GCR - Golden Cross Resources

[Sean K]

Perhaps it was just resistance at $0.06...

 

[Kipp]

Back to the unpenatrable resistance line of 5.2c. I suppose the drilling results were pretty dissapointing- so much gold- such a low grade. The soil in my backyard prob has 0.6% gold- maybe I should float a speccie company!

<insert lazy no research question> What sort of grade do they have next door at Newcrest? Are they also dealing with ~1% Au deposits?

Also may be a good buying opp for GCR- as CBA recently jumped ship on a fair wad of stock which no doubt has added a hell of alot of sell depth, which could be a greater reason for SP jumping back to 5.2... maybe a bigger factor than the drilling results?

p.s. Nice pick on INL and GGY. Guess you've shouting those hippies at the BC a few drinks.

 

[Sean K]

Back to the unpenatrable resistance line of 5.2c. I suppose the drilling results were pretty dissapointing- so much gold- such a low grade. The soil in my backyard prob has 0.6% gold- maybe I should float a speccie company!

<insert lazy no research question> What sort of grade do they have next door at Newcrest? Are they also dealing with ~1% Au deposits?

Also may be a good buying opp for GCR- as CBA recently jumped ship on a fair wad of stock which no doubt has added a hell of alot of sell depth, which could be a greater reason for SP jumping back to 5.2... maybe a bigger factor than the drilling results?

p.s. Nice pick on INL and GGY. Guess you've shouting those hippies at the BC a few drinks.

Hi Kipp,

Not sure what to think about CBA reducing their holding.

I completely missed this ann. Didn't come up on Power Etrade for some reason. It actually looks good to me. With all these results fed into the revised estimate they'll easily have more than 500K tn cu and 1.3m oz au. It's a great resource that will be easy to dig up. I'll help them....

Perhaps the market was expecting better results....

 

[Kipp]

to dig up. I'll help them....

Perhaps the market was expecting better results....

Heya Kennas,
Easy because it is open pit you mean? So is it more economical to mine 1 mill oz at 30 m depth and 0.6g/Ton grade than it would be for say BMA who have ~10g Au/ton grade at 300m? These figures are very ballpark- I'm speaking in general terms. I suppose the great advantage GCR have is easy transport, which could offst their higher mining costs.

 

[Sean K]

Heya Kennas,
Easy because it is open pit you mean? So is it more economical to mine 1 mill oz at 30 m depth and 0.6g/Ton grade than it would be for say BMA who have ~10g Au/ton grade at 300m? These figures are very ballpark- I'm speaking in general terms. I suppose the great advantage GCR have is easy transport, which could offst their higher mining costs.

Yeah it's an easy open pit operation. They only need to virtually level the Hill and spoon it on to the rail line that is, what, 5 m away? Actually, I think the proposed mill is further away, like, 200m.

 

[Sean K]

Woof woof,

GCR has been out of the spotlight, with no recent anns, copper and gold working their way back to equilibrium, and sp gets a smashing. Perhaps by too far unless something has gone horribly wrong at Copper Hill. I do note CBA are off the substantial shareholder register, so that might explain the sell off. Why would CBA sell? Perhaps they know that this project has no legs???

1.4m oz au (maybe to be upgraded) just down the road from Cadia (NCM), next to the rail line, open pit, blah blah, again.

I suppose I place this post out there to show that I think the sp has come off too far (IMO, as a holder). MACD and RSI are shocking. It can only go up on that, surely? Stochastics isn't oversold atm though, but it's a 2 yr weekly, so it's not as atune to movements. It's way below on the daily....Points to a good trading opp. With POG and POC appreciating (slightly - or maybe recovering) then I'm thinking of a short term trading op, as opposed to an 'investment'.

I'm holding my 'investment' because the resource is there (maybe - who knows after the BDG fiasco?) and it looks economical.

Not sure if anyone else has bought some or been interested...anyone....anyone??

 

[exgeo]

I've noticed CBA selling out a couple of other small resource stocks I hold such as GUN (Gunson), so perhaps the selling is just a result of portfolio re-balancing rather than a signal that something's up at GCR. It is pretty low-grade, but if there's enough of it then it's got to be worth something (bulk mining methods). Cadia's resource is listed first in the table below:

Cadia (0.57% Cu equivalent)*
267Mt @ 0.65g/t Au, 0.15% Cu (for 5.5Moz Au and 400kt Cu)
136Mt @ 0.32g/t Au, 0.33% Cu (for 1.4Moz Au and 455Kt Cu)
GCR (0.46% Cu equivalent)*

*Copper equivalent calculated using conversion factor of 0.2g/t Au = 0.13% Cu. This will of course change, depending on the metal prices used at the time of conversion.

