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High-Grade Gold, Platinum and Palladium Project in Brazil

Summer 2011

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Volume 14 | Number 3 | Summer 2011 Vancouver, British Columbia www.ReportOnMining.com Planning for Profits - Report on Mining edition is published four times a year by Fusion Publishing Inc. All rights reserved. Any reproduction or duplication without prior written consent of Fusion Publishing Inc. is strictly prohibited. Published by Fusion Publishing Inc. Canadian Office Fusion Publishing Inc. #317 – 1489 Marine Dr. West Vancouver, BC Canada V7T 1B8 1.888.925.0313 (Toll Free) USA Office Fusion Publishing Inc. 145 Tyee Dr. Pt. Roberts, WA USA 98281-9602 1.888.925.0313 (Toll Free) Publisher Terry Tremaine

There certainly has been considerable volatility in the market since our last edition. The issues affecting the world somehow seem more dramatic than in the past, especially when you consider the result of constantly evolving and improving communication technology. We are privy to everything not just after the fact, but as events actually unfold. That was made perfectly clear to me while in Kenya watching as a Masai warrior climbed a tree to get better reception for his cell phone. Though volatile as commodity pricing is, most are at historic high points with signs pointing to continuing increases. The market continues to maintain healthy levels with expectations of more to come. Silver is a case in point, currently trading at historic highs. In this issue James DiGeorgia, frequent contributor and long-time gold advocate, makes the case for $50 silver. As we go to press Colossus Minerals Inc., our cover feature, is announcing even more significant finds. It’s certainly exciting out there. Personally I enjoy it and would wish for nothing less.

Associate Publisher & Editor Connie Ekelund Production Manager Christie Smith Contributing Editors Robert Setter Account Managers 1.888.925.0313 Terry Tremaine Maureen O’Brien Marie Richards Garry Farris

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Publication Mail Agreement #41124091 Circulation & Distribution Canada Post Distacor Inc. Newsstand Digital Non-deliverables please return to: Fusion Publishing Inc. Report On Mining Magazine #317 - 1489 Marine Drive West Vancouver, BC Canada V7T 1B8 Subscriptions: 1 year $14.95 in Canada (+$8.00 in USA) 2 years $28.00 in Canada (+$16.00 in USA) 1.888.925.0313 x1001 info@ReportOnMining.com www.ReportOnMining.com Free Digital Subscription www.reportonmining.com The information in Planning for Profits - Report on Mining has been carefully compiled from sources believed to be reliable, but its accuracy is not guaranteed.

Cover Story 4 10

Colossus Minerals Inc. Base Metals & Gold 2010 Acquisitions by Metals Economics Group

South America 12

Cancana Resources Corp.

14

Merger Markets by Divya Balji and Ron Mandel

New Producers 16

Argonaut Gold Inc.

18

$60 Silver – The Next Leg Up by James DiGeorgia

North America 20

Endeavour Silver Corp.

24

Stability and certainty key to a thriving mining industry by Jean-François Minardi

26

Xtierra Inc.

28

Pipeline Activity Index by Metals Economics Group

www.ReportOnMining.com On the cover: Colossus Minerals Inc.

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Summer 2011 | Planning for Profits | Report on Mining 3


The Company is lead by Mr. Ari Sussman, Chairman and Chief Executive Officer. Mr. Sussman has focused much of his career in the natural resources industry in Latin America, playing a key role in finding funding for, and in developing, high grade mining assets. In April of this year Mr. Sussman discussed the future of Colossus Minerals, upcoming events, the high grade resource asset and his outlook for the metals markets.

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olossus Minerals is a Canadian-based development stage mining company focused on bringing into production the high grade Serra Pelada gold, palladium and platinum project, located in the Carajas region of Brazil. As sole operator, Colossus has earned a 75% stake in the venture company that controls Serra Pelada. This region has a storied past highlighted by the largest precious metals rush in Latin American history. Colossus Minerals is in great shape with over $100 million cash on hand and is poised to reach its goal of bringing the mine into production by 2012. Trading on the TSX under the symbol CSI, Colossus has a market cap of $876 million with 104 million shares outstanding as of April 2011.

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History The traceable history of the property goes back to 1979 when legend has it that a farmer found a 600 gram per tonne gold rock in the area where the mine is now located. Based on that finding a mad staking rush followed. The property was held by the Brazilian government and Vale S.A. in what was then a remote area. The region has since been developed to encourage and facilitate economic growth with the presence of major deposits of iron ore, copper and gold leading to a huge employment opportunity in this previously poor area. The Brazilian government and Vale S.A. oversaw pit operations and determined which of the locals could surface mine by granting them concessions using a lottery draw system. It was eventually shut down due to flooding in the open pit area but not before an estimated 2 million ounces of gold was taken. A registered Brazilian cooperative company, COOMIGASP was granted an exploration license by the Ministry of Mines & Energy in March, 2007. The 100 hectare license is centered on the Serra Pelada pit.

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“We stepped in July 2007,” explained Mr. Sussman. “There was an open bid on a public tender to earn a 75% interest. We took the chance and were awarded the contract. Not that many big players were interested in bidding as it was thought to be a mess at that time. We can clearly see that our risk has paid off. From 2007 until today we have made great strides; just consider that we are now fully permitted on both the environmental and mining side and are planning to open an operating mine with gold production next year.” Jurisdiction In Mr. Sussman’s view, the Brazilian government has done a great job of protecting foreign investment. “Brazil is likely one of the top four foreign countries in which to do business. There is bureaucracy to some degree, things can move slowly at times but they do move.” With politics centre left, the Brazilians are a proud people and very much want to be involved. “It is not a country you can bring in non-nationals to work. Foreign miners don’t make up a large percentage of the companies operating there. Colossus management sees very low risk to any attempt at nationalization by the Brazilian government.” Mr. Sussman summed up by saying that, “The laws are clear, just stick to them; others have been successful in Brazil.”

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Results Drill results continue to be spectacular if not unexpected. Results released on March 24, 2011 included these highlights of 136.43 g/t gold, 249.20 g/t platinum and 121.40 g/t palladium over 7.81 metres in extensions of the central mineralized zone. Additional previously drilled holes include SPD 034 with 53.59 g/t gold, 20.77 g/t platinum and 41.3 g/t palladium over 70.70 metres. In terms of establishing the resource Mr. Sussman stated, “We’re not that close but this is a classic high grade problem that has traditionally existed in mining resource estimation of this nature. In high grade scenarios such as ours, drill spacing must be very tight in order to get an accurate estimate. In this case, tight drilling with five metre spacing just isn’t feasible from surface — which is why we are aggressively moving forward with the underground decline. To get an idea of the potential size of the resource, consider that the historic open pit produced in excess of 2 million ounces.”

