As you may be aware, the Emerging Trends Report has been in Australia conducting a boots-on-the-ground survey of precious and specialty metal projects since February 2010 (2010-2012 Australian Precious and Specialty Metals Survey).
We have been following and writing about the monetary and technology metals trends since 2005 and 2007 respectively and have undertaken this venture because we believe these metals represent the best investment opportunity available today.
We have identified 45 metals to date, not including gold, facing at least one of six different kinds of supply threat; at least 38 of these metals are, or soon will be, mined in Australia.
We are convinced demand for these metals will not abate significantly short of economic Armageddon because over the last 8 months, Japan (Dec. 2009), the USA (Feb. 2010) and the EU (June 2010) have awakened to how critical these metals are to their economic well-being and have introduced measures to secure supplies of these metals going forward. This pits free market ideology against the new mercantilism of command economies, and we believe the competition will serve to support these metals prices in the years ahead.
Like everyone else, we were blindsided by the Australian governments introduction of the Resource Super Profits Tax in May 2010. Fortunately, the Australian people have a better understanding of the role of business and the contribution of the mining sector to its flourishing economy than the leftist prime minister, who was unceremoniously booted from office.
The watered-down tax now being proposed we view as a face-saving political stunt by a leftist government desperate to remain in power, for the new proposal faces a number of significant challenges, not least being its very constitutionality. Our articles and interviews on this subject are available here.
While the matter remains unresolved, it is clear the precious and specialty metal companies we are investigating will not be subjected to additional taxation. This suggests the recent sell-off in these companies stocks, which have in fact held up better than the overall market, constitutes a buying opportunity.
However, until the matter is resolved, which is what will be required to affect a thaw in the freeze on direct foreign investment in Australian mining projects, we will continue to err on the side of being too conservative. For the time being, we are focusing exclusively on companies that are fully funded and not dependent on the capital markets to advance their projects.
Our second Investment Report pertains to just such a companya small (A$100 million market cap) narrow vein gold mining company that stands to do very well going forward regardless of the outcome of the MRRT or the election.
Highlights of our 35-page Investment Report on this company include:
unlike too many Australian mining companies we have investigated that have too many geographically diverse, multi-metallic prospects but too little capital to develop any of them, this company has but one focus, narrow vein high grade gold, in a very narrowly defined geographical region and the money to develop it; the company has A$7.5 million in cash, no debt, and a new, essentially paid for A$3.5 million, 80,000 ton per annum gravity plant soon to be commissioned; the mine has been in production periodically since November 2009 and has stockpiled 10,000 tons of ore in anticipation of the new plants commissioning, which is conservatively valued at A$6 million at todays gold price; the company anticipates an all-in production cost in the A$600-650 per ounce, and with its first gold pour, which is scheduled for late September, the company will be re-rated to reflect its status as a gold producer; its namesake mine alone has a 910,000 oz JORC resource that both regional geology and history suggest will prove to be multiples higher; and this company has a recently announced a A$4.5 million joint venture with a prominent Chinese firm to explore and development a variety of separate targets on the companys nearby mining and exploration leases. If this strikes you as the kind of company you may like to invest in, we invite you to purchase Investment Report #2 on our website. Details are available here, but briefly with our new service you may opt to
buy the report on this junior gold producer as a one-off purchase for $60 here, purchase an Annual Subscription for $500 (12-15 reports per year), which includes access to the secure features on our website, a copy of our eBook, Credit & Credibility, and is backed by an unconditional money back guarantee; or choose to become a sponsor of our circumnavigation of Australia, in which case you will receive everything we produce in the timeliest manner as well as access to a range of special features on our website. As always, we would be happy to answer any questions you may have, and any feedback you would care to share with us would be welcomed.
Best,
Richard Karn Managing Editor The Emerging Trends Report US +1-510-962-5021 (calls forwarded to Australia at no additional charge) AUS +61-403-782-883 (mobile)
MCO Price at posting:
37.0¢ Sentiment: LT Buy Disclosure: Held
