Venture falls to 13-month low during Sept. 19-23

Vancouver – The S&P TSX Venture Exchange Index lost a dismal 216.77 points during the Sept. 19-23 period, falling to a 13-month low at 1,534.18 points. The index declined on all five days as European debt worries and slower-than-expected economic growth pounded equity markets around the world. Trading volume rose sharply to average 100.7 million shares traded daily, up from around 85 million shares traded daily over the past two months.

Grayd Resources was the most active stock on the exchange with 33.03 million shares traded, and also its biggest percentage gainer with a 33% rise. Agnico-Eagle Mines has made a friendly $275-million takeover bid for the company and its two Mexican gold projects, both located in Sonora’s Mulatos gold belt around 70 km northwest of Agnico’s Pinos Altos gold mine. Agnico will pay $2.80 in cash or 0.04 of a share and 5¢ for Grayd’s flagship La India project, which boasts a measured and indicated resource of 760,000 oz. gold from 26.8 million tonnes grading 0.88 gram gold per tonne, as well as 506,000 inferred oz. from 19.7 million tonnes at 0.8 gram gold. The deal also includes Grayd’s early-stage Tarachi gold-porphyry discovery about 10 km north of La India.

Chesapeake Gold saw the biggest value gain over the period, climbing $2.19 to $17.44 on light volume typical for Chesapeake. The company has released pilot-plant-scale metallurgical testwork for its large Metates gold-silver project in Mexico’s Durango State, confirming average recovery rates of 90% for gold, 77% for silver and 81% for zinc. Chesapeake is currently completing a prefeasibility study for the project, which it bills as one of the world’s largest undeveloped gold-silver deposits. It contains measured and indicated resources totalling 17.2 million oz. gold, 467 million oz. silver and 3.4 billion lbs. zinc.

Yukon gold explorers fared the worst over the trading week in terms of value losses. Atac Resources shed another $1.72 to $4.42 on no news; the stock has now fallen by 58% from its year high of $10.34 in late July. Kaminak Gold and Prophecy Platinum suffered similar fates. They fell $1.13 and $1.33 respectively, to close at $2.88 and $2.81.

Tawsho Mining saw the biggest percentage drop on the exchange, falling 40% or from 50¢ to 29¢. The company has drill results back from its Whisker Valley gold project in Northern Newfoundland. Seven of 12 holes intersected narrow quartz veins bearing gold mineralization, with the best returning 0.5 metre grading 13.99 grams gold.

NMC Resource meanwhile gained 29% after stating a state-owned South Korean company, Korea Resources Corp., is interested in its Boss Mountain molybdenum-copper project in British Columbia. NMC’s shares rose to 58¢ from 45¢. The Koreans will conduct a “project assessment study” on Boss Mountain over the next few months, part of a government-sponsored research program. Boss Mountain last saw production from Noranda in 1983.