02/20/2010                                    www.insidemetals.com Vol 5, Issue 4
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 March 6, 2010.
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
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

PRECIOUS METALS MARKET UPDATE

Gold closed at $1118.00/oz (London Fix) on February 18, 2010, a 3.2% increase from the $1083.25/oz (London Fix) closing price on February 4, 2010, when data for the previous newsletter was gathered.
 
Silver closed at $15.83/oz (London Fix) on February 18, 2010, a 1.9% decrease from the $16.13/oz (London Fix) closing price on February 4, 2010.
 
Platinum closed at $1524.00/oz (London Fix) on February 18, 2010, a 1.6% decrease from the $1549.00/oz (London Fix) closing price on January 21, 2010.
 
Palladium closed at $434.00/oz (London Fix) on January 21, 2010, a 0.7% increase from the $431.00/oz (London Fix) closing price on February 4, 2010.
 
 
GOLD vs. EURO/U.S. DOLLAR CHART

The gold price has risen to $1118.00 per ounce after establishing a record high close of $1212.50 (London Fix on December 2, 2009). Gold has been steadily rising since the October 2008 lows, and closed above $1,000 per ounce in September 2009, and then sky-rocketed to record levels. During this rise in the bullion price, there was a steady decline in the value of the U.S. Dollar, until December 4, 2009, when the Euro/$ was 1.5068, and then the dollar started to increase in value. The Euro/$ value on February 18, 2010 was 1.3567.
 
The above chart reflects the expected parallel movement in the price of gold and the value of the U.S. Dollar. In the last week there has been more fluctuation in the gold price than in the U.S. dollar.

 

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Gold & Silver ETF's
 

The SPDR Gold Trust (GLD) now controls 35,669,096 ounces of gold. The gold holdings that have been steadily increasing since October 2008 have been recently consolidating as gold prices have risen from $925 in July 2009 to current levels around $1,100 per ounce. The GLD reached a record 36,450,190 ounces of gold on June 1, 2009. GLD holdings were 35,512,379 ounces when this newsletter was last issued.
 
The accumulation of silver by the iShares Silver Trust (SLV) has been steadily increasing since early 2008, in spite of declining silver prices beginning in August 2008 through October 2008. SLV silver holdings and the price of silver moved upward in mid-January. Silver prices and SLV silver holdings have been steadily rising since July 2009. SLV silver holdings reached a record 305,893,368 ounces on December 3, 2009, when the price of silver closed above $19.00 per ounce (London Fix). The SLV currently holds 303,708,676 ounces of silver
Holdings in both the GLD and SLV have been steadily increasing as the price of both gold and silver has been rising. Both the GLD and SLV are maintaining their positions in spite of a recent sharp decline in gold and silver prices. This suggests that investors continue to believe in the long term prospects for gold and silver.
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GEO POLITICAL VIEW
GEOPOLITICAL VIEW
BY GEORGE, THERE'S A GOLD BUBBLE ABOUT TO----
 
At the World Economic Forum in Davos in late January, billionaire investor George Soros stated that when interest rates are low, conditions are ripe for asset bubbles to develop, and the bubbles are now starting to form. He also said that the ultimate asset bubble is gold.
 
On February 17, 2010, Devon Maylie reported in The Wall Street Journal that George Soros recently doubled his stake in the SPDR Gold Trust (SLV) during the last quarter of 2009. Regulatory filings show that Soros' $8.8 billion investment vehicle, Soros Fund Management (SFM) raised is stake in the SLV by 3.7 million shares to 6.2 million shares.
 
Mr. Soros acquired this stake for $421 million, bringing his total holdings in the fund to $663 million. It was also reported that SFM owns 11,000 call options to purchase an extra 1.1 million shares.
 
SFM had also increased its stake in Yamana Gold Inc. (AUY) by buying 60,880 shares.
SMF now owns 85,880 shares of AUY that had a value of $973,314 at year-end.
 
