VANCOUVER — The S&P TSX Venture Composite Index managed to curb its decline last week despite tepid economic data from China, and concern over US$85 billion in pending U.S. government spending cuts. The Index dropped 11 points or roughly 1% en route to a 1,133.36 point weekly close.
U.S. politicians continue to point fingers over the pending sequester, which amounts to a series of automatic budget cuts agreed to by both Democrats and Republicans during the debt-limit crisis in 2011. The action is designed to cut US$85 billion in government spending over the next 10 months, with defense programs slated to be cut by 13% and nondefense programs by 9% in 2013.
Meanwhile China's manufacturing sector slowed in February, as domestic and foreign demand declined, with new orders and new export orders falling. According to a report from China's National Bureau of Statistics the official Purchasing Managers' Index fell to 50.1 after seasonal adjustments, dropping from 50.4 in January and marking the weakest level since September 2012.
April contracts for copper dropped 5¢ during the week en route to a US$3.51 per lbs. weekly close, while contracts for gold bullion fell US$2.70 per oz. before settling at around US$1575 per oz. to end the trading period. Oil markets were also on the decline, with April contracts for crude losing US$2.36 before closing at US$90.92 per barrel.
Toronto-based junior Lakeland Resources jumped 150% before finishing the week at 14¢ per share. The company announced it was dropping its focus on precious and base metals in favor of uranium, and is in the process of picking up eight uranium prospects in the Athabasca basin of northern Saskatchewan and Alberta.
Assuming the deal closes, Lakeland will purchase eight projects totalling roughly 1,900-sq.km from a private Alberta-based company for 7.5 million shares plus undisclosed cash considerations. Interest in Athabasca-style uranium deposits has picked up recently as the commodity has enjoyed a renaissance over the past six months. Lakeland has until the end of April to finalize the transaction, pending a technical review of the properties.
B.C.-based junior Yellowjacket Resources is also aiming to cash-in on a uranium upswing, announcing on Feb. 28 that it had entered into an agreement to acquire a 1,300-sq.km portfolio of mineral claims in the western Athabasca Basin region.
The company saw its share price rise 122% before closing out the week at 10¢. No terms were released, though the company reports "the claims were acquired at acquisition cost in part from a non-arm’s length director and in part from an arm’s-length third-party." The company had previously focused on the Yellowjacket gold project 9 km east of Atlin, B.C., but now expects its uranium assets to be its primary exploration target.
Both Lakehead and Yellowjacket are focusing on the Patterson Lake region where Alpha Minerals and Fission Energy are working on the Patterson Lake South uranium discovery.
Tasman Metals closed at $1.05 on Friday after gaining 11¢ during the week on the back of a maiden resource at its wholly-owned Olserum heavy rare earth element (REE) project located 200 km southwest of Stockholm, Sweden. Rare earth element bearing minerals identified at Olserum include xenotime, apatite, monazite and minor allanite.
On Feb. 27 Tasman announced it has delineated 4.5 million tonnes averaging 0.6% TREO at Olserum, as well as 3.3 million inferred tonnes grading 0.63% TREO at a 0.4% TREO cut-off grade. Mineralization occurs as two sub parallel zones, trending approximately east-west and dipping steeply to the north, with lower grade intervening material. The mineralized zones have been intersected over 600 metres of strike, and remain open at depth and to the east.
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