Brent Cook on Market Call

Here's the link, go watch it yourself.

Bayfield Resources (BYV.v) smearing and Brent Cook's rebuttal

After last week's spat between Bayfield (BYV.v) and Brent Cook, today we get to see the reply by Brent Cook to Bayfield Resources (BYV.v), via his weekly "Exploration Insights" letter. We're also allowed to re-print the piece in the public sphere, so here it is. The assistance of 'LV' appreciated on this.

Exploration Insights
by Brent Cook
www.explorationinsights.com

Issue No. 152
July 31, 2011

Normally Exploration Insights is exclusive to subscribers and we appreciate that you don’t cut and paste or forward the timely information herein. However, as soon will become clear, the Rant in today’s letter is for general distribution and you are welcome to send it along to anyone you think may be interested its subject (if you would prefer a .pdf send us an email).

The Rant

US Based Newsletter Writer Clarifies Bayfield Ventures’ Clarification of Misinformation Regarding Potentially Confusing Drill Information that Bayfield Clarified in a Previous Confusing Release as Mandated by BCSC

On Tuesday, July 26 a US based newsletter writer was asked during this BNN interview (Tuesday, 11:50 EST) to comment on Bayfield Ventures’ (BYV.TSX-V) potentially confusing drill results. Subsequent to his comments, Bayfield distributed this news release in which they stated that factual errors were made by said newsletter writer in the discussion.

Let’s get factual

In their June 30 news release, Bayfield Ventures reported that the British Columbia Securities Commission (BCSC) required BYV to “clarify” certain details of its technical disclosure of previously released drill results. The “potentially confusing” information in question relates to BYV’s reporting of long intervals of mineralized drilling results that were created by diluting a few, sporadic high grade intercepts with lengthy intervals of lower grade (and even some barren) intercepts. This equates to a mathematical smearing of the isolated high grade intervals throughout a larger volume of low and possibly sub-economic material.  By smearing gold grades, the character of the geologic occurrence is misrepresented and can be confusing and/or misleading to the general public who, on the whole, don’t have the tools or experience to recognize this mathematical misrepresentation. (We have examined this issue many times here at Exploration Insights using the free drill interval calculator.)

That was the gist of the BNN conversation.  BYV was not represented as the “poster child” of smearing; rather, their recent press releases and the restatement required by the BCSC merely made them a timely example for a respected daily business show. 

With respect to the BCSC mandated clarification-- this addresses five drill holes from four separate news releases dated September 8, 2010 to June 27, 2011. Specifically*:

• Sept 8, 2010 RR10-18: BYV reported 81 meters grading 5.08 g/t Au, between 488 to 569 meters drill depth; this was restated to 13 meters of high-grade contained in three separate intervals (see table below).

• Dec. 14, 2010 RR10-52: (My personal favorite, with erratum to the BNN discussion where I misstated 80 meters, rather than 58) BYV reported 58 meters grading 1.84 g/t Au between 394 to 452 meters drill depth; this was restated as 1.1 meter grading 89.96 g/t Au, at 402.4 meters depth.
• Feb. 16, 2011 RR11-1: BYV reported 116.6 meters grading 1.05 g/t Au between 509 meters to 626 meters drill depth; this was restated as 20.8 meters containing three, isolated, high-grade intercepts.
• June 27, 2011 RR11-70: BYV reported 43.8 meters grading 1.02 g/t Au between 41.00 to 84.80 meters depth; this was restated as two separate higher grade intervals totaling 10.4 meters.
• June 27, 2011 RR11-71: BYV reported 79.5 meters grading 8.66 g/t Au between 15.50 meters to 95 meters depth; this was restated as 25.5 meters grading 26.7 g/t. Both drill holes 70 and 71 are good drill intercepts, the significance of which is dependent upon pending results from nearby holes.
• Yet to be restated: RR11-14: 56.9 meters grading 0.62 g/t between 275 to 328.3; should be two separate intervals of about 3 meters each grading 6.75 and 2.14 g/t.

*Note that we are only considering gold assays, as some of the earlier releases did not include silver assays.

