Nautilus Minerals faces project setbacks

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I scarcely have the time to scan the Canadian market, however there are occasionally those opportunities which just cross by eyes and demand a comment. Nautilus Minerals (TSE.NUS), a mineral explorer listed on the Toronto, London stock exchanges, is seeking to develop subsea exhalative mineral occurrences. These deposits present some unique problems, however the history of engineering development, say to the oil & gas industry, conveys that there need not be such a huge obstacle exploiting these deposits. 

The stock has over the years disappointed enthusiastic investors who have pushed the stock from $6 to just 32c today. This capitalises the company at $76million, which strikes me as a very low value given the potential for these types of deposits. Consider that the stock price has collapsed in more recent times because its JV partner, the PNG government through its investment vehicle has ended the relationship after it spend $70 million for its 30% equity. The implication is that the capitalised value of NUS's retained equity would be something of the order of $180mil. This of course is only a historic cost, and ignores any farm-out advantage. The stock price has found a short-term bottom, and has been selling recently on high-volumes, which gives us confidence. I am very suspicious of the PNG governments termination of this agreement. Given the abundance of corruption in PNG, one is inclined to think that some party of investors is involved in market manipulation, whether:

1. Personal investment gains

2. Strategic stake building

Time will of course tell what is the case. None of this really detracts from the appeal of the investment. The matter has gone to arbitration with the Australian government. I fully expect that some Western Australian  or Chinese company will take a stake in the company. This strikes me as a very good entry. The latest presentation describing the company's activities and mining method. The clear advantage of such mining is that:

1. It does not produce waste - it merely displaces it

2. It recovers only the valuable portion - the waste is the same silt that was deposited, in the same anaerobic environment, so there is no chance for oxidation.

3. It has no apparent impact on the seafloor since there is little aquatic life (at depths below sunlight penetration) at such depths and the areas affected are quite minor in comparison to the vast sea floor. 

4. There is no extensive impact to existing land uses, i.e. The impact on fishing would be minor. Even sediment 'siltation' can be reduced by dispensing at deeper levels (below fishing trawlers).

The company has outlined a resource at Solwara 1 & 12 of 3 million tonnes grading 7.8% copper , 5.5g/t gold (some silver & zinc). This is very high grade ore. The company is backed by a number of industry majors is there is no shortage of funding. The company is well-cashed up with $90mil in the bank. 

Salwara in the New Britain area of PNG is the most advanced project, however the company is also assessing another far larger, lower-grade, nickel, cobalt, rare earth deposit in the waters of Tonga.  

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Marengo Mining (MGO.ASX) - trading out

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Yesterday I took short term trading profits on Marengo Mining (MGO.ASX). I traded into Global Mining (GBE.ASX), which is currently striking low-term or all-time lows, and thus made a compelling entry. Looking at the chart for Marengo Mining, this stock appears to be going back to 9-10c support. This will probably happen in association with an issue; but I can't recall their cash position. The long term chart offers no short term clues of course; but it does show that we are looking at a lot of lateral consolidation before this stock breaks out. This is of course consistent with the VERY long development lead time. Let's not forget that this project is in PNG, and that exploration costs are high. I recall City Resources in the 1980s being absorbed by other interests because of the huge cash drain of its PNG interests. 

This company it at least more focused. The problem is that it found the most lucrative exploration area - highest grades after outlining the main ore zone. A great stock to trade though off that 9-10c support....though those trades will get commensurately smaller as that 'wedge' close out. 

Note the stock is struggling to achieve pass its moving average; and 15c is an important resistance.

Not a bad return for a fortnight stake - 12.5c to 14c. What's that 20%?

This is also an industrial stock and we are in a recession. Copper is an appealing commodity however.

