Trevali Mining's Recent Assessment for Halfmile and Stratmat Deposits

Trevali Mining (TSX:TV) started the week by releasing a preliminary economic assessment for its Halfmile and Stratmat zinc-lead–silver deposits in New Brunswick’s Bathurst Mining Camp.

The report was led by SRK Consulting and looks at two different scenarios, both of which indicate positive economics, the company said in a statement on November 6.

“This PEA study on Halfmile-Stratmat provides a strong, initial foundation for Trevali’s future plans in the Bathurst Mining Camp,” said Mark Cruise, Trevali’s president and CEO.

Trevali is already a top zinc producer.

The base case looks at a scenario in which material from Halfmile and Stratmat is fed into a new 3,000-ton-per-day concentrator plant located at the Stratmat site.

This study includes annual payable peak production of approximately 117 million pounds of zinc, 35 million pounds of lead, 2 million pounds of copper and 766,000 ounces of silver over a mine life of 13 years.

It also points to pre-production capital expenditures of C$231 million, a post-tax internal rate of return (IRR) of 19 percent and a post-tax net present value of C$99 million at a discount rate of 8 percent.

The other scenario looks at the feasibility of transporting pre-concentrated dense media feed to the concentrator plant at the company’s Caribou mine, also located in the Bathurst Mining Camp.

Under that plan, pre-production capital expenditures are estimated at C$156 million, with the post-tax IRR coming in at 25 percent and the post-tax NPV sitting at C$116 million at an 8 percent discount rate.

“The study contributes significantly to the Company’s continued interest in the region and … demonstrates the optionality for future planned production on either a stand-alone basis or by leveraging our current Caribou operational team and infrastructure,” Cruise added.

The Halfmile deposit includes four sulfide zones and consists of 73 claims covering an area of 1,104 hectares.

Stratmat is composed of 95 contiguous claims spread across an area of 1,827 hectares.

The mineral resource estimate for Halfmile was updated as part of the PEA.

Aside from the Halfmile and Stratmat deposits, Trevali owns two commercially producing operations.

Its zinc-lead-silver Santander mine in Peru produces 2,000 tons per day, while its zinc-lead-copper-gold Caribou mine in New Brunswick produces 3,000 tons per day.

Earlier this year, Trevali acquired a portfolio of zinc assets from Glencore (LSE:GLEN) and now also owns an 80-percent stake in the Namibia-based Rosh Pinah mine and a 90-percent interest in the Perkoa mine in Burkina Faso.

The company has moved up nicely since the beginning of 2017, jumping over 31 percent.

Diversified Miners (RIO) (TCK) (VALE) (BHP) Close Down as Base Metals Drop

Base metals dropped in Monday trading putting pressure on diversified mining giants Rio Tinto (NYSE:RIO), BHP Billiton (NYSE:BHP), Vale SA (NYSE:VALE) and Teck Resources, (NYSE:TCK), which all closed down.

Three-month copper on the London Metal Exchange dropped to $9,207 a ton, its lowest since March 17. It closed at $9,225 a ton from Friday's close at $9,450.

Stocks of copper in LME warehouses last rose 1,350 tons to 451,775 tons, their highest since June 2010.

Also weighing on metals, the U.S. dollar was stronger against a basket of major currencies, weakening metals demand from non-U.S. investors. European equities were down on increased talk that Greece will be forced to restructure its debt and uncertainty over a bailout for Portugal which dampened risk appetite.

Aluminium closed $2,674 from $2,690 a ton.

Zinc ended at $2,325 from $2,398 a ton. Stocks of the metal rose 50 tons to a seven-year high of 764,300 tons.

Battery material lead was down close to five percent to its lowest in over a month at $2,520 a ton. It closed at $2,528 from $2,651 a ton, while tin finished at $32,350 from $33,100 a ton and nickel ended at $25,500 a ton from $26,155.

Platinum was lower by 0.2 percent at $1,779.99 an ounce, while palladium fell 3.3 percent to $735.22.

BHP closed Monday at $97.98, falling $1.82, or 1.82 percent. Rio Tinto closed at $69.09, down $1.82, or 2.57 percent. Teck Resources ended the session at $50.68, losing $1.26, or 2.43 percent. Vale closed at $32.05, dropping $0.73, or 2.23 percent.

Teck Resources (NYSE:TCK) Led by Red Dog, Zinc in 2011?

Most investors know the value Teck Resources (NYSE:TCK) is getting from its copper and metallurgical coal assets, but they are about to come on strongly with its zinc asset via its Red Dog mine, where production is ready to crank up.

Zinc for the most part is used to galvanize iron and steel. Teck's metallurgical coal goes primarily to Chinese steel mills and copper of course to electrical and housing.

Another benefit of the Red Dog mine is it has lead as a byproduct, which is used in infrastructure projects, tin substitute in soldering, and car batteries.

Those charting tin also see a head and shoulders pattern which suggest it's ready to breakout sometime soon.

