| 12/20/2008
www.insidemetals.com |
Vol
3, Issue 23 |
|
 |
In
This Edition...
Precious
Metals Market
Update
Gold &
Silver ETF's
Geopolitical
View
Gold
Producer News
Website Updates
|
|
| Dear
Subscriber, |
The
newsletter will be
published next on
January 10, 2009.
|
IN
THIS EDITION OF
INSIDEMETALS
|
|
In this edition
of the InsideMetals
Newsletter, we'll
take a look at gold
& silver ETF's,
production, pricing
and news, as well as
precious metals
trends, gold
producer news and
recent website
updates, which
includes our new
Advertising and
Media Kit
information.
|
|
 |
| 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 |
|
| PRECIOUS
METALS MARKET UPDATE |
 Gold
closed at $855.25/oz
(London Fix) on
December 18, 2008.
This is a 10.6%
increase from the
$773.25/oz (London
Fix) closing price
on December 4, 2008,
when data for the
previous newsletter
was gathered.
Silver closed at
$11.29/oz (London
Fix) on December 18,
2008. This is a
17.8% increase from
the $9.58/oz (London
Fix) closing price
on December 4, 2008.
Platinum closed at
$862.00/oz (London
Fix) on December 18,
2008. This is a 8.6%
increase over the
$794.00/oz (London
Fix) closing price
on December 4, 2008.
Palladium closed at
$178.00/oz (London
Fix) on December 18,
2008. This price is
a 4.1% increase over
the $171.00/oz
(London Fix) closing
price on December 4,
2008.
YEAR
TO DATE GOLD vs.
EURO/U.S. DOLLAR
CHART
The Year to Date
Gold vs.
Euro/U.S. dollar
chart shows an
increase in the
price of gold
while the U.S.
dollar
consolidates
since the
newsletter was
last published.
The U.S. dollar
index has
recently risen
to a two year
high against a
basket of 6
currencies. The
strength in the
U.S. dollar
reflects
investor flight
to safety.
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to a world-wide
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| Gold
& Silver ETF's |
The SPDR Gold
Trust (GLD)
controls over
24,000,000 ounces
of gold. On
December 18, the
GLD reached a
record 24,927,686
ounces. When this
newsletter was
published last on
December 4, 2008,
the GLD held
24,366,840 ounces
of gold. The
previous record
was 24,776,938 set
on October 13,
2008.
.
The accumulation
of silver by the
iShares Silver
Trust (SLV) is
beginning to
decline as silver
prices are
consolidating near
the $10.00 per
ounce level.
Silver holdings
had been building
since August in
spite of declining
prices. On
December 4, 2008,
the SLV controlled
213,860,066 ounces
of silver. As of
December 18, 2008
these holdings
have increased to
217,412,903
ounces.
|
| 2007
Silver Nevada Miner
Bar - 99.9%
Pure 5 Troy Ounces
of American History |
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|
| GEO
POLITICAL VIEW |
 GOLD
MAINTAINS ITS VALUE
WHILE OTHER ASSETS
DECLINE
As the
Federal Reserve has
taken the interest
rates to almost 0%,
on Tuesday, December
16, 2008, the dollar
is being dumped by
currency traders.
The Fed has now set
a target range of
between 0% and 0.25%
for its benchmark
federal funds rate.
The U.S. now has the
lowest key interest
rate in the
industrialized
world, and the Fed
stated that it plans
to keep rates low,
and may consider
additional actions
to bolster the
financial system.
The aggressive
action by the Fed
underlines the
weakness of the U.S.
economy.
Following the move
by the Fed, stocks
rose sharply, and
bonds surged. The
DOW finished up
359.61 points (4.2%)
to 8924.14 on
Tuesday. This was
the biggest gain in
the DOW in more than
3 weeks.
On December 12,
2008, Goldman Sachs
announced that it is
raising its near
term gold and silver
price forecast on
expectations that a
weaker U.S. dollar
will result in
higher precious
metals prices. Gold
is often bought as a
currency hedge.
