http://www.rickackerman.com/2010/09/idaho-gold-miner-a-speculative-buy/#more-26264

End-of-summer travel delayed this report on Premium Exploration (TSX symbol: PEM) by a week, although we did issue an informal “buy” recommendation on the junior miner in the Rick’s Picks chat room a couple of weeks ago. The Canadian-listed stock was trading for around 45 cents a share at the time but has since moved up as high as 57 cents, where it closed yesterday. Based on technical analysis, we’re projecting upside potential over the near term to 64 cents, or perhaps 67 cents if any higher. These projections have a horizon of about 2-3 weeks, but there are longer-term forces at work that augur still higher prices.

Stock charts aside, we rate Premium’s shares a high-potential speculative bet for the long-term. The company is well managed under CEO Del Steiner, and its Idaho site has yielded some very

impressive core samples so far: 5.75 grams per metric tonne (g/t) over 76 meters, 3.65 g/t over 74 meters, and more than 9 g/t over 25 meters. Moreover, the larger structure from which these samples were taken is mostly unexplored. The Central Idaho gold region has already produced more than four million ounces of gold from mostly placer projects, but Premium’s site could conceivably double that figure over time. One reason investors are especially excited about the Orogrande fault zone is that it is geologically similar to Nevada’s Carlin Trend, which has produced more gold than any other mining district in the U.S.

Spreading the Word

We toured Premium’s central Idaho site on August 25 as guests of the company in an entourage that included such seasoned veterans of the precious metals world as radio host Al Korelin, Roger Wiegand, Sean Brodrick, Marshall Berol and Dan Pisenti. All came away sufficiently impressed by Premium’s operations, most particularly at Friday-Petsite, to have bought shares in the company immediately after the tour or to have taken back favorable reports to their respective investment firms. For the record, your editor holds no shares in the firm at present but plans to take a stake after this report has aired publically.

Premium’s financial position looks solid, buttressed as it is by a $10 million round of financing completed in July. This will allow the firm to undertake another 30,000 feet of drilling over the next two years. A 50 million-share float and warrants at 35 cents have damped down price volatility on news, but shares appear to be well covered by inferred resources including 549,000 ounces at Friday-Petsite.

For additional details, as well as a fascinating interview with CEO Steiner, I recommend checking out Sean Brodrick’s in-depth report on the trip at “UncommonWisdomDaily.” You can also find extensive site maps and detailed drilling results at Premium’s web site. As always, let the buyer beware. Due diligence is advised if you’re thinking about acquiring PEM shares.