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1/17/17

Three things that made me laugh

After a couple of years of Exeter Resources (XRC.to) (XRA) insisting that it has enough water supply to build its oxide gold mine, today XRC comes out and says, "We have a new water supply and we really do have enough water AND THIS TIME WE MEAN IT". You can tell the CEO used to work at Canaccord, can't you? The Zerb Who Cried Wolf.

Buried down in the Argonaut Gold 4q16 production NR, the mere trifle that it plans to spend $75.8m on capex in 2017, all on wholly-owned assets. That's around 22% of total market cap! That's more than its cash + undrawn debt facility as at Dec 31st! That's 5X operating profit for the first three quarters of 2016! The only people buying this stock today are the ones who only read charts and headlines.

I got as far as the intro blurb in Tommy Humphrey's Q&A with Cambone of Kitco before closing the tab, the bit that goes, "He calls himself Millennial Mining’s best stock picker, Kitco News sits down with Tommy Humphreys...". Jeez, how smug do you want your Giustra asslicker to be before you throw up in his face? The complete self-absorbed asshole on a stick with cream and cherry.


When your post-tax IRR is 153%...

...a few things happen:
  • You don't need to cut corners on cost parameters.
  • You can highlight the total LoM capex and not try to hide behind initial capex
  • The market doesn't care if it's only a scoping study at this stage.
  • It doesn't even care about the location. Much.
  • You stock pings 10% at the open.
Yup, Mariana Resources (MARL.v) has given us its Hot Maden PEA today.

Disclosure: I own no shares directly, but do have some indirect financial exposure to the success of this project.

Today's reminder of how badly run Coeur (CDE) is

It goes like this:

1) Coeur (CDE) spends $8m earning into 51% of the Joaquin project in Argentina.
2) It then pays U$60m to the optionee, Mirasol (MRZ.v, which is a well run company by the way), for the other 49% that it doesn't own. Half cash half shares.
3) Four years later, it sells Joaquin for U$25m (cash and shares) to Pan American Silver (PAA.to) (PAAS)
4) The above doesn't take into account the money CDE has wasted on Joquin in the meantime in exploration costs and land carrying costs.
5) IKN half-expects CDE to carry the 2% NSR it's left holding on the property at U$35m and pretend it hasn't lost money.

How the market thinks CDE is worth over $2Bn in market cap is beyond my ken.

1/16/17

So many good things in the new edition of Global Mining Observer...

...but top of the list must be this report, "The Great Royalty Freak Out" (part two) with the added bonus of flamingoes with a beach ball.

1/15/17

Odebrecht bribes: The fun begins

Tonight, Brazil's Folha de Sao Paulo reports that the ex-President of Peru, Ollanta Humala, received a U$3m bribe from Odebrecht in the form of a (totally illegal) political campaign contribution. Unsurpisingly, Peru newspapers are all over the rebound story.

Hey, this whole Odebrecht thing? It's going to be great. Just great.

The IKN Weekly, out now




IKN400 has just been sent to subscribers. 13,954 words. Most of them spelled correctly. Try the veal. I'm here all week.

Arizona Mining (AZ.to): The elephant in the room

On Friday Angry Geologist ran a nice little summary post on the recent comings and goings at Arizona Mining (AZ.to) and its Hermosa (Spanish for "beautiful", if you care enough) project. These last few weeks have seen one side (led by Global Mining Observer) with potential negatives, the other side (led by the company itself, of course) pointing out its undoubted attractions...hey, great grades after all. But the last part of TAG's post, the "elephant in the room", has the makings of a full-scale fatal flaw project killer and anyone long this stock should at the very least be asking serious questions of its management team. And should expect some good answers. Go have a look.

1/14/17

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

...in reverse order:

Third Place: "Peter Marrone's fat salaries are only matched by his brass neck". Your humble scribe thanks A. Person for the heads-up on that 2011 quote.


