After a brief halt at $9, Shabu Gold Mines resumed trading in the $10.75 range. The issue hit a high of $12.75 during the week — up from 35 cents in February. Incredibly however, the hugh price rise comes on meagre results.
The initial results from a 10,000-ft drilling program on the company’s Sheehan Lake property 80 km northeast of Red Lake, Ont., include an uneconomic 24.8-ft section grading 0.078 oz gold per ton. Four other narrower sections assayed anomalous gold values in the 0.06 oz-per-ton range.
Unbelievable you say? Well it doesn’t end here. Last month, the company agreed to issue 1.75 million shares for two more grass-roots prospects, pushing the issued amount of stock up 46% to 5.5 million shares. Those shares were valued at $3. But at $10.50, the paper profit for the vendors is an enormous $18.3 million.
Coming back to reality, Claude Resources, which holds a 45% stake in an emerging gold mine northeast of La Ronge, Sask., added 65 cents to $5.25. Placer Development is beginning an underground program on Claude’s Seabee property. Also, Barclays Bank exercised an option for 100,000 Claude shares at $3.60 per share.
Bay Resources and Services was also on the plus side, adding 27 cents for the week to $2.07. St. Genevieve Resources has made a takeover bid for all the outstanding Bay shares. Talk is that Monte Carlo Gold’s gold discovery on the Caribbean island of Aruba is the real thing. Surface prospecting unearthed some spectacular shows of visible gold. The issue advanced 60 cents to a high of $4.
Other stronger issues included Trio Gold, up 45 cents to $1.45 and Goldhunter Explorations which added 20 cents to 81 cents .
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