MINING MARKETS & INVESTMENT NEWS – WESTERN MARKETS — VSE breaks through 300 level; AG zooms on bid

Buoyed by a rise in gold and Homestake Mining’s takeover bid for Argentina Gold, the Vancouver Stock Exchange mining index broke through the 300-level over the report period March 3-9, to close at 311.95, for a gain of 16.18 points, or 5.5%. The composite index rose 7.36 points, or 1.8%, to finish at 421.26. The combined value of the Alberta Stock Exchange was off 5.12 points, or 0.3%, at 1,894.37.

Homestake’s takeover bid of 0.545 of a share for each AG share caught many by surprise. Argentina Gold reached a high of $7.15 before falling back to $6.85, for a $2.25 gain. The company reported results for three additional holes at the 60%-held Veladero project, including hole 121 at western Filo Federico, which yielded 131 metres averaging 6.93 grams gold per tonne (including 68 metres of 12.95 grams) starting from 19 metres below surface.

Donner Minerals was up 9 cents at 46 cents. The company entered into a joint venture with Noranda on 1,100 mineral claims in the Lac Rocher area of Quebec. This adds to the 581 claims recently optioned from Falconbridge. Donner must pay $250,000 and spend $2 million on exploration over the next two years. Donner has arranged a $3-million brokered private placement of 7.5 million special warrants priced at 40 cents each.

Starcore Resources more than doubled to close at 66 cents, up 35 cents, while ProAm Explorations tacked on 18 cents to finish at 55 cents. The two are partners in a platinum venture at Samuels Lake, near Atikokan in northwestern Ontario. The companies report that drilling may have intersected a zone of significant interest while testing an electromagnetic conductor. Assay results are pending.

Auspex Minerals and International Vestor Resources have entered into an agreement to merge into one company called EuroZinc Mining Corp. Management of both companies believes the amalgamation will speed up development of the Aljustrel zinc project in Portugal. Shareholders of Auspex will receive 0.75 of a new share for each share held, whereas Vestor shareholders will receive one new share on a 1-for-1 basis. Auspex was up 3 cents at 40 cents, while Vestor slipped 3 cents to 47 cents.

Chet Idziszek-led Hyperion Resources tumbled 27 cents to close at 30 cents on the release of sporadic results from a small drilling program on a copper-rich volcanogenic massive sulphide target at the joint-ventured Holguin property in Cuba. Three of the eight holes drilled yielded copper assays that were deemed significant, including 2 metres of 0.6%, 6.7 metres of 9.4%, and 2 metres of 5.4%.

Great Basin Gold closed at $1.60, up 34 cents. The company plans to acquire the remaining 25% stake in the Ivanhoe gold project in Nevada held by Cornucopia Resources. In return, Great Basin will pay 2.75 million shares and 250,000 warrants exercisable at $2 per share for one year.