Vancouver Stock Exchange War Eagle up in quiet market

The Vancouver Stock Exchange’s resource index took a hit during the week ended May 21, dropping 12.2 points to finish at 505.14. The composite index followed suit, dropping a more modest 4.89 points to the 561 level, while gold continues to be stuck at the US$355-per-oz. level.

War Eagle Mining took a jump during the report period, finishing up 25 cents at 95 cents on more than 850,000 shares. The company noted there were no material changes in its affairs since announcing a joint venture with BHP-Utah on War Eagle’s Quartz Mountain Basin project in Oregon. BHP can earn a 70% interest in the property by spending a total of US$5 million. In a recent release, War Eagle also noted it was negotiating to acquire two other resource properties.

Vera Cruz Minerals remained halted at the company’s request during the week, last trading May 15 at $2.15. The halt came after Galico Resources announced it would not proceed with a planned earn-in deal on the Vera Cruz property in New Mexico.

During the course of a due diligence review, Vera Cruz completed check assays which revealed dramatic variations in grade compared with those previously released. Galico said the difference in grade was due to severe nugget effect and as a result, the company decided not to proceed with the deal. Vera Cruz is now completing further check assays and Ernest Peters, president, said a number of other companies have since expressed interest in the property.

Earlier this month, Vera Cruz released drilling results from the property including intersections of 190 ft. grading 0.28 oz. gold per ton, 210 ft. of 0.12 oz. and 150 ft. of 0.12 oz. The results pushed the stock from the $1.35 level to a high of $3.

El Condor Resources and Covenant Resources, which plan to merge on a 1-for-1 basis, did not proceed with previously announced plans to acquire all the issued shares of St. Philips Resources. The two companies had intended to offer St. Philips shareholders one share of the merged company in return for two shares of St. Philips.

El Condor and Covenant are now reviewing the exchange ratio in light of their recent acquisition of Kennecott’s interest in the North and South Kemess properties in north-central British Columbia. Both El Condor and Covenant slipped a nickel to finish at $2.60 and $2.45 respectively, while St. Philips added a nickel to close at $1.10.