Isn't it interesting that Mr. Soros' view of gold being the ultimate bubble would pop up at Davos, following his move to increase his position in the precious metal. Could it be that he has already sold some of his recently acquired gold, or is he increasing the tension that will burst the bubble in order to acquire more.
 
Recent strengthening of the U.S. dollar as a result of concerns about a default by Greece has resulted in a decline in the gold price, but in recent days gold has strengthened even in response to the news that the IMF plans to sell 191.3 tonnes of gold in a bid to reduce its dependence on lending revenue.
 
The recent strength in gold may be reflective of investors returning to the metal as a hedge against volatility in the foreign exchange markets, and remember Soros is a master at foreign exchange transactions.
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NYSE GOLD PRODUCER NEWS
NYSE
February 5, 2010: Coeur d'Alene Mines Corp. (CDE) announced that it has completed the sale of $100 million of senior unsecured notes under its effective shelf registration on file with the U.S. Securities and Exchange Commission. In conjunction with the sale of the Notes, CDE sold $3.75 million of its common stock. The principal of the notes is payable over twelve equal quarterly installments. The first payment is due on March 31, 2010. CDE has the option of making payments in cash, stock, or a combination of both. The stated interest rate on the notes is 6.5%, but compensation using stock will be based on a weighted 90% average share price over a pricing period ending shortly before the payment date.
 

February 5, 2010: Gold Fields Ltd. (GFI) announced that it is in the process of negotiating six-day work weeks at Driefontein and Kloof in anticipation that work stoppages may be a continuing factor as a result of seismic activity and government imposed safety halts. GFI lost 76 days of production in 2009 as a result of unplanned work stoppages.

February 8, 2010: Harmony Gold Mining Ltd. (HMY) reported that it returned to profitability in the three months through December after benefiting from a higher rand gold price. In South African currency, HMY earned 264,774 rand a kilogram (2.2 pounds) for gold during the quarter, up 10.6% from the previous three months. In the second quarter, which ended December 31, 2009, HMY posted net income of 118 million rand, compared to a loss of 29 million rand in the previous quarter. Gold production during the quarter declined 1.2% to 11,569 kilograms because of the closure of the Evander 7 shaft in South Africa's Mpumalanga province and the Brand 3 shaft in the Free State province.

February 10, 2010: Barrick Gold Corp. (ABX) announced that Chilean authorities had approved an environmental impact study that clears the way for ABX to expand extraction to 260,000 tonnes per day from 200,000 tonnes per day from its Zaldivar copper deposit, nearly a 20% increase.

February 10, 2010: Goldcorp Inc. (GG) has entered into a binding Investment Framework Agreement (IFA) with Quaterra Resources Inc. (AMEX: QMM) that formalizes the terms of a previously announced Letter of Intent that provides GG with an option to acquire an interest in certain mining properties held or acquired by QMM in central Mexico, by funding a two-year exploration program through a private placement investment of $10 million. The first $4 million of the closed private placement consists of units at C$1.41, comprised of 3,001,418 common shares of QMM and 1,500,709 two-year share purchase warrants exercisable at C$1.76 per share. Under the IFA, GG has an option to acquire up to 65% in any property held by QMM in central Mexico, except for Nieves, by spending an additional $2 million over a two year period on advanced exploration on that property and by completing a Feasibility Study. Thereafter, GG will solely fund operations at the property until a production decision is made, at that point, QMM will be responsible for its proportionate share of expenditures.

February 10, 2010: Gold Fields Ltd. (GFI) views Mali as a new frontier for gold exploration. GFI's West Africa head, Peter Turner said the company is focusing on the prospective Yanfolila belt, an under explored gold-rich part of southwestern Mali. GFI has been exploring properties in Mali acquired as part of the Glencar transaction. The flagship property is Komana, located in southern Mali which has provided gold grades up to 15.7 grams/tonne found near surface and contains visible gold. Early stage exploration is ongoing at Bokoro, Faliko, and Badogo, which are located within a 60 km radius of Komano. Ongoing drilling at Komano will continue until June 2010, and then a conceptual study will be completed in December 2010. GFI's West African operations in neighboring Ghana respectively produced 173,000 ounces at Tarkwa, and 45,000 ounces of gold at Damang in the December quarter. This production bodes well for future gold production from the region.

