| 06/07/2008
www.insidemetals.com |
Vol
3, Issue 11 |
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In
This Edition...
Precious
Metals Market Update Geopolitical View
Gold
Producer News
Website Updates
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| Dear
Subscriber, |
The
newsletter will be published next on June 28,
2008
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| IN
THIS EDITION OF INSIDEMETALS |
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In this edition of the
InsideMetals Newsletter, we'll take a look at
how eskom impacts gold production and platinum
prices, as well as precious metals trends, gold
producer news and recent website updates, which
includes updates on our InsideMetals Quarterly
Gold Stocks ScoreCard.
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| In
This Issue |
| Precious
Metals Markets Update |
| 2007
Silver Nevada Miner Bar |
| Geopolitical
View |
| Whitney
& Whitney Inc. |
| NYSE
Gold Producer News |
| AMEX
Gold Producer News |
| NASD
Gold Producer News |
| InsideMetals.com
Website Updates |
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| |
| PRECIOUS
METALS MARKET UPDATE |
 Gold
closed at $878.50/oz (London Fix) on June 5,
2008. This is 5.0% lower than the $922.75/oz
(London Fix) closing price on May 22, 2008, when
data for the previous newsletter was gathered.
Silver
closed at $16.65/oz (London Fix) on June 5,
2008. This is a 7.0% decrease from the $17.82/oz
(London Fix) closing price on May 22, 2008.
Platinum
closed at $1974.00/oz (London Fix) on June 5,
2008. This is a 10% decline from the $2192.00/oz
(London Fix) opening price on May 22, 2008.
(There was no closing price for Platinum on May
22, 2008.)
Palladium
closed at $421.00/oz (London Fix) on June 5,
2008. This price is 7.0% lower than the
$453.00/oz (London Fix) closing price on May 22,
2008.
ONE YEAR GOLD
vs. EURO/US$ CHART
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| 2007
Silver Nevada Miner Bar - 99.9% Pure 5
Troy Ounces of American History |
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| GEO
POLITICAL VIEW |
 ESKOM
IMPACTS GOLD PRODUCTION & PLATINUM PRICES
Since 1886 South Africa has been the center of
mass for the world's gold production. At its
peak production of 1,000 tons in 1970, South
Africa's gold production was 79% of the world's
annual supply of gold. Its position has been
declining in the last 30 years.
At the close of 2007, South Africa finally fell
off the top of the pedestal, a position it held
since 1905. Its number one position was taken
over by China. South Africa's gold production
totaled 275 tons last year. China produced 304
tons of gold last year. The 2007 production
results pushed South Africa down into second
place.
South Africa's gold production in the first
quarter of 2008 fell by 15.6% to 57.6 tons (1.68
million ounces) as the industry combats the
power shortages that have begun to reach a
critical mass from years of failure by Eskom to
upgrade the country's power infrastructure.
Even though South Africa has lost its number one
position as the world's leading gold producer it
has sufficient identified gold resources in the
country to remain a leading producer for
sometime if the power infrastructure is upgraded
to the point that the cost of mining in South
Africa can remain competitive with the other top
producing areas of the world.
The power shortages are also affecting other
commodities such as copper, coal, and platinum.
Copper production in neighboring Zambia will be
affected as power is reduced to the country
which gets its power from South Africa. Power
will be cut back from its normal 530 megawatts
by 15%.
Platinum production will also be affected by the
power shortages, but because the supply cuts
will occur in the dominant platinum producing
region of the world, there will be strong upward
pricing pressure. South Africa accounts for
approximately 80% of the world's total annual
mine production of platinum. South Africa
accounts for approximately 88% of the world's
platinum reserves.
Impala Platinum, the world's second largest
producer has plans to boost its platinum
production by about 600,000 ounces from 2012 to
2018, but the company reports that it hasn't yet
secured sufficient power for some of its planned
expansion.
Cuts in platinum supply will affect platinum
prices. On May 19, 2008, Mineweb reported that
Johnson Matthey, a leading platinum refiner,
expects a substantial platinum shortage that
will force platinum to trade in the range
between $1,750 and $2,500 per ounce over the
next 6 months. Investor's should take advantage
of dips in the platinum price until Eskom and
the mines resolve the power problems.