2008 has been a
strong year for
gold. Gold started
the year at $847 per
ounce and rose to
over a $1,000 ounce
in March. For the
year to date, gold
has averaged $870
per ounce. Gold is
serving its purpose
as a safe haven.
Gold is essentially
even for the year,
while the DOW has
declined
approximately 4,438
points (34%) from
its 13,043 close on
the first day of
trading in January,
to today's close of
8,605.
As world gold
production has been
declining in the
last several years,
it is expected that
demand will continue
during this time of
global recession and
economic
uncertainty. There
will be strong price
support for gold;
especially as the
government's
solution to healing
the U.S. economy is
to spread the wealth
around with newly
printed dollars.
The inability of
junior exploration
companies to raise
financing will
definitely
contribute to fewer
gold properties
advancing toward
production. Many of
the junior companies
are now operating in
survival mode and
are desperately
trying to preserve
their cash and keep
their best projects.
Undoubtedly, senior
companies with
strong balance
sheets and a need to
maintain production
levels will acquire
from the juniors
their best projects
with identified
precious metal
reserves and
resources.
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to a world-wide
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& Whitney Inc.
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Management
Consulting Firm |
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| NYSE
GOLD PRODUCER
NEWS |
 December
9, 2008: Goldcorp.
Inc. (GG) announced
that it will study
the viability of
building a $199
million power
station in Mexico to
reduce costs at its
Penasquito gold and
silver mine. The
power plant will
form the basis of a
feasibility study GG
will undertake in
2009. The $1.5
billion mine will
consume more power
than any other GG
project.
Penasquito was
designed to produce
400,000 ounces of
gold, 31 million
ounces of silver,
and 208,000 tons of
zinc per year for an
estimated mine life
of 20 years.
December
9, 2008:
Goldcorp. Inc. (GG)
reported that it
expects to get a 40%
gold and silver
reserve boost at
Penasquito, while
its capital cost
estimate is less
than 10% higher than
the original
estimate of $1.494
billion. GG
estimates that gold
reserves will be
increased by 30%,
with a 15% to 20%
increase in silver,
lead, and zinc
reserves for
year-end reporting.
There is also
potential for
initial resources to
be declared for bulk
mineable and
high-grade
underground zones,
as well as the
nearby Noche Buena
property.
December
10, 2008: Yamana
Gold Inc. (AUY)
announced that it
has entered into a
C$100 million equity
financing agreement
whereby Canaccord
Capital Corp. and
Scotia Capital Inc.
will serve as Lead
Underwriters. The
Underwriters will
purchase 16,700,000
shares of AUY for
resale to the public
on a bought deal
basis at a price of
C$6.00 per common
share. In addition
AUY has agreed to
grant the
Underwriters an
option to purchase
an additional
2,505,000 shares at
C$6.00 per share
exercisable in part,
or for all shares
for a period of 30
days from the
closing date of the
offering. Subsequent
to this
announcement, AUY
reported that the
above agreement was
increased to C$135
million, and the
offering was
increased by
5,800,000 shares.
December
10, 2008:
AngloGold Ashanti
Ltd. (AU) announced
that Edgardo Maya,
Auditor General, for
government of
Colombia would
recommend denial of
permission for AU to
develop the
Gramalote gold
deposit located in
the central province
of Tolima, in an
environmentally
sensitive forest
reserves. AU reports
that the deposit
contains an
estimated 13 million
ounces of reserves.
December
10, 2008:
Hecla Mining Company
(HL) announced that
it has been notified
by its banking group
that its mine plan
for Greens Creek is
satisfactory.
Acceptance of the
mine plan confirms
the bridge loan
maturity date of
February 16, 2009.
The loan was a part
of the financing
obtained to purchase
the remaining 70.27%
of the Greens Creek
joint venture as per
the April 2008
offer.
