least one more charge of anxiety left in the Land of the Light Brigade. My gold target for next week is therefore up at $1,330 per ounce.
Since I did my early morning analysis, Comex gold is up a buck more at $1,318.8 per ounce and 1.2% above last Friday's close - a steady march higher from April Fool's low of $1,277.4. Gold is not the only happy camper in the Metals & Miners' camp.
Copper & Miners hang tough too...
Given the latest carnage in equity markets it is very encouraging to see copper prices holding their head proudly above the $3-level and most miners spared from deep sell-offs. Comex copper has pulled back from an early jog into $3.06 territory to trade currently at $3.041 per pound. Copper giant and mining bellwether Freeport-McMoRan (FCX) is down today but still above $32 per share with a healthy 3.8% dividend. Remember mid-March when Freeport looked like it may drop below $30? Somebody loves miners.
Moly benchmark miner Thompson Creek (TC) punched a 4-month high this morning before settling back to $2.93 - still up more than 12% for the day. Better-than-expected mine output and improving moly prices have helped lift this miner from itts $1.72 low in December. Maybe change is in the winds?
General Moly's Liberty Play
Copper plus moly appears to be in the new equation for General Moly (GMO) as presented in their latest press release:
The Liberty Starter Pit Project (Press release, 4/8/2014)
Bruce D. Hansen, Chief Executive Officer of General Moly, explains:
We believe a copper focused Liberty Starter Pit Project has the potential to generate favorable economics given its low strip ratio in shallow pits combined with relatively low initial capital requirements with the significant pre-existing infrastructure and the site’s prior open-pit operations. In addition, our preliminary view is that the Starter Pit Project can begin on our privately owned land which is expected to allow for a shorter and simpler permitting process with the state of Nevada. Taking into account the current ratio of molybdenum and copper prices today compared with our initial Liberty study in 2008 and updated results in 2011, it makes sense for the initial economics and production schedule to be largely driven by the site’s shallow blanket of secondary sulfide copper mineralization.
We anticipate completing the PEA in the summer of 2014, and believe the results will demonstrate the inherent value and flexibility that the Liberty Project provides to our shareholders, complementing the significant value and optionality of the Mt. Hope Project. Even as we initiate this PEA at Liberty we are continuing to pursue financing alternatives for the Mt. Hope Project, and recent updates to capital and operating costs, mine plans, and project economics are supporting ongoing due diligence efforts. In addition, we are pleased to see an upward trend in underlying molybdenum prices from just over $9 per pound in the summer of 2013 to the current $11.50 per pound. This represents a 14-month high for moly prices and is supported by improved demand and tighter supply. Given the cost structure of the industry along with further growth demand potential, we feel the molybdenum price has the potential to continue to improve in the coming years to a more sustainable long term level.
Now, that's not such a bad idea is it? I threw a few shares of GMO in the buckboard Monday at March 2009 prices. GMO is presently trading at $0.92 up 5.75%.
Please do your own research - markets can turn on you faster than a feral cat.
Keep the faith, pardner!
Kitco Gold Survey
My weekly input to the Kitco Gold Survey: