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British Columbia Special Issue
British Columbia is one of the richest mineral regions in the world. Ignored by the mining industry for the past three decades, changes at home and abroad have led to the province being rediscovered.
May 2007 Special Issue
Nearly all of the major mining companies had a strong presence in British Columbia for decades, with many of those companies building and developing mines. A political change in the early 1970's drove much of the industry out of the province.
The industry was just getting comfortable again with the provincial government as metal prices collapsed in the late 1990s. Over the past couple of years, the mining industry has begun to re-discover British Columbia. The imminent start of development of a massive mining project by a small company will bring greater awareness to the mineral wealth of the province.
Progress on that project should lead to further strengthening of the industry as other small companies advance both historic projects and recent discoveries. Several projects are now approaching the level where the majors will begin to get involved, through joint ventures and acquisitions of companies.
The increased appeal of B.C. comes at the same time that political uncertainties mount in many parts of the world. Leftist governments in parts of Latin America, on-going violence in parts of Africa, arbitrary taxes on mining and corrupt governments in some third world countries, growing racial tensions and religious conflicts are all serving to make North America a more comfortable region for investment.
B.C., with a wealth of mineral riches and a government that is very supportive of the mining industry, is quickly emerging as one of the most favorable places for mining development.
A Long Mining History
Mining played an important role in British Columbia for most of the history of Canada's mountainous westernmost province. Exploration got underway in the 1850s and mining quickly became an important part of the provincial economy.
The California gold rush of 1849 brought fortune seekers from around the world to the West Coast of North America. Many of those who were too late to stake their claim to fortune in California moved along the coast in search of a new bonanza.
Gold was soon discovered on the Fraser River, which meets the Pacific Ocean at Vancouver. Over the next few years, the prospectors worked their way up one of the biggest rivers in the world. There was enough gold in the river gravels to keep the panners interested, with newcomers working further and further into the uncharted interior of the province.
In 1862, Billy Barker found gold on Williams Creek, an offshoot of the Fraser nearly 1,000 kilometers up the river. He pulled $1,000 per day of gold out of the ground, leading to a rush of frenzied fortune seekers from all over the world. Between 1862 and 1870, over 30,000 people converged on the boom-town called Barkerville which grew up alongside Barker's claims. In its heyday, Barkerville was the largest city west of Chicago and north of San Francisco.
Barkerville still attracts hordes of visitors as a living ghost town and a tribute to the hardy souls who helped build the province. Over time, the gold miners moved on from Barkerville, testing every creek they encountered.
In August 1896 prospectors found gold near Dawson City in the Yukon.. Gold was found throughout the region, and many of the locals who staked claims became wealthy.
Since the Yukon was so remote, word of the find spread slowly to the rest of the world. The Klondike Gold Rush began in the summer of 1897 when two ships docked in San Francisco and Seattle carrying miners returning from the Yukon with bags of gold.
Word spread like wildfire of the riches being found up north. Soon 100,000 people from all walks of life and every part of the world dropped everything and set off for the Yukon. Only 30,000 completed the trip, and of that number only a few of the earliest to arrive actually made any money from the Klondike goldfields.
The most popular route was by boat up the west coast to Skagway in Alaska, then over the Chilkoot Pass to the Yukon River at Whitehorse and then by boat (the prospectors had to build their own boats) 500 miles down river to Dawson City.
Many Klondikers set off on other routes, including overland routes that took them through British Columbia. Thousands of gold seekers passed through B.C. on the way to the Yukon, always keeping an eye out for their own goldfield as they traveled through the wilderness. Some of those intrepid explorers found encouragement along their path to the Yukon and stayed in B.C. Others returned after finding disappointment further north. Many communities around the province began their history in those early gold rush days.
The gold seekers turned up many base metal showing in their search for riches, but it was only gold that could be mined by an individual miner and carried out on foot. Some of the base metal showings were documented for the benefit of those who would follow.
