Re: This stock could be INTeresting INT(TSX-V)
in response to
by
Welcome To The 300 Club HUB On AGORACOM
We may not make much money, but we sure have a lot of fun!
Message: This stock could be INTeresting INT(TSX-V)
Doesn't copy here well but this is J.Taylors from a few days ago...jitney selling down at the end of each day so buys are decent near the close.
Update
Premium Exploration, Inc.
Business: Exploration and development of gold deposits in Idaho
Traded TSX-V: PEM
US OTC: PMMEF
Initial Recommendation: US$0.17
Price 4/20/11: US$0.67
Shares Outstanding: 114,694,519
Market Cap: US $77 million
NI 43-101 Resource: 1.2 million oz.
Progress Rating: A-3
Telephone: 604-682-0243
Web Site: www.premiumexploration.com
When I first started covering this stock for my subscribers, Premium
Exploration Inc. (Premium) held 400 claims along a north-south goldbearing
trend in Idaho that extends 30 kilometers, from the Petsite-Friday
Gold Zone on the south to the Buffalo Gulch Gold Mine on the north. As
management became confident with its ability to uncover the “plumbing”
within which gold mineralization was transported and deposited, it
aggressively added approximately 1,100 claims, which has enabled it to lay
claim to virtually the entire 30-kilometer-long trend in what can only be
described as a district-sized play. In addition, the company added claims to
the west to gain access to another lengthy fault zone. It is important to note
that early drill results along that zone confirmed that the same style of gold
mineralization exists in that zone.
Let me get right to the point. This company currently has a 1.2-millionounce,
bulk-mineable open-pit resource that is NI 43-101 compliant. This
calculation is from one small portion of that 30-kilometer-long strike length.
More precisely, the 1.2 million ounces are calculated from an area measuring
1 kilometer long by approximately 125 meters wide and to a depth of 300
meters.
The illustration below on your left, which shows the area from which 1.2 million ounces are currently derived,
shows the potential to increase the existing resource to perhaps around 2 million ounces by infill drilling into
the blank spaces to a depth of 300 meters. If, as expected, this pans out to be the case, the company will have
outlined 2 million ounces from 1.4 kilometers of a 30-kilometer strike length. That is less than 5% of the entire
strike length of this gold-bearing trend. But please, for the sake of those of you who are new to mine
exploration, we want to emphasize the fact that we are not implying you multiply 2 million ounces by 20 to get
11
a sense of what the upside gold resource target is here. What we are saying is that based on exploration to date,
we think the odds of a deposit much, much larger than 2 million ounces is highly likely.
When might we see a 2-million-ounce 43-101
resource? I think based on the company’s drill
program, this could be achieved within the next 12
months.
It isn’t indicated in the picture on your left, but at
various points along the 30-kilometer trend,
management is also planning to drill three more
high priority zones—namely, the Deadwood,
Buffalo Gulch, and Monday. Prospects for adding
upward to 900,000 ounces of bulk-mineable gold
from these three zones seem to be a good bet, based
on exploration work carried out to date. If so, that
means Premium’s resource totals could be pushing
toward 3 million ounces with still only a
small fraction of the 30-kilometer-long
trend being drilled.
Also, numerous more targets along that
trend have been identified using geophysics
and gold in soil anomalies. Those zones
will be tested in the future. What
management wants to accomplish with its
Phase 4 drill program is to demonstrate
continuity in the mineralized zones and the
extent of gold mineralization that is
contained in those zones and then begin to
turn what appears to be blue sky upside
potential into something that looks more
certain. My bet is that over the next year,
the market will start to wake up to the
massive upside potential from Premium’s
claims. That should happen with continued
success in a two-pronged exploration
program aimed at: (1) demonstrating the
bulk-mineable potential of any one of many
mineralized zones along the 30-kilometer
trend; and (2) demonstrating by drilling,
that there exist numerous, similar bulkmineable
zones along this 30-kilometer
trend.