Japan Foreclosed Guide Profiting from the Gold Boom

Mining Fundamentals eBook

Author Andrew Sheldon| 

Applied Critical Thinking | www.SheldonThinks.com

Marengo Mining (MGO) - progressing

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Marengo Mining (MGO.ASX) is a stock which has a world-class project in PNG. It has a lot of appeal for numerous reasons:

1. Immense resource - low grade, but its huge size and high grade zones give it appeal, scale and leverage. The discovery of the high grade zone is relatively recent. It would be nice if it comes at the front-end of the project, as was the case with the Porgera mine.

2. Institutional backing - the share register is dominated by some major institutions. These include the Sentinel Investment Fund, George Soros, et al.

3. Financial backing - the company has the support of Non-Ferrous China (NFC), a Chinese state-owned enterprise, which comes with bank financing, and probably equity participation for project finance

4. PNG government participation - This includes the reimbursement of Marengo for their $100mil expenditure before they earn 30% equity, i.e. MGO can expect $30mil back form the government I believe. Perhaps PNG govt has 10% free-carried, so it might only be $20mil. 

5. Cash backing of $25mil, say $5mil to finish the feasibility study; that means with PNG reimbursement, they have $45mil to contribute towards a project cost which I guess is around $2 billion. The implication of course is that there is going to be major dilution, with either NFC or institutions coughing up a lot of equity. But I dare say, not before a substantial rise in the share price.

6. Metal output: The mine will product a product stream comprising copper, molybdenum and gold; so the project start-up is commensurate with a turn-around in economic activity. The proposed project is 25Mtpa of ore throughput, doubling to 50Mtpa in time.

There are of course obstacles like the long development lead-time. i.e. The project is scheduled to start production in 2016. You can view a company presentation here; though I would keep watching the company website for an update on these high-grade zones. The Omora Zone is a separate and distinct target close to the existing orebody. This zone can be expected to mined early, and it will thus greatly enhance the commercial viability - since intersections of 165 metres @1.08% copper & 381ppm Molybdenum are more than double the grade of the primary ore zones.

There is no doubt that there will be some excitement with this company upon completion of the feasibility study. I expect this stock to rise to 27-30c, before some profit-taking and selling-back, because its a long development lead-time. So there is scope for a trade now.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Some quality exploration stocks moving forward

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Given the sentiments I expressed in this blog article, you might be inclined to think its time to look at resource stocks again. I have still to answer this question, but at this point, let me point you towards several stocks you might like to consider, as well as the type of stock.

Type of stocks

If we are about to engage in a period of solid, sustainable growth, then we want to ditch gold, and look at commodities - copper and nickel. We know copper has very good fundamentals, so this is a very good bet. I also like nickel, as I know of scant new capacity. Undoubtedly there are some projects in Russia, Greenland, Africa, but my interest is in one in particular.

Which companies?

Of course we can buy established miners, or we can buy future miners which are trading at a discount. I have several in mind:

1. Metals X Ltd: This Australian stock is capitalised at $300 million; but in 4-5 years it will be worth $3-4 billion, so it represents good buying. It is sitting on one of the largest undeveloped nickel deposits in the world.

2. Voyager Resources Ltd (VOR.ASX) is another good stock which I just discovered today. The company is developing a raft of good projects in Mongolia, which will supply gold and base metals to China. The grades are clearly commercial, so its just a matter of time for the value of these assets to be realised. This company is capitalised at $100 million, but again, though they might not be the largest projects in the world (at least at this point), they have a few of them. They have $5mil in cash, and having spent as much in the last quarter, you can expect a capital raising in the next quarter. We do like to see exploration though for such a large-scale project, you don't need to worry about the cash burn because the % of cash raised is less than 10% of the equity. The long-term upside is far greater. Expect a takeover bid for this company if the share register is open; but perhaps they already have Chinese stake holders. Do your research!

3. Marengo Mining (MGO.ASX) - This is a more advanced copper-gold play in PNG. PNG is not the easiest regimes in the world to work in, but when you have a large project, you can commit to it far more easily. The tax system I doubt is as favourable as Mongolia, but this is a large project, low grade, and mix of copper-gold.