Summer 2011 | Planning for Profits | Report on Mining 5


Emboque, December 2010

Stock Price Based on the excellent drill results alone, the stock price may be considered a bargain at under $10 per share. The share price has been range bound for the past year despite eye catching drill results and the excellent progress to date. Mr. Sussman had some thoughts, “It could be investor fatigue since 2010 saw few news releases and was largely a permitting year. We were admittedly quiet last year but we achieved our goals with respect to the permits and are ready to go.” Mr. Sussman went on to suggest that with all the positive activity at the mine site, news could be released as frequently as every four-six weeks through the rest of 2011. “This will put Colossus back in the public eye and could lead to a breakout in the share price at some point in the year. The share price short term will be news event driven but we are going to be in production next year so the valuation bump from that is certainly coming.”

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Gold Less than 1% of total global investment is currently in gold. Mr. Sussman believes that gold will go much higher over the next decade for a number of reasons. World currencies are flawed and inflated with printing presses going strong creating increasingly worthless paper money worldwide. Secondly, there has been too much leverage and borrowing and governments seem bent on repeating past economic mistakes. Thirdly, most people still do not own any physical gold. Mr. Sussman mentioned he had recently been on a gold investment panel conference call with some big name gold analysts yet only 300 people were in attendance. Platinum/Palladium Mr. Sussman was just as bullish if not more so on platinum and palladium, “It is easier to quantify the case in terms of supply and demand. Much of the current production comes from South Africa which has issues that crop up from time to time that disrupts the supply side. With the middle class of India and China growing, the demand for autos will naturally increase with that. Auto manufacturing is the final destination for much of the platinum and palladium production.” Looking to the future, Mr. Sussman asserted, “Like the run in silver now, I can see the time coming when platinum and palladium will also be viewed as precious metal currencies and demand will rise from that shift as well.” Management Working alongside Mr. Sussman, a key member of the Colossus team is Randy Reichert, President and Chief Operations Officer. Mr. Reichert is a proven mine builder with over 25 years experience in mine operations. In his career previous to joining Colossus, Randy acted as COO with Orsu Metals. A list of recognized mining names rounds out his resume including Bema Gold, Kinross Gold and Cominco (Teck). While with Kinross, Mr. Reichert was the General Manager of the Julietta and Kupol Mines.

Dr. Vic Wall is on board as the Vice President of Exploration. Dr. Wall is a geologist with 35 years experience and is very well known in the mining industry. He has research and exploration experience with a number of major and junior mining companies and is among the best at analyzing geological formations. Dr. Wall won the Goldcorp challenge in 2001 for his work in developing innovative modeling techniques for precious metals minerals systems. Another key member of the Colossus team, Dr. Augusto Kishida, brings 35-plus years of experience in mining. Dr. Kishida is acknowledged as a leader in understanding the Brazilian Archean Greenstone Belts. Dr. Kishida has previously been involved with important gold deposit discoveries such as the one currently being mined by Yamana Gold among others. The most recent addition to the team is Chief Financial Officer, Claudio Mancuso. He is a chartered accountant with over 10 years experience in the mining industry and capital markets. Mr. Mancuso held the VP Treasurer position at Agnico-Eagle before joining Colossus. Last but not least, Ann Candelario, Vice President of Investor Relations, comes to Colossus with two decades of investor relations and communications experience. Her knowledge and expertise are greatly valued by the Colossus team. Summary Colossus is unique for several reasons, but of special note is that the gold by-product is platinum and palladium. This is significant since the cost of mining the gold is likely to be very low, perhaps even zero as the by-product metals offset the costs of gold production in a significant way. Mr. Sussman pointed out that, “It is not complicated to separate these metals from the gold and current plans call for production of a PGM concentrate in year two of production.” Colossus has an enviable ore body with all permits in place, cash on hand sufficient to get the mine to production, and a low tonnage high grade mining scenario. Considering these factors in a rising precious metals environment leads to the conclusion there is much upside yet to come for Colossus Minerals. For additional information go to colossusminerals.com, or for securities related data, go to sedar.com.

Colossus Minerals Inc. Ann Candelario, VP Investor Relations One University Avenue #401 Toronto, ON, Canada M5J 2P1 Phone: 1.416.643.7655 Email: acandelario@colossusminerals.com www.colossusminerals.com TSX: CSI Year Hi/Low: $9.87/$6.20

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Summer 2011 | Planning for Profits | Report on Mining 9


Metals Economics Group Strategic Report: Base metals and gold 2010 acquisitions spending totals $50.7 billion

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he 2010 dollar volume of large ($25 million minimum) acquisitions totalled $50.7 billion — the third-highest annual total in ten years — a whopping increase of 260% over 2009’s $14 billion, and 23% over 2008’s $41 billion. According to Metals Economics Group’s (MEG) recent Strategic Report, the 2010 total signifies a general return of confidence to the industry after a period of significant strategic retrenchment and caution due to the worldwide recession and sharply lower metals prices that began in late 2008 and lasted into early 2010.

Data analyzed from MEG’s Acquisitions Service shows a very significant rebound in both base metals and gold acquisitions spending. The total price paid in base metals deals (copper, nickel, and zinc) increased 220% to $21.8 billion in 2010 (43% of the year’s total), and gold jumped 298% year on year to a historical high of $28.9 billion (57% of the 2010 total).

Figure 1: Base Metals and Gold Acquisitions Dollar Volume, 2001-2010

Data source: MEG Acquisitions Services © Metals Economics Group, 2011 10 Planning for Profits | Report on Mining | Summer 2011www.ReportOnMining.com


Distribution of the 66 base metals acquisitions targets considered in 2010 (Figure 2) is almost even among all regions; however, Africa dropped from 22% of 2009’s total acquired base metals in-situ value to 7% in 2010. The acquired value of reserves and resources in 2010 base metals transactions totalled $668.4 billion, with copper company and project acquisitions accounting for $371.4 billion of the total. Each region, except for Europe, hosted at least one very large deal in terms of in-situ value.

Of the 60 primary gold transactions (Figure 3), the AustraliaPacific region was tops with ten deals containing $75 billion of in-situ value — 33% of the $222.7 billion gold total. It was followed closely by North America (mostly Canada) with 11 transactions accounting for 31% of the total. The price paid as a percentage of in-situ value in 2010 averaged 13% for the 60 gold deals — a 71% increase over 2009. The most expensive region for gold acquisitions was Africa at 26.9%. The least-expensive region for acquiring gold in the ground was North America, with prices averaging only 3% of in-situ value.