Over the course of the 1900s, the big mining companies from all over the world followed up on those showings uncovered by the gold seekers. B.C. quickly became one of the most important mining regions in the world.
Before they became gold companies, Newmont and Placer Dome both operated multiple base metal mines in the province. The core of Teck Cominco for decades was the Sullivan mine, which operated for 80 years as one of the largest zinc mines in the world. Many skiers will be familiar with the Britannia mine, on the road between Vancouver and Whistler. Now a mining museum, Britannia was for many years the biggest mine in the British Commonwealth.
Complex Geology Created Many Deposit Types
The geology of British Columbia is complex and interesting. The mountainous province has a wide range of geological environments that produced virtually every type of mineral deposit, including gold, silver, platinum, base metals, uranium, coal and even oil and gas.
In broad terms, the geology is similar to that of the mineral-rich west coast of South America, which produces billions of dollars worth of metals annually.
Hundreds of millions of years ago, much of the present land was under the sea, where sediments quietly accumulated. Roughly 200 million years ago, the portion of the earth's crust known as the Pacific Plate began splitting in the middle. As the two sides of the plate are being forced apart, the edges are being pushed against Asia and the Americas. The leading edges of the oceanic plate are being subducted, or forced under the continental plates.
The interaction of the two plates in B.C. isn't straight on, but includes movement of the continental plate to the north. The result is that present-day B.C. includes sections of continental crust that were broken off from Washington and Oregon. Those segments are intermingled with sea-floor sediments, metamorphosed continental crust and a plethora of volcanic and intrusive rock types.
The subducting continental crust generates magma (molten rock) that has produced some of the mountain ranges as it forces its way toward the surface, lifting the overlying rocks. Where the molten rock comes to the surface, it creates volcanoes.
Molten rock near the surface becomes a heat source that drives the circulation of high temperature fluids that create many of the world's metal deposits. At various times over the past couple of hundred million years, most of the province has seen magmatic activity. As a result, virtually the entire province is amenable to the formation of metal deposits.
A series of ice ages represented the final step in sculpting the province. Almost the entire province was covered by ice, with only the highest peaks sticking through glaciers that were thousands of feet thick. A few big ice fields in the northern part of the province remain as a glimpse of what all of the province once looked like. Those massive glaciers scooped out valleys and then deposited layers of sediment as they finally melted away.
That complex geological history generated literally hundreds of metal deposits. Many of those deposits were developed into mines in decades gone by.
For investors today, of even greater importance than the numerous mines that once operated in B.C. are the multitude of discoveries that were never developed.
Running Out of Suitable Deposits
Vancouver has been at the center of worldwide mineral exploration for decades. The political turn-around in the early 1970s that drove the mining industry away spurred Vancouver-based geologists to fan out around the world, leading to major metal discoveries in every region of the planet.
Over the past half century, the mining industry had the luxury of picking the best metal deposits in the world to be developed into mines. For much of that time, the major mining companies had free access to pretty much every part of the world. Metal deposits were often cast aside by companies that had the option of developing bigger and better deposits in other places.
Low metal prices in the late 1990s led to a near shutdown of mineral exploration. When economic activity took off worldwide over the past few years, there was a shortage of metal deposits to develop into new mines. The mining industry reacted by buying existing production. While the surviving companies are getting bigger, industry production has been flat.
After decades of exploration, most of the world has been looked at. There will undoubtedly be big, new discoveries... but not at the pace that the industry enjoyed in earlier decades as they made the first exploration pass.
As the mining industry looks for ways to expand, some of the deposits that were found in decades gone by are being re-evaluated. Shareholders of the small companies that now hold those deposits are seeing big gains in the values of their holdings.
A Supportive Government
British Columbia's mineral exploration and mining industry produces billions of dollars for the province each year. After decades of decline, the government is now committed to further enhancing the economic benefits of mining.