(Fig. 1- One-year BYV chart showing news release dates for drill results that were subsequently “clarified”, and the apparent market reaction to original news releases)

Summarizing:

1.    81 meters becomes 13 meters beginning at 488 meters drill depth;

2.    58 meters becomes 1.1 meter beginning at a drill depth of 402 meters;

3.    116 meters becomes 20.8 meters beginning at a drill depth of 509 meters;

4.    79.5 meters becomes 26.5 meters beginning at a drill depth of 38 meters;

5.    43.8 meters becomes 10.4 meters beginning at a drill depth of 41 meters.

On July 19, some of these restated results from the June 30^th clarification news release were posted to BYV’s website in a cross-section, as represented below (Fig. 2). The section actually appears to run slightly east of north, so the section may not be truly perpendicular to the strike of the feature; the true width may be somewhat less than drill width. I have edited the cross-section by including the approximate location of the long “mineralized” intervals as originally reported by Bayfield on the drill trace against the restated intervals where possible. This graphic visualization helps put some context to the restated mineralized intervals.

(Fig. 2- Burns Block Cross Section showing drill hole trace and mineralized intervals. The red bars represent the actual location of the mineralized intervals as restated in the June 30 news release. The length of the red bar is proportional to the grade. I added the green on the drill trace to represent the approximate drill interval the mineralization in red was smeared across in previous news releases. Note 50-meter scale on drill trace. So, does the green convey a different impression of the mineralization than the red?)

A key takeaway from the cross section is that, with the exception of mineralization intersected in RR-70 and 71, these high grade intersections are deep and, based upon the presently available information, would not be exploited via open pit mining. It is also very obvious that some of the “clarified” results are very narrow, high grade hits that were mathematically smeared over greater drill length —specifically RR-52—just as the BCSC noted.

The other topic discussed in the BNN segment relates to continuity of grade. In the cross section above, and in previous releases, BYV suggests that their drilling has identified a high grade gold shoot with a down plunge length of about 600 meters. Basically, BYV has connected the red bars on the drill holes above and are interpreting that these form a continuous mineralized body. The distance extrapolated between drill holes is up to about 100 meters – this is a big distance to extrapolate in deposits of this type. It will take considerably more infill drilling to prove continuity.

Bayfields’ location map suggests to me that there may be other drill holes that cross their section of choice, but that are not included; however, there is insufficient information to be certain, or to know why BYV selected the holes they used (the drill map is here for anyone interested). If drill hole data relevant to interpreting continuity are missing, one needs to ask why potentially useful data are omitted. Regardless, at this stage I am dubious about grade continuity of this projected shoot-- only time will tell.

There does, however, appear to be sufficient drilling immediately east and west of Bayfields’ section to establish or negate continuity along strike (Fig. 3). In some instances, gold ore bodies have continuity down plunge or dip which can be matched along strike. Basically, if an ore body is extensive or continuous in one direction it can be in the other as well; therefore, it is possible that we can use that on-strike data to guess at the down plunge continuity.

(Fig. 3- North Drill Fence map extracted from complete map, showing drill hole locations. Note the number of holes per location. Red are “high grade” holes, orange are drilled with assays complete, and yellow with assays pending. What is in the holes immediately adjacent to those selected for BYV’s cross section?)

The cross section in Figure 2 above is only a paper-thin two dimensional slice through the earth lined up along the holes BYV selected. Bayfield has drilled many dozens of holes along east west lines, usually with several holes from the same location. In order to evaluate the 600-meter long ore shoot BYV is postulating, we need to establish the east-west strike length of this zone. Although difficult to tell from the map, it appears drill stations are between 10 and 50 meters apart along the east-west lines—a good distance to establish grade and structural continuity.

I am afraid, however, that the drill data is too poorly organized and presented to permit any conclusion regarding grade continuity along strike and therefore the potential tonnes and grade of the proposed shoot, or continuity therein. Bayfield should present us with a series of north-south cross sections similar to Figure 2, indicating the thickness of the section (showing the distance holes are projected into the section), using all the drill holes with down-hole assays in order to prove BYV have discovered something of value. Many companies at this stage of outlining a possible resource do this on corebox.net or through their own websites. It’s basic exploration and disclosure practice in Canada.