Figure 2: Base Metals Acquisitions by Region, 2010 (Total in-situ value acquired = U.S. $668.4 billion)

Figure 3: Gold Acquisitions by Region, 2010 (Total in-situ value acquired = U.S. $222.7 billion)

Data Source: MEG’s Economic Service ©Metals Economics Group, 2011

MEG’s Acquisitions Service gives clients a competitive edge by reporting and analyzing current and historical transactions involving advanced-stage base metals and gold projects, operating mines, and companies. MEG’s Strategic Report provides informed, insightful analysis for mining industry planners, analysts, executives, and exploration managers. Published since 1982, the Strategic Report draws on MEG’s wealth of knowledge and insight in a bimonthly compilation of timely, informative, and analytical articles on critical supply-side issues facing the global mining industry. In addition to original research, articles are drawn from MEG’s flagship MineSearch database, Corporate Exploration Strategies, Reserves Replacement studies, and Acquisitions and Exploration Activity services.

www.ReportOnMining.com

Summer 2011 | Planning for Profits | Report on Mining 11


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ancana is a junior Canadian TSX Venture Exchange listed company (V.CNY) involved in mineral exploration in Brazil and Canada. Initially in diamond exploration and production, the Company is now expanding into manganese production and exploration. The Company retains its interest in its diamond property in Brazil as well as an interest in a gold property in B.C., Canada.

Cancana is arranging financing for the development and expansion of existing assets and the purchase of an interest in producing manganese operation in Brazil. Cancana’s objective for the past year has been to review and analyze existing projects as well as seek new opportunities that will enhance shareholder value and provide near term cash flow.

Cancana has embarked on a structure that focuses its efforts on the following breakdown of projects: Producing

Near Team

Exploration

Projects with existing revenue and a Projects with near team production Projects that are long range in nature proven resource with an exploration possibility, while maintaining an having shown promise for proving a step-out opportunity exploration opportunity. resource of land banking

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In concert with this strategy the Company plans to access pure exploration opportunities on a step-out basis. All of this provides for a qualified mix of projects that fit well with the objectives of the Company. Brazil Mining Overview Brazil is the third largest country in the Americas after the U.S.A. and Canada, and has the world’s ninth largest economy. Brazil is the world’s largest exporter of niobium, tin, lithium, tantalum and gemstones. Bauxite, gold, manganese, among other primary mineral products, also contribute positively to mineral export revenues. Cancana’s Projects Cancana has established a strong mix of projects that encompasses commercial opportunity along with exploration and development potential. Primarily focusing on Brazil, these projects afford the Company the ability to have kimberlite and alluvial diamond exploration and production, gold exploration and production as well as manganese exploration and production. These projects are in various stages and the following brief on each project will help describe the type and status of each project. Diamond Interests Cancana has agreed to partner with Amazon Resources, a UK-based company, on its projects. These include the Paraúna alluvial diamond and gold project (Paraúna), which is located in the Minas Gerais State of Brazil north of the city of Belo Horizonte. Cancana has an 80% interest in the Carolina kimberlite claim in Espigao, Rondonia. www.ReportOnMining.com 

Manganese, Diamond and Gold Interests Cancana has been acquiring manganese claims and now holds over 12,000 hectares. Cancana recently announced that it will seek a trial mining license on three of these claims and commence operations. Along with the process of going into trial mining, Cancana has been seeking already producing manganese mining operations and has secured Letter of Intent and Heads of Agreements with two companies to date. Cancana has acquired a 75% interest in a further five mineral claims containing diamond kimberlites and gold on 27,000 hectares. Cancana also has an interest in the Dash Property located 105 kilometres northwest of Lillooet, B.C. and has potential for gold, silver and zinc mineralization.

Cancana Resources Corp. Sun Life Plaza, West Tower Suite 1600 144 - 4th Ave S.W Calgary, AB, Canada T2P 3N4 Tel: 1.604.561.0840 Email: andrew@cancanacorp.com www.cancanacorp.com TSX.V:CNY Year Hi/Low $1.50/$0.40 Summer 2011 | Planning for Profits | Report on Mining 13


Markets continue recovery; mining sector gives strong showing by Divya Balji and Ron Mandel

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he uptick in M&A activity in the mining sector in the first quarter of 2011 has given industry experts a taste of what’s to follow for the rest of the year. With the world economy mostly recovered from the credit crunch, capital and credit markets have opened up and financial institutions have loosened their lending purse strings. Stronger commodity prices and valuations in the industry have brought more willing sellers to the table. Mining companies are also looking to spend the cash accumulating on their balance sheets as a result of the strong worldwide demand for commodities.

Following a sluggish first half of 2010, the second half of last year saw an introduction to “mega” multi-billion dollar deals with Kinross’ Canadian $7.16 billion purchase of Red Back Mining and the failed Canadian $41.9 billion bid for Potash Corp. of Saskatchewan by BHP Billiton. “We started to see some large deals last year and that momentum continued and increased in 2011,” said Jeffrey Lloyd, Partner at Blake, Cassels & Graydon LLP.

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The energy, mining and utilities sector dominated the top Canadian M&A deals, by contributing to 74% of total deal value in Canada during the first quarter of 2011, with a total value of U.S. $16.8 billion, according to Mergermarket data. By deal count, this sector had 29 deals and represented 35.4% of all transactions for the same time period. The mining sector on its own saw a total of 14 deals, excluding lapsed and withdrawn deals, with a total value of U.S. $8.6 billion. Amidst the plethora of “good-sized” M&A transactions in the first quarter of this year, Canada saw a series of “domino-type deals” occur as well, Lloyd said. This was jumpstarted with the proposed merger between copper, nickel, lead and zinc producing Lundin Mining and copper, zinc and gold producing Inmet Mining announced in January. A month later, Equinox Minerals stepped in and made a U.S. $4.6 billion rival offer for Lundin. China-based Minmetals then decided to step in and made a U.S. $6.5 billion offer for Equinox which fell to the wayside when Equinox signed a definitive agreement to be acquired by major gold producer Barrick Gold for U.S. $7.5 billion and called off its bid for Lundin. “We have seen some significant activity [and] expect to see a heightened pace of deal activity in mining. We anticipated we would see record activity [and the] first quarter supported that. As western economies recover and developing economies grow, the mining M&A trend will continue through the year,” said John Nyholt, Partner and National Leader of Transactional Services at PricewaterhouseCoopers. Commodities that stood out include copper, gold, iron ore and coal, Lloyd and Nyholt said. Gold companies are looking to increase their reserve base through acquisitions and iron ore and copper companies are trying to feed the growing demand from developing nations, Nyholt explained. Companies with a focus on these commodities will see a heightened amount of activity. However, Nyholt cautioned that gold companies have become more expensive due to sky-high valuations and rising gold prices and this could dampen their appetite for M&A within their sector. Potential acquirers of gold companies could sit on the sidelines for the time being, Nyholt added. Despite the ongoing construction of nuclear power plants in China, the nuclear disaster at Fukushima, Japan following the disastrous tsunami earlier this year has had power generation companies re-thinking that coal could be the safer alternative from nuclear for power generation. This could increase the demand for thermal coal but in turn negatively affect M&A activity in the uranium space, as companies will now have a “wait and see” stance with regards to acquisitions, Nyholt noted. This has also affected uranium price, which peaked at about U.S. $75 per pound for uranium oxide, and is now trading at about U.S. $55 per pound. www.ReportOnMining.com 

