Gold rallies as Barrick breaks the mold

Gold roared back to life in the Oct. 15-21 report period, rising US$4 to a London morning fix of US$374.80 per oz. Silver also shone, rising US6 over the five trading days to finish at US$5 per oz.

Barrick Gold, up 81 at $25.69, made headlines by announcing its foray in Russia. The major purchased a 10% stake in London-listed Highland Gold, owner of the Mnogovershinoe mine, near the Russian border with China and Mongolia, and the high-grade Mayskoye gold deposit in the Chutkota region. Barrick bought its stake from South African-based Harmony Gold.

Also, Harmony dumped its 16.6% interest in High River Gold, though the news pushed the junior producer down 22 to $1.85. The sale also explains the issue’s heavy trading volume of more than 20 million shares.

Bema Gold rose 56 on news it had intersected more high-grade gold mineralization at its Kupol gold property in Russia’s Far East region. The targeted epithermal vein system, which remains open in all directions, has now been traced for 3.5 km along strike and for 400 metres in vertical extent. Bema finished the period at $4.21.

Promising drill results also sent Imperial Metals higher: upwards of 2.54% copper and 17.4 grams gold per tonne were pulled from the newly discovered Northeast zone at the Mount Polley property in British Columbia. Imperial ended the period at $4.15, up 40.

The most active prize went to Queenstake Resources, which, on Oct. 21, saw nearly 39 million shares change hands. The anomaly — about 1.5 million shares trade on any given day — reflects the release from escrow of 32 million treasury shares that were issued earlier this year as part of the Jerritt Canyon deal. Queenstake ended the period at 69, a penny shy of its close in the previous period.

Noranda was among big newsmakers in the base metals group, announcing that it’s cutting Horne’s production capacity by one-quarter and its workforce by one-third. The copper smelter, situated in Rouyn-Noranda, Que., needs to knock $30 million off operating costs to ensure its profitability. Noranda ended the period at $15.40, off 95.

Inco announced a third-quarter loss of $27 million; however, an earlier profit warning kept the issue relatively firm at $41.20. The quarterly loss, which compares with net earnings of $91 million a year earlier, is mainly attributable to the prolonged strike at the Ontario operations.

Falconbridge fared worse than its cross-town rival, falling $1.25 to $23. Investors had expected to see more than US$21.3 million in earnings, but a bad performance at the Kidd Creek division kept the major from fulfilling its wishes.

Tahera jumped 3 to 16 on news it had discovered another diamondiferous kimberlite body at the Jerico property in Nunavut. To date, six holes have intersected the dyke, yielding five stones from 7.6 kg of core; however, none of the results explains the indicator mineral trains found in the Bird Lake area.