The government has committed to making B.C. an ideal place to invest. The new B.C. Mining Plan has reduced mining regulations, reduced taxes and taken other steps aimed at making the province more investor friendly. British Columbia now has competitive taxe rates, reasonable mining regulations, high quality and accessible geological data and attractive exploration incentives, making it one of the most favorable places to explore.
Land claims of the First Nations, or aboriginal peoples remain a stumbling block in some areas. However, the First Nations in many areas are now embracing mining development as a way to generate jobs and financial security for their communities. The perception of widespread difficulties with land claims is largely a legacy of the past, but remains an impediment for some investors. Few companies face any real difficulty, and over time the perception will converge with reality.
The start of development of the Galore Creek mine will signal to the world that the system works and that B.C. is indeed one of the most favorable places in the world for mine development. As the mining industry returns to the province, they will find that many of the best prospects are held by small mining companies. Astute investors are already building positions in the companies best situated to benefit from the re-emergence of B.C. as a mining powerhouse.
Company Updates
Bravo Ventures
(BVG-TSXV)
Bravo's recent technical report outlines an inferred resource of 900,000 ounces of gold and 5.7 million ounces of silver on its Homestake Ridge gold-silver project in northwestern British Columbia. A multi-rig core drilling program in the coming months is intended to extend the known mineralized zone and test high-priority targets outside of the present resource area.
Homestake Ridge is located in a mineral belt that hosts some of the richest mines in North America. The project is geologically similar to Barrick's nearby Eskay Creek mine (2.6 million tonnes grading 48 grams per tonne gold, 2,150 grams per tonne silver and 7% zinc/lead/copper).
Exploration at Homestake Ridge goes back more than a hundred years, to prospectors and miners traveling through northern British Columbia. Three major mining companies worked in the area over the past 30 years and collected data that Bravo assembled as a basis for its successful exploration program. Based on the results to date, Bravo is in a position to rapidly advance the project with the next round of drilling.
Bravo continues work at their properties in southeastern Alaska where surface and float samples have produced high grade gold-lead-zinc-silver. The company will begin a 2,000 meter drill program in the area in the upcoming months.
Drilling also continues on the company's Nevada properties, with funding from joint venture partners. Bravo is one of the largest property holders in the highly prospective Cortez Trend.
In summary, Bravo Ventures has already outlined an initial resource on its property in British Columbia and continues to explore several other projects in Alaska and Nevada that offer shareholders potential for further exploration success.
Price May 10, 2007: C$1.23
Shares Outstanding: 74 million
Shares Fully Diluted: 86 million
Market Cap: C$91 million
Contact: Jay Oness, Investor Relations
604 684-9384
www.bravoventuregroup.com
Copper Fox Metals
(CUU-TSXV)
Copper Fox recently announced an updated resource estimate, confirming Schaft Creek as one of the largest copper-gold-molybdenum deposits in the world. Copper Fox has a 93% interest in the property, located just northeast of NovaGold's Galore Creek deposit in British Columbia.
Schaft Creek was discovered in the 1950's and has been worked on by three large mining companies since that time. Drilling confirmed the presence of a large deposit, but for a period after 1973 government policy was unfavorable toward mining, leading to a wholesale exit from the province.
As the industry regained confidence in the provincial government, the metal prices slumped, further delaying the return of exploration and development activity. Copper Fox optioned the property from Teck Cominco in 2001, at the bottom of the price cycle. The deal provides an opportunity for the major to earn back into the project. A back-in would be positive for Copper Fox in that it would confirm that Schaft Creek is indeed a world-class deposit. If the major backs in, they would then provide the bulk of funding through to production.
Since Copper Fox acquired its interest, the project has appreciated in value in several ways. Firstly, the prices of gold, copper and molybdenum rose by multiples from their 2001 levels, adding enormous value to what was then a marginal deposit. Secondly, NovaGold's plans to build roads and infrastructure in the area for their nearby Galore Creek project will provide a significant benefit to the Schaft Creek project.