Another interesting development has been the increase in spin out transactions by smaller mining companies with both gold and base metal assets. A number of these companies are spinning out their gold or base metal assets into separate pure play companies in order to maximize shareholder value, Lloyd noted. Recent examples of these types of transactions include Silver Standard Resources’ spin out of Pretium Resources in the fourth quarter of 2010 and the proposed spin out by Minera Andes of its Los Azules copper project. The mining sector is truly becoming a global market and industry experts are on the lookout for more cross border M&A transactions. Asian companies are looking to participate in outright purchases of Canadian mining companies when previously, they were simply content with forming joint venture and strategic partnerships and minority stake buys, Lloyd explained. Minmetals Resources’ failed takeover bid for Equinox was a strong indication that Chinese entities are very focused on aggressively growing by acquisitions, Nyholt added. He also sees indications that Indialed M&A activity in the mining sector is becoming more visible, Nyholt said. Canadian mining companies that are currently listed on the Toronto Stock Exchange (TSX), could look at a secondary listing in Asia given the increased interest in investing from that region, Lloyd said. On the flip side, because of the depth of mining expertise in the Canadian investment community, foreign mining companies could either consider an IPO or a secondary listing on the TSX as well, Lloyd added. The mining sector, one of the hardest-hit during the 2008-9 economic recession, has rebounded strongly, fuelled by strong demand from developing countries and firm commodity prices, and looks set to post a year of strong M&A activity in 2011. This activity is expected to continue on the upward trend of all deal sizes, including more mega multi-billion dollar deals, spin-offs and secondary listings on the TSX and in Asia.

Summer 2011 | Planning for Profits | Report on Mining 15


Creating the Next Quality Mid-Tier Gold Producer in the Americas A

rgonaut Gold Inc. (“Argonaut”, TSX: AR) is a Canadian gold producer focused on the Americas with a current portfolio of 100% owned projects located in Mexico. These projects include the producing El Castillo mine (Durango, Mexico), the San Antonio development stage project (Baja California Sur, Mexico), the past producing La Colorada mine (Sonora, Mexico) and the La Fortuna advanced stage exploration property (Durango, Mexico). The total of Measured and Indicated Resources (“M&I”) for the company exceeds 5.3 million ounces, with more than 600,000 ounces in an inferred resource. The company also holds exploration properties along the Mojave-Sonora Megashear in the state of Sonora, Mexico. Argonaut was formed and is operated by an experienced management team with a long history of creating value for their shareholders. This team includes key personnel from Meridian Gold and New Dimensions.

San Antonio Development Project San Antonio became part of the Argonaut portfolio of projects thru the acquisition of Pediment Gold, completed in January of 2011. The San Antonio project is located near the historic mining town of San Antonio, 40 kilometres southeast of La Paz. A 2009 National Instrument 43-101 compliant technical report shows an M&I Resource of more than 1.2 million ounces of gold. This resource consists of mineralization in two pits, the Las Colinas and Los Planes pits. In 2010, a 36,000 metre drill program was initiated between the two pits. Initial results from this drill program indicate mineralization exists, a new technical report incorporating these results will be released in the second quarter of the 2011. Furthermore, the land package at San Antonio includes more than 48,000 hectares, providing additional exploration potential surrounding the current known resource.

Argonaut’s Cornerstone, Increasing Production at the El Castillo Mine El Castillo is a heap leach gold mine located in the state of Durango, 100 kilometres north of the state capital. El Castillo hosts 1.23 million ounces of Proven and Probable Gold Reserves (“P&P”) and 1.7 million ounces of M&I (which includes P&P). In just one year since acquiring the El Castillo mine, Argonaut invested $15 million in infrastructure into the mine in order to increase production from a 25,000 ounce run rate to a 72,000 ounce run rate. A $5 million investment in drilling and land purchases during 2010 provided for a gold resource increase from less than 600,000 ounces ore remaining to more than 1.7 million ounces at a .15 g/tonne cut-off. In 2011, Argonaut estimates 70-75,000 ounces at $575-$600 cash cost. During 2011, the East Side Processing Plant will also be commissioned as Argonaut builds for the future.

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Past Producing La Colorada Project From 1994 to 2002 La Colorada was operated as an openpit, heap-leach mine, producing approximately 353,000 ounces of gold and 1.2 million ounces of silver. During these years, mining took place on the El Creston, La Colorada and Gran Central mineralized zones. The overall historical strip ratio was approximately 3:1, with an average grade of 1.04 g/t gold and 17.07 g/t silver. The reported recoveries were 70% for gold and 15% for silver. Approximately 30% of the ore was run of mine (“ROM”) with the remaining material being crushed to one inch minus and stacked on a separate leach pad from the ROM ore. Mining ceased in 2001 due to low gold prices. As of November 30, 2009 there were 605,000 ounces in M&I with an additional 582,000 ounces in inferred resources. Drilling in 2011 will focus on converting the ounces in an inferred category to an M&I category. Ongoing Growth In 2011, Argonaut has a $6 million drill program focused on expanding resources at all three of these properties, as well as a program at our La Fortuna property. • El Castillo (1,500 metres) to drill core samples in order to perform metallurgical recoveries • San Antonio (10,000 metres) aimed at following up on intermediate zone between two previously defined pits • La Colorada (19,000 metres) aimed at defining and converting inferred resources to a M&I category • La Fortuna (1,000 metres) aimed at testing earlier identified targets In addition to our extensive drill program, Argonaut continues to evaluate additional acquisition opportunities within the Americas. Implementing the same strategy for unlocking additional value such as has been achieved at El Castillo, Argonaut’s strategy is focused on combining assets with a new source of capital resources and experienced personnel in order to maximize operational synergies, ramp up production and therefore increasing the overall value of the combined entities. www.ReportOnMining.com 

Please refer to sedar.org or www.argonautgoldinc.com for full N.I. 43-101 reports aforementioned.