 

[Sean K]

I've noticed CBA selling out a couple of other small resource stocks I hold such as GUN (Gunson), so perhaps the selling is just a result of portfolio re-balancing rather than a signal that something's up at GCR. It is pretty low-grade, but if there's enough of it then it's got to be worth something (bulk mining methods). Cadia's resource is listed first in the table below:

Cadia (0.57% Cu equivalent)*
267Mt @ 0.65g/t Au, 0.15% Cu (for 5.5Moz Au and 400kt Cu)
136Mt @ 0.32g/t Au, 0.33% Cu (for 1.4Moz Au and 455Kt Cu)
GCR (0.46% Cu equivalent)*

*Copper equivalent calculated using conversion factor of 0.2g/t Au = 0.13% Cu. This will of course change, depending on the metal prices used at the time of conversion.

Geo, you mean that Copper Hill has:
136Mt @ 0.32g/t Au, 0.33% Cu (for 1.4Moz Au and 455Kt Cu)
Ya?

 

[exgeo]

I've noticed that using current metal prices, copper hill actually seems MORE valuable on a dollar/ton rock basis than cadia. The economics of Copper Hilll must be very geared to the copper price. I used metals prices of 5800 USD/t Cu and 620 USD/Oz Au and a USD ex. rate of 75c = 1 AUD. I assume that the rise in the copper price since GCR calculated their resource has meant that the conversion of 0.2g/t Au = 0.13% Cu is out of date, therefore the copper-equivalent grades listed in my earlier post should be ignored (I got this figure from a GCR report about 9 months ago).

Cadia's resource is listed first in the table below, Copp Hill second:

Cadia
267Mt @ 0.65g/t Au, 0.15% Cu (for 5.5Moz Au and 400kt Cu)
136Mt @ 0.32g/t Au, 0.33% Cu (for 1.4Moz Au and 455Kt Cu)
GCR

To calulate a value per ton of rock I did this. metal qty/ton rock * metal price * usd>aud conversion.

Cadia Gold = (0.65/31.1) * 620 * 1.33 = 17.23 AUD
Cadia Cop = 0.0015 * 5800 * 1.33 = 11.57 AUD
Total = 28.80 AUD/t rock

CoHill Gold = (0.32/31.1) * 620 * 1.33 = 8.48 AUD
CoHill Cop = (0.0033 * 5800 * 1.33 = 25.45 AUD
Total = 33.93 AUD/t rock

Of course you can plug your own long-term metal price assumptions into this formula and play about with the numbers. If you could be bothered, you could even do a chart in excel of copper-equivalent grade vs. metal price.

 

[mmmmining]

I am not fan of low grade Cu deposit anymore. There are so many of them all over the world. $30-40/t rock seems of very low economic value, particularly in a soaring mining and processing costs environment. Even worst with a bit of Au and a bit of Cu.

For comparison purpose, you can easily get $60/t for ire ore, or $50/t for thermal coal just mining and transport with little or no processing.

 

[exgeo]

From minesite.com- January 14, 2007

That Was The Week That Was … In Canada

The on again, off again take over war for BCMetals is back on again. British Columbian copper miners, Imperial Metals and Taseko Mines continue to inch up their bids in an effort to win control of the advanced Red Chris copper-gold deposit in northern British Columbia. With proven and probable reserves of 277.8 million tonnes grading 0.35% copper and 0.27 g/t per tonne, plus an additional measured, indicated and inferred resources outside the pit shell of 574.8 million tonnes at 0.32% copper and 0.28 g/t gold, the stakes are high. Taseko recently upped its bid by a nickel to C$1.15 for each BCMetals share out- duelling Imperial Metals' increased offer of C$1.125 per share. Imperial already holds around 17.2 per cent of BCMetals' shares while Taseko owns nearly 5 per cent.

This capitalises BCMetals at 42.6m CAD (46.4m AUD). GCR is capped at 27.2m AUD (504m shares * 5.4c). Therefore, given the current resource, GCR is trading around the right levels perhaps. But it does go to show that there is a "market" for this calibre of resource (compare BC Metals with GCR's resource. GCR 0.33gt/t Au, 0.32% Cu vs. BCM 0.27g/t Au, 0.35% Cu). Also, GCR is still drilling out their deposit, so resource upgrades are likely.

 

[exgeo]

Some of today's results look a lot better than what's been drilled so far, some over 2g/t Au equivalent, not too bad for a bulk deposit. Also the area of mineralisation is still open. The resource upgrade will be interesting when it arrives..

 

[sydneysider]

Woof woof,

GCR has been out of the spotlight, with no recent anns, copper and gold working their way back to equilibrium, and sp gets a smashing. Perhaps by too far unless something has gone horribly wrong at Copper Hill. I do note CBA are off the substantial shareholder register, so that might explain the sell off. Why would CBA sell? Perhaps they know that this project has no legs???

1.4m oz au (maybe to be upgraded) just down the road from Cadia (NCM), next to the rail line, open pit, blah blah, again.

I suppose I place this post out there to show that I think the sp has come off too far (IMO, as a holder). MACD and RSI are shocking. It can only go up on that, surely? Stochastics isn't oversold atm though, but it's a 2 yr weekly, so it's not as atune to movements. It's way below on the daily....Points to a good trading opp. With POG and POC appreciating (slightly - or maybe recovering) then I'm thinking of a short term trading op, as opposed to an 'investment'.