Work by Copper Fox over the past few years has also added considerable value to the project. The company has improved the geological understanding, leading to the discovery of zones with higher grades and extending the limits of the deposit. They have carried out metallurgical work that enhances the recovery levels estimated decades ago. They have also conducted other engineering and environmental work and achieved an understanding with the local First Nations.
Copper Fox announced its updated resource estimate on May 9. Using a cut-off of 0.2% copper (similar to Galore Creek), the deposit has 1.06 billion tonnes of measured and indicated resource averaging 0.31% copper, 0.23g/t gold, 0.02% molybdenum and 1.63g/t silver. Those figures imply a contained metal content of 6.6 billion pounds of copper, 455 million pounds of molybdenum, 7.8 million ounces of gold and 55 million ounces of silver.
The fall-off in the share price after the announcement of the resource suggests that some investors don't fully understand the figures. As is typical at this stage, the figures are based on an overall average grade of the entire deposit as presently outlined. Within the overall deposit, there are zones with substantially more favorable grades. To put this in perspective, at the planned mining rate, the total deposit is adequate for more than 40 years of production. Subject to the actual geometry of the deposit, mining of material at the average grade might not occur until after year 20.
The company will now begin to more carefully evaluate the deposit, with the intent of identifying zones with more favorable grade. The next round of evaluation will involve a more detailed examination of the deposit that will be carried forward into a mining plan. To that end, the company plans a 15,000 meter drill program for this summer.
Other work in support of a pre-feasibility study will include further engineering studies, environmental assessments, geotechnical work for minesite design, further metallurgical testing and conclusion of socio-economic agreements.
We have already enjoyed a five-fold gain in the share price since we began following the company in Resource Opportunities in February 2006. There is still considerable upside potential as the company advances toward a pre-feasibility study over the course of this year. An updated scoping study expected in the coming weeks should provide greater insight into the economic outlook for the project.
Few investors yet recognize that the Schaft Creek deposit is very large and has excellent prospects of continuing to advance toward development. Subscribers may recall similar skepticism over many of the projects that we have covered that evolved into investment successes.
Price May 10, 2007: C$1.25
Shares Outstanding: 70 million
Shares Fully Diluted: 81 million
Market Cap:C$ C$87.5 million
Contact: Investor Relations
403- 264-2820
www.copperfoxmetals.com
Fjordland Exploration
(FEX-TSXV)
Fjordland's primary exploration project is the Woodjam gold-copper project in the Cariboo region of central British Columbia. Earlier work in the Woodjam area turned up three gold-copper-mineralized zones -- Megabuck, Takom and Spellbound -- all related to a large alkalic gold-copper porphyry system. Fjordland's exploration team was attracted to the project by the potential to identify a substantial deposit within the large mineralized area outlined by the earlier drilling.
Drilling on the project now held by Fjordland, starting in the 1970s, produced encouraging results. However, it was not until the last couple of years that British Columbia projects like Woodjam have begun to gain investor attention.
Fjordland has a 60% interest in Woodjam while Cariboo Rose Resources (CRB-TSXV) a company that has seen its share price soar on results from the Spanish Mountain project, 40 kilometers north of Woodjam, has a 40% interest in the project. Drilling at Spanish Mountain is outlining a broad zone that carries just over 1 gram per tonne of gold. In June 2004, Fjordland intersected 275 meters grading 1.03 grams per tonne gold plus 0.14% copper. Woodjam is road accessible, at low elevation and can be worked year-round.
The Woodjam property is 35 kilometers south of Imperial Metals' Mr. Polley mine and 60 kilometers southeast of Taseko's Gibraltar mine, both of which are also based on porphyry deposits. Northgate's Kemess South mine, located in a remote location approximately 600 kilometers northwest of Woodjam, produces 300,000 ounces of gold and 75 million pounds of copper per year. Proven and probable reserves total 86 million tonnes at a grade of 0.67 gram per tonne gold and 0.22% copper. At that grade, and in a remote location, the Kemess mine generated US$41.8 million of operating cash flow in the most recent quarter.
