Monarques Adding to Gold Property Position in Val d’Or

Being a perimeter of the prolific Abitibi Gold Belt has made Val d’Or, Quebec a hotbed of mining activity for about a century. After all, the Abitibi Gold Belt is part of the prolific Abitibi Greenstone Belt that has been the home to more than 100 mines producing in excess of 170 million ounces of gold. Greenstone belts are known to host economical deposits of gold (and other minerals) and Abitibi is one of the largest greenstone belts in the world.

The name Val d’Or itself, which is French for “Valley of Gold,” is about enough to send miners by the dozens to the region. It’s not just a playground for majors, several junior miners are showcasing the gold in their property, including Metanor Resources (TSX-Venture:MTO) announcing last week that it had a record gold pour of 1,079 ounces in the prior week from its Bachelor Mine in Val d’Or.

Monarques Resources Inc. (TSX-Venture:MQR) has aggressively built quite a large land position in Val d’Or. The list of acquisitions this year has been extensive, but most recently, in September, the Quebec City-based company acquired a 50% interest in the Simkar gold property from Eloro Resources. Subsequent to the acquisition, the two companies formed a joint venture to manage and explore the 4-km² property in the heart of the Abitibi Greenstone Belt.

There is no commercial production on the property currently, but Louvicourt Goldfield produced about 31,915 ounces of gold (avg. grade of 4.62 g/t) in the 1940’s and 20,000 ounces of gold (avg. grade of 8.42 g/t) between 1987 and 1993 from three main zones. Additional exploration by Megastar Resources identified three more gold-bearing zones and a new high-potential gold structure. As part of its acquisition, Monarques is conducting $750,000 in exploration work by June 2014.

That is just one of the properties in the Monarques portfolio in Val d’Or. Cumulatively, Monarques owns properties that cover more than 100 km² in Val-d’Or, comprising a total of 399 claims, two mining leases and over $1.76 million in credits from the Ministry of Natural Resources.

On Tuesday, the company said that it is expanding its footprint through the signing of a purchase agreement with Critical Elements Corp. to acquire an undivided 50% interest in the Croinor property in the Val d’Or area. Today’s move is part of a bigger plan to gain total control of the property. In October, Monarques signed an agreement to acquire X-Ore Resources Inc., which owns the other 50 percent of the Croinor property as part of a joint venture with Critical Elements. X-Ore is the operator at Croinor, a 55-km² property comprised of 212 mining claims that has accumulated over $7.5 million in work credits with the Ministry of Natural Resources.

As part of the acquisition from Critical Elements, Monarques is transferring ownership of 11 mining properties in the James Bay area and giving Critical Elements 500,000 common shares of MQR. The divesture of the James Bay assets concentrates Monarques’ properties exclusively in and around Val d’Or.

“It was time for innovation and I believe that this transaction was necessary in the current market. With this transfer of properties, we have shifted assets on which no work was planned in the mid-range term, to assets (Croinor) that consolidates and strengthens our position in Val d’Or,” said Jean-Marc Lacoste, President and Chief Executive Officer of Monarques, in a statement today.

Although more cash will certainly be needed, the company has also recently raised a gross amount of $252,000 for exploration efforts. Shares of MQR are lower by half a cent at 10.5 cents in early afternoon trading activity on Monday on negligible volume of 700 shares. Like so many other miners, shares are down sharply in 2013, losing about half their value, although shares are up about 50% from lows in July.

Montreal Notes, “Cinq a Sept”…….Mining stocks

December 11, 2013   There was an informational “cinq a sept” meeting at the University Club in Montreal on December 5.  Three mining companies presented their current strategies and responded to the attendees’ questions. Historically, when mining corporations’ stocks suffer through bear markets, are overlooked and oversold, it is often an ideal time to consider them.  So many, but not all, mining companies offer the potential for exceptional capital gains. In-depth research, at times like this, can be well worth it.