When and if Bayfield does present the public with sufficient cross sections and maps to make an assessment of the grade and continuity of Burns Block and the postulated shoot, we are certain the US based newsletter writer will be happy to publicly review the data and, if need be, reconsider his current assessment of the company.

Are we clear now?

Brent Cook on BNN's 'Market Call' Monday March 7th....get your question into him now

The man they call Brent Cook is the guest on BNN's Market Call Monday. The show kicks off at 7pm EST and runs for the full hour, so you have plenty chance to get the views of Cook on all things mining. 

So folks, do yourself a favour and get your question into Cook via the toll-free number 1-877-667-6288 or from Toronto 416-957-8199, or if you prefer, mail in with your question to marketcall@bnn.ca because you know it makes sense.

The Cookie Crew

As fawning fans of the white bearded meister of the junior world, here at IKN we're happy to see this pop up on the BNN TV listings for tomorrow Tuesday 25th January 2011:

11:30 AM - Commodities with Andrew Bell
Roundup Mining Conference: Phillips Baker, CEO, Hecla Mining
Choosing the Right Junior: Brent Cook, Editor, Exploration Insights
Gold Discovery in Ethiopia: Andrew Smith, CEO, Canaco Resources

Thanks to reader 'JC' for the headsup and as we just know Brent Cook will rock da house with his wisdom, it's time to CUE THE MUSIC!

Brent Cook on Seafield Resources (SFF.v)

Brent Cook's Exploration Insights letter last Sunday devoted part of its space to last week's news release out of Seafield Resources (SFF.v). Your humble scribe has received permission to reproduce Cook's thoughts here at IKN, so here they are below. What follows, ladies and gentlemen, is the difference between hucksters that pretend to know about drilling results and professional geologists who do actually know what the hell they're talking about. Enjoy Cook's analysis.

Influential newsletter writers and Seafield’s big hole

...........

Speaking of investment letter writers, I understand that the Midas Letter is calling Seafield Resources (SFF.TSX-V) the next Ventana, and advises that you grab as much as you can with both hands at under $1.00.  Ventana Gold (VEN.TSX) has a 3.5 million ounce inferred gold resource in Colombia and is the subject of a takeover offer of approximately $1.5 billion.  Seafield, or Ventana II if you prefer, announced a drill intersection of 449 meters grading 1.29 grams per tonne gold including 10 meters @ 2.87 g/t Au, and 23.95 meters @ 9.18 g/t Au.  Within the higher grade section was a 2-meter interval grading 70 grams per tonne gold.  SFF (~99 million shares outstanding and ~146 million fully diluted) popped from $0.23 to $0.57 on huge volume of 70 million shares after it opened for trading on Friday. 

I reviewed the results and the well-written 43-101 after the drill hole announcement, and since I received a number of queries from subscribers, offer the following quick and dirty review of the Miraflores property in Colombia.

The property has seen a number of drill campaigns from several exploration companies, the most recent being B2 Gold, in 2007.  The historical work, plus a report from the renowned economic geologist Richard Sillitoe concluded that Miraflores is a multi-phase magmatic-hydrothermal breccia.  Meaning, the mineralization is confined to a fractured and broken pipe-like body formed by the injection of several magmas and hydrothermal fluids related to these intrusives. There are three alteration and mineralization phases, of which it appears that an early silica and base metal event is associated with the better gold mineralization.  Drilling, mapping, and underground sampling have essentially defined the limits of the body at about 250 meters by 280 meters.  Although the breccia body is open to depth, drilling suggests that the better gold mineralization is concentrated in the upper 250 meters or so.  There is some evidence that a high grade core dipping to the southwest could extend the mineralization to depth in one direction.  

In April 2010 SFF estimated an inferred resource, based on approximately ten drill holes and underground sampling, of 776,373 ounces grading 1.295 grams per tonne gold for the Miraflores breccia pipe.  The resource report noted that the high grade mineralization within the body occurred mostly within a central core and was both erratically distributed and nuggety (localized very high grade gold that is difficult to model in a resource estimate).  The highest grades (3 to 429 g/t Au) occurred in fault veins, and mineralization generally decreased towards the edges of the breccia body. 