Fjordland's new president Tom Shroeter has more than thirty years experience as a government geologist focused on British Columbia and has received various awards for his work. The directors bring considerable mining industry experience and success.
Recent work by Fjordland has focused mainly on the Megabuck Zone, which was discovered in 2004 by drilling a geochemical anomaly. Trenching and drill intersections have outlined a large mineralized system at Woodjam.
The 2005 program was primarily intended to test new zones and succeeded in discovering the Takom zone, 2 kilometers south of the first discovery. Drilling in 2006 encountered significant mineralization at the Megabuck zone, with hole 06-51 grading 0.95 g/t gold and 0.19% copper in an area 50 meters south of previous drilling, and hole 06-53 returning 1.52 g/t gold and 0.23% copper. The gold-copper system outlined by drilling to date at Megabuck remains open to depth and is also open laterally.
Induced polarization and magnetic geophysical surveys are underway on the company's Takom zone. Drill results from 2006 indicate the potential for an underlying large porphyry system. Takom is defined by a 2 kilometer by 1 kilometer soil geochemical anomaly. Upon completion of the surveys, drilling is planned later this summer.
Fjordland has recently entered into a joint venture agreement with Serengeti Resources (SIR-TSXV) on the Tezz property in northern British Columbia. Sampling by government geologists has identified strong gold-copper values in stream samples on the property. The property is located 40 kilometers south of Prince George and adjoins ground recently staked by NovaGold resources.
In July 2006, the company optioned an 80% interest in the Olympic-Rob IOCG deposit in the Yukon. The initial drill program conducted on the Olympic Property in 1997 by Commander Resources tested only 6 of many potential targets located within the ten square kilometers of prospective breccia on the project. Significant copper mineralization has also been mapped on surface. The high grade copper values encountered in the surface trenching are similar to copper grades and thicknesses encountered in early drill holes peripheral to the Olympic Dam ore body. A $600,000 drill program is scheduled to begin in June.
Based on the earlier drilling success, the company is well positioned to continue to generate favorable results at Woodjam. Successful results on the company's other projects should bring additional attention to this under-valued company.
Price May 10, 2007: C$0.255
Shares Outstanding: 46 million
Shares Fully Diluted: $54 million
Market Cap: C$12 million
Contact: John Gomez, Investor Relations
604-893-8365
www.fjordlandex.com
Romios Gold
(RG-TSXV)
Romios has several high potential exploration projects in North America. The Galore Lake project in northwestern British Columbia is especially interesting for investors at this time, as development work is about to get underway NovaGold's adjacent 1.5 billion-tonne Galore Creek deposit. NovaGold's deposit has a total metal endowment (reserves plus measured, indicated and inferred resources) of 14 million ounces of gold, 227 million ounces of silver and 15 billion pounds of copper, demonstrating the potential for huge deposits in that geological setting.
The Romios project is composed of 9 properties within and around the NovaGold property. Several of the projects have had extensive work in the past, leading to an initial resource estimate on one of the properties.
The northwest section of British Columbia has a long mining history that goes back over a century, when miners discovered gold on route to the Klondike gold fields in the Yukon. Substantial exploration, involving most of the major mining companies, from the 1950's to the 1970's resulted in several base metal discoveries, including Galore Creek. A change in the provincial government in 1973 led mining companies to turn away from B.C. and the area was put on hold. The discovery of what is now Barrick's Eskay Creek mine led to a new wave of exploration in the 1980's.
Romios' Newmont Lake property is located midway between Galore Creek and Eskay. The property was first explored in the 1960's by Newmont. The Eskay Creek discovery prompted further gold-silver oriented work to be done on the property. In the early 1990s, ten companies independently explored separate sections of the property, entirely with a precious metals focus. Those companies did not collaborate, and as a result they did not grasp the significance of the geological setting.
