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Cash, buck(s), Colombia mining, Afrique

Thom Calandra
1 Comment|July 18, 2013

Several West Africa properties are for sale

Cash, to paraphrase the Arctic Monkeys, "don't know nuffin." 

East Africa Metals (EAM in Canada), formerly Canaco (Magambazi in Tanzania), started trading on the Venture the other day in Canada. At 16 cents, the stock sells for about half of its $24 million in treasury. THIS DOES NOT MEAN EAM IS CHEAP.

Across the continent, in West Africa, another cash hoard, Asanko Gold (AKG in USA), has listed shares worth about $10 million more than its $195 million in treasury. Asanko has Esaase in Ghana and is the former Keegan Resources, whose flagship project I have seen twice. Peter Breese runs the company from London and the USA and is well known in South Africa and Australia mining circles.

There is almost no reason to "own" cash in resources unless the cashiers are lining up projects or potential purchases that make immediate sense. Mr. Breese tried to nail down a PMI Gold project within hiking distance from Esaase in Ghana. That merger of equals failed, depending on whom is to be believed, because of the demands of Australia's Macquarie regarding the PMI debt it owned/managed; or for other reasons linked with leadership, headquarters location and so on.

Peter Buck was a director and chairman associated with PMI Gold, which is building out its Obotan gold property. Mr. Buck, a West Australia geologist, resigned when the PMI-Asanko merger unraveled, but he and Keegan/Asanko's Shawn Wallace were to become co-chairmen of the merged West Africa entity.

Alex Buck recently entered the picture; she runs Asanko Gold's public relations from London. I do not know if there is a connection here with Peter Buck; I asked.

Ms. Buck and Peter Buck each share one or two of the same corporate connections, as one reads Alex Buck's LinkedIn profile:

But then, Peter Breese of Asanko shares corporate connections with Alex Buck as well, including LionOre Mining (nickel) and Mantra Resources.

I happen to know PMI and Asanko hold out hope for a combination for their respective companies and projects. I do not know where the Bucks start or stop on all this. (I could not resist that.)

I also know that several West Africa properties are for sale, including one literally bordering part of Esaase and owned by African Gold Group (AGG in Canada). That one is called Asankrangwa, and it is somewhere between the Ashanti and Sefwi gold belts in Ghana. I have been on it.

I am not sure where I am going with all this. Except, after seeing Candente Copper say it would buy the portion of Cobriza Metals it does not own (today Tuesday) for all stock, that purchases NOT forking over cash are mostly bookkeeping or tidying these days.

Everyone in the business -- from Asanko to East Africa Metals to (one of our TCR 8) Colt Resources (GTP in Canada) -- says they could purchase (or sell) properties and make their equities more valuable. Right. 

In Africa, this is no reason, not right now anyways, to purchase Andy Smith's reformulated company, East Africa Metals. Mr. Smith in Vancouver tells me many funds probably woke up one day last week, saw the NEWCO in their portfolio, and hit the eject button on their East Africa shares at 20 cents, or 16 cents.

I happen to own the shares because I was naive enough to purchase Canaco shares after seeing the Magambazi gold project in Tanzania with my own eyes. Turns out, Mr. Smith says he will develop Magambazi into a mine even with its resource coming in at less than 1 million ounces. We'll see. 

Speaking of Tanzania, I hold out hope Tembo Gold (TEM), now 10 cents, will be able to raise cash soon and get on with its exploration under geologist Dave Scott. Huge dilution, gulp. Shareholders might cross their fingers and hold out hope for a strategic partner.

TCR 8: Pilot Gold (PLG in Canada) is starting a 20,000-meter drill program at its Nevada gold project, Kinsley Mountain. ...

Solvista Gold 
(SVV in Canada) is performing miserably as an equity. Others in Colombia, including Continental Gold (CNL in Canada), are faring poorly, too. ... I attach Gabriel Bayona's latest two-pager on Colombia mining issues. He does a terrific job of capsulizing the July 2 application process for concessions.
Tags: GOLD

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"faring poorly" seems to be the common denominator these days. But for investors, times could not be the *only* play is to own physical gold and physical gold is on sale. Demand out of Asia continues to grow and that inflation The Bernanke is concerned about is not far off - look at the price of oil as your first clue. Sell paper. Buy physical. Sleep well.
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July 18, 2013
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