  The first presenter was NYSE (“PLM”) and TSX (“POM”) listed “Polymet Mining,” a copper, nickel and precious metals developmental company. The other two presenters, “Monarques Resources” and “Uragold” are Quebec based Junior mining stocks focusing on gold projects in Quebec. All three companies made fine presentations. In our opinion, they merit attention, particularly while their stocks’ prices languish at their multi-year price lows.  

   First presenter Polymet Mining is focused on commencing mining operations in the Mesabi Iron Range district in Minnesota. The project is located in the Duluth Complex, one of the world’s largest undeveloped deposits of copper, nickel and other precious metals. Polymet has a large cash position and I should note recently that officers made ten purchases of the shares over the last two months with no insider sales of the shares whatsoever.

   Most importantly, Polymet is diligently following Minnesota’s rigorous environmental compliance standards. The company has enormous reserves. Over the last three years, the stock’s price range has been from $2.61 to a low of .63 cents. Today, Polymet at $1.04 merits close attention.          

   The second presenter, Monarques Resources, symbol “MQR” is a Québec based exploration company with its projects located in the prolific Val D’or region on the Cadillac Fault. The region has a long history of gold production having produced over 175, 000,000 ounces of gold with years of further production to come. Worth noting is the fact that Monarques’ “neighbor mines” are a “who’s who” of major Canadian mining.  The company has eleven projects at present and management has acquired properties that by our analysis are extremely undervalued.

   Periods of bear market duress in metals’ stocks often create tremendous opportunities to purchase projects at astonishingly low prices which Monarques’ management has done. Monarques’ five largest shareholders own 52% of the shares with management owning 8%. Since Monarques’ creation in 2011, the stock’s price has ranged from .34 cents to .07 cents. Today the stock is selling at .11 cents. We are paying very close attention. Our site Canadianmineanalysis.com will follow Monarques very closely.

  Uragold Bay Resources (symbol “UBR”) was the third presenter and is an interesting situation. It is a junior exploration company trading on the TSX Venture Exchange with insiders owning 14% of the shares. Uragold’s business model focuses on developing low-risk, low-cost gold mining operations while exploring on core properties that hold the potential of discovering large gold deposits.

  The Uragold strategy is to do surface mining in an area successfully mined fifty years ago in a much more efficient fashion than was done in the past with archaic equipment by today’s standards. Yes, gold was produced successfully at this site, but indications suggest much more remains. The Company’s properties are located in the Southeastern region of Quebec. Moreover, the company properties benefit from extensive historical exploration work. Yes, a good deal of previous exploration information is available. Uragold is down from .22 cents two years ago to .04 cents. With what they have already shown, attention to Uragold is merited.  

Final Thoughts!                                                      

 Too often, major brokerage houses have overlooked stocks when they are literally “on sale.” The major brokerage houses (particularly the New York ones who needed bailouts) greatest talent seems to be in recommending stocks when they are popular, not when they are undervalued. However, the smaller brokerage houses have been good sources of low cap stock advice.  And another point, many people doing their own research can run rings around the so called expert analysts. 

Think about this: There are no guarantees in the difficult field of mining exploration, but by spreading the risk and doing the necessary due diligence, superb returns can be seen. What we have seen too often is that most investors invest in the mining stocks well after they have already moved up in price. Moreover, most investors refuse to take profits when they occur. Thank you, K.C. Grainger

Counterpoint: No holes in PolyMet mine report

After reading Lee Schafer’s “PolyMet mine report has giant hole in it” (Dec. 8) the only hole I see is in his column. “You can’t just write down your answers,” he writes, “you have to show the work.” Schafer needs to heed his own advice.

Minnesota has comprehensive financial assurance requirements in place to ensure that every company will cover its cost of closure and of postclosure reclamation. There are 30-plus pages of Minnesota Rules related to the various requirements. These rules were set up with input from all stakeholders, including environmental groups.