Our handy-dandy drill interval calculator (pictured below) reveals that, excluding the two higher grade intervals in DH-03, the SFF announcement of 449 meters grading 1.29 grams per tonne gold consists of 415 meters grading 0.798 grams per tonne gold plus the two high grade sections.  Within the higher grade, 23.9 meter interval, there is a 2-meter section grading 70 grams per tonne gold.  This narrow interval alone has a significant influence on the entire 449 meter interval, such that when excluded the grade drops to just under 1g/t Au for the remaining 447 meters.  DH-03 went through the guts of the breccia pipe, and the drill results are representative of the deposit-- basically they confirm the previous drilling and resource estimate.  Hmm…this is not looking good.

(Fig. 1- Breakdown of Seafield’s 449 meters grading 1.29 g/t Au)

In summary, all the excitement is over a single drill hole that really offers minimal new information on a gold deposit that has been effectively defined by previous work.  Miraflores is a discrete breccia pipe hosting a decent resource centered around a higher grade core.  There may be the potential to add ounces at depth to the southwest as indicated by the deeper interval announced by SFF this week.  It is difficult to tell how much of the resource could be economically mined because the deposit rests on the side of a steep hill; developing the deeper portions could entail the removal of a significant amount of barren rock (high strip ratio). 

Although the upside to the Miraflores property may lie in as yet undiscovered or undrilled targets, that upside existed at $0.23, and has nothing to do with the 449 meters grading 1.29 grams per tonne gold or, the 415 meters grading 0.798 grams per tonne gold plus a couple of high grade intervals.  This is not Ventana II, and Miraflores is not a large enough deposit to entice me.  If other gold in soil anomalies on the property noted in an October 6 news release are the real sex to this play, then it is best to really look at the historical results and wait until SFF begins releasing additional data from those targets.  Considering that a single drill hole through a known deposit caused over two-thirds of SFF’s outstanding shares to trade hands in one day, one has to wonder who made the better trade, buyers or sellers.  Monday’s action should prove interesting.

Two minehead radio show links

Tipping the hat to MP we get to feature two smart mining brains in one post, as two heads are better than one.

This link takes you to Mickey Fulp on the Korelin show, talking Animas amongst other things.

This link takes you to Brent Cook on the Puplava show, talking on what makes a junior miner successful, with advice on how to avoid the bad ones.

Brent Cook on BNN's 'Market Call' tonight 7pm EST

Every once in a while something is worth watching on teevee. It doesn't happen very often but tonight throws up one of those occasions with Brent Cook appearing on BNN's Market Call for a full hour this evening., Tuesday November 2nd. The show starts at 7pm EST so make sure you're watching because you'll be smarter about rocks afterwards, that's a cert.

Headsup complete. You do have please that nice day yes thank you very well.

UPDATE: A message from the bearded one himself:

It's live TV.  If any of you have any questions it would of course be great to hear from you.  The number is toll-free 1-877-667-6288 or from Toronto 416-957-8199.  You may email questions to marketcall@bnn.ca. 

Cheers

Brent

Exploration mining investor, HANG YOUR HEAD IN SHAME

I can't believe this, I truly can't. Back in late September Brent Cook published a set of three You Tube videos, totally free to go watch (here, here and here) that took the viewer through a recent site visit Cook made to the Yukon area so red hot amongst the sector right now. In the three videos that total 16 minutes you get to see what this top quality economic geologist does, looks at and looks for when on a field trip and evaluationg whether the company running the show is a buy or not.

The videos contain a wealth of information, stacked to the brim with smarts about rocks and I defy anyone not to come away from then knowing more than they did, even the most experienced of professionals. As for the retail metalhead (i.e. you and me) it's impossible to miss these tutorials.

And that brings me to the utter shame you MUST feel immediately, retail metals and mining investor. I went and watched these vids when they first came out, thought they were bound to be a smash hit with tens of thousands of viewings etc etc. But then this morning a commenter left a "good BC vids" type comment on this post, so out of sheer curiosity I went to check on viewer number so far.