Argonaut Gold Inc. Nichole Cowles 9604 Prototype Court Reno, NV, USA 89521 Phone: 1.775.284.4422, ext. 101 Fax: 1.775.284.4426 Email: nichole.cowles@argonautgoldinc.com www.argonautgoldinc.com TSX: AR Year Hi/Low: $5.48/$2.32

Summer 2011 | Planning for Profits | Report on Mining 17


$60 Silver – The Next Leg Up By James DiGeorgia, editor, Gold & Energy Advisor

I

started recommending silver at the same time we started my Gold and EnergyAdvisor.com when silver was exactly $7 per troy ounce. We have done many updates and reports on silver since 2004, including a full issue in August 2008 when silver was trading for $13 an ounce. Since that recommendation to buy on the pullback, silver is up almost 200%. Silver does has unique variables that will help it move higher:

• Silver does have industrial uses and applications including its use in solar panels, silver-zinc batteries, and other emerging technologies. The jewellery and silverware sector is the second largest user of silver, and then photographic industry. • The rebuilding of Japan will boost the demand for silver. • Silver is a by-product from copper, lead, and zinc mines. Mining supplies are projected to grow slowly, and probably not as fast as demand.

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Below is the trend from world silver supply and demand: World Silver Supply and Demand

• Once gold broke out silver was able to make new highs for about two months, and with over a 20% gain. • Since the breakout, gold is up over 40%. Here is a long-term chart for silver: Silver (COMEX) – Monthly Continuation OHLC Chart

Notice that demand from photography is down substantially because of digital photography, but demand from coins, medals and investment is growing dramatically. Investors are still underinvested in gold and silver. We think investment advisors will continue to recommend diversification into gold and silver, and investment demand will continue to grow. • Now that gold has risen from $250 to over $1,400, some investors prefer silver because they can buy more ounces with their investment dollar. Because of its lower price, silver may outpace gold and oil price performance. • Investors will continue to diversify into safe havens like gold and silver. • Silver is close to breaking out of long-term resistance. We saw that once gold broke out of its long-term resistance there was no longer selling, supply and gold was able to make historic new highs for about two months. Here is a chart of gold since its breakout: GC-Gold (COMEX) – Weekly OHLC Chart

Let’s review the chart: • Gold made a historic high in 1980 at $1,000. There was major resistance at $1,000. • Notice that gold had a tough time getting through resistance, and it took over a year to break out. The financial crisis saw massive selling in all assets, so the breakout of gold was delayed. We doubt silver will have the same delay. www.ReportOnMining.com

Silver did spike to the $50 area when the Hunt brothers tried to corner the silver market in late 1979 to January 1980. Silver is within striking distance of its historic high. Currently silver is around $37. I believe silver can behave like gold and break to new highs and can gain another 20% to the $60 area. This could be a potential 62% move from current levels. I believe this could take 12 to 18 months. Investors still have time to get into silver before it reaches resistance and breaks to historic highs, similar to the price action of gold. Summary Here are the many reasons to consider silver as an asset: • Like gold, silver is a hard asset that acts as an investment haven during times of economic uncertainty. • Rising investment demand. • Silver has a low to negative correlation to most financial assets like stocks and bonds. • Rising costs to find and produce silver. • Silver does have industrial uses and its industrial demand will probably increase with the rebuilding of Japan. • Inflation threats. • Geopolitical threats, especially from the Middle East. • Falling dollar. • Investors and speculators are favouring silver because they can buy more ounces with their investment dollar. • Silver can break out to new historic highs and has the potential to provide significant appreciation, similar to the price action of gold. Like gold, we recommend silver pieces. In times of crisis, like in Japan, Egypt, and Libya, it is better to barter with a gold or silver piece versus an electronic entry in your brokerage account. Summer 2011 | Planning for Profits | Report on Mining 19


NYSE: EXK TSX: EDR Frankfurt: EJD

E

ndeavour Silver Corp. is a Canadian based mid-cap mining company producing silver with gold as a by-product from two mining operations in Mexico. The company has 82 million shares issued, 92 million shares fully diluted, and is strong financially with more than U.S. $100 million in working capital at year-end. Endeavour grew its silver production by 26% in 2010 to 3.3 million ounces plus it produced 17,713 ounces of gold. Endeavour Silver is listed on the TSX under the symbol EDR, on the NYSE under EXK as well as the Frankfurt exchange under EJD. The Company has posted an impressive six straight years of production increases and seven straight years of reserve and resource growth since acquiring its first silver mine in 2004. Endeavour continues to aggressively pursue its goal to become a premier mid-tier silver producer by expanding its two existing silver mines in Mexico coupled with an aggressive acquisition program in Mexico and elsewhere in Latin America.

Getting Started Back in 2002, Chairman Bradford Cooke observed that the gold price was on the move but the silver price was still flat on its back. Given that historically wherever gold goes silver follows, he recognized that a career opportunity may be staring him in the face. Mr. Cooke gained control of a TSX Venture shell company and together with President Godfrey Walton began the search for precious metal opportunities in Mexico. As Mr. Cooke, recalls, “We started off by looking at numerous, high grade, narrow vein prospects marked by small historic Spanish diggings up in the heart of the Sierra Madre mountains.� But the pair quickly realized this approach was not serving them well, so in late 2003 they changed course and started looking for operating silver mines in established mining districts with process plants that were fully built and permitted but were about to close for lack of ore.

Jumbo drill inside Porvenir Mine.

20 Planning for Profits | Report on Mining | Summer 2011 

www.ReportOnMining.com


Top: Guanajuato Plant; Bottom Left: Guanacevi silver pour; Bottom Right: Guanajuato ore conveyor.

