Vancouver Stock Exchange Bullion rally has little impact

Institutional buyers are sticking to the senior golds, with most of this trading on eastern exchanges. But brokers here are optimistic that gold’s comeback may be the real thing, and the start of better times for junior precious metal issues.

At presstime trading activity in Vancouver was light. The VSE Index was off marginally today, Nov 8, at 716.18 points, down 3.16 points from a week ago.

Continental Gold moved up 25 cents to reach $9 today. The company is slowly regaining ground since a lawsuit was initiated against it by BP Resources Canada. BP is Continental’s joint venture partner (30%) on the Mt. Milligan gold-copper project near Prince George, B.C. BP is claiming the right of first refusal to acquire Continental’s interest in Mt. Milligan.

Fairbanks Gold slipped a quarter to $7 at presstime. The company’s key asset is the Fort Knox bulk tonnage gold project near Fairbanks, Alaska.

War Eagle Mining was the volume leader over our report period, down 83 cents to $1.20. The company’s share price surged last week on speculation of a hot hole from the War Eagle Mountain property in Idaho being drilled by Nerco. Investors that bought on “mystery” appear to have sold on history when the generally lacklustre results were released.

Prime Resources is still facing criticism from investors because it did not immediately disclose the withdrawal of $4.25 million of financing in its September offering. Although the units were eventually picked up by Canarim, the matter served to further weaken Prime’s slipping share price.

But another explanation for the company’s share price is the number of shares now issued and outstanding; some 58 million fully diluted at last count. Over our report period, Prime lost 1 cents to settle at $2.09.

Even Murray Pezim is being criticized for his flamboyant promotional style which some industry watchers say is no longer welcomed by today’s more conservative, aware, and value-conscious investor. But in all fairness, the Pez has chalked up an impressive number of gold discoveries that today make up the production cornerstones of several major mining companies.

Work is continuing on the Eskay Creek project in northwestern British Columbia owned 50% by Prime company, Calpine Resources. Calpine lost 15 cents to settle at $4.80.

Stikine Resources, which owns 50% of Eskay Creek, moved up 13 cents to $39.50. Yorkton Securities is looking for a buyer for the company’s tightly held shares, and a number of majors are said to have looked at the offer. But we gather one of the stumbling blocks is that Stikine isn’t able to deliver operatorship of Eskay Creek, something almost every major mining company would surely want.

Officials from O’Hara Resources said recent trading activity in the company is largely from U.S. investors interested in the company’s proposed placer mining operation at Camptonville, Calif. Although officials told us permitting wasn’t yet in place, O’Hara expects to sign a deal with a contract mining company for development of the properties.

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