ONLY TWO HUNDRED AND SEVENTY ONE VIEWINGS FOR THESE VIDEOS!!

I can't believe this (and it's even less for parts two and three, 181 and 156). The information contained in these Brent Cook videos is 100% solid gold, but only 271 people (probably less, if you're like me and watched them over again) people have bothered to go see these videos. ARE YOU GUYS TOTAL MORONS? DO YOU REALLY WANT TO BE STUPID FOREVER AND RIPPED OFF FOREVER? I mean, you must be really happy to be absolutely dumbass stooooooooopid about junior mining companies because you make NO EFFORT AT ALL TO EDUCATE YOURSELVES, do you? No, you much prefer to follow the scam-mongers of the mining commentary world that lead you by the nose into the exact stocks that make the maximum amount of money...for them. 

HOW THE HELL CAN YOU IGNORE GREAT INFORMATION AND GET SUCKERED IN BY THE SCUMBALLS? Hang you head in shame immediately, mining traders.

So now the solution. WATCH THESE VIDEOS NOW. Get smart on rocks, dudettes and dudes. You need to see these most excellent videos and you need to see them right now. Take 16 minutes aout and watch what Cook has to tell you because his words will make you a better and more profitable investor, period. You have no excuses left not to watch these. Do it now. Right now.

Part One

Part Two

Part Three

Brent Cook's 'drill hole interval calculator', a smart sector tool

Minehead special coming up. Brent Cook over at Exploration Insights, along with his pals at Corebox, has come up with a great little tool for us mining speculators to use called the drill hole interval calculator.

It's a handy dandy little calculation tool that will really help us laypeople interpret and understand a drill hole assay result as published in NRs. Brent introduced the tool in his Exploration Insights weekly letter this week as has been kind enough to give this humble scribe permission to reproduce his explanation of how it works, along with a good example. So without further ado I hand you over to Brent's text. Enjoy.

Speculators in minerals exploration face real difficulties while attempting to interpret drill information when important pieces are missing from company press releases.  Most common amongst our problems is determining what a drill interval grades when higher grade intersections are removed—essentially the residual grade.  With that in mind, Corebox and Exploration Insights have jointly developed a drill hole interval calculator that provides that residual grade; we are making it available to anyone interested.  This will hopefully prove popular with investors (and drive them to our respective websites).

Often news releases that announce drill results report a long interval grading 'X' grams per tonne gold (or any metal) over 'Y' meters. The Y interval may contain smaller, higher grade intervals within; this is generally indicated by a statement such as: 'Including __ grams per tonne gold over ___ meters.' Although this is useful information it only tells half the story. We also need to know what the rest of the interval grades when the high grade intervals are excluded. Would the excluded interval make money (ore) or lose money (waste) if it were mined?

To use our Drill Hole Interval Calculator, simply fill in the data for the long interval and then the smaller or 'including' intervals. You are left with the average grade of the drill interval excluding the higher grade sections. If the company has posted the results on Corebox you will be able to visually walk through the property section by section or view it in 3-D. Putting this data into geologic and economic context requires experience and understanding - that is what Exploration Insights is all about.

I hope you find this useful and good luck out there,
Brent Cook

Although this calculator is by no means the final word on grade, I think you will find it a useful tool in your exploration research.  Have fun and pass it around.

IKN back. So use this cos it's pretty neat, dudettes and dudes.  Thanks again to Cook for allowing a chunk of his subscriber-only letter to make it to the public sphere, because his explanation on how this works is much better than anything this humble scribe could have weaved together. IKN, passing it around, having fun and signing out.

The Cook appreciation society (excerpt from IKN71)

This was part of yesterday's weekly.