Immediately they started seeing more interesting opportunities. A small silver mine and surrounding property located at Guanacevi, Durango appeared to hold strong exploration promise and was up for sale. The only hitch was that another company had already made an offer but when that deal collapsed, they moved in. By January 2004, they agreed to the asking price of $7 million and in May 2004, Endeavour signed the final contract to acquire the Guanacevi mines and plant. The Company was now in the silver mining business. Endeavour’s first deal also introduced Cooke and Walton to Industrias Peñoles, the largest Mexican mining company, who held mining properties in Guanacevi. After negotiating the purchase of several Peñoles properties in Guanacevi, Cooke and Walton enquired about possible acquisitions in other silver mining districts controlled by Peñoles. In the summer of 2007, Endeavour Silver purchased its second producing silver mine, complete with a fully built and permitted process plant, in close proximity to the city of Guanajuato, Mexico. As a result of these two transactions, Peñoles became the largest shareholder of Endeavour with 2.8 million shares (3%).

www.ReportOnMining.com 

Building a Management Team As the Chief Executive Officer, Mr. Cooke was quick to point out the importance of building a management team of people who have done what he wants to do and been where he wants to take Endeavour. The core management group in fact has a combined 150 plus years of direct mining experience to draw on. This has been the main reason why Endeavour has built an enviable track record not only of growth but of doing what they say they are going to do. Mr. Cooke detailed his leadership role as encompassing three main components. His first job is to get the Endeavour story out to the investing public, secondly to raise the required financings to move the Company forward to its goals, and perhaps most critically, finding new mining opportunities and negotiating those deals. Endeavour Silver’s President and Chief Operating Officer, Godfrey Walton, oversees the day to day operations of the Company. Other key members of the team include Dan Dickson, Chief Financial Officer; Dave Howe, Vice President of Operations in Mexico; Barry Devlin, Vice President of Exploration; Hugh Clarke, Vice President of Corporate Communications; and Miguel Ordaz, Legal Representative and Projects Director in Mexico. All have played key roles in the success of Endeavour Silver.

Summer 2011 | Planning for Profits | Report on Mining 21


Creating Value Endeavour has not only grown its silver reserves/resources and production each year, it has also driven its cash costs down for three consecutive years and is forecasting this trend to continue. Mr. Cooke explained that, “Overall we have successfully identified and corrected inefficiencies and have improved productivity as we have moved forward. At this time we are benefitting from economies of scale as we continue to grow the operations and we also benefit from our rising gold revenues, which act as a credit against our costs to produce the silver. We are heading for $5 cash cost per ounce in the long term.” In the last quarter of 2010, cash costs were $4.72 per ounce, suggesting the longer term goal is within reach. As a result, the Company posted its fifth consecutive year of financial outperformance and its first ever year of net earnings in 2010, U.S. $7.2 million or $0.11 per share. Profit margin tripled and operating cash flow jumped 167% to U.S. $32.7 million. Operating profit margin has gone through the roof in recent months. With cash costs in the mid U.S. $5 per ounce range and the silver price north of U.S. $35 per ounce, Endeavour could easily be looking at that level of earnings per quarter in 2011. Mr. Cooke asserted, “This will be a transformational year as Endeavour seeks to double the size of the Company through organic growth and some key acquisitions.” Endeavour is forecasting 3.7 million ounces of silver production for 2011 plus 19,000 ounces gold as compared to 3.3 million ounces silver and 17,000 ounces gold in 2010 by expanding the Guanajuato plant from 600 tonnes to 1,000 tonnes per day. Several exciting new exploration projects will be drilled this year as the hunt for new discoveries heats up. Working in Mexico Mr. Cooke likes the jurisdiction Endeavour is operating in, stating, “Mexico is a good place to do business.” Nowadays, mining companies are forced to look for new mines in farflung locations that may be prospective for metals but are definitely not their first choice from the political risk point of view. Therefore risk management has become important even for the early stage explorers. As Mr. Cooke put it, “Mexico is attractive because mining has been in the culture for 450 years; it is not just tolerated but is widely understood and encouraged by the general population. So there is little social resistance, an attractive social infrastructure, and a good reliable work force.” Mr. Cooke acknowledged that the war on drugs is a concern because of the collateral damage it can cause but was quick to point out that Endeavour has not experienced any direct negative impact from the drug trade. Endeavour’s strategy is not to have weapons at the mine or with security. He explained that the Company cultivates strong local community relations so that it is seen as a locally based entity and employer rather than an outsider coming in to exploit the people and the land. The vast majority of Endeavour’s 800 employees are Mexican. 22 Planning for Profits | Report on Mining | Summer 2011 

Bullish on Silver Mr. Cooke believes the spot price for silver will continue to track gold, fall behind from time to time and then play catch up. Short term, he is looking for a correction soon, which should allow these two metals to consolidate their gains of the past few months and set up the market for new highs in the fourth quarter of 2011. Based on the 1980 gold top of $800 and an inflated U.S. dollar, Mr. Cooke sees gold approaching U.S. $2,500 per ounce before the current cycle peaks. And based on the historic gold to silver ratio of 16:1, that would suggest a silver price peak in the U.S. $150 per ounce range for this commodity cycle. In terms of where we are in the cycle, he suggested 2012 was probably too soon to see a top but was expecting a very robust year nonetheless. Underlying global factors include the devaluation of major currencies, such as the U.S. dollar spiral as America seemingly attempts to inflate their way out of massive amounts of debt. Rising investment and electronic demand is not being offset by new mine supply so the silver price still has strong fundamental reasons to go higher. Rising Share Price Mr. Cooke was conservative but bullish on the potential for the share price although he preferred not to speculate it. He did say that, “Our share price will certainly reflect the bullish silver price environment which is good for all silver producers. What sets Endeavour apart from our peers is our aggressive growth outlook, our management depth, financial strength and share structure, all of which create great leverage to much higher cash-flow and earnings going forward.” The Company’s website at www.edrsilver.com and public filings at www.sedar.com provide additional detailed information on its properties and other related documentation with respect to the Company and its mining operations.

Endeavour Silver Corp. #301-700 West Pender St Vancouver, BC, Canada V6C 1G8 Phone: 1.604.685.9775 Fax: 1.604.685.9744 Email: hugh@edrsilver.com www.edrsilver.com NYSE: EXK; TSX: EDR; FSE: EJD Year Hi/Low: $10.33/$3.07

www.ReportOnMining.com


www.ReportOnMining.com 

Summer 2011 | Planning for Profits | Report on Mining 23


Stability and certainty key to a thriving mining industry Jean-François Minardi

I

n order to attract investment and compete globally, governments must offer sensible, stable mining policies. This is the main lesson from the annual international Survey of Mining Companies published by the Fraser Institute, Canada’s leading public policy think-tank. The latest survey, based on the opinions of mining executives representing 494 mineral exploration and development companies on the investment climate of 79 jurisdictions around the world, shows that Alberta jumped to first from fourth last year and is now the world’s most attractive jurisdiction for mineral exploration and development. Meanwhile, Québec, which ranked number one for three consecutive years, has fallen to fourth place. How can we explain the relative performance of each jurisdiction?