Gerald Ray, who has a Ph.D. in geology and considerable experience in this type of geology, compiled information from the Galore Lake region and carried out additional field work. His January 2006 report concluded that the Romios property has many geological similarities to the rich Galore Creek property.
Drilling of 10 holes by Romios on the Newmont property confirmed the earlier results and further expanded the deposit outlined by the previous operator. A preliminary inferred resource of 200,000 ounces of gold, 291,000 ounces of silver and 6.7 million pounds of copper was estimated based on the work to date. A geophysical survey suggests the potential for a much larger mineralized area. Further drilling this year will continue to expand the deposit and test other nearby targets. (The Galore Creek deposit actually comprises several individual deposits.)
The company holds properties immediately adjacent, or even within the NovaGold property. Construction of an access road to the Galore Creek deposit, along with a power line and other infrastructure development will directly benefit the Romios property. The road will actually pass over one of the Romios properties on which surface sampling has indicated the presence of gold and copper. Road construction will effectively cut a trench on the Romios property, allowing geologists to take a sample for more than a kilometer.
Romios is also continuing to acquire high-potential properties, with the latest being Nizi, a gold-silver prospect north of the Galore Creek area. Samples from the property have yielded more than half an ounce of gold plus more than a kilogram of silver.
Romios has cancelled its planned merger with Copper Canyon Resources (CPY-TSXV). After completing due diligence on the Copper Canyon property, Romios concluded that the share ratio of 1.5 shares of Romios for each 1 share of Copper Canyon was not in the best interest for its shareholders.
Romios' management and geological team had the foresight to acquire an extensive property position in the Galore Creek area over the past three years. As that project moves into the development stage, investors are beginning to notice Romios, which holds the dominant land position outside of the NovaGold ground. Results to date make it clear that the Romios ground has serious geological merit. The pending merger will give Romios a direct stake in the NovaGold development project.
Romios share price was hit recently when 4.5 million private placement shares became free trading. The dip in the price provides an excellent opportunity to get a position as the summer work program gets underway, for both Romios and its neighbor.
Price May 10, 2007: C$0.63
Shares Outstanding: 53 million
Shares Fully Diluted: 67 million
Market Cap: C$33 million
Contact: Investor Relations
416-221-4124
www.romios.com
Terrane Metals
(TRX-TSXV)
As Terrane advances its Mount Milligan porphyry copper-and gold deposit toward development, it's exploration focus has shifted to its second major deposit -- Berg. Both projects are located in central British Columbia.
Mount Milligan, Berg and two other projects were acquired from Goldcorp after that company and Barrick jointly took over Placer Dome, a major gold producer. Goldcorp now holds a major interest in Terrane. Rob Pease, Terrane's president, was previously general manager, Canada exploration and global major projects for Placer Dome. Other members of the Terrane management team bring considerable exploration and mine development experience.
Mount Milligan was explored by a junior company in the 1980s and acquired by Placer Dome in 1990 for C$270 million. The major carried out detailed engineering work and secured mine development permits, but the declining metal prices saw the project shelved until 2004.
The Mount Milligan deposit has been outlined by more than 900 drill holes. Placer Dome estimated a measured and indicated resource of 205 million tonnes containing 1.1 billion pounds of copper and 3.7 million ounces of gold.
Drilling last year by Terrane has pushed out the limits of the deposit. The company is now working toward an updated resource estimate and is conducting feasibility and mine permitting work.
The upcoming drilling program at Berg is intended to expand the near surface resource identified by Placer Dome. That deposit was first explored in the 1960s by Kennecott. By 1980, Placer, as a 51% joint venture partner, outlined a 238 million tonne deposit grading 0.4% copper, containing 2.1 billion pounds of copper with substantial values of molybdenum and silver. No further work was done on the project, with the two majors retaining their interests.
Terrane acquired the 51% interest held by Placer Dome in the Goldcorp transaction and subsequently acquired the 49% interest from Kennecott. For the first time in three decades, the property ownership is consolidated.