Cook’s intro

As usual, Brent Cook’s weekly edition of Exploration Insights (1) (out yesterday) was a mine of information and I thoroughly recommend his services to anyone interested in making money in the exploration mining sector (and no I’m not on commission or anything, and yes I’m fortunate to consider him a friend). He’s given me permission to share the first two paragraphs of yesterday’s letter here with you, the ones that paved the way for the details that came later. Frankly, I wish I’d written them:

“Speculating in minerals exploration is a very high risk endeavor in which buying an indiscriminate basket of stocks will definitely lose you money over the long term and, usually over the short term too.  My experience has been that the more selective I am, the better the odds of success-- provided the selection criteria are valid. 
c

“A more common strategy that many resource sector commentators employ is the shotgun approach.  The advantage to the shotgun strategy is that you are bound to bag a few winners and it seems to work fairly well when the entire sector is moving: not so well when the sector drops.  The disadvantage, and something I saw all too often as an analyst at a retail brokerage firm, is that retail investors tend to end up with dozens or even hundreds of stocks in their portfolio.  Usually they have very little idea why they bought most of these companies in the first place and whoever had recommended them (be it a taxi cab driver or letter writer) had failed to update them or suggest when to sell.  More often than not, this collection of orphan stocks sits in accounts at a loss and there is no liquidity, i.e. no one wants to buy them.”

IKN back. Your author agrees, with particularly strong agreement on the part about people ending up with dozens of positions. I’m also acutely aware of the difference in people’s enthusiasm about handing out buy recommendations compared to sell recommendations. There are several reasons for that, of course. One is that the tipster may not want to draw attention to his losing trades. Perhaps another is the fear people have of selling and then watching the stock take off without them, leaving cash on the table for somebody else to pick up. Also, as a market pro once suggested perhaps cynically, an analyst or letter writer with too many sell calls would be put on the blacklists for future cheap private placements.  But another point is that you really have to be darned lucky to sell well, something that people don’t like admitting. More on that another day.

Brent Cook talks gold exploration

Here's the link to eight minutes and thirty-four seconds of Brent Cook getting grilled on gold miners, exploration, places he likes, places he doesn't like. Good stuff, metalheads.

Recommended

Tonight I received the following mail (extracted) from subscriber 'SA':

"...I'm trying to expand my gold holdings to other areas of the world. Could you recommend other gold analysts' newsletters you trust and value for their selections. Thanks for any help you can give!

Sincerely,

XXXXX (name witheld)

To which I sent the following reply. Then it occurred to me that more people than SA might be able to take advantage of the calls, so here they are for everyone.

Hi XXXXX,

I trust and recommend three:

1) Mickey Fulp. His newsletter is free. Sign up here. He gets paid by the companies he covers but he's very selective about the companies he takes on. It's a no-brainer to read Fulp..it's free!!

2) Gary Tanashian of Biiwii dot com. Find out more here. A technical analyst who follows precious metals closely. The only tech analyst I ever bother with. Excellent, honest, insightful and amazing value for money at $26/month.

3) Brent Cook at Exploration Insights. Go to his site on this link. The best geology based gold stocks subscription newsletter by a mile. The top industry pros all read Brent Cook. It's not cheap but it's worth every penny. I learn more from Brent than anyone else.

Hope this helps. By the way, i'm not on any sort of commission from any of the three above. I reco them because i read and trust them.

Brent Cook interviewed by The Gold Report

Right here on this link. Worth your time.

Links to the Brent Cook show

Two readers kindly sent me the links to Brent Cook's appearance on BNN's Market Call Tonight program last Thursday. This morning a reader mailed to ask where they could get links to see the show. So let's make the connections right here on the blog, cos this way more people can benefit.

This link is to part one of the show

This link is to part two of the show

This link is to the short 'top picks' section at the end of the show.

Well worth your time, mineheads. It'll take you around 45 minutes to watch it all, which is 45 minutes well spent.

Brent Cook on BNN tonight

A mining headsup for mineheads: Brent Cook is appearing on BNN's Market Call Tonight (Thursday 11th March), the show starting at at 7pm EST (4pm PST). Be there or be square, dudettes and dudes.

Regulars will know that Cook is a great brain to pick when it comes to explaining the technicalities of geology, so why not send in a question yourself and get it answered on air? You can do that by phoning (toll free) 1-877-667-6288, or if you're like me and semi-allergic to telephones you can email questions to marketcall (AT) bnn.ca (just change the (AT) for an @ symbol).