February 11, 2010: Barrick Gold Corp. (ABX) reported that it will begin field operations at Mt. Nakru and Simuku projects in New Guinea. These projects are copper-gold-molybdenum projects owned 100% by Australian listed Coppermoly Ltd., subject to a joint venture agreement with an ABX subsidiary Barrick (PNG) Exploration Ltd. ABX can earn a 72% interest in Coppermoly's three existing projects by spending A$20 million within 8 years. Diamond drilling will start at Nakru in the second quarter of 2010 and will test depth extensions of surface mineralization and copper related Induced Polarization geophysical targets

February 11, 2010: Gold Fields Ltd. (GFI) reported that its Gold Fields Horsefly Exploration Corp. has resumed drilling on the 157 sq. mile Woodjam North Property (WJNP) at Williams Lake in central British Columbia. WJNP is part of the Woodjam Joint Venture (WJV) owned by Fjordland Exploration Inc. (60% interest) and Cariboo Rose Resources Ltd. (40%). This Phase 2 winter drilling program is a continuation of a budgeted $2.5 million, 12-month program which began in July 2009. GFI plans to complete 3,000 to 4,000 meters of drilling in 12 holes. This drilling is planned to follow up on positive results at Takom, Deerhorn, and Megabucks. Refer to the press release for details on the specific objectives of this drilling. GFI has the option to earn up to a 70% in the WJNP by spending $19 million in exploration by July 2016.

February 11, 2010: Silver Wheaton Corp. (SLW) has agreed to acquire all gold and silver resources from Augusta Resource's Rosemont Copper Project in Pima County, Arizona. SLW will pay Augusta $230 million in cash installments. Augusta expects to receive key operating permits for the project in the fourth quarter. Rosemont is expected to be a low costs, long-life, and large-tonnage producer. SLW believes that Rosemont could increase its silver production to 2.4 million ounces over a long term. Rosemont's gold production should increase by about 15,000 ounces.

February 16, 2010: Goldcorp Inc. (GG) announced the acquisition of a 70% interest in the El Morro project, an advanced stage copper-gold project located in the Atacama Region of north-central Chile. On a 100% basis, El Morro contains proven and probable reserves of 6.7 million ounces of gold and 5.7 billion pounds of copper. The acquisition was completed pursuant to a January 6, 2010 Acquisition Funding Agreement (AFA) between GG and New Gold Inc. (NGD), in which GG loaned a NGD subsidiary $463 million to fund the acquisition of the 70% held by Xstrata Chile S.A. Under terms of the AFA, GG acquires the 70% interest purchased by NGD, and also transferred $50 million to NGD. GG will also provide 100% of NGD's funding requirement for development and construction of the project through commercial production. GG becomes the operator of the project.

February 17, 2010: Agnico-Eagle Mines Ltd. (AEM) reported net income of $47.9 million for the fourth quarter of 2009 compared to a net income of $21.9 million in the fourth quarter of 2008. AEM achieved record fourth quarter 2009 gold production of 163,276 ounces of gold at a cash cost of $297 per ounce compared to 89,360 ounces produced in the fourth quarter of 2008 at a cash cost of $463 per ounce. For the year AEM produced a record annual production of 492,972 ounces of gold and raised its reserves by 0.3 million ounces net of production to a record 18.4 million ounces. Refer to the press release for production and cost details at individual projects.

February 17, 2010: Goldcorp Inc. (GG) reported that as of December 31, 2009, the company had proven and probable gold reserves of 48.8 million ounces (a 5.3% increase over 2008) and proven and probable silver reserves of 1,300 million ounces (a 4.2% increase over 2008). Measured and indicated gold resources increased 3.2% to 22.7 million ounces in 2009, and measured and indicated silver resources increased 38.3% to 598.1 million ounces. All of the increases are the result of GG's successful organic growth programs and do not include any ounces acquired during the year. Refer to the press release for reserves and resources compiled by project and tabulations of copper, lead, and zinc reserves and resources. 