In addition to the exploration potential identified by the Terrane geologists, the Berg project is benefiting from infrastructure development in the area, including a nearby mine development.
Terrane also holds a gold project in Nunavut with large-scale potential, but at an early stage of exploration. The company is seeking a joint venture partner to fund further work on that project. In addition, Terrane holds a royalty interest in a portion of the Howard's Pass zinc project in the Yukon and Northwest Territories now being explored by Pacifica (PAX-TSXV). Both of those interests were previously held by Placer Dome.
Terrane has significant upside potential as it advances Mount Milligan toward production and as exploration advances on the Berg project.
Price May 10, 2007: C$0.67
Shares Outstanding: 71 million*
Shares Fully Diluted: 102 million
Market Cap: C$48 million
Contact: Investor Relations
604-681-9930
www.terranemetals.com
* Goldcorp holds 240 million preferred shares, which are convertible, with restrictions, to common shares on a one-for-one basis.
Initiating Coverage
Barker Minerals
(BML-TSXV)
Barker Minerals is an early stage exploration company focused on the discovery of gold, copper porphyry, and massive sulphide targets in the Cariboo Gold District of British Columbia, one of the most highly mineralized belts in the province.
The company holds an extensive land position, with 19 fully owned projects covering 295,000 acres. Of these 19 projects, Barker in currently concentrating on 6 properties, which have over 150 drill targets completed to date.
Barker's principal project is the Frank Creek property, located approximately 77 km northeast of Williams Lake, which has demonstrated the potential to host poly-metallic massive sulphide deposits. Previous work on the property includes placer mining, soil sampling, and electromagnetic airborne surveys. This work identified numerous geophysical and geochemical anomalies whose results are consistent with those of VMS deposits.
Prospecting on the property in 1999 led to the discovery of a massive sulphide boulder zone comprised of economic grade mineralization. Assays showed results of up to 15% Pb, 3.5% Zn, 1.3% Cu, 20 oz/tonne Ag, and 0.6 g/t Au.
Barker has also excavated a trench in a zone of weathered massive sulphide boulders near a culvert located 2 km up the logging road of the Frank Creek project area. The excavation exposed a stratiform, massive sulphide layer at least 1.2 m thick over 10 m. Additional boulders containing massive sulphide mineralization were found along the strike as far as 150 m away, suggesting the potential for a VMS deposit.
Over the past year, the company has completed an additional 2704 m of drilling over 7 holes on the project. Further exploration, including trenching and drilling, is set to resume this summer.
Barker has also initiated a drill program on its Kangaroo Gold project, with the first 2 drill holes recently completed.
The 2000 meter drill program is intended to test the targets defined by previous surface exploration programs. The first 2 drill holes intersected similar mineralization as Cross Lake Minerals' (CRN-TSX) nearby QR mine, which is scheduled to go into production this fall.
Kangaroo's southern anomaly, which lies along strike of Cross Lake's copper-gold trend, will also be tested. Previous drilling on the project intersected 5.26 g/t gold over an 8.5 meter interval. Eight additional drill holes on Kangaroo are planned for this summer.
Barker also has an extensive exploration program in place on its Ace property. Results have confirmed the potential for significant massive sulphide deposits along a zone at least 8 km in length.
Mineralization is similar to other Besshi-type massive sulphide deposits in British Columbia, most notably the Windy Craggy deposit, one of the largest massive sulphide deposits in the world.
The majority of the work to date has been along a well defined target area of 2.7 km. This area hosts an extensive mineralized boulder field and coincident bedrock mineralization consistent with VMS deposits.
Samples taken from 53 mineralized boulders of sulphide-bearing quartz veins yielded 3.1 g/t Au, with some results of up to 29 g/t Au.
Preliminary drill results from 1260 meters of drilling confirm the presence of gold-bearing mineralization on the project. Results indicate that mineralization extends for the length of the 8 km boulder field, which could lead to the discovery of numerous deposits -- typical of VMS discoveries.