Brent Cook on BNN last night

We like Brent Cook. We also like his appearance on BNN's Market Call last night where he covered a lot of bases and talked about a lot of junior mining companies out there, so check it out for yourself:

Here's the link for part one

Here's the link for part two

Here's the link for part three, his 'top picks' segment

Rusoro Mining (RML.v): Brent Cook shows his integrity

Last Friday evening, Brent Cook of Exploration Insights was the guest for the whole hour on BNN's Market Call evening show. I featured the re-run video in this post on Saturday as essential viewing for mineheads and a lot of you clicked through (if you haven't seen it yet, go have a look...you'll learn loads).

However I got a lot of feedback on the part where Cook commented on Rusoro Mining (RML.v) as he said the company was connected with Russian mafia. Well I laughed about it over my Saturday coffee and then mailed Brent Cook to say that I think he got that one wrong. From what I hear, other people with greater gravitas than I also thought it was a bit heavy. So it was impressive to see Brent Cook stand up yesterday and say "hey guys, I was wrong". In a world of overstuffed egos, kudos is again deserved by Cook for having the fortitude to admit his mistake publicly. I've been given permission to reproduce the extract from his letter to clients yesterday and here it is.

Before moving on to this week’s belated letter I need to rectify a statement I made on Friday’s BNN Market Call Tonight show regarding Rusoro Mining (RML.TSX)

To the best of my knowledge, there is no Russian mafia involvement or connection with Rusoro: I was wrong. According to the most recent information circular, the significant Russian shareholders in Rusoro are Andre Agapov (8.9 million shares), Vladimir Agapov (59 million shares) and Peter Hambro (~6.1 million shares). These are legitimate businessmen and companies.

In retrospect, had my foot not been so much quicker than my mind, this is what I should have said regarding why we are not invested in Rusoro:

Although Rusoro is an obviously undervalued gold company with measured and indicated resources of about seven million ounces and another seven million in the inferred category, I do not see a clear way forward that benefits shareholders: i.e. takes the share price up. There are too many variables and risks that are beyond our ability to understand and predict in Venezuela. This uncertainty is a very strong headwind that I believe will keep outside investors from re-rating the company for quite some time. An investment in Rusoro implicitly assumes that you trust the Venezuelan government (Hugo Chavez at the moment) to play fair with shareholders.

Venezuela has been, shall we say, less than fair in their appropriation of natural resources. In 2007 they nationalized the last foreign company’s participation in an oil field. In the mining sector, Gold Fields and Hecla experienced sufficient national and local government impediments and bureaucracy at their gold projects to convince them it was best to leave. Their departure benefited Rusoro who legally acquired the Choco deposits from Gold Fields and, Isidora from Hecla. RML has subsequently been able to work through the issues and turn those operations around. Rusoro is now the “company of choice” for the Venezuelan government, as evidenced by their joint venture on the Isidora mine.

Elsewhere in Venezuela, Crystallex (a 26-cent stock with reserves of 16.8 million ounces of gold) was denied a mining permit and is awaiting an appeal. Gold Reserve, the other foreign mining company operating in Venezuela, is contesting the revocation of a key permit by the government on their Las Brisas gold deposit. Both companies are effectively dead in the water at the hands of the government.

It just remains for me to say that, as a subscriber to Exploration Insights, I would recommend this high quality newsletter to all. Nobody does the world of rocks as well as Cook. Nobody. For more info, click through here. I state that I stand to receive no sort of renumeration whatsoever from recommending Cook's services to you, it's simply a case of reco'ing a quality service to make you into a better mining investor.

UPDATE: for those of you tuning in from V-Headline, please be clear that Roy Carson is a two-faced lying dickhead of the first order.

Brent Cook on BNN Market Call, September 25th

Essential viewing for mineheads. Sixty minutes of Brent Cook on BNN last night. Excellent insight and solid advice all the way through. Link through right here.

Brent Cook interviewed

Here the link to an interview that website Gold Report has just done with Brent Cook, geologist and newsletter writer on mining and all things concerned. A good read for all you mineheads out there.

Nice to see Fortuna Silver (FVI.v) getting a positive mention.