I am comfortable with the sovereign risk of these countries. Its Turkmenistan, Kirghistan, Uzbekistan and affiliates that I worry about. I've seen projects in these areas delayed long-term.

You may know some other good stocks....honestly I am not focused on the market; but based on my 30 years of market watching...yes, I started when I was about 12-13 years old, these are good stocks...probably better than many you will find.

Japan Foreclosed Guide Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Interest returns to the gold stocks

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Its been some time since I posted some news on speculative mining stocks. The reason is that I see little appeal in exploration stocks at the moment for several reasons:

1. The lack of appetite for risk

2. The lack of capital for risk, i.e. the difficulty raising money, i.e. Base Metals Ltd

3. The difficulty for non-gold projects given the worrisome outlook for commodity demand

4. The development lead time for projects

One of course can find stocks which one likes like MIL Resources (MGK.ASX), however without a rapid development schedule or adequate funding, then the market will pass them by. Recognising the slow pace of exploration or gold conversion by MGK, I decided to sell this stock 2 months ago. The concern is that even when they release results, the market will say - these results are good, but what about the spectre of another cash raising. When the company is not going to have an operating mine for 3 years, then its looking too long term, and of course in a recession, they will be looking at share price debasement with each successive cash raising. The alternate picture of course is that they are able to attract funding from one of the majors. They have been passed over by a major Chinese company, but that company was probably interested in the iron ore project. The gold side is promising, but sadly not in this commodity cycle.

In this last week, I have been drawn back to an old favourite stock - Adamus Resources (ADU.ASX), which is merging with a Canadian mining stock Endeavour Mining Corp (EDV.TSE). Adamus Resources is a small miner with the capacity to add resources to its existing mine, as well as to scale up its existing plant given the prospect of promising exploration results.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - moving higher

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MIL Resources (MIL.ASX) has been going sideways in recent times. "Gold is great", but it makes more sense if you are producing it, or exploring for it. This only occurs when companies start sinking holes. This is the case with MGK. This month they commenced a drilling program on their PNG gold projects, and based on the indicators from surface trenching and their geological association, I am expecting some high grade results over widths of 4-20m. This makes for very attractive small scale mining. I'm expecting this stock to break out of its 2c resistance very soon, so I have rebuilt my stake in this company.

Alkane Exploration (ALK.ASX) - a stock which I have liked for a long time, has recently announced that its looking at a 1mtpa processing plant for its Dubbo rare earths-zirconia plant. This project has a NPV of $1.2billion, yet the company is capitalised at just $450mil. I see upside for this $1.70/share stock (we recommended at 45c) to $2.00, however its going to need an issue soon, despite its $18mil in cash. Market confidence will be another factor paring back the prospects of a 1mtpa plant, even if the 'anti-China' stigma favours full development of this project. I'd question if their suite of rare earths are even refined in China. I've done no research to find out.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - consolidating

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With the calamity behind us and the market likely to settle down, we are going to see gold prices slump a little, the $A drift, and confidence return to the speculative end of the market; at least the end which is cashed up. MIL Resources (MGK.ASX) are well positioned for recovery. The company has $4mil in cash, and is just about to launch into a drilling program; at a time when gold prices are $1800/oz, and copper prices still a healthy $4/lb. Mostly they are a gold story!

With drilling starting in several weeks, expect speculative interest to return to this end of the market. We can already see this happening. The stock fell to 1.6c when risk capital evaporated, but it quickly returned, and the stock reached 2.2c on Monday before closing at 2c. Today the stock was stronger, reaching 2.2c before sustaining a sell-off due to off-screen selling. It might take a little time to regain the confidence, but I expect it to remain above the moving average.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - a short term hit

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MGK will take a hit today after a 550pt hit to the Dow Jones after bad news from the EC. The Dow closed at its low, so further falls can be expected in Friday trading. I note however that gold was strong until gripped by profit-taking. Low interest rates or asset deflation is actually good for gold, because 'no yield' gold becomes more profitable against falling yields of other assets. Gold is going to $2400/oz, so expect more upside. Meanwhile the Dow Jones is going back to 10,550 points - technical support. MGK will probably get support at 2.2c, however it will probably go as low as 2c during the day, so be in there. The Dow will go lower tomorrow, but gold has already had its profit taking. Gold will recover, so buy today. The day to buy is today.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Vital Minerals (VML.ASX) - a starter, but...