Second Place: "Seminario SAB and Minera IRL". Amazingly, incredibly, coincidentally, the day after this post appeared Seminario stopped its fear campaign via mail and social media in Peru. And amazingly, incredibly, coincidentally, it also marked the bottom price of IRL in Peru trading, since then recovering 17%. Napoleon Valdez and his minion Jaime Pinto are going to get a lot more exposure on these pages in the weeks to come...they'll just love that. Hey Pinto, you were so cool on Canal Ñ the other day, talking about corruption. After all, with your track record there's no doubting how much of an expert you are on the subject.
 
First Place: "Yamana Gold (AUY) (YRI.to) fails to disclose its El Peñon problems" which won the hit count by a country mile because, once again, IKN is the first to break English language news of mining company deceit and mushroom politics towards shareholders and the market. When will the blithering idiots like Marrone running these companies learn that to control news you have to lead it, not play catch-up to pissant bloggers? People this stupid should not be given the controls to multi-billion dollar market cap companies and ruin public image for all the sector.

Chile gets a Unabomber

This morning, Chile woke up to the across-the-board headlines news of what can best be described as an eco-terrorist organization sent a letterbomb to Óscar Landerretche, head of Chile's State-run mining company Codelco (the world's biggest copper producer). The bomb exploded when Landerretche and his wife opened it, causing both of them enough injuries to land them in a hospital emergency room, though thankfully neither are seriously injured and Landerretche was discharged early this morning, burns on his hands.

According to a message via a blog post later (which I'm not linking to, not giving these scumballs an ounce of extra publicity) the group who call themselves "Individualistas tendiendo a lo salvaje" (kind of difficult to translate neatly, but "Individualists with savage tendencies" is the gist of it) wrote alongside pictures of the explosive device by way of proof (translated):

"The pretentious Landerretche deserves to die for his offenses against Earth. We are not scared if people not targeted by the attack are injured or killed....he deserves our explosive gift for being at the head of a devastating mega-project against all our beautiful Earth."

The interesting bit is that this isn't the first eco-terror attack performed by this group, as other letterbomb attacks on academics with far lower public profiles have already happened in Chile under their name.

1/13/17

The Friday OT: Madonna; Open your heart

This is what happened: I was strolling through a large local department store earlier this week, looking for something completely unconnected with anything in this post, when I walked past a TV showing this video on some music channel. I walked straight past it, paid no attention, then suddenly stopped and turned round with, "Damn, long time since I saw this...and hey, Madge really could sing!".



A cool 80s pop song that's stood the test of time, so give it another hearing. Video good enough for a single shot listen. Large serving of cliché slap bass as a cherry on the cake. Youtube here.

Lobito in 2016! We check his track record so that you don't have to

It's that wonderful time of the year when the bullshit scammers working for the proven securities fraudster and legal bullyboy Porter Stansberry make up their fictitious report cards on their performances in the year just gone by. Top of the list of the BS-purveyors is Louis Lobito Little Wolf James, Chief Rock Kicker at Casey Research and a past master in massaging his true performance to make it look way better than it truly is.

But help is at hand! The industrious backroom staff here at IKN Nerve Centre* have done the heavy lifting for you and looked back through all the 2016 editions of Lobito's two publications, "International Speculator" (IS) and "Casey Resource Investor (CRI) and found every single new recommendation made by Lobito in 2016. Then also his claimed entry price (which is often a bullshit call in itself, he loves picking a price from a couple of days before publication date when it suits him) and where we stand today. Then to round off, we add in the percentage change and a final column which assumes a $1,000 level stakes investment in each of the twelve names he reco'd last year. A table!


And the good news is....yes indeed Lobito made a profit last year. If you'd invested $12,000 with him, a thou on each pick, you'd walk away today with $12,098. And 63 cents. Before commissions. And before paying Casey Research. Hoorah!

In a little more detail, Lobito started badly by telling his flock to short the US stock markets (SH and SDS, with SDS famously being his Top Pick of the year...he hee). His did his subbers well by picking out Eastmain (ER.to) and Alexco as junior mining picks, then a good call on Kinder Morgan (KMI) in June. But then things got sticky....and I just love that new reco on Tahoe Resources Lobito, you outdid yourself there.

Bottom line: A monkey with a dartboard.

*me

Chart of the day is...

...the TIPS ten year yield, last six months:



Readers of The IKN Weekly will understand why this is such an important chart right now.

The Trump rally is over.