Most gold issues on the major exchanges entered a modest correction phase today, as gold bullion gave up $8 to $442(US). However, the correction for some companies amounted to nothing more than sideways trading.
One issue which has not traded since April 9, is Shabu Gold Mines which has been halted since that date. A spokesman for the Alberta Stock Exchange tells The Nortern Miner that the stock trading activity in Shabu is under investigation following the rapid price drop — from a high of $12.75 to $5. He expects the issue to resume trading this week.
Shabu made a spectacular advance from 35 cents in February to a high of $12.75 — all on poor drill results from a grass-roots gold prospect east of Red Lake, Ont.
General Minerals Corp., made the most active list after it churned through more than 450,000 shares. The issue advanced a dime to 35 cents . General has closed a deal with All- Star Resources which will see the latter company become operator of General’s placer property in B.C. All-Star has also agreed to pay a total of $3.5 million for a 70% interest in the project.
Zahavy Mines was also a big winner, adding $2 to $6. The company has decided to exercise its first right of refusal on the 50% interest in the Favourable Lake, Ont., gold property. Getty Resources has decided to backout and has put up its 50% stake on the auction block. Zahavy says it will pay $3.69 million for the interest, thereby increasing its stake to 100%.
Long suffering Golden Star Resources shareholders have finally found something to cheer about. The issue advanced smartly to a high of $6.25 — up $2.38 for the week. The company has a concession in Guyana which hosts large tonnages of low grade gold reserves. Placer Development has finalized an option agreement with Golden Star which will see the major start of a six-month study of the deposits.
Easier issues include Ontex Resources at $3.80 and Greenstrike Gold which gave up 19 cents to $1.45.
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