Keep in mind that financial assurance is just one part of the very comprehensive environmental review and permitting process our regulatory agencies have structured for companies proposing to operate in Minnesota. Financial assurance is not part of the environmental impact statement (EIS). It is part of, and required in, the permitting process.

The EIS is not a decision document. It is an impact statement. Once impacts are determined, the various water and air permits will be discussed by the Minnesota Pollution Control Agency. Once the specific permitting requirements are determined, the specific costs associated with financial assurance can be finalized.

This financial assurance determination takes place during the permit-to-mine stage of permitting. The financial assurance phase of permitting will also provide additional opportunity for the public to participate and provide input.

Our Minnesota regulations are very specific when it comes to what must be looked at for adequate financial assurance coverage. It must cover a detailed review of all costs of potential environmental exposure, and it must review and adjust this cost annually. Financial assurance must be continually in place and available to the state at all times. The financial instruments cannot be dischargeable through bankruptcy, and the state has the authority to revoke and deny a permit if a company does not comply with the requirements. Finally, no company will be released from its liability until the site is reclaimed.

Concerns about covering costs are legitimate. Creating fear through misinformation is not. Antimining groups like the ones referred to in the column have been doing just that for years, creating fear and putting out misinformation. In 2010, these same groups introduced legislation to unnecessarily change financial assurance requirements, including a section to have this issue addressed in the EIS phase of project review. At that time, the Star Tribune Editorial Board opposed the legislation, saying it “isn’t needed” (“Don’t let new law slow PolyMet,” Feb. 14, 2010).

We all want every company to cover its obligations. Fortunately for all of us taxpayers, Minnesota regulations require it.

At the appropriate time in the regulatory process, when all the homework is done, the state will write down its answer on financial assurance as it relates to the PolyMet project.

 

Frank Ongaro is executive director of MiningMinnesota.

VIV Avivagen CEO says company makes progress on six goals

AVIVAGEN ANNOUNCES CEO UPDATE LETTER

Avivagen Inc. has released a chief executive officer update letter.

Dear Shareholders,

It is my pleasure to provide a further update on the progress of our Company.

My update to you in June provided my impressions after three months as CEO: a great team, an exciting technology and substantial market opportunities. It also outlined the challenges that are inherent to building a successful life sciences business. In that update, I concluded by setting forth six goals. I believe we have made material progress on all of them: 1.Support U.S. marketing of Oximunol(TM) Chewable Tablets by Bayer Animal Health. We have helped our partner in developing new materials to support its marketing of this product line. In evidence of this, a shipment of new Bayer-labelled product was delivered and accepted on November 13th. The rate of sales and re-ordering will now be determined by our partner’s success in marketing this exciting canine health supplement to United States veterinarians.2.Launch a new direct-to-consumer canine product in the United States. In July, Avivagen took delivery of a first U.S. batch of its Vivamune(TM) Health Chews for large dogs. Since then, we have tested a print-based advertising campaign, tested internet marketing approaches and attended three pet-oriented expositions – to sample product and refine our direct sales messaging. We will expand our marketing commitment once we are satisfied our approach is optimal.3.Create further direct-to-consumer companion-animal products. In August, Avivagen took delivery of an initial batch of its second and third U.S. direct-to-consumer products; Vivamune(TM) Health Chews for Small Dogs and Vivamune(TM) Health Chews for Cats. These are now being test marketed alongside Vivamune(TM) Health Chews for Large Dogs.4.Generate initial food-animal product sales in selected international markets. In June and shortly after our first shareholder update, we announced our first commercial sale of OxC-beta: within the Kingdom of Thailand, where we have approval for commercial use. Work is now advancing on registering OxC-beta for sale in other Asian nations. We aim to announce such registrations when they are completed and as local distribution arrangements are finalized.5.Undertake business development activities for current and new products. Since June, we have created relationships with potential OxC-beta customers across Asia: in countries with large livestock industries, including Thailand and five other nations. Consequently, we expect that OxC-beta will soon be tested in multiple customer-driven food animal studies – in both aquatic and terrestrial livestock species. Should the results of one or more of such studies be as targeted, we believe there is the potential for material sales of OxC-beta for livestock in 2014.6.Communicate progress on the above to all of our stakeholders. We believe in building credibility with stakeholders and proving our seriousness with real achievements. This process started with clearing legacy liabilities and building our base of shareholders’ equity. We are now proceeding to generate further proof of the utility of our product – by way of our business development activities and by publishing peer-reviewed scientific articles. As specific facts about those initiatives become available to communicate through 2014, we are committed to work with the media to maximize investor awareness of our achievements. Of the matters outlined above, I’d like to highlight our work in Asian markets. It is important, as it has the potential to jump-start the revenues of our Company. The six countries in which we have built relationships have a combined population of approximately 1.7 billion people. This is around fifty (50) times the population of Canada, and their livestock markets are, in some cases, much larger than their populations suggest due to a focus on exports. While we cannot go into the business of forecasting future sales, our choice of geographies, species and trial designs are all directed to providing the best possible probabilities of material success for OxC-beta. When we receive customer test results, registrations and product orders, we will disclose it to the greatest appropriate extent.

