Toronto Stock Exchange Noranda drilling gives Christmas cheer to

Long-suffering shareholders of Denison Mines woke up during the week ended Dec. 18 to find an unexpected surprise in their Christmas stockings. It came in the form of Denison’s new President and chief executive officer Bill James, who has been given the authority carte blanche to turn the beleaguered uranium company around. The initial euphoria sparked a 40 cents increase in the price of Denison A shares. But as investors contemplated the extent of the task facing James and Chairman Helen Roman-Barber, the A shares slipped back from the week’s high of 95 cents to close today, Dec. 19, at 70 cents.

Shareholders of Ontex Resources were also in a festive mood as an Ontario court judge ordered Metalore Resources to return full ownership of the Brookbank gold property to Ontex.

As a contingent of Ontex executives celebrated the victory on champagne from President Sam Fuda’s winery, shares of Metalore went into a free fall. While Metalore says it will appeal the decision, the issue dropped from $10 to end the day down $6.50 at $3.50.

Fuda and his team are now wondering what to do about the mansion that Metalore President George Chilian built on claims that tie on to the Brookbank property near Geraldton, Ont. “We should build one of our own,” quipped one of the Ontex party goers.

The sobering fact is that when all the legal bills are tallied up, Ontex and Metalore will have spent roughly $3 million for the right to claim a deposit that only contains about 300,000 oz.

There was more Christmas cheer for market players this week as the U.S. Federal Reserve board paved the way for lower interest rates by dropping the key interest rate it charges on loans to banks to 6.5% from 7%. While investors were slow to react to this welcome news, the composite 300 index ended the week up 16.85 points on a volume of over 30 million shares traded.

There was also some good news for gold watchers. As the precious metal continued to act as a barometer of Middle East tensions, gold advanced by US$7 during the reporting period to close at US$378.90 per oz. in London.

As gold issues responded, the gold and silver index added 4.58% before closing at 5376.48. Among the big winners was American Barrick. It gained $1.12. Shares of Hemlo Gold moved up 75 cents. Placer Dome, which had an option with Metalore to earn 50% of the Brookbank project, was also a winner. Although Placer Dome isn’t commenting on the outcome of the lawsuit, it added 63 cents to close at $18.13.

Shares of Echo Bay added an impressive 88 cents despite confirmation that the company will swallow a $39.7-million writedown on gold properties held under the Alta Bay joint venture in Nevada. The Alta Bay properties include 40% of the Robertson mine which is being sold for $2 million cash plus royalties.

While gold’s fortunes improved, silver prices tumbled to the lowest levels in 14 years on speculation that a recession will spark a drastic cut in industrial demand for the metal. During the week, silver fell US5.6 cents on the New York Commodity Exchange to US$3.97 per oz. It was the lowest since Feb. 10., 1976, when silver closed at US$3.93 per oz.

Among the most active issues this week was Trimin Resources. The company says it plans to use proceeds from the sale of its Hanson Lake project to buy back up to 2.2 million of its own shares at not less than 95% of their net asset value. The 4.8 million issued Trimin shares ended the week on even ground at $2.

Drill results released today from the Freewest Resources, Noranda joint venture at Harker-Holloway, Ont. suggest that the Lightning zone extends on to disputed claims held by COATS-listed Card Lake Resources. Freewest gained 10 cents while shares of Noranda moved up 12 cents. Two stepout holes located 1,300 ft. east of the Lightning zone on the Deserault claims intersected 9.5 ft. of 083 oz. gold per ton and 7 ft. of 0.09 oz. above 600 ft. The two holes were designed to test the area stratigraphically above the Lightning zone.

An impressive 63-ft. intersection grading 13% copper was pulled recently from the Aur Resources, Societe Miniere Louvem joint venture at Louvicourt Twp. east of Val d’Or, Que. But stunning though it is, the intersection tested the centre of the deposit and won’t have any impact on the size of the orebody. Shares of Aur gained 10 cents today, while Louvem lost 15 cents.

Timmins Nickel reported record nickel output from its 51% owned Redstone mine near Timmins, Ont. Second-quarter (ended Nov. 30) production from the mine was 1.5 million lb. up 73% from the previous quarter. Timmins Nickel added 1 cents to end the week at 71 cents.