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Vital Metals (VML.ASX) has restored some confidence since the last announcement. The early drilling results were not encouraging. The latest results offer some promise of high grades, though the widths and lack of consistency are reasons to retain some risk-aversion. Check out the results here. Some 15 drill holes of the 60 hole (5000m) program are outstanding. It is not clear what the relationship between mineralisation and host lithologies is, so there is the potential for a new association. This is not clear from the disclosure; nor is the position of the intrusives in relation to the mineralisation, i.e. At depth?

Mind you, with a market capitalisation of $18mil, I'm inclined to think MGK.ASX is far better value, with far more upside. I must acknowledge though that Vital's Watershed tungsten deposit is strategically important, and a nearer term project, as opposed to MIL Resources' Amazon BAy, which they will be sitting on for another decade.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - a mover! 2nd day

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As expected MIL Resources (MGK.ASX) closed up around 10% today at 2.4c, having touched 2.5c yesterday. There are no announcements at this point; however irrespective of any corporate news stimulus, I suggest there are 'technical' (chart based) reasons to expect a breakout tomorrow to new highs, i.e. above 2.5c. Watch for news overnight or tomorrow.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - building support for next move!

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MIL Resources rose to 2.5c today in lunch time trading. The stock has fallen back to 2.3c in the last 30minutes. I see it trading as low as 2.2c (support) before it consolidates for a bigger move in coming days.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - moves higher

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MIL Resources (MGK.ASX) is in recovery mode. As expected the company established a support at 2c, or more correctly 1.9-2c, and is moving higher. There is temporary resistance at 2.3c, and I expect them to challenge the 2.5c level next week. The company is planning a 4000m drilling program, and I'd not be surprised if they expand this, though this will depend on their capacity to prepare drilling platforms and to schedule a drilling rig. The reason I say this is because they might have more current interpretation of the gold anomalies.

MGK is a rather undervalued stock compared to its peers, so I see this as a good stock to buy. It is an exploration stock, so there is a necessity to trade out of this one. Its a buy, and don't hold for too long. Its a stock you might be able to trade 3-4 times before production, at which point I loose interest, because at that point, they cease to offer predictability. Blessed are the explorers! That's about as religious as I get. Oh, and of course GOLD!! I had to repress it whilst I was a coal analyst.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - prepares for drilling

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A number of announcements have been released by MIL Resources (MGK.ASX) over the past week which should result in interest from the 'gold market'. These announcements can be downloaded from the ASX:

1. Drilling schedule

2. Golden Peak trenching results - this report suggests that the company has yet to report for the trenching of the broader Western Zone geochemical anomaly. My guess is that geochemical results for this region will be released in the next few weeks, and that the zone might be added to the drilling program.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGX.ASX) - a mover!

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This is one of my favourite stocks - for several reasons:

1. Its so undervalued compared to its contemporaries

2. Its got great projects

3. Its timing for exploration is good - its a gold boom

I was recently expecting this stock to fall to 1.1c. This was on the basis of several concerns:

1. Slow drilling schedule - which I expected to cause the stock languish - it did, but not to the extent of reaching my target - 1.1c.

2. Technical support - The strongest support was 1.1c, and I expected it to at least fall to that level for a short term before recovering.

3. Loss of confidence - I actually expected a rapid correction due to market correction. I expected this to hit explorers who are considered less tangible. The broader market did fall; though my forecast was a little 'tragic', so MGK only fell as low as 1.4c.

