Comments: BUY FIRST TRANCHE—BYV continues taking flak for the way it reported its most recent drill results (see our Term of the Month article in this month’s International Speculator), but the fact remains they has greatly expanded a high-grade shoot that the developers of the multi-million-ounce gold project next door are going to want. Plus, the company is drilling for more. Takeover potential still strong.

As we go live with this update, someone is selling, with no company-specific bad news – that’s an opportunity.

So, did Bayfield smear their results?

The company did report 79.5 meters of 8.66 g/t gold, including 11.2 meters of 60.05 g/t gold. Now, 79.5 x 8.66 = 688.47 gram-meters and 11.2 x 60.05 = 672.56 gram-meters. That’s close enough that it’s pretty evident there was very little gold outside of that 11.2-meter high-grade segment.

Management argues that they reported the 79.5-meter interval because, while it carried almost no gold, it was mineralized – meaning, it was the same kind of altered rock that carried the high-grade, not just untouched country rock. They further argue that this was an exploration hole, in which it’s too early to say what parts might end up included in eventual ore, and not a resource definition hole, in which one must exclude material that will never be mined. They say the regulators applied the stricter, resource-definition standard to their exploration hole.

That may be so, but we would not have reported the results in the way the company did – and we’re sure they’ll be more careful in the future. But does that mean BYV’s results are a scam? Hardly. The 11.2-meter hit they are said to have smeared carries gold in every subinterval, and the aggregate result is still a terrific hit. Anything in the range of a couple ounces per tonne is probably economic, even over less than a meter width – let alone 11.2 m. And this is in a hit that extends a known high-grade shoot over 600 meters, making it a very significant discovery.

Bottom line, yes, beware of smearing, but also don’t let yourself get stampeded by critics seeking to make names for themselves as would-be whistle-blowers.