The short answer is: uncertainty. Mining is a highly cyclical and capital-intensive industry, with a long lead time between initial investment and commercial production. The whole process of mineral resource development, from exploration to production, may take up to 15 years. Exploration companies do not have production revenue and therefore must rely on investors who are prepared to support high-risk activities. In short, mining is a very expensive and risky business. For these reasons, global investors will always avoid places where the rules of the game are not clear and predictable; where taxes are subject to sudden increases and public opinion is hostile.

24 Planning for Profits | Report on Mining | Summer 2011www.ReportOnMining.com


The good news is that, when compared to the rest of the world, Canada’s provinces have a high level of certainty. This year, they claimed four of the top 10 spots. Alberta’s resourcefriendly government, competitive taxation regime, and superior infrastructure render the province a standout for mining investment. Saskatchewan, ranked third, has also shown that greater certainty in the regulatory framework can help improve its competitiveness among the world’s jurisdictions. Québec’s relative decline in the Survey is likely due to the fact that mining taxes were raised unexpectedly last spring in the 2010 Québec budget with little, if any, consultation with the industry. Another element of uncertainty has been Bill 79, a bill amending the Mining Act. Opposition parties, environmental NGOs, and municipalities have called for a re-writing of the Mining Act and the government has finally decided to suspend the bill, at least until the next legislative session in the fall. These variables certainly rocked miners’ confidence in the province; however, as long as the situation does not worsen, Québec remains a good place to mine. British Columbia improved slightly, climbing to 36th from 38th last year. The province continues to be viewed poorly, with respondents citing land claims issues, environmental uncertainty, and political turmoil at the provincial level as reasons to remain hesitant about investing in the province.

The state of Nevada ranked second in the Survey and is the top non-Canadian jurisdiction. Finland and Wyoming are also in the top 10. Chile is the only jurisdiction outside North America that consistently ranks in the top 10. Australia generally saw an improvement in its rankings after taking a hard hit in the special Survey of Mining Companies: 2010 Mid-Year Update, following the Australian government’s plan to impose a heavy Resources Super Profits Tax (RSPT) on the mining industry. The Australian government has since announced it would back away from the proposed tax, earning a positive reaction and improved rankings from the global mining industry. The worst performers are Indonesia, Zimbabwe, Wisconsin, Madagascar, India, Guatemala, Bolivia, Democratic Republic of Congo, Venezuela, and Honduras. Unfortunately, except for Wisconsin, these are all developing nations which most need the new jobs and increased prosperity that mining can produce. In these nations there is a high level of uncertainty concerning mining policies and regulations that drive mining investment away. Too often the rule of law is not upheld and negotiated contracts and property rights are not respected. The regulatory framework is unpredictable and sometimes arbitrary. As one miner said in the Survey about Zimbabwe, “Rules change left, right, and centre, and there is no hope of legal recourse.” Miners have to deal with corruption, administrative inefficiency and the risk of a sudden increase of royalties or even nationalization. However, other developing countries have shown that stable and clear regulations, transparency, a well established legal system, secure property rights, an efficient bureaucracy and good mining policy will encourage exploration, which in turn will increase the known mineral potential. A country like Botswana is without a doubt a model to emulate for other developing countries with a mining potential. Its resource wealth, a relatively high level of economic freedom, and good institutions are helping the country to reduce poverty and create prosperity. The result is that it is now in the upper middle income category of the World Bank. The lack of uncertainty in the rules of the game certainly plays an important part in this success story. As one miner said, “Botswana is promining and has efficient bureaucrats, no corruption, reasonable and consistent regulations, and reasonable taxation.” To conclude, uncertainty in developed or developing countries matters because, in today’s globally competitive economy where mining companies may be examining properties located on different continents, a jurisdiction’s policy climate has taken on increased importance in attracting and winning investment. Jean-Francois Minardi is a senior economist with the Fraser Institute’s Centre for Mining Policy Research.

www.ReportOnMining.com

Summer 2011 | Planning for Profits | Report on Mining 25


X

tierra Inc. is a Canadian mineral exploration and development company focused on adding shareholder value through property development in Mexico. Xtierra has three main properties and is planning to go into production at two of its advanced stage projects. The company was formed through a merger between Antamena Capital Corporation, a capital pool company and Orca Minerals Limited. After raising $8.8 million in financing the company was listed on the TSX Venture Exchange in September 2008 and began trading under the symbol XAG.

The stock price has ranged from a low of .10 to a high of .65 over the past 52 weeks and as of May 2011 was sitting in the mid-40 cent range. With average daily volume around 175,000, liquidity is decent especially for investors seeking opportunities to take sizable positions to capitalize on the metals trends in play. With a book value of .24 and a price to book of just 1.8x, the company valuation is attractive as compared to the metals industry average price to book of 3.8x. The Company is led by Terence N. McKillen, an experienced mining business expert. With over four decades of experience Mr. McKillen has enjoyed numerous exploration and development successes. Since 1996, Mr. McKillen has devoted his attention to the financing and development of junior companies. He holds executive-level positions in Conquest Resources, Labrador Iron Mines, and Minco PLC based in the United Kingdom. Photos, top: Stepout core; Bottom, left to right: The Glory Hole, Analysts reviewing the Glory Hole, Ball mill feeding WHIMS. Center: Pilot Plant Ball Mill.

26 Planning for Profits | Report on Mining | Summer 2011 

www.ReportOnMining.com


The Company’s most noteworthy project is the Bilbao deposit containing silver, copper, gold and lead. Production is planned for 2013 and will likely be a combination of open pit and underground mining. The inferred resource estimate has been increased to 120 million ounces of silver equivalent with 26 million ounces of silver alone. As a result, mine life is now projected to be up to 15 years. Recent step out drilling at Bilbao uncovered a new high-grade silver vein that appears to be unrelated to the existing resource. Company management was pleased to announce very impressive numbers as high as 247 grams per tonne silver. They are continuing to drill in that area in order to fully understand how much this strike will impact the overall size of the resource. From 2006 to 2010 over 20 kilometres of drilling took place. Final decisions regarding mine construction will be made later this year once the results of an independent feasibility study are in. At that time, Xtierra will also move forward on financing arrangements and start the permitting process for open pit extraction. Annual production at Bilbao is forecast to exceed one million tonnes of ore with saleable zinc, lead, copper and silver production as well as other metals credits as a by product. As with all of Xtierra’s properties, the Bilbao project has a solid infrastructure and is located in close proximity to highways, electricity and water resources.