I'm holding my 'investment' because the resource is there (maybe - who knows after the BDG fiasco?) and it looks economical.

Not sure if anyone else has bought some or been interested...anyone....anyone??

The market is so fixated on U and there are so many small listed companies that a lot of stocks have been condemned to orphan status. As more listings take place on the ASX this problem will grow more severe. We might even end up with a Canadian type situation with two trading boards. I am staying with U stocks as this is the only sector that is attracting substantial overseas funds. GGR will remain an orphan.

 

[exgeo]

It's unlikely that GCR's JORC resource "isn't there". You are really comparing apples and pears here. Bendigo's resource is high-grade nuggety gold. If you put a hole in position "x" you drill straight through solid gold. If you move the hole 20cm to the left, you miss the nugget and get zero. These are very hard to estimate via drillholes alone, as BDG shareholder will be able to testify all too well.

GCR's resource is bulk tonnage, low grade and disseminated, basically the polar opposite of nuggety gold. Much easier to estimate what's there based on drillholes. If the mineralised zone is 60m thick, moving the hole few metres away will likely give an almost identical result.

CFS have been selling lots of small junior resources, for example Gunson (GUN). And you'd think gunson would be one to hold on to given that there's predicted to be shortage of the stuff they're hoping to produce. CFS are just re-weighting the portfolio away from resources a bit I'd imagine.

 

[exgeo]

Looks like somebody else has noticed that the last holes were much higher grade than the previous lot. Must be a reasonable positive that it's rising on a day after base metals prices crashed by 10%.

 

[Uncle Festivus]

exgeo I've been on this for a few years based only on the 'shotgun' style of exploration ie lot's of prospects, farm-in/out in the hope one of them would hit paydirt. Hopefully this one's it & should be further confirmation with each hole. Nice volume today too, as you say, on a 'down' day.

I reckon BDG will come back too, again a long term holding

PS straighten up yer rig there, your hole will be crooked.

 

[Flipper15]

Hi exgeo, kennas & other posters,

Interesting stage for GCR, looks like they are being rerated. I have studied the stock closely for the last 15 months and believe that their steady as she goes approach with no fanfare may just win out in the end. The market is chasing high grade drill hits etc on companies that are only starting to drill prospects. GCR has a big head start, probably at least 2 years ahead of many. The low grade is there but the high tonnage may get them across the line.

The focus on Copper Hill is warranted but I think sometimes that the market has forgotten about the other prospects.

In the announcement 2 days ago the reference to Parkes and others was interesting. I had not seen Parkes referred to as an important property to them previously. No mention of a farm out so they must rate it.

Others that I thought they may keep for themselves such as Cargo have been farmed out.

Also note that Cargo is being drilled this quarter and the Adelong sale must be close now. What they get for it is the big question, but it could contribute to a rise in the share price maybe between half a cent to one cent.

So there is a lot more to GCR than Copper Hill.

I think we will be remindered of that in the next 6 months with Parkes and the farm outs.

It was curious to see a more confident tone about the January drilling results which begs the question why they didn't mention other recent results in the same way.

I am referring to holes 238 wwith an intersection of 72 metres at 0.61 Cu & 1.86 Au and hole 242 with 142 metres at 0.83 Cu & 1.38 Au.

Both particularly strong in gold.

What did you guys think of these holes ? They probably don't change the average grades and we can cherry pick the better results but they show that Copper Hill can still get some big hits.

Also, I can't believe that Newcrest would not be having a serious look at them at some stage. They are an obvious predator being just 40km up the raod with Cadia. And they are successfully mining Cadia so there would be efficiencies with knowledge, etc.

Does anyone think that Newcrest would be interested ?

My view is that if current commodity prices can hold at these levels then in 3-4 years time when they should be mining Copper Hill that the share price will not be 5 cents any longer, more like 20 cents plus.

Flipper

 

[exgeo]

Well, I was interested before just because it had a large tonnage and as you say, might just have gotten across the line because of that. Now that they are finding higher grade stuff then that makes it even more likely to be a goer. The location is good, with grid power, railway and so on. The IP survery will hopefully highlight some new drilling targets as well.

No idea about NCM takeover - they've been mooted as a takeover themselves for how long?! Personally if I was driving a large mining company, I'd only take over NCM from the administrators, but egos and non asbestos-lined pockets have a way of parting CEOs with their cash.

Market cap is still only $27m (504m shares * 5.4c) and they have $6.9m in cash, from the Dec 06 qtly.

 

[Flipper15]

Thanks exgeo, dissapointing finish.

Needs more believers of the story to be holders, instead of a selloff which undoes a lot of the good work.

This may creep up on many eventually.

Realistically with Copper Hill I think we are looking at the end of this year to be at that stage.

Flipper

 

[exgeo]

I was surprised to note that one of the directors cut his shareholding by 1/3 (750,000>500,000 shares), selling at 5c. Maybe he wants to buy them back at 4.8c or something? Anyway, I'm glad I sold a couple of days ago, for reasons relating only to wanting the money for a short-term trading opportunity, nothing relating to GCR. As I said before, the latest drilling seems like good news for this project.