December
10, 2008:
Coeur d'Alene Mines
Corp. (CDE) is
pleased to report
operations at its
new San Bartolome
silver mine in
Bolivia is
performing according
to plan, resulting
in continued
increase in monthly
silver production
and a decrease in
monthly operating
costs. In November
the mine produced a
record 818,000
ounces of silver, a
34% increase
compared to October
production of
611,000 ounces of
silver. CDE expects
December production
to reach nearly
1,000,000 ounces,
bringing 2008
production to
approximately
3,200,000 ounces as
forecast. Cash costs
in November declined
37% from October
levels to $6.90 per
ounce. Cash costs
are expected to drop
below $6.00 per
ounce in December.
December
11, 2008:
Hecla Mining Company
(HL) announced that
it has entered into
an agreement to sell
securities to
selected
institutional
investors for
aggregate proceeds
of $21 million. The
offering is expected
to close no later
than December 15,
2008. The securities
for sale include
approximately 10.24
million shares
priced at $2.05 per
share along with
Series 1 warrants to
purchase up to
approximately 7.68
million shares of HL
at an exercise price
of $2.45 per share
and Series 2
warrants to purchase
up to 7.68 million
shares at an
exercise price of
$2.35 per share. The
Series 1 warrants
expire in 5 years,
and the Series 2
warrants expire on
February 28, 2009.
December
11, 2008:
IAMGOLD Corp. (IAG)
announced that they
have entered into a
definitive
arrangement to
acquire all of the
outstanding common
shares of Orezone
Resources Inc.
(OZN). Total
consideration is
valued at
approximately 139
million. Per the
arrangement, IAG
will acquire and
finance the
development of the
Essakane project,
one of West Africa's
largest undeveloped
gold reserves (4
million ounces). OZN
exploration assets,
including Bombore,
will be distributed
pro rata to OZN
shareholders to
create New Orzone.
Each OZN shareholder
will receive 0.08 of
an IAG share and a
pro rata share of
New Orzone for each
OZN share held. IAG
will provide OZN an
immediate C$20
million equity
financing at C$0.28
per share, subject
to regulatory
approval. IAG will
become a 16.6%
shareholder in New
Orezone.
December
12, 2008: Goldcorp.
Inc. (GG) reported
that its President
& CEO, Kevin
McArthur will retire
effective December
31, 2008. McArthur
will serve through
2009 as Advisor to
the CEO and remain
as a director on the
GG board. The board
has appointed
Charles Jeanne, GG
Executive VP for
Corporate
Development as
President and CEO.
December
15, 2008:
Barrick Gold Corp.
(ABX) announced that
it has resumed
operations at its
North Mara mine in
Tanzania, after
suspending activity
last week, when some
200 people invaded
the mine and
destroyed property
worth approximately
$15 million. The
government has
bolstered security,
and a more permanent
solution is being
sought.
December
15, 2008:
IAMGOLD Corp. (IAG)
completed the
previously announced
sale of the Sleeping
Giant mine and
milling facility
located in
northeastern Quebec
to Cadiscor
Resources Inc.(TSXv:
CAD). The sale also
includes the Fiordin
claims. IAG will
receive 5,185, 715
common shares of
CAD. Upon receiving
these shares IAG
will own 12% of CAD.
IAG will also
receive 1,000,000
common share
purchase warrants
exercisable at
$0.47/share that
will expire on
December 31, 2010.
IAG will also
receive a $3.5
million debenture
convertible into
common shares of CAD
in the first year at
a share prices of
$0.47/share,
$0.51/share in the
second year, and
$0.56/share in the
third year.
December
15, 2008: Newmont
Mining Corp. (NEM),
and its joint
venture partner,
Fresnillo plc
reported the
acquisition of
Seabridge Gold Inc's
Noche Buena gold
property in Sonora,
Mexico. The price
paid to Seabridge
was $25 million in
cash at closing and
an additional $3.5
million payable upon
commencement of
commercial
production and a
1.5% NSR payable on
all gold production
sold for $800/oz or
greater. NEM holds a
44% interest in the
JV. A drill
indicated 600,000
ounce resource has
been located on the
Noche Buena
property.