February 17, 2010: Yamana Gold Inc. (AUY) reported that a judge from Argentina's Catamarcha province has indefinitely suspended work on AUY's giant Aqua Rica copper-gold-molybdenum mine project following clashes between protestors and police. Environmentalists had been blocking a road servicing the site near the town of Andalaga since December. AUY has been conducting drilling to update a feasibility study with the goal of making a decision on whether or not to proceed with the project at the end of 2011. If developed, AUY's 100% owned Aqua Rica is expected to produce 12.5 million tons of copper and gold concentrate and 357,750 tons of molybdenum concentrate, resulting in average annual production of 365 million pounds of copper and 154,000 gold equivalent ounces in the first 10 years of production. Aqua Rica has an estimated mine life of 26.5 years.

February 17, 2010: Iamgold Gold Corp. (IAG) reported that its fourth quarter 2009 operating earnings more than doubled, driven primarily by strong gold prices. IAG reported adjusted Q4'09 earnings of $41.4 million, or $0.11 per share, which compared to a profit of $16.4 million, or $0.06 per share in the year-earlier quarter. IAG's latest quarter and the year-earlier quarter were impacted by impairment charges which resulted to net losses in both periods. IAG posted a net loss of $47.4 million, or $0.13 per share in the latest quarter, compared to a net loss of $96.4 million, or $0.33 per share in the year-earlier quarter. For the fourth quarter of 2009, IAG's revenue rose 27% to $265.3 million based on gold sales of 233,000 ounces at an average price of $1096 per ounce and strong niobium sales. Refer to the press release for exploration, development, operational, and financial details.

February 17, 2010: Kinross Gold Corp. (KGC) reported that it is considering the purchase of several assets in Russia, and sees its venture with OAO Polyus Gold as the optimal vehicle to pursue these acquisitions.

February 17, 2010: Kinross Gold Corp. (KGC) reported record fourth quarter 2009 gold equivalent production of 613,858 ounces, an increase of 12% over the year-earlier quarter. For the full year 2009, gold equivalent production was 2,238,665 ounces. Revenue for the fourth quarter was $699 million compared to $484.4 million in the fourth quarter of 2008, an increase of 44% based on an average realized gold price of $1,094 per ounce sold compared with $794 per ounce sold in the year-earlier quarter. For the full-year 2009 revenue was $2,412.1 million, a 49% increase over full-year 2008. The average realized gold price for the full year was $967 compared with $857 per ounce sold for the full-year 2008. KGC expects to produce approximately 2.2 million gold-equivalent ounces in 2010. Refer to the press release for details on operations, development, and exploration.

February 18, 2010: Barrick Gold Corp. (ABX) announced that the U.S. Bureau of Land Management has approved ABX's plan to combine and expand its Bald Mountain and Mooney Basin mines in northeast Nevada by 3,920 acres. This approval could result in the addition of 130 more jobs.

February 18, 2010: Barrick Gold Corp. (ABX) plans to create the biggest U.K. based gold producer by spinning off its Tanzanian assets and listing them on the London Stock Exchange (LSE) next month. African Barrick Gold (ABG) will be created when ABX sells its 25% stake in ABG, which produced 716,000 ounces of gold in 2009.

February 18, 2010: Barrick Gold Corp. (ABX) reported for the fourth quarter net income of $215 million, which compares with a loss of $468 million in the year-earlier quarter. During the quarter ABX produced 1.9 million ounces of gold and realized $1,119 per ounce for the gold sold. The cash cost for this gold was $474 per ounce. ABX's revenue for the quarter rose to $2.4 billion from $2.1 billion in the previous fourth quarter. ABX expects to mine between 7.6 and 8 million ounces in 2010, excluding the gold produced at its African Barrick Gold unit, which will be spun-off. ABX also noted that the above results include a one-time charge of $241 million to eliminate its gold hedge, and the company is seeking permission to start mining at its Cortez Hills project while a Federal Court has ruled that a new environmental impact study needs to be conducted as a result of a suit by environmentalists and Shoshone Indians to block operations. Prior to the suit, the BLM had issued permits to ABX approving the mine. ABX expects to produce 1.08 million to 1.2 million ounces of gold at Cortez Hills in 2010 at a cash cost of $295 to $315 per ounce. ABX will revise its 2010 guidance at Cortez Hills if the court decision impacts planned operations.

