On July 3, 2008 Golden Predator announced that it had completed a private placement of 2,500,000 shares at $2.00 per share for proceeds of $5 million.
The private placement was entirely subscribed by Toronto based Front Street Investment Management Inc., a division of Front Street Capital.
About Golden Predator Mines (GP: TSX)
Golden Predator has a number of projects on the go but its Springer Tungsten project is perhaps the most exciting prospect at the moment. The company hope to have the Springer Tungsten mine and a 1300 tpd mill operating by year end 2008.
“Golden Predator acquired the Springer Mining and Milling Complex in November 2006from General Electric Company through a loan facility with Energy Metals Corporation. The Springer Mine is a former tungsten (WO3) producer located in Pershing County, Nevada. Existing infrastructure at Springer consists of a 1,300 foot vertical shaft and mine workings, primary and secondary crushing stations, a small tungsten ore stockpile, 1,000 tons per day mill and sulphide flotation circuit, and a tailings pond. Certain water rights necessary for operation of the Springer mill were also acquired. Golden Predator purchased these facilities for US$4.5 million plus less than $1 million in reclamation bonding obligations to General Electric.
The Springer mine and mill opened in early 1982 at a cost of US$55 million through a joint venture between General Electric and Utah International. It was soon closed in October 1982 due to falling tungsten prices and the facilities have been held on a care and maintenance basis with no mining activities having been carried out since that time.
Historic tungsten resources as calculated by General Electric in March 1983 are 3.59 million tons (3.26 million tonnes) grading 0.446% WO3 for a total of 1.60 million stu WO3 (1 short ton unit - 20 pounds. The identified histroric resources are sufficient for a 12.8 year mine life at 1000 tpd.). These resources are not compliant with NI-43-101 and have not been verified by a Qualified Person. The company is not relying on these resource estimates as being NI43-101 compliant.” (Excerpted from the Golden Predator Mines official website)
Golden Predator is also expecting to have the Taylor Poly-Metallic 1320 tpd mill and Silver mine operating by year end 2009 and the new 1000 tpd Gold mill at Springer operating by year end 2010. Meanwhile, the company currently has a passive income stream from its portfolio of gold exploration proprieties and leases from the Lyle Campbell Trust.
Lastly, the management team at Golden Predator Mines is the same one that assembled in two years time, a portfolio of more than 100 uranium projects in the western United States under a company called Energy Metals. On August 10, 2007, Energy Metals was acquired by Uranium One for $1.9 billion dollars.
About Front Street Capital
Front Street Capital manages around “2.8 billion in assets among various long/short equity strategies, mutual funds, limited partnerships and trusts. Front Street Capital partners are the largest investors in each of the products, with over $250 million invested.”
Front Street Capital provides investment management services to Ceres Global Ag Corp., Renaissance Global Resource Fund, CIBC Energy Fund, CIBC Precious Metals Fund and the CIBC Canadian resource Fund.
A description of Front Street Capital would be remiss without mentioning Norm Lamarche.
Norm’s biography as presented on the Front Street website is as follows:
“Norm Lamarche: established Tuscarora Capital Inc., one of Front Street Capital’s two founding companies, with Gary Selke in 1996. From 1987 to 1995, Norm was a portfolio manager with Altamira Management Ltd., where he managed Altamira's AltaFund Investment Corp., Altamira's Resource Fund and the Orbitex Resource Fund, and was responsible for the equity component of Altamira's Balanced Fund.
Norm has earned a reputation as the “best mutual fund manager you’ve never heard of” (Globe and Mail), managing the #1 and #2 fund in Canada over the last 15 years. Norm is a partner, co-chief investment officer and VP of the Firm, as well as a Management Committee member.
Norm currently manages seven top performing funds that consistently outperform their benchmarks and the competition, including the Front Street Growth Fund (formerly Front Street Small Cap Canadian Fund), Energy Growth Fund and the Mining Opportunities Fund. He has also managed the highly successful Front Street Flow Through Partnerships.”
On a personal note, I’m a very close follower of Norm’s monthly commentaries, which get posted to the Front Street website towards the beginning of each month. Norm’s track record is simply stellar and I pay a great deal of attention to his thoughts. Being the ‘resource guy’ at Front Street, I surmise that purchasing shares in Golden Predator were his decision. Norm’s investment in Golden Predator is a superb endoresement for the company (in my humble opinion) – thatswhy I figure its time to put Golden Predator on my watchlist.
Investment Risks
Without limitations, some of the risks include reserves and resource risk, development risks, permitting risks, off-take agreements, commodity price risks, geo-political risks, exchange rates, weather related impacts etc.
So Do Your Own Due Diligence !
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Last update : 04-07-2008 05:30
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