4. Priorities - The company continues to allocate funding to its titanomagnetite project, which I see as a long term strategic assets. This might be because it has a statutory 'minimum spend' to comply with, however I do see this project as a short term distraction from the 'greater gold' value.

5. Gold price - it started to recover.

6. End of tax year - This was the other short term negative on the stock.

In response to consolidation, and the stronger gold price, MGK share price, I jumped on the stock from last week. I was still accumulating as of yesterday. So I should at least reverse my prior negativity which was mostly short term. I have also been busy in recent times...so equities are not getting my full focus.

I cannot recall when the drilling program is due - I think around Sept 2011; however there will be short term trenching results, which will at least give some surface indicators of the tenure of the gold grades, and the lateral extent. For this reason, we might expect some short term strength. The technical resistance levels are 2.5c, 3c, 3.7c, 4c, 4.5c. It will not be a straight line.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGK.ASX) - better buying ahead

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MIL Resources (MGK.ASX) might be looking at a time of 1.1c before they recover. Despite their very attractive prospects, the company is not taking a path best for shareholders, but rather spreading their cash resources very thinly. This is of course a problem for shareholders between now and when they ultimately reach bottom - I'd say at 1.1c. The problem is not the quality of the projects but timing and strategy:

1. The directors are not acting in the best interests of short range shareholders - but those looking for long term opportunities. What is the difference? Some are directors accumulating unpaid salary which I dare say will be paid out from debased shares with options at an opportune time.

2. There projects are long term, i.e. Titanomagnetite resources to be developed in a decade, and gold resources (very attractive) requiring a lot of drilling. Easy to get excited; but what happens after the great requires - another drilling program requiring money.

In the short term, I believe this stock is too long term. It has over $4mil in cash, which will not go very far in PNG, given the dispersion of projects they are testing. Thereafter there is upside with:

1. Exploration results from drilling

2. Farming in by JV partners who will have 3D results to justify farm-in and high buy-in provisions

3. A stronger gold price

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGK.ASX) - expecting trenching results

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With MIL Resources (MGK.ASX) having bedded down its issue and raised $5mil. I have bought back into this stock. They have fallen to an important support, and with funds raised, and months of trenching under their belt, we can expect a drilling program ahead, and I think this will be a precursor to a JV partnership to fund any further development. I am expecting positive drilling results from this project given the appealing grades from trenching, as well as the extensive occurrences of gold/copper. I believe they are on to a Highlands Gold style deposit (high grade fissure deposits) rather than massive, disseminated porphyry-copper targets. This will auger well for a faster development, but a shorter mine life unless they can find repetitious structural controls....which is not far-fetched. Its still early days, but its a good trading opportunity.

I am comforted by the strong rally on Wall Street overnight, as well as the strong gold price.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Marengo Mining (ASX:MGO) - major copper project

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Damn! I missed out on Marengo Mining (MGO.ASX) before Friday closing...and now its running away from me. I had an order on at 31.5c at 3:40PM Friday, and missed out in some late buying. This is a stock which I recommended back in October. Meant to tell you lately, but never found my desired entry price. On Friday, I just gave up and decided to get some...or so I thought :( Hope you did better.

Ok...I managed to get a few MGO on opening at 35c....not sure how because I expected them to open higher...anyway frenetic trading on both sides. I'll have to wait to see the ledger as they are now 36.5c. The appeal of this stock is that they have a VERY large copper-gold deposit in PNG; the company is well-supported by institutions, and the company is at a fairly advantaged stage of development. Copper-gold are the commodities to be in, so if you have them, you are in a good position. I am expecting a rally over the next few weeks in this stock.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGK.ASX) - just about to move

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Gold prices are stronger. Expect stronger gold and oil prices as the Middle East is thrown into a frenzy of political turmoil by riots for democracy. The reality is that this is just the start of the democracy movement. These protests will spread like wildfire for several reasons:

1. Online social networking. You cannot stop it. There are technologies which will by-pass government scrutiny.

2. Wikileaks. there is only one agency disclosing embarrassing information about governments and corporations; tomorrow there will be hundreds of them. It will result in the credibility of government reaching a new low. Don't think that just Middle Eastern governments are worried. In fact politicians around the world who have engaged in corruption, and channelled kickbacks through secret Swiss bank accounts are more than a little worried by WikiLeaks.