December
16, 2008: Agnico-Eagle
Mines Ltd. (AEM)
announced that it
has agreed to issue
900,000 common
shares at a price of
$38.00/share to fund
the previously
announced purchase
of surface rights
and advance royalty
payments in
connection with the
development of the
Pinos Altos property
in Chihuahua State,
Mexico. The issuance
is scheduled to
close on, or about
December 19, 2008,
and is subject to
certain conditions
including execution
of definitive
documentation, and
normal regulatory
approvals, including
the approval of the
Toronto Stock
Exchange.
December
17, 2008:
Kinross Gold Corp.
(KGC) announced that
it has completed the
acquisition of a 40%
interest in Minera
Santa Rosa SCM from
Anglo American plc
for an aggregate
purchase price of
$140 million. Minera
owned 100% of the
Lobo-Marte gold
project in the
Marcunga district in
northern Chile. On
November 20, 2008,
KGC had announced
that in a separate
agreement with Teck
Cominco Ltd., it
acquired 60% of
Minera for
approximately 5.6
million shares of
KGC, plus a net
capital payment of
$40 million and a
1.75% NSR on 60% of
future production
payable when the
gold price is $760
per ounce or more.
KGC expects the to
complete the
purchase with Teck
Cominco by the end
of the year.
December
17, 2008:
Barrick Gold Corp.
(ABX) announced that
it has revised down
the damage to its
North Mara Mine in
Tanzania during an
attack last week to
$7 million from the
previously estimated
$15 million.
December
17, 2008;
Coeur d'Alene Mines
Corp. (CDE)
announced it has
entered into a new
$20 million facility
with Mitsubishi
International Corp.
(MIC).The facility
has been structured
as a gold lease
under which CDE
received proceeds of
$20 million from the
sale of 23,529
ounces of gold lent
to it by MIC. CDE
will then deliver
these ounces to MIC
over the next 12
months.
|
| AMEX
GOLD PRODUCER NEWS |
 December
9, 2008:
Crystallex
International Corp.
(KRY) reported that
it has received a
Notice of
Application (Notice)
concerning the
commencement of a
legal proceeding
against the Company.
The Notice has been
filed by
Computershare Trust
Company of Canada in
their capacity as
Trustee for holders
of KRY's 9.375%
Unsecured Notes due
December 23, 2011.
December
11, 2008:
Claude Resources
Inc. (CGR) reported
on its most recent
gold exploration
results from the
Fork Zone area of
its Madsen property
located at Red Lake,
Ontario. The most
recent assays
continue to identify
significant zones of
gold mineralization.
Drilling highlights
include 3.67 ft.
assaying 0.38 opt
gold from drill hole
RUM-08-41; 8.86 ft.
assaying 0.90 opt
gold from drill hole
RUM-08-52 ; 3.28 ft.
assaying 0.91 opt
gold from drill hole
RUM-08-66; and 4.26
ft. assaying 1.45
opt gold from drill
hole RUM-08-68. The
current Fork Zone
geological
interpretation is
that at least two
sub-parallel,
southeasterly
dipping shear zones
are present which
host southwest
plunging ore shoots.
The mineralized
shear systems have
been intercepted
over a strike length
of 1475 ft. and
remain open along
strike and at depth.
December
11, 2008:
Crystallex
International Corp.
(KRY) reported that
it has now been
served with a Notice
of Application
(Notice) by
Computershare Trust
Company of Canada in
their capacity as
Trustee for holders
of KRY's 9.375%
Unsecured Notes due
December 23, 2011.
Computershare is
seeking on behalf of
the debenture
holders a Court
declaration that
there has been a
Project Change of
Control which
requires KRY to
purchase all of the
notes of each note
holder who has so
requested at a price
equal to 102% of the
principal amount of
the notes along with
accrued and unpaid
interest from the
date of purchase.
December
11, 2008:
Richmont Mines Inc.
(RIC) announced that
its acquisition of
Patricia Mining
Corp. (PAT), by way
of a plan of
arrangement has been
approved by more
than 96% of PAT
shareholders.