February 18, 2010: Compania de Minas Buenaventura SA (BVN) announced that it expects an ongoing strike at three units of its precious metals mining operations to end early next week. The six day work stoppage has halted operations at the Orcopampa gold mine, the Uchucchacua silver mine, and crimped operations at the Antapite gold mine. Miners are demanding information about BVN's finances between 2006 and 2009. Peruvian law requires mining companies to share 8% of profits with workers. Miners say BVN has under reported its profits.

AMEX GOLD PRODUCER NEWS

AMEX

February 9, 2010: Endeavour Silver Corp. (EXK) announced that it has acquired an option to purchase the San Sebastian silver-gold properties in Jalisco State, Mexico from IMMSA (Grupo Mexico), one of the largest mining companies in Mexico. The San Sebastian properties (13.3 sq. miles) cover a classic, low sulfidation epithermal vein system in four mineralized vein sub-districts: Los Reyes, Santiago de los Pinos, San Sebastian del Oeste, and Real de Oxtotipan. The San Sebastian veins tend to be large and can carry high grade silver-gold mineralized ore bodies. Drilling performed by IMMSA from 17 widely spaced diamond drill holes succeeded in finding widespread silver-gold mineralization ranging from 0 to 1 grams/tonne gold and from 50 to 150 grams/tonne silver over 2 to 6 meter widths.
 
February 11, 2010
: Aurizon Mines Ltd. (AZK) reported results of its underground drilling program from the 810 meter exploration drift, and the 280 meter drift at its Casa Berardi Mine in northwestern Quebec. Part of the current program focused along Zone 123, located approximately 950 meters east of the production shaft which extends to a depth of 1,100 meters from the surface. As of December 31, 2008, Zone 123 contained an inferred mineral resource of 714,000 tonnes at a grade of 9.4 grams/tonne which contains 216,000 ounces of gold. Since August 2009, 30 additional holes have been drilled from underground at an average spacing of 50 to 75 meters that have extended known mineralization by approximately 300 meters in both the up-dip, and down-dip direction. This drilling has identified a group of locally stacked mineralized lenses inside a steeply south dipping, 200 meter thick corridor that extends 900 meters vertically. Individual lenses range in thickness from 3 to 10 meters. The best intersections are located in the lower extension of the system. Highlights include:
 
- Hole CBP-0115 returned 5.5 grams/tonne gold over 10 meters at 1,100 vertical meters below the surface.
 
-
Hole CBP-0114 returned 8.1 grams/tonne gold over 6.5 meters and 9.2 grams/tonne gold over 5 meters at approximately 900 meters below the surface
 
February 11, 2010
: Northgate Minerals Corp. (NXG) board of directors has approved the development the Young-Davidson gold mine which is located near the town of Matachewan in Ontario, Canada. The property contains 2.8 million ounces of proven and probable reserves. The Young-Davidson mine is expected to produce 180,000 ounces of gold per annum over a 15-year mine life at a $350 per ounce net cash cost. Construction on the project is expected to start later this year, and the mine is expected to start production in 2012. Construction is expected to cost $339 million along with $50 million in annual expenditures for goods and services.
 
February 17, 2010
: Apollo Gold Corp. (AGT) announced additional drilling results from nine holes drilled at its Grey Fox project, including one of the best drill intersections to date of 17.9 meters at an average grade of 14.3 grams/tonne located on the boundary of Grey Fox and the Pike River properties with indications that mineralization is open to the north as the favorable Destor-Porcupine Fault Zone is approached. Results are pending from 14 holes, including the first six holes drilled on Pike River along the favorable Contact Zone. The Grey Fox and Pike River projects are just south of AGT's Black Fox Mine.
 
