Toronto Stock Exchange Westmin pulls hot hole as Persian Gulf

Share values, reacting to events of the Persian Gulf conflict where last-minute talks between U.S. Secretary of State James Baker and Iraqi foreign minister Tariq Aziz failed the produce a breakthrough, continued to decline during the week ended Jan. 8. With the Jan. 15 deadline for Iraqi forces to move out of Kuwait fast approaching, investors are now bracing themselves for the prospect of war. Evidence of this was today’s (Jan. 9) sixth straight decline in the composite 300 index which measures Canadian share values. It closed down 12.78 points to 3169.64 on a volume of 12.6 million shares.

Reflecting rising tensions, gold added US$4 per oz. to end the week at US$394 in New York. However, both the metals and mines and gold and silver indices drifted into negative territory.

While all of this was occurring, Westmin Resources reported a spectacular 23-ft. intersection grading 1.10 oz. gold per ton on the SB property near Stewart B.C. As part of a plan to earn 50% stake in the project from Tenajon, Westmin completed 16,000 ft. of drilling in 76 holes.

Located between Premier’s Big Missouri and open pit mines, the SB is known to contain 308,000 tons of grade 0.5 oz. gold and 1.07 oz. silver. News of the discovery sparked a 20 cents leap in the price of Westmin shares. They closed at $2.

The Queenston Mines issue was also active this week on speculation relating to a 5-hole drill program at its Matachewan, Ont., joint venture with COATS-listed Strike Minerals.

With the third hole in progress, Queenston is reported to have encountered 17 ft. of massive sulphides on a property that has already yielded 7 ft. of grade 0.53% copper and 0.12% zinc per ton.

After advancing to $1.13 earlier in the week, Queenston shares slipped back to $1.10 today, while controlling shareholder Joutel Resources eased ahead to 17 cents from 15 cents on a volume of 314,750.

Definitive assays from the Robertson Twp. claims won’t be available until after the program is completed later this month.

The Audrey Resources issue added 45 cents within 48 hours, on news that 30 companies now have the necessary information needed to make a formal evaluation of Audrey and its Mobrun polymetallic mine near Rouyn-Noranda, Que.

Kerr Addison Mines’ subsidiary (and Audrey’s joint venture partner) Minnova has emerged as the favorite either to take over Audrey or to fund development of Mobrun’s new 1100 lenses. But observers close to the company say Minnova and others will be looking closely at the potential net smelter return on production from a massive sulphide deposit that may be expensive to mine.

Northgate Exploration, which owns 18% of Audrey, has missed the deadline for repayment of a $7.5 million loan. But discussions involving Northgate and its lead bankers of the Colomac gold project still continue. The Northgate issue was down 1 cents today at $1.84.

Meanwhile Kerr Addison, even today at $15.88, has become the latest of a group of companies that currently have their oil and gas assets on the selling block. Kerr values its 30.5% stake in Anderson Exploration at $98.4 million and will concentrate its efforts on mining if and when the sale is completed.

However, as Denison Mines can attest, selling oil and gas assets in the current market climate is extremely difficult, especially as the Persian Gulf crisis makes it hard to put a valuation on the assets.

Kerr has also put 7.3 million Noranda shares up for sale. As Noranda was steady today at $16, Kerr Addison’s stake in the big company is currently worth $116.8 million.

Platinova Resources was among the most active stocks this week after granting Teck the right to earn a 50% stake in the East Greenland gold/platinum project.

After climbing to $1.85 this week, the Platinova issue eased back today to $1.84.

Corona retains an interest in the project by virtue of the two million Platinova shares it acquired recently in exchange for 51% of the Greenland property. Corona A shares gave up 5 cents today.

Bema Gold, the only mining issue to be added to the TSE composite 300 index this year, saw its shares advance 5 cents to $3.15. Bema replaces seven issues that will be dropped from the index Feb. 1: Brenda Mines, Denison Mines A, Canamax Resources, Muscocho Explorations, Belmoral Mines, Equity Silver Mines and Glamis Gold.