West-coast juniors look for direction

TSX VENTURE EXCHANGE

Junior mining stocks showed weakness despite an overall strengthening in metal prices over the period April 5-11. Gold, for example, gained $5.10 to close at US$427.90 per oz. The S&P-TSX Venture Exchange Index shed 47.73, or 2.5%, to finish at 1838.55.

Three times as many mining companies on the Venture Exchange reached 52-week lows as achieved yearly highs: 22 versus 73.

Vancouver-based Eaglecrest Explorations traded the most shares, 4.5 million, and tacked on 3 to close at 14, for a 27% increase. The company is starting a 15,000-tonne underground program on the San Simon project in Bolivia. The work entails two 150-metre declines and 900 metres of development drifts.

Second-most active was Spider Resources, which gave back a penny to close at 11.5 on a volume of 3.6 million shares. Spider and partner KWG Resources released drill results from their McFaulds Lake project in the James Bay Lowlands. Hole 64 intersected 5 metres grading 4.02% copper, 0.4 gram gold and 10 grams silver per tonne, including 9.1% copper over 1.55 metres and 6.5% copper over 0.7 metre.

Building on the previous week’s gains, Alexis Minerals closed up 8, to 78, on a volume of 3.3 million shares. The company and partner Noranda pulled some high-grade copper intervals from drilling on their West Ansil property, near Rouyn-Noranda in northwestern Quebec.

Trading more than 3.1 million shares, Abacus Mining & Exploration was driven 32% higher to 41 after retaining Vancouver-based Roman Friedrich & Co. for financial and strategic advice. Effective April 15, each Abacus shareholder will receive one new share of Niblack Mining for every four Abacus shares. Niblack plans to list on the Venture Exchange after a prospectus offering of at least $2.5 million.

Continuing its losing streak, Messina Minerals fell 36% or 55 to close at $1.97 on 3.1 million shares. That follows a 32% slide in share value in the previous week, reflecting drill results from the Boomerang zone in Newfoundland.

BcMetals lost 11 to close at 37 on 3 million shares. The company’s primary asset is the proposed Red Chris mine, south of Iskut in northwestern British Columbia. BcMetals has been busy improving copper and gold recoveries, getting the provincial government to pay for an extension to the power grid, and raising money to build the mine.

UGL Enterprises lost 41, or 45%, to close at 49 on a volume of 2.3 million shares. In the previous report period, UGL soared by 50% after announcing it had acquired a uranium property in northern Mongolia that contained 4-10% uranium over several hundred metres. The increase was short-lived, however, and trading was soon halted. The company retracted those high uranium grades, citing a transcribing error. The real grades turned out to be several orders of magnitude lower.

Among the value leaders was Cardero Resources, which tacked on 24 to close at $3.80 on more than 460,000 shares following encouraging results from drilling at the Pampa de Pongo iron project in southern Peru. The project is 35 km southeast of the Marcona iron mine. Widely spaced drilling suggests a potential resource of 1 billion tonnes comprising 75% magnetite. Preliminary metallurgical tests indicate magnetic separation could produce a salable concentrate grading 66-69% iron.