STOCK MARKETS — Gold’s stability fails to revive ailing VSE

Western markets remain on the critical list, with the Vancouver Stock Exchange’s composite index limping along at the 700 level, down more than 12 points during the report period ended Feb. 21.

Gold’s relative stability at US$379 per oz. offered little comfort to the resource index, which continues to fall, dipping 7.16 points to the 1,105-level.

Despite the market’s severe lethargy, investors and traders continue to pile into Murgor Resources. The issue traded as high as $2.97 on more than 3 million shares, finally finishing up 43 cents at $2.83. Drilling is under way on the company’s Barry Twp. gold property in northwestern Quebec and the first hole is reported to have intersected a true width of 111 ft. of mineralization, similar to that exposed in surface trenching. Previous trenching values include 0.33 oz. gold per ton over 31.4 ft.; 0.42 oz. over 5.25 ft.; and 0.21 oz. over 19.1 ft. Assay results from the first hole are pending.

Management of Sutton Resources is at a loss to explain recent weakness in its share price. The company released the results of a preliminary economic evaluation on its Kabanga joint venture with BHP in Tanzania, estimating the project will spin off US$115 million in cash flow per year during the first 10 years of production. The issue lost $4.38 to close at $16.88. Taseko Mines and El Condor Resources issued press releases denying rumors contained in an investment letter out of the U.S. regarding imminent deals with majors on their two separate properties in British Columbia. Taseko owns the Fish Lake copper-gold project which contains an estimated 744 million tons grading 0.236% copper and 0.0127 oz. gold. El Condor holds a 60% interest in the Kemess South copper-gold project which contains 220.9 million tons grading 0.22% copper and 0.018 oz. gold.

Taseko slipped 63 cents to $12.13 while El Condor dipped a nickel to $4.85. St. Philips Resources, which owns the remaining 40% of Kemess South, finished unchanged at $2.

The merger between New Canamin Resources and Toronto-listed Princeton Mining may be in jeopardy, following the the recent slide in the latter’s share price. New Canamin has hired Goepel Shields & Partners as financial advisers for the transaction, which would give shareholders 1.25 shares of Princeton plus half a warrant (one warrant exercisable at $1.15 for 14 months) for each share of New Canamin.

New Canamin closed down 8 cents at 95 cents while Princeton finished at the 76 cents level, compared with a price of $1.15 for New Canamin and $1 for Princeton at the time of the original merger proposal.

Trading in Canabrava Diamond was active, with more than 2 million shares changing hands, helping push the issue up 8 cents to $1.98. Exploration work on the company’s Brazilian diamond concessions outlined targets for bulk sampling, and Canabrava reports that it has been approached by three major companies regarding the formation of a joint venture.

Castle Rock Exploration dipped 10 cents to 17 cents as shareholders await results from a 9-hole drill program on the Cerro Agujerado gold property in Mexico. The company is evaluating new gold prospects and is considering a joint-venture proposal from a major mining group.

Alberta-listed TVI Pacific edged up 8 cents to 67 cents. The company estimates its Canatuan gold-base-metal project in the Philippines will provide an after-tax net cash flow of $78.8 million (undiscounted) over a mine life of nine years. The company expects to complete a prefeasibility study on Canatuan by this May.

Summo Minerals estimates the total resource on its three copper-oxide projects in the U.S. at more than 68 million tons grading 0.48% copper. The issue closed up 9 cents at $1.24.