It is important to recognize that such success is not built overnight: we are dealing with sophisticated livestock and feed producers who need to see real results and benefits from their adoption of OxC-beta. This requires us to engage with them to develop product-usage protocols in their species of interest and demonstrate our commitment to customer service. Our staff and outside collaborators are working intensively at such matters, which are vital to making a commercial success of our technology.

Demonstration of staying-power is also important to such livestock customers. We therefore undertook steps to strengthen our financial position over these past months. While this update is being written prior to the release of our October 31 results, our balance sheet has been dramatically strengthened. Review of our draft fiscal year-end financials show that our working capital and shareholders’ equity have each been improved on a year-over-year basis: with the addition of the new equity from our financing this fall, Avivagen can better demonstrate stability to customers, suppliers, staff and investors and is in a stronger position to fund scale-up of production and sales.

While no management can perfectly ensure the successful commercialization of a technology, we believe we are providing OxC-beta the right positioning to become a big winner:

– In companion animals, we have multiple products and marketing channels in the United States – the world’s largest consumer market. – For livestock, relationships with leading companies in some of the world’s largest livestock production markets and for the most commercially important species. – We have also secured capital needed to execute our stated corporate strategies.

With our company’s position now stronger than ever, we expect 2014 to be a pivotal year for Avivagen.

We remain committed to developing Avivagen into a pre-eminent creator of products for companion and food animals. We are realizing that goal by developing internal skills for validating product applications, creating commercially-viable product formulations and managing supply and fulfillment logistics. Using this model, we intend to build exceptional value for our shareholders.

I look forward to providing updates about the above matters and believe our work towards achieving our corporate objectives will soon be reflected in the market value of our Company.

Thank you for being a shareholder of Avivagen, for taking the time to read this update and for your continuing support for our efforts.

We seek Safe Harbor.

© 2013 Canjex Publishing Ltd.

2013 Recap

Tax loss selling is here again! This is a great time to be taking a serious look at the Junior sector, not just commodity stocks, but oil and tech – amongst others. For the past two years I have compiled a list of about 100 companies, considered by many professionals in the marketplace to have been oversold and beaten down.

Well 2013 has pushed the junior market to record lows. So, what to do?? Now, more than ever, it’s time for serious due diligence on this sector. These stocks have reached levels not seen before, most of the time for no other reason than indifference in the small cap space. I have no list this year as there are too many excellent buying opportunities.

Remember one thing.. all my calls and research this year have focused on finding survivors, and the street tells me that Management is the key to moving forward. Money is obviously very important as well, but the smart money is counting on good managers to take companies through these horrendous times