Vancouver Stock Exchange Calpine, Stikine, Prime active players

During the week ended March 20 the fortunes of the U.S. dollar continued to dominate the gold market as international investors flock into the currency. The U.S. dollar rose over 100 basis points to close at about 153.65 yen, while gold gapped down to US$392.50 per oz. from the US$400 level. Some see the dollar as a better store of value not only relative to their own currency, but to gold as well. The precipitous dive in the Tokyo market, which many cite as cause for much of the dollar’s strength, continued over the period shedding in excess of 2,000 points to close below the 31,000 level.

All this has had little or no apparent affect on the Vancouver market which put in an impressive performance, with the VSE index advancing more than 24 points during the week to the 762 level.

A great deal of the market’s attention was focused on the players in the Eskay Creek property north of Stewart, B.C., namely Calpine Resources, Stikine Resources, and Prime Resources.

Calpine added 3/8 to its share price closing at $6 3/4 with more than two million shares traded. Trading was heavy in Prime as well, the issue adding 3/8 to $5 5/8 on 1.72 million shares.

Stikine put in the most impressive performance, jumping $12.25 per share to close at $54.25.

The action in the group is tied to takeover rumors on Stikine, which has been on the block since last fall.

The share price of Calpine has been following based on a 7-to-1 fully diluted share ratio, although the price ratio has increased somewhat in the past few sessions.

Prime has been having a harder time following the share prices up, and many point to this as a stumbling block to the April merger vote between Prime and Calpine. Prime, with less than half the leverage to Eskay Creek compared with Calpine and 50% more shares, has significantly less leverage to a perceived increasing value in the property that a takeover would bring. Some of this difference is compensated for by the warrant offered in the merger. As the share prices increase, however, the warrant’s influence drops.

High Frontier Resources was active during the period rising 9 cents on more than 750,000 shares to close at 60 cents per share. The company recently acquired the Dome Mountain property in Utah consisting of over 2,800 acres. High Frontier has a number of warrants expiring on April 3 which are exercisable at 55 cents.

Tungco Resources was active, traded over 1.2 million shares during the period reaching a high of 25 cents before closing up 4 cents at 19 cents per share. The company recently optioned 50% of its Waratah property in the Iskut River area north of Stewart, B.C. to Big M Petroleum for $100,000, 200,000 Big M shares, and $500,000 in exploration expenditures.

Canarc Resource reached a high of $2.10 during the period, closing at $1.87 for a gain of 7 cents. Canarc recently received a summary report of Calpine’s 1989 work on the GNC property which surrounds a large part of the Eskay Creek property. The summary notes several gold showings and surface anomalies as well as various geological similarities to the Eskay Creek property. Calpine plans a $500,000 program on the property this season.

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