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to a world-wide targeted audience |
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| Whitney
& Whitney Inc. - A Nevada Based
Management Consulting Firm |
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| NYSE
GOLD PRODUCER NEWS |
 May
27, 2008: Kinross Gold Corp (KGC) has
closed a private placement financing with
Riverside Resources Inc. KGC has purchased 1.25
million common shares of Riverside at a price of
$1.20 per share for a total of $1.5 million. KGC
now owns approximately 7% of the outstanding
common shares of Riverside. The shares are
subject to a four-month hold period. The deal
will be used to advance Riverside's seven
properties including the El Capitan Gold project
in Durango, Mexico, and the Sugarloaf Peak Gold
project in Arizona and for general working
capital requirements.
May 30, 2008:
Kinross Gold Corp (KGC) announced the first
production of gold and silver from its Kupol
project in the Far Eastern Federal District of
Russia. The Kupol mine is operated by the
Chukotka Mining and Geological Company, which is
owned 75% by KGC and 25% by the State Unitary
enterprise of the Chukotsky Autonomous Okrug.
KGC's share of Kupol's 2008 production is
expected to be between 365,000 to 390,000 gold
equivalent ounces, at an average cost of sales
of $235 to $245 per ounce. Kupol is the first of
three major new development projects for KGC
expected to come into production in 2008.
June 2, 2008: Goldcorp
Inc (GG) declared its sixth monthly dividend
payment for 2008 of $0.015 per share.
Shareholders of record at the close of business
on Thursday, June 12, 2008 can receive payment
of this dividend on Friday June 20, 2008.
June 2, 2008: Iamgold
Corp (IAG) has announced positive results from
the feasibility study regarding a past backfill
system at its northern Quebec, Niobec mining
operation, which will double reserves. Niobec is
IAM 100% owned niobium operation. The past
backfill system will enable the extraction of
more ore grade material and will double reserves
to more than 20 years at current mining rates.
IAG has also completed changes at its Mupane and
Yatela gold operations that will help production
costs.
June 3, 2008:
Newmont Mining Corp (NEM) has purchased an
additional 1.5% stake in Gabriel Resources Ltd.
(TSX: GBU). NEM has bought 3,878,302 common
shares and now owns 19.9% in the company. NEM
stated the acquisition was made for investment
purposes only. It paid an average of $CDN2.86
for the shares.
June 3, 2008: Silver
Wheaton Corp (SLW) has agreed to purchase 50% of
the life of mine silver produced at the La Negra
mine in Mexico. The La Negra mine, 80% owned by
Aurcana Corporation, is a 1,100 ton per day
polymetallic mine that has operated for 30
years. SLW will pay Aurcana an initial $25
million in order to acquire 50% of all silver
produced from the La Negra mine for the lesser
of $3.90, or the prevailing market price per
ounce of silver. The transaction is expected to
close by June 20, 2008. As part of this
agreement, Aurcana has also agreed to complete a
separate life of mine silver stream agreement on
its soon to be acquired Shafter Silver Mine
located in Texas. Terms of the future agreement
are expected to be announced in the third
quarter of 2008.
June 5, 2008:
Coeur d'Alene Mines (CDE) will retain ownership
of the Rochester silver and gold mine in Nevada
after evaluating different strategies for the
mine. CDE said the mine continues to be an
important source of cash flow given the current
silver and gold prices. The mine generated more
than $12.4 million of free cash flow in the
first quarter of 2008 and continues to exceed
budgeted levels.
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| AMEX
GOLD PRODUCER NEWS |
 May
27, 2008: Gammon Gold Inc (GRS) announced
the courts of the State of Guanajuato Mexico
have dismissed a $13 million lawsuit brought
against Metales, (an inactive subsidiary of GRS)
initiated by Rafael Villagomez, a former 50%
owner of the El Cubo mine. El Cubo Mine was
acquired in 2004 by GRS's subsidiary Mexgold
Resources Inc. GRS has held the position that
the action was without merit and that position
was upheld by the Court on May 21, 2008.