Approval is
conditioned on
satisfaction or
waiver of all other
conditions to
closing, which
include the approval
of the Ontario
Superior Court of
Justice. As a result
of the arrangement,
PAT shareholders
will receive cash
and RIC shares, and
will hold 9% of the
outstanding shares
of RIC.
December
11, 2008: Apollo
Gold Corp. (AGT)
announced that it
has closed a $15
million bridge
financing facility
relating to its 100%
owned Black fox
Project located near
Timmins, Ontario.
The bridge facility
will mature on June
30, 2009, but may be
refinanced before
that date if the
bridge facility is
finalized. At this
time AGT can utilize
$6 million of the
Bridge Facility to
advance the Black
Fox Project with the
balance of $9
million to be
utilized pending
satisfaction of
certain conditions
required by the
Banks regarding
improvement of AGT's
capital liquidity
position on terms
satisfactory to the
Banks (Macquarie
Bank Ltd. and RMB
Resources Inc.). The
Banks will receive a
5% arrangement fee,
and the Bridge
Facility will bear
interest at LIBOR
plus 10% per annum
(currently equal to
12% per annum). In
addition, each Bank
will receive
21,307,127 warrants.
Each warrant
entitles the holder
to purchase one
common share of AGT
at a price of
C$0.221 per share,
and exercisable for
a period of 4 years.
December
11, 2008:
Aurizon Mines Ltd.
(AZK) announced the
completion of a
successful infill
drilling program at
its Joanna project
which is located
12.5 miles from
Rouyn-Noranda, in
northwestern Quebec.
At Joanna, AZK has
previously reported
on 319 drill holes.
In this release AZK
has included the
results from 70
recently completed
drill holes. Results
from an additional
74 holes are
pending, and are
expected to be
received by year
end. This drilling
program totaled
441,124 ft. in 463
holes. Drilling has
intersected one to
four mineralized
intersections along
the East block which
demonstrates
continuity of
mineralization along
3,600 ft. of strike
length with 65 - 325
ft. thick
mineralized zones.
Results were
reported from 57
holes with one or
more mineralized
intersections
greater than 16 ft.
with grades greater
than 0.029 opt gold
(1 gram/tonne). This
infill drilling
program has
confirmed continuity
and grade of
mineralization. AZK
expects to release
an updated resource
estimate early in
2009. Refer to the
press release for
the drilling program
details.
December
15, 2008:
Eldorado Gold Corp.
(EGO) reported the
completion of the
previously announced
sale of the San
Bento mine in Brazil
to AngloGold Ashanti
Ltd. (AU). For $70
million payable with
2,701,660 free
trading shares of AU
stock
December
17, 2008: Endeavour
Silver Corp. (EXK)
announced that it
has arranged a C$4
million private
placement financing
of special warrants
brokered by certain
Canadian placement
agencies. The
private placement
will consist of up
to 3,080,000 special
warrants priced at
C$1.30 per special
warrant for gross
proceeds of up to
C$4,004,000. Each
special warrant is
exchangeable for one
common share and one
half share special
warrant. Each
special warrant can
be exercised to
purchase an
additional common
share at a price of
C$1.90 per share
within a 5 year
period from the
earlier of the
closing of the
placement plus 60
days, or from the
issuance of a final
receipt for a
prospectus to
qualify the special
warrants in all
relevant Canadian
jurisdictions.
|
| NASDAQ
GOLD PRODUCER NEWS |
 December
9, 2008:
DRDGold Ltd.
(DROOY), South
Africa's number 4
gold producer
reported that it has
bought the remaining
35% interest in the
gold recovery
component of the
Elsburg Gold Mining
joint venture from
Australia's
Minetails Ltd. for
177 million rand in
cash. DROOY will
have outright
management control
over the Elsburg JV,
and will be entitled
to 100% of the gold
produced and cash
flows from the
retreatment of
tailings by the JV
which has a 12-year
mine life.
|
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