Another great week for our stocks. While we got stopped out on 2 stocks. The rest are up nicely and we have adjusted stops up to ensure we take profits off the table. The Bond position looks like it's not going to break in our favour in time. We will look at it again another time.
We like Ivanhoe Mines in particular.
We feel IVN is one of the most overlooked gold companies today with the greatest upside potential. IVN has the potential to become one of the biggest gold winners that we ever come across.
IVN is currently focused in Mongolia where it owns what many people believe is the world's largest untapped copper-gold development project, Oyu Tolgoi, which is 80 km (50 miles) north of the China border. This project is world renowned and has been in development for over 4 years to date with an ultimate mine life that is expected to exceed 40 years!
Oyu Tolgoi comprises a rectangular block 10 x 9 kms in area, in which exploration prospects are named South Oyu, Southwest Oyu, Central Oyu and Hugo Dummett (North and South).
IVN is set to make history with its Oyu Tolgoi project and many people are not even aware of capitalizing on this rare investment opportunity.
What is extremely exciting to us is the fact that the second largest mining company in the world, Rio Tinto (RTP), has formed a strategic partnership by investing in IVN and, through an Ivanhoe-Rio Tinto Technical Committee, will jointly engineer, construct and operate Ivanhoe's Oyu Tolgoi copper-gold mining complex! The agreement creates a defined path for Rio Tinto to become the largest shareholder in IVN.
Now that IVN has formed this joint venture with Rio Tinto it should allow them easy access to the capital they need to fully develop Oyu Tolgoi. Rio Tinto’s total investment in IVN may reach as much as $1.5+ billion!
In September 2006 IVN announced that an independent Integrated Development Plan (IDP) prepared by a joint venture between AMEC Americas Limited, of Vancouver, Canada, and Ausenco Limited, of Perth, Australia, with input from 12 other leading international engineering and environmental consultants, confirms the potential of IVN's Oyu Tolgoi Project in southern Mongolia to become one of the world's largest copper and gold producers and a model of environmentally-sound mineral development.
The independent study indicates that the Oyu Tolgoi Mine will be capable of average annual production in excess of one billion pounds of copper and 330,000 ounces of gold for at least 35 years. Peak annual production in excess of 1.6 billion pounds of copper and 900,000 ounces of gold is projected to be reached six years after initial production begins.
The IDP also indicates that Oyu Tolgoi could produce approximately 35 billion pounds of copper and 11 million ounces of gold over the projected, initial 35-year life of the mine, based on resources delineated to May, 2005.
A paramount priority for Ivanhoe Mines and its strategic partner, Rio Tinto, is the completion of an acceptable Investment Agreement with the Government of Mongolia to permit the investors to proceed with full-scale production of the Oyu Tolgoi mine and ore-processing complex.
The Mongolian Government is the only thing left holding IVN from getting the Oyu Tolgoi project into full production however we feel that the long time waiting is finally coming to an end very soon.
Since Mongolia's national general election in June 2008, Prime Minister Sanjaa Bayar, members of the Cabinet and members of the State Great Hural have publicly endorsed the objective of ensuring that Oyu Tolgoi is placed into production as quickly as possible. Speaking in September, the Prime Minister described his policy of "accelerated development" of Oyu Tolgoi and other large mineral deposits as an "historic" economic growth opportunity for Mongolia.
Recently, IVN announced that a draft agreement was approved in principle by the Mongolian Cabinet and National Security Council in March and Ivanhoe is awaiting Parliament's review and approval which has been said to be at the top of the Government's action agenda. You can read the press release here-
http://finance.yahoo.com/news/Ivanhoe-Mines-Ltd-Mongolian-iw-14627771.htmlAs you can see, IVN seems to be right around the corner from receiving an agreement with the Mongolian Government! This could be the perfect time to invest into IVN before the potential big news!
Rio Tinto and IVN have spent more than US$1 billion on the project to date and underground construction has continued while they await the finalization of the investment agreement.
IVN is well positioned with quality assets and a significant cash position of approximately US$384 million.
IVN also holds interests in various mineral resource projects in the Asia Pacific region, including the Ovoot Tolgoi coal mine in Mongolia; the Cloncurry project for the exploration and development of copper, gold, and uranium in Queensland, Australia; and the Bakyrchik gold project in Kazakhstan.
IVN’s CEO John Macken is a leader in his field coming from a 19-year career with mining giant Freeport McMoran Copper and Gold, most recently as Freeport's Senior Vice-President of Strategic Planning and Development, based in New Orleans. He spent a total of 13 years with Freeport's operating unit, P.T. Freeport Indonesia, culminating in the position of Executive Vice-President and General Manager at Freeport's Grasberg mining complex in Papua, the world's largest single copper and gold mine. The company is now valued at over $18 billion!
With the most recent surge in copper prices and all the right characteristics forming to take gold to record highs during the upcoming years, there is no doubt in our minds that IVN with its Oyu Tolgoi property could become one of the biggest winners that we ever invest in.
Masa Igata of Frontier Securities, one of the largest Financial Institutions in Mongolia is a regular speaker for SGX here in Singapore. I include his most recent presentation which will give you a very good insight into the new Mongolia.
MGN is a U.S. based mineral company focused on the acquisition and exploration of silver dominant mineral deposits. MGN's primary focus is on the advancement of the Montanore silver-copper project located in northwestern Montana, with a goal to ultimately become a new mid-tier producer of precious and base metals.
MGN has 28.74 million shares outstanding and a market cap at $1.92 of $55.18 million. MGN is sitting on $21.98 million in cash and has no debt. After subtracting MGN's cash position from its market cap, MGN's actual business and property is being valued at only $33.2 million.
MGN's Montanore silver-copper project located in Montana has a resource estimate of about 230 million ounces of silver and approximately 2 billion pounds of copper. Based on MGN's enterprise value of only $33.2 million, MGN's silver resource base is currently being valued at less than $0.15 per ounce! To the best of our knowledge, MGN's silver resource base has the lowest valuation per ounce in the entire industry.
Silver prices have been starting to rally big once again over these past couple of days. Silver is now back above $35 per ounce and for MGN's estimated resource to be valued at less than $0.15 per ounce indicates to us that MGN has enormous upside potential.
If MGN is successful at eventually building a mine at the project, MGN expects the project to process 12,500 tons of ore per day and produce 8 million ounces of silver and 60 million pounds of copper annually!
MGN's project has excellent nearby infrastructure including a highway, railway, low cost power, and a large available supply of labor. It is located in one of the most prolific silver regions in the world, at the northern end of a trend extending south to the Coeur d'Alene Silver District, which has historically produced more than 1 billion ounces of silver.
Earlier this year, MGN raised $15.2 million in a private placement at $2.96875 per share. MGN is currently trading at a discount of 35% from where the company raised $15.2 million by offering 5,120,000 shares of its stock to the public.