Getting back to the immediate Friday-
Petsite Resource Area, the map on your left
shows that the potential from this
immediate area could be even larger than
the 2-million-ounce potential over a 1.4-
kilometer strike length. I say that because
12
of the existence of an additional prospective target extending 1 kilometer to the north and 1.5 kilometers to the
south of the 1.4-kilometer zone that hosts the existing resource.
Also, note the trend to the west that extends 2 kilometers north and south. This trend has had two drill holes put
into it and has produced two gold-bearing holes with the same kind of gold mineralization. That suggests the
potential to add considerably more ounces as it is drilled.
What I’m saying here is that we simply don’t know how extensive and continuous gold mineralization is on this
trend. But the more exploration that has been carried out, it seems the more reason there is to be optimistic that
Premium could be in the early days of discovering a monster gold deposit.
If continuing exploration work reveals a realistic chance for Premium to develop something major (we are
thinking 10+ million ounces), I believe these shares could rocket to much, much higher levels. And with the
gold bull market as strong as it is, discounting something big by the market could happen sooner rather than
later. The risk you run by staying on the sidelines with a stock like this is that the market may realize this
stock’s potential before you hop aboard. There is no way of knowing when a sufficient number of pieces of the
jigsaw puzzle will be completed to let the market “see” what is evolving on Premium’s Idaho Project. But I’m
thinking it could be sooner rather than later, if, as I anticipate, ongoing results are positive. And I’m not even
thinking in terms of deeper high-grade underground potential. For now the upside potential from shallow bulkmineable
targets is very large, so that is what I think the markets will focus on most for the foreseeable future.
A major point that needs to be stressed is that based on its work over the past few years on this project,
management has gained confidence in its ability to use geophysics and gold in soil anomalies to identify goldbearing
fault zones and, with that, more highly prospective drill targets. That is a confidence builder because it
means a higher probability of drilling and resource-building success going forward.
The bottom line for me with Premium is that this speculative junior gold stock has the potential to rise in price
and market cap by a factor of several-fold from its current level of around $75 million if/when sufficient
evidence exists to point toward a world-class deposit in the making. Some people are able to envision a picture
as the pieces of this puzzle are put together. For those who can accurately see the picture early, the upside could
be enormous. In my view, the downside risk from these levels, assuming a continuing bull market in gold and
the shares, is limited. Thus, I see Premium as a strong buy at these price levels for speculative gold share
investors.
Premium Exploration, Inc.
Business: Exploration and development of gold deposits in Idaho
Traded TSX-V: PEM
US OTC: PMMEF
Initial Recommendation: US$0.17
Price 4/20/11: US$0.67
Shares Outstanding: 114,694,519
Market Cap: US $77 million
NI 43-101 Resource: 1.2 million oz.
Progress Rating: A-3
Telephone: 604-682-0243
Web Site: www.premiumexploration.com
When I first started covering this stock for my subscribers, Premium
Exploration Inc. (Premium) held 400 claims along a north-south goldbearing
trend in Idaho that extends 30 kilometers, from the Petsite-Friday
Gold Zone on the south to the Buffalo Gulch Gold Mine on the north. As
management became confident with its ability to uncover the “plumbing”
within which gold mineralization was transported and deposited, it
aggressively added approximately 1,100 claims, which has enabled it to lay
claim to virtually the entire 30-kilometer-long trend in what can only be
described as a district-sized play. In addition, the company added claims to
the west to gain access to another lengthy fault zone. It is important to note
that early drill results along that zone confirmed that the same style of gold
mineralization exists in that zone.
Let me get right to the point. This company currently has a 1.2-millionounce,
bulk-mineable open-pit resource that is NI 43-101 compliant. This
calculation is from one small portion of that 30-kilometer-long strike length.
More precisely, the 1.2 million ounces are calculated from an area measuring
1 kilometer long by approximately 125 meters wide and to a depth of 300
meters.
The illustration below on your left, which shows the area from which 1.2 million ounces are currently derived,
shows the potential to increase the existing resource to perhaps around 2 million ounces by infill drilling into
the blank spaces to a depth of 300 meters. If, as expected, this pans out to be the case, the company will have
outlined 2 million ounces from 1.4 kilometers of a 30-kilometer strike length. That is less than 5% of the entire
strike length of this gold-bearing trend. But please, for the sake of those of you who are new to mine
exploration, we want to emphasize the fact that we are not implying you multiply 2 million ounces by 20 to get
11
a sense of what the upside gold resource target is here. What we are saying is that based on exploration to date,
we think the odds of a deposit much, much larger than 2 million ounces is highly likely.