February 17, 2010
: Claude Resources Inc. (CRG) reported exploration results from its Madsen Project in Red Lake, Ontario. The reported results were a continuation of the company's 2009 surface exploration drilling program that tested a near-surface extension of the Austin Tuff. Highlight from the drilling program include high grade 2.0 meter intercept grading 44.38 grams of gold per tonne, and a 18.0 meter interval with a 0.14 gram per tonne grade. Refer to the press release for assay details of the reported eight drill holes. CRG will continue to evaluate this Austin Tuff Extension as a host for significant mineralization along strike. In December 2009, CGR released a NI 43-101 resource calculation for the Madsen project which reported an indicated resource of 928,000 ounces of gold at 8.93 grams per tonne and an inferred resource 297,000 ounces of gold at 11.74 grams per tonne. The Austin Tuff mineralization was not part of the resource calculation and represents a potential additional resource upon additional drilling.

 

NASDAQ GOLD PRODUCER NEWS
NASD
February 8, 2010: Randgold Resources Ltd. (GOLD) reported a profit for the fourth quarter of $32.1 million compared to $9.12 million in the fourth quarter of 2008 on revenue of $139.2 million in the fourth quarter of 2009 compared to fourth quarter 2008 revenue of $78.1 million in 2008. The company's fourth quarter 2009 production rose to 137,332 ounces from 118,925 ounces in the fourth quarter of 2008, and combined with a 39% rise in average gold prices, gold sales rose 34% to $139.2 million. Rising gold production was due to an expansion at its Loulo operation that is 20% owned by the government of Mali.
 
February 11, 2010: DRDGOLD Ltd. (DROOY) reported gold production of 59,866 ounces, a 4% rise in its production for the quarter which ended December 31, 2009. Revenue for the quarter was up 12% to R499.6 million based on an average rand gold price of R268 302/kg ($1106.00 per ounce), and a rand gold cost of  R223 653 ($925 per ounce).
 
February 12, 2010: DRDGOLD Ltd. (DROOY) announced that it is seriously considering Zimbabwe for expansion despite political uncertainty. DROOY reported that it has invested R5 million in seed capital in a 50-50 joint venture with Zimbabwe partner Chizim to establish an exploration project in the country's greenstone mining belt.
 
February 16, 2010: Royal Gold Inc. (RGLD): reported that shareholders of International Royalty Corp. (AMEX: ROY) approved Royal Gold's bid to acquire all of the shares of  ROY for a combination of cash and RGLD shares as previously reported. The acquisition is subject to final approval of the Plan of Arrangement in a Canadian court.
 
February 18, 2010: Lihir Gold Ltd. (LIHR) announced that it had for the fourth year in a row delivered a record annual gold production, and for the first time total output exceeded 1 million ounces, with production of 1.124 million ounces, a 27% increase over the previous year. LIHR also announced that it would sell its Ballarat project in Victoria because it would not meet the company's desired production and cost goals. LIHR projects full year 2010 production to be in the range between 960,000 and 1,060,000 million ounces of gold.
INSIDEMETALS.COM WEBSITE UPDATES
INSIDEMETALS WEBSITE UPDATES
InsideMetals has added to the Home Page of its website, an Advertising & Marketing Guide link for readers who may be interested in advertising their business on the InsideMetals website, or in the newsletter. The website has been visited by readers from more than 184 countries.
 
The Advertising & Marketing Guide contains basic demographic information as to the regions in the world from which the website is viewed; information as to banner advertisements and placements in the website and in the newsletter; and special Gold and Silver Medallion Advertising Programs that are available to mining and exploration companies.
If interested, please visit the following links for more information:
 
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We hope you have enjoyed our newsletter.
 
The newsletter will be published next on March 6, 2010.

Until next time!!!,
 
InsideMetals