Barker Minerals was founded by Louis Doyle, now President and CEO. Prior to forming Barker, Louis spent years in the financial planning and mutual fund industry, and comes from a family with an extensive mining background. Going forward, the management team is committed to building investor awareness.
I expect the share price to trend higher over the coming year as the company builds a stronger investor following, and generates positive news from its numerous projects.
Price June 11, 2007: C$0.27
Shares Outstanding: 48 million
Shares Fully Diluted: 64 million
Market Cap: C$ 12 million
Contact: Investor Relations
(250)563-8752
www.barkerminerals.com
Hard Creek Nickel
(HNC-TSXV)
Hard Creek holds one of the largest undeveloped nickel deposits in the world. Located in northern British Columbia, the deposit has seen considerable exploration activity over the past 50 years.
Several factors have come together to suggest that the Turnagain deposit has potential to evolve into an important world-class nickel deposit. These factors include: the immense size of the deposit, advances in nickel metallurgy, the outlook for ongoing strength in the nickel market and improving infrastructure in the region.
The company has a strong management and advisory team that brings considerable experience in finance, geology and mining.
Hard Creek is now conducting an aggressive drill program intended to expand and upgrade the plus-billion tonne resource. Metallurgical testing and engineering studies now underway are designed to support an updated economic assessment due for completion this fall.
Exploration on the Turnagain ultramafic complex dates back to 1956. Since then, several companies explored the area and outlined several large areas with nickel, cobalt and platinum values. That previous exploration included 230 drill holes. Drilling by Hard Creek supplemented the earlier work and led to a preliminary resource estimate of 428 million tonnes of measured and indicated resource grading 0.17% nickel plus 0.011% cobalt. An additional inferred resource has 742 million tonnes of similar grades. Those figures suggest a total contained nickel endowment of 4.5 billion pounds. Since then, further drilling by Hard Creek has greatly expanded the resource.
The deposit is located about 60 km east of the town of Dease Lake, which is on Highway 37. There is presently road access to the deposit.
The 127 hole drill program (36,000 meters) now underway has several objectives: to move more of the inferred resource into the measured and indicated categories; to identify areas with higher grades; to expand outward from the known deposits; and to test other targets that could evolve into additional deposits. One of the target areas is a platinum-rich zone.
While the Turnagain deposit is enormous, the grade is less than other sulfide nickel deposits presently in production. The preliminary economic assessment completed a year ago demonstrated the viability of the deposit and estimated a net present value of C$595 million. Those figures are based on a long-term nickel price of $6.60. (Nickel currently sells for more than $20 a pound.)
Since that study, the resource has been greatly expanded, providing the scope for a larger scale operation. An updated assessment this fall will take into account the larger resource and other advances to the project.
The deposit would be mined as a large-scale open pit with a low stripping ratio. The nickel would be recovered by way of standard flotation to produce a nickel sulfide concentrate. The company is evaluating the option of processing the concentrate on site using a hydro-metallurgical approach or shipping it to an existing smelter.
Putting the Turnagain deposit into perspective, the size compares to the largest porphyry copper deposits. The contained metal value per tonne is well in excess of a typical porphyry copper deposit. The metallurgy of nickel is somewhat more complex than copper. However, all of the engineering and metallurgical parameters were considered in the preliminary economic assessment, which suggested the economic viability of the project.
Compared to NovaGold's Galore Creek deposit, which is now under development, Turnagain has a similar size, a substantially higher contained metal value per tonne, and a similar (or perhaps more accessible) location.
The current market value of the company is small in relation to the enormous potential value of the deposit. I expect the value to increase as the project gains greater investor acceptance and as the ongoing work programs continue to advance the deposit.
Price June 11, 2007: C$2.20
Shares Outstanding: 57 million
Shares Fully Diluted: 68 million
Market Cap: C$ 125 million
Contact: Investor Relations
(604) 681-2300
www.hardcreeknickel.com
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