When might we see a 2-million-ounce 43-101
resource? I think based on the company’s drill
program, this could be achieved within the next 12
months.
It isn’t indicated in the picture on your left, but at
various points along the 30-kilometer trend,
management is also planning to drill three more
high priority zones—namely, the Deadwood,
Buffalo Gulch, and Monday. Prospects for adding
upward to 900,000 ounces of bulk-mineable gold
from these three zones seem to be a good bet, based
on exploration work carried out to date. If so, that
means Premium’s resource totals could be pushing
toward 3 million ounces with still only a
small fraction of the 30-kilometer-long
trend being drilled.
Also, numerous more targets along that
trend have been identified using geophysics
and gold in soil anomalies. Those zones
will be tested in the future. What
management wants to accomplish with its
Phase 4 drill program is to demonstrate
continuity in the mineralized zones and the
extent of gold mineralization that is
contained in those zones and then begin to
turn what appears to be blue sky upside
potential into something that looks more
certain. My bet is that over the next year,
the market will start to wake up to the
massive upside potential from Premium’s
claims. That should happen with continued
success in a two-pronged exploration
program aimed at: (1) demonstrating the
bulk-mineable potential of any one of many
mineralized zones along the 30-kilometer
trend; and (2) demonstrating by drilling,
that there exist numerous, similar bulkmineable
zones along this 30-kilometer
trend.
Getting back to the immediate Friday-
Petsite Resource Area, the map on your left
shows that the potential from this
immediate area could be even larger than
the 2-million-ounce potential over a 1.4-
kilometer strike length. I say that because
12
of the existence of an additional prospective target extending 1 kilometer to the north and 1.5 kilometers to the
south of the 1.4-kilometer zone that hosts the existing resource.
Also, note the trend to the west that extends 2 kilometers north and south. This trend has had two drill holes put
into it and has produced two gold-bearing holes with the same kind of gold mineralization. That suggests the
potential to add considerably more ounces as it is drilled.
What I’m saying here is that we simply don’t know how extensive and continuous gold mineralization is on this
trend. But the more exploration that has been carried out, it seems the more reason there is to be optimistic that
Premium could be in the early days of discovering a monster gold deposit.
If continuing exploration work reveals a realistic chance for Premium to develop something major (we are
thinking 10+ million ounces), I believe these shares could rocket to much, much higher levels. And with the
gold bull market as strong as it is, discounting something big by the market could happen sooner rather than
later. The risk you run by staying on the sidelines with a stock like this is that the market may realize this
stock’s potential before you hop aboard. There is no way of knowing when a sufficient number of pieces of the
jigsaw puzzle will be completed to let the market “see” what is evolving on Premium’s Idaho Project. But I’m
thinking it could be sooner rather than later, if, as I anticipate, ongoing results are positive. And I’m not even
thinking in terms of deeper high-grade underground potential. For now the upside potential from shallow bulkmineable
targets is very large, so that is what I think the markets will focus on most for the foreseeable future.
A major point that needs to be stressed is that based on its work over the past few years on this project,
management has gained confidence in its ability to use geophysics and gold in soil anomalies to identify goldbearing
fault zones and, with that, more highly prospective drill targets. That is a confidence builder because it
means a higher probability of drilling and resource-building success going forward.
The bottom line for me with Premium is that this speculative junior gold stock has the potential to rise in price
and market cap by a factor of several-fold from its current level of around $75 million if/when sufficient
evidence exists to point toward a world-class deposit in the making. Some people are able to envision a picture
as the pieces of this puzzle are put together. For those who can accurately see the picture early, the upside could
be enormous. In my view, the downside risk from these levels, assuming a continuing bull market in gold and
the shares, is limited. Thus, I see Premium as a strong buy at these price levels for speculative gold share
investors.
2 Recommendations
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