It was Minco PLC that provided Xtierra with the Laguna Project. Laguna has the potential to create considerable cash flow for the Company going forward. Located in Zacatecas state Mexico, Laguna is a silver-gold-mercury tailings project that is 100 percent owned by Xtierra. With an indicated resource of 32 million ounces of silver equivalent, including 15 million ounces of silver, it is an interesting project to say the least. The Laguna resource sits under water and has accumulated from five centuries of yearly flooding from gold and silver mines located nine miles upstream from the project. The Mexican National Water Board is the governing body and controls the area, not the mining regulators. Xtierra has already obtained the permits necessary to extract the resource. The Company is currently analyzing options for the most efficient method to use such as suction dredges or damming then draining the area to facilitate the use of more conventional hydraulic mining methods. Xtierra also has the El Dorado property located in the Pinos gold district of the Central Mexican Mineral Belt southeast of the Bilbao site. The Company has an option for a 100% interest in the 3,000 hectare property known to contain a 1-kilometre long gold strike with over a dozen veins. With visible gold apparent, and values up to 50 ounces per tonne gold recorded, this is an opportunity that warrants further exploration. The Company is seeking a high-grade gold and silver vein system as well as mineralization suitable for the set up of leaching operations. The drilling will determine if mineralization exists between the veins. Currently, a local family is mining the area but is only using rudimentary tools for gold recovery. In addition to the Company’s three main properties, Xtierra also has another 12,267 hectares of property surrounding Bilbao they can explore. There is a great deal of unlocked value in Xtierra at this time. In December of last year, Sprott Asset Management purchased a 10% stake in the company, and in doing so gave notice that the company is indeed undervalued with much upside to come.

Xtierra Inc. 220 Bay Street, Suite 700 Toronto, ON, Canada M5J 2W4 Phone: 1.416.362.8243 Fax: 1.416.368.5344 info@xtierra.ca www.xtierra.ca TSX.V: XAG Year Hi/Low: $.65/0.10

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Summer 2011 | Planning for Profits | Report on Mining 27


Metals Economics Group Pipeline Activity Index drops from December high

M

etals Economics Group Pipeline Activity Index (PAI) dropped sharply in January from December’s threeyear high before recovering modestly in February. The PAI’s movement over the past few months follows a typical seasonal trend — increased activity through the latter months of the year followed by a drop in the first few months of the following year as companies resume work after the holiday break. Despite January’s sharp fall from December’s record high, the PAI remains slightly above the 2010 average. MEG Pipeline Activity Index (PAI), March 2011

After reaching $2.36 trillion in December 2010 — the highest since MEG initiated the PAI — the industry’s aggregate market capitalization dipped in January. Metals prices continued to increase helping to lift the aggregate market capitalization to $2.32 trillion at the end of February — less than 2% below December’s high-water mark. The number of significant drill results released in the latest two-month period was slightly lower than the NovemberDecember 2010 period, but still relatively strong compared to 2009 and the first half of 2010. Regionally, the top three destinations — North America, Latin America, and AustraliaPacific — combined to account for more than three-quarters of announcements in both November-December 2010 and January-February 2011. Unlike gold results, which have slowed recently as the relative gold price has more or less flattened over the past five months, significant base metals results remained strong through the holiday season.

Source: MEG Industry Monitor; MineSearch; Exploration Activity Services, © Copyright 2011 Metals Economics Group

28 Planning for Profits | Report on Mining | Summer 2011www.ReportOnMining.com


Significant Junior and Intermediate Company Financings Base Metals Financings

Number of Financings Completed

240

$5,000

200

$4,000

160

$3,000

120

$2,000

80

$1,000

40

Jan-11

Feb-11

Dec-10

Oct-10

Nov-10

Sep-10

Jul-10

Aug-10

Jun-10

Apr-10

May-10

Mar-10

Jan-10

Feb-10

Dec-09

Oct-09

Nov-09

Sep-09

Jul-09

Aug-09

Jun-09

Apr-09

May-09

Mar-09

Jan-09

0 Feb-09

$0

Source: MEG Industry Monitor; Exploration Activity Services, © Copyright 2011 Metals Economics Group

Initial resource announcements by junior and intermediate companies were up from January-February 2010, but still well shy of bimonthly numbers prior to the economic collapse in early 2008. The overall value of initial resources reported in the latest two-month period is up from November-December 2010, with more than 40% of the $28 billion total attributable to the Zafranal project in southern Peru, where AQM Copper and Teck Resources announced initial resources containing more than 1.5 million mt of copper and 870,000 ounces of gold. Of the initial base metals resources announced in January-February 2011, the top three primary copper projects accounted for more than 92% of the total value. The decrease in the number of significant financings completed by junior and intermediate companies in the latest two-month period was the biggest contributor to the decline in the PAI, as both January and February expectedly dropped from December’s peak. The amount raised in January-February 2011 was also below the 2010 bimonthly average of $3.82 billion.

www.ReportOnMining.com

Number of Financings Completed

Amount Raised (US$ mil)

Gold Financings

$6,000

The MEG Pipeline Activity Index (PAI) measures the level and direction of overall activity in the supply pipeline, incorporating significant drill results, initial resource announcements, project development milestones, and significant financings into a single comparable index. The PAI is featured in the MEG Industry Monitor — a series of comprehensive graphs and charts, with related commentary, illustrating MEG’s analysis of monthly changes and emerging trends in the base and precious metals pipeline. Using information only available from MEG through MineSearch, Exploration Activity Services, and Acquisitions Services, the Industry Monitor tracks developments based on announcements over the past 26 months of significant drill results, initial new resources, project development milestones, significant financings, and acquisitions. For more information on the PAI, visit Metals Economics Group’s web site at www.metalseconomics.com. About Metals Economics Group (www.metalseconomics.com) Metals Economics Group (MEG) is the most trusted source of global mining information and analysis. We draw on three decades of comprehensive information and analysis, with an unsurpassed level of experience and historical data. To help our clients reach better decisions more quickly, we supply raw data and sophisticated analysis based on unbiased research and reporting. From worldwide exploration, development, and production to strategic planning and acquisitions activity — our databases and studies help you make confident decisions and, ultimately, improve results. Contact: Nadine Tanner, Director, Marketing, Metals Economics Group, Suite 300, 1718 Argyle St., Halifax, Nova Scotia, Canada B3J 3N6. T: +1 902.429.2880; F: +1 902.429.6593; ntanner@metalseconomics.com.

MEG

Summer 2011 | Planning for Profits | Report on Mining 29


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