June 2, 2008: Eldorado
Gold Corp (EGO) has obtained all necessary
permits and approvals to begin construction at
its Efemcukuru mine in Turkey. Site preparation
activities are now underway with work initially
focused on providing upgraded access to the site
and the necessary site clearing. The mine is
expected to produce 112,000 ounces of gold per
year.
June 2, 2008:
Apex Silver Mines Ltd (SIL) has reached an
agreement where Sumitomo Corp will purchase from
SIL, for $70 million, SIL's rights pursuant to a
Deferred Payment Agreement dated September 25,
2006. The agreement requires Sumitomo to make
deferred payments to SIL related to its 2006
acquisition of 35% of the San Cristóbal mine in
Bolivia.. The transaction is subject to the
approval of the company and Sumitomo Boards of
Directors and is expected to close in June 2008.
Full details regarding the deal can be seen in
SIL's press release.
June 3, 2008: Claude
Resources Inc (CGR) plans to initiate an
underground drill program at its Madsen Property
in Red Lake, Ontario from the 12th Level.
Originally CGR planned to start the program in
the 1st quarter of 2009 from the 16th Level, but
has now decided to move the start date to the
4th quarter of 2008.
June 3, 2008:
Crystallex International Corp (KRY) announced
that Mr. Gordon Thompson has resigned as
Crystallex President and CEO in order to pursue
personal interests. The KRY Board has appointed
Robert Fung as Executive Chairman and CEO, and
Mr. Robert Crombie as President. Both of these
appointments have been made on an interim basis.
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| NASDAQ
GOLD PRODUCER NEWS |
 May
29, 2008: Royal Gold Inc (RGLD) has
declared its third quarter dividend of $0.07 per
share of common stock. The dividend is payable
on July 18, 2008 to shareholders of record at
the close of business on July 3, 2008.
May 30, 2007:
Lihir Gold Ltd (LIHR) announced that Equigold
shareholders have approved the merger of LIHR
and Equigold NL. By the end of the year, the
merged company expects to have four mines in
operation in three countries, producing at an
annual rate of more than 1.2 million ounces of
gold.
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| INSIDEMETALS.COM
WEBSITE UPDATES |
 PAID
SUBSCRIBER RESOURCES
New Ranking
Numbers & Financials: All of the
year-end 2007 annual reports and/or SEC 10-K'
financial reports have been filed by the
InsideMetals.com Gold Producer Stocks. Their
financial data has been compiled and will be
posted to the website in mid-June. The updated
financial data can be viewed by paid subscribers
by using the "Quick Nav Bar" on the
Index Page and then by going to the table that
will link to the updated data.
For each company new Ranking Numbers have been
computed that reflect their financial
performance in 2007. A positive ranking number
indicates that the company generated a profit.
Companies with more positive ranking numbers
will tend to perform better as investments than
companies with less positive ranking numbers.
Companies with negative ranking numbers should
be carefully studied using the InsideMetals.com
Business Summaries. There may be factors that
have resulted in positive stock performance in
anticipation of future results.
The Ranking Numbers and financials can be viewed
by going to the Index Page and navigating as
explained below:
To view an individual company's 2007 financial
data, go to the large table listing "All
Gold Companies" and click on "F."
To view the 2007 financial data, compiled by
Stock Exchange, go to that table and click on
the link to the appropriate exchange or click on
the link to "All Gold Companies."
The financial performance of the gold producing
companies to date, based on their 2006 financial
data can viewed by stock exchange or a
compilation of "All Gold Companies" by
clicking on the link that will display the
performance over the required time
period..
For those newsletter subscribers who are not yet
subscribers to InsideMetals.com, the publication
of these ranking numbers in the website will
assist investors in identifying mining stocks
that are undervalued, especially as a result of
the recent decline in gold prices.
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We
hope you have enjoyed our newsletter.
The newsletter will be published next on June
28, 2008
Until next time!!!,
InsideMetals
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