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Gold Summary for May 16, 2011

2011-05-16 15:06 ET - Market Summary

by Stockwatch Business Reporter

New York spot gold closed down $5.40 to $1,489.80 Monday, falling with oil and the U.S. dollar. The euro rose against the dollar on hopes a decision over Greece's debt restructuring will be delayed, following the arrest of the International Monetary Fund's chief, Dominque Strauss-Kahn. He has been charged with sexual assault in his $3,000-a-night hotel room, and is scheduled to reappear in court on Friday, which he awaits in more modest circumstances on Riker's Island. Also today, the TSX Venture Exchange lost 41 points to 1,996, while the TSX Gold Index rose three points to 366.

Despite bullion's fall, Canadian gold miners ended the day up slightly. Barrick Gold Corp. (ABX) added 36 cents to $43.99 on 5.26 million shares, Iamgold Corp. (IMG) added 44 cents to $18.65 on 3.47 million shares and Agnico-Eagle Mines Ltd. (AEM) rose 61 cents to $60.05 on 916,000 shares.

Stephen Dattels's Brazilian Gold Corp. (BGC) dropped four cents to $1.38 on 379,000 shares. The company has drill results, including 74 metres of 1.32 grams per tonne gold, from its Rio Novo project in Brazil. It awaits assays from three more holes and apologizes for the delay, which it blames on backups at the lab. Several pleasing rounds of assays from the company's other Brazilian project, Boa Vista, took the stock up to $1.50 in April from 65 cents in January. Investor Dattels's 7.92 million shares rose by $6.7-million in value. One of the men helping to move the stock is Brazilian Gold's new chief executive officer, Ian Stalker. He took the position in January, and has since helped raise $23-million and plan 20,000 metres of drilling. Before Brazilan Gold, Mr. Stalker was CEO of Australian-listed Berkeley Resources Ltd., which is exploring for uranium in Spain. Before that, he was CEO of TSX-listed UraMin Inc., which France's Areva NC bought for $2.5-billion in August, 2007. Mr. Stalker acquired his first 1.53 million Brazilian Gold shares at a deemed value of 35 cents, or $536,910. They are now worth $2.11-million.

Maxim Finskiy's Century Mining Corp. (CMM) lost a penny to 35.5 cents on 105,000 shares. The company hopes to have its management information circular, detailing the proposed merger with Mr. Finskiy's White Tiger Gold Ltd. (WTG: $2) by the end of this month. Meanwhile, six dissendent shareholders are still working hard to stir up merger opposition. They are worried about insider connections, unfavourable tax consequences and an unreasonable break fee. Recently, they say they received "telephone contact" from White Tiger and Century shareholder Fran Scola, who made it clear White Tiger would not negotiate a different exchange ratio. Now, to continue their hard work, they are asking fellow concerned shareholders for money. An ideal donation would be about one-tenth of a cent for each share held, similar to what the six men say they have already contributed. The money will pay for the costs of communication, lawyers and industry experts.

Two of the dissidents, Rainer Hummel and Larry "the Hoov" Hoover are involved with Robin Dow's Galahad Metals Inc. (GAX: $0.125). Mr. Hummel is a finder while Mr. Hoover is a director. The Hoov is also a hub leader on the Agoracom website for a handful of Canadian companies, including Crystallex International Corp. (KRY: $0.12), Noront Resources Ltd. (NOT: $0.77) and Golden Hope Mines Ltd. (GNH: $0.175). He is not, however, a Century hub leader; that job goes to optometrist Dr. Francis Dube, also a supporter of Golden Hope and Noront.

Mr. Scola has another company, Ecometals Ltd. (EC), up three cents to 23.5 cents on 360,000 shares. It has begun 1,000 metres of drilling at its Rio Zarza gold project in Ecuador. This is the project from which Mr. Scola's hype of "significant mineralization" in February, 2010, pushed the stock to $1 from 60 cents. Days later, assays returned "subeconomic" and the stock dropped back down to 37.5 cents. After that, Ecometals continued drilling at Rio Zarza but stuck to celebrating the drilling's technical successes. Mr. Scola resigned as CEO on Jan. 1, but remains a director. For his efforts last year, he received $227,970.

This month, Ecometals is expecting to receive a $2.5-million (U.S.) option payment from Robin Slaughter's private company Ecuador Capital Corp. Ecuador is optioning the Condor gold project in Ecuador for $7-million; it paid its first $2-million last December.

Finally, a quick update on Fred Stanford's Torex Gold Resources Inc. (TXG), which added two cents to $1.60 on 2.30 million shares and news the company has restarted drilling at its Morelos gold project in the gang-filled state of Guerrero, Mexico. It had to stop 11 drills on March 24, after armed robbers stole from several of Torex's trucks. Now Mr. Stanford says local, state and federal authorities are providing "permanent security support." He did not says how much the company will spend on increased security; before the robberies it budgeted about $8,300 a month. Torex says its will add drills to the project, in hopes it can still meet this year's 125,000-metre drill target. It can easily afford more drills; at Jan. 31, 2011, it had $56.8-million in working capital.

GLTA.

BaBe.