Producers & prospectors: Colombia, Peru, Nevada (ANM, AGD, FVI, GBG)

VANCOUVER, B.C. -- Producers (of silver, gold and copper) – actual producers -- are outpacing the stock-market pack. So are metals projects of grand scale that are less than two years from reality.

A growing lot of producers (and several highly speculative prospectors) that I have visited this year are racing higher. These include Antares Minerals (TSX: V.ANM, Stock Forum) in Peru, Witwatersrand Condolidated Gold Resources Ltd. (TSX: T.WGR, Stock Forum) and (OTO: WIWTY, Stock Forum) in South Africa, Fortuna Silver in Peru (TSX: T.FVI, Stock Forum) and Antioquia Gold in Colombia. At the top of the producer heap: Ferdi Dippenaar’s Great Basin Gold Ltd. (TSX: T.GBG, Stock Forum) and (AMEX: GBG, Stock Forum).

Great Basin Gold shares, in the wake of its improved Hollister Mine (Nevada) and accelerated gold output, is the standout this week. (The South Africa and Nevada miner is a Ticker Trax Planetary Prospect and one that we own here at home.) “I think we have some shorts covering,” Great Basin CEO Ferdi tells me from South Africa. “Maybe warrant related?”

Among miners/prospectors we have researched and presented to our paying subscribers, Antares Minerals of Peru is on the Honors List in a two-week valuation shift. Even today (Wednesday), the shares are rising smartly. “I like to remind people that we also have 50 percent stake of a gold-copper project in Argentina,” CEO John Black tells me. “Haquira in Peru remains the main story but our Rio Grande in Argentina may be a bit of a hidden gem in the portfolio.”

We here at home do not own Antares but have been to the Haquira copper project in Peru, along with Mr. Black and co-founder and interim Bellhaven Copper & Gold chief Dr. Paul Zweng.

I can’t do justice to all of the specifics on the producers’ year-to-year gains in output, grades, mine revenue and lowered expenses. Here are some stray bullets from Ticker Trax:

• At GBG’s Hollister, some 39,000 (gold-equivalent) ounces were dispatched, or sold, in the recently reported June quarter vs. 6,000 ounces in the March quarter. This is a sequential marvel and is, if Mr. Dippenaar is correct, reason enough to see non-believers buy back their short-sold shares.
• Great Panther Silver (TSX: T.GPR, Stock Forum) is recording record-high net income from Mexico (as are others, including Endeavour Silver (AMEX: EXK, Stock Forum) and (TSX: T.EDR, Stock Forum) and First Majestic Silver Corp. (TSX: T.FR, Stock Forum). Still, the Panther’s Guanajuato operation is lagging internal expectations … “due to grades being lower than estimated in the first quarter.” Guanajuato's $7 U.S. cash cost per silver ounce thus far thos year is way above company guidance of $5. The Panther is a longstanding Planetary Prospect of our service and – as with each of our 12 prospects – we here at home own it.
• Timberline Resources Corp. (TSX: V.TBR, Stock Forum), as it develops its Butte Highlands gold mine in Montana for delivery by 2012 or sooner, is fortunate to see its contractor drilling units continue to mark positive net income for a fifth straight quarter. I owe CEO Randy Hardy a full report on my visit to Butte. I have yet to purchase Timberline shares.
• Revett Minerals Inc. (TSM: T.RVM , Stock Forum) looks like it finally is getting grudging investor respect as a hard-as-nails operator of a steady-eddie silver mine at Troy, Montana. Note I said grudging. The quarter showed almost $3.5 million cash flow from the Troy Mine even in the face of low silver and copper grades, thanks to the efforts of a small team headed by CEO John Shanahan and biz-dev guy Doug Ward. John Shanahan tells me today (Tuesday), “We are over the hump. Our Q2 grades were as low as we could go and we still generated enough cash to cover us, including G&A. We are few weeks from hitting the C beds, where we will see grades pick up substantially. Our team is mining well and is consistent day-in and day-out, so Q3 will be better, Q4 will be better again, and we are off to the races in 2011 and 2012. We could see Troy mine life extended from 6 to 15-20 years at good grades.” I own a small number of shares and am looking to raise my stake in Revett. Revett’s Rock Creek project in Montana is making its way through the federal court system.

Notes: I am working on a small article about Peru, sourced almost entirely by native Carlos Baca at Fortuna Silver Mines (TSX: T.FVI, Stock Forum). Fortuna’s stock performance deserves Honor Roll recognition this month -- in light of the company’s continued success at Caylloma, a silver, zinc and copper mine at approximately 5,500 meters altitude (and yes, I have been there). … The ticker for Serafino Iacono’s new Gran Colombia Gold and its array of Colombia holdings, once it starts trading, will spring from the halted Canada ticker TPR.H, the old Tapestry Resource Corp. (TSX: V.TPR.H, Stock Forum). Potential Gran Colombia Gold partner (via the historic Frontino Mine) Medoro Resources Ltd. (TSX: V.MRS, Stock Forum) in Colombia says it is working to ensure it snares a 5 percent stake in Gran Colombia’s $200 million or so Frontino Mine purchase. Medoro shares are a love-hate relationship for me. Mostly hate going back to the busted legacy of the old Colombia Gold Fields. But I believe Medoro’s El Marmato in Colombia is a worthy gold project on a troubled and poisoned mountaintop. I own a small number of Medoro shares, made even smaller by the recent reverse-split/consolidation of the stock. … Finally, Bellhaven Copper & Gold shares, CEO Paul Zweng tells me, look like they are “double-topping.” Dr. Zweng is the reason, along with director and broker Patrick Abraham of Panama and former Bellhaven CEO and founder Julio Benedetti of Panama, that we own 1.4 million shares of Bellhaven here at home. Paul Zweng is a co-founder of Antares Minerals in Peru. Dr. Zweng tells me from his Honolulu asset management office, “I have been warning (CEO) John Black about the dangers of a double top forming regarding ANM's stock chart. Fortunately for ANM, the share price has blown through the top on high volume. Looking at BHV's stock chart, I now have the same prospect facing me; a double top is forming here as well. I hope to have ANM's success.”

NEW ORLEANS & SF: This autumn I will be making two or three appearances outside of prospect tours. One of them is in New Orleans, where I appear each year at Brien Lundin’s New Orleans Investment Conference.

If you’d like to join our Stockhouse and Ticker Trax audience at the late-October show, please register and pay up at this link: REGISTER FOR NEW ORLEANS. You get a discount on the price at that address. And I have something special planned for New Orleans. It’s my favorite investment show – along with the longstanding San Francisco Hard Assets conference in November, when I will be presenting a workshop.

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