We are likely to have democratic governments in the Middle East within 10 years. The implication is that these governments will have no reason to discount their petroleum to preserve the sanction of the US government. The implication is that we might be looking at higher petrol prices. This is not assured; though given the global shortage, we might expect OPEC to be stronger than ever. So there is a good probability of higher oil prices. Of course, the other reason is China, India, and global economic activity in general. We are in the midst of a technological revolution not seen before. Its not just China, its the unemployed in Libya, Turkey and the Philippines who are learning programming, or other online skills, and providing outsourcing skills to the West. Its an educational revolution. They are learning Western values. If they are really smart; they will leapfrog our structured democratic values, and develop a meritocracy....however that is improbable....since too few people are canvassing that.

Anyway, in such times, gold is very good. Many of the established producers are over-priced, so I am always looking for new, emergent stocks with good prospects for developing resources. In the last 2 weeks we have seen a favourite Vital Metals go from 10c to 17c, settle to 15c, and now its going for another rally. Today, we can see another favourite just starting to move. MIL Resources was unable to retain Sinotech as a strategic partner to develop its PNG interests. I am confident they will find a partner for these interests. They have a recent low of 2.8c, however the market at 3.3c is still cheap. They are sitting on a strategically valuable 4billion tonne titanomagnetite resource (i.e. iron, titanium, vanadium). I do not think this will be developed for 10 years, however its good to know they have it for the time the high strength steels market develops. These ores will be highlight sought after.

In the interim, the company has the Poi gold-copper deposit. Gold and copper prices are at all-time highs, so a company which has been soil sampling and trenching, getting attractive results, and will be ready to drill in 3mths looks rather attractive. In the short term, I am expecting this company to find a new partner to drill test the targets in this project area. PNG has some very substantial gold-copper resources, so the results from drilling will be very attractive. I would not be surprised to see a company like Indophil Resources becoming a JV partner.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGK.ASX) - JV dead but not the end

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Gold stocks are likely to recover this week, and copper prices are also rallying due to shortages of supply, with copper prices up to $4.63/lb. Gold was up $11.50/oz overnight to challenge the short term downtrend. I expect we will see stronger trends in the resources sector in the coming weeks. The cheapest entry is MIL Resources (MGK.ASX). This stock was recently marked down because a prospective JV partner, a Chinese company, decided not to follow thorough with the MOU. This does not concern me because I think they were always more interested in the titanomagnetite resource. They might not have liked PNG as an investment market as well.

I think we can expect some positive sampling results from MIL's PNG Poi project, as well as a commitment to some drilling. They will want to give some 3-dimension value to the positive surface expressions of gold and copper.

The great aspect about a company like MIL is that if you are comfortable that they have a good project, you can sit back and watch the tangible value be added. You can of course trade them. But you can also feel comfortable with the trend in gold prices and project development.

Currently, MIL Resources is trading at its support level of 2.8c.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

MIL Resources (MGK.ASX) - awaiting results

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Expect MIL Resources (MGK.ASX) to push up from 3.5c today. The stock has an upward momentum, but it has still to establish a support level above 3.7c, which is previous resistance based on the year chart. Check out the month chart here. The stock is trading above its simple moving average, so expect that trend to hold until the 3.7c support is breached. I therefore expect a move up to 4c, with some resistance at 4c and 4.5c. The rest of the story will depend upon trenching or drilling results. A 5-year chart will provide clues to the next move I suggest, with a rally to 10.5c....subject to good drilling results, which I expect. This will capitalise the company in the vicinity of $30 million, which is about right given the stage of project advancement.

Japan Foreclosed Guide Profiting from the Gold Boom Mining Fundamentals eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com