Teck Resources closed Friday at $58.81, gaining $0.13, or 0.22 percent.

Goldman (NYSE:GS) Prefers Copper Among Base Metals

Saying they see most base metals as being close to fully priced, Goldman Sachs (NYSE:GS) noted copper is the one base metal they see continuing to rise in price.

Their assertion in both cases are the supply and demand equation at this time, which appears to have plenty of product for the market in the near term, with the exception of copper.

Talking the nickel rally they see it more of a price spike than anything else, citing the low supply and demand challenges it faced. They see it as a price spike, saying the rally happened too quickly in relationship to the shortage. “We continue to believe that further upside is unlikely beyond the very short-term, and medium-term risk is still heavily skewed to the downside,” Goldman concluded.

On copper prices Goldman said, “Although historical information on global producer, consumer, and trader inventories is imprecise, the data and estimates we do have suggests that there is still metal to be destocked as prices drive higher. We believe the highest historical breakout of prices and timespreads occurred when stocks moved down to around 9-10 days of consumption post-SRB sales in 2005/2006.”

They concluded, “We continue to recommend copper consumers aggressively protect price risk. We also recommend zinc consumers lock in longer-dated hedges when periods of high macro volatility persist and zinc prices sell off.”

Teck Resources (NYSE:TCK), Freeport (NYSE:FCX), BHP Billiton (NYSE:BHP), Rio Tinto (NYSE:RIO) All Close Up as Commodities Jump

For the most part individual miners enjoyed a more profitable day than diversified miners, but that didn't stop Teck Resources (NYSE:TCK), Freeport-McMoran (NYSE:FCX), BHP Billiton (NYSE:BHP) and Rio Tinto (NYSE:RIO) from finishing positive Tuesday.

Most industrial and precious metals rose Tuesday, with lead being the one exception to the rule.

Gold and silver both pushed up nicely, and copper, aluminum, nickel, tin and zinc were all up for the day.

Teck Resources closed Tuesday at $63.56, gaining $0.76, or 1.21. percent. Freeport-McMorRan closed at $55.64, up $0.02, or 0.04 percent. BHP closed at $95.69, rising $0.54, or 0.57 percent. Rio Tinto surged to $76.63, gaining $2.46, or 3.32 percent.

Jim Rogers, Peter Schiff Remain Bullish on Gold

Jim Rogers and Peter Schiff have been gold bulls for some time, and also agree that the value of U.S. dollar will continue to diminish over time based on the misguided policies and practices of the Federal Reserve.

Rogers continues to maintain gold will rise for years to come, and believes it should be trading at about $2,000 an ounce, comparing to the the former all-time high of $850 an ounce after being adjusted for inflation.

Even so, he still says gold will eventually reach $2,000 sometime in the next decade.

Peter Schiff has been even far more optimistic, predicting gold price could rise as high as $5,000 an ounce. Schiff also believes the rise in the value of the U.S. dollar is just a temporary bump and it'll resume its loss in value.

Both oppose the policies of the Federal Reserve and see U.S. bonds as extremely negative at this time.

Concerning other commodities, Rogers still likes zinc and cotton, with cotton putting pressure on many companies with heavy exposure to it and lower margins.

He also likes silver, which many commodity experts think will be the trade of the next decade. He believes it could definitely reach $50 an ounce again, and possibly go much higher.

Alexco Resource (AMEX:AXU) Doubles Over Last Year

Alexco Resource Corp. (AMEX:AXU) is worth taking a look at, as the mineral exploration and development company has doubled its share price over the last 12 months, and seems to have continual support under the current levels.

The company mines, for the most part, in the Yukon Territory of Canada, and its properties are thought to hold gold, silver, lead and zinc ores.

They also generate secondary revenue from project management services and consulting on environmental permitting.

Alexco was trading at $6.42, up by $0.11, or 1.74 percent. Trading volume is above its 3-month daily average.

Coeur D'Alene (NYSE:CDE), Other Miners, Considered Potential Takeover Targets

With the failure of giant mining companies to secure mergers and acquisitions recently, it seems miners like Coeur d'Alene Mines Corporation (NYSE:CDE) are considered as major acquisition targets in an industry that wants to grow through acquisition, as organic growth is getting more difficult because of limited resources.

RBC has taken aim at Coeur d'Alene Mines, upgrading them from "Underperform" to "Sector Perform," and we should see a number of these types of upgrades happening with the smaller miners who will help with expansion, but not at the cost of tightening and more expensive credit.

Coeur d'Alene Mines, based in Idaho, mines primarily for gold and silver, but also has secondary metal production such as zinc and lead.

The miner closed Friday at $23.48, increasing by $1.26, or 5.67 percent. RBC raised their price target on them from $22 to $27.

Yamana (NYSE:AUY) Still Struggles to Gain Respect, Traction

Although there have been a lot of positive comments and data presented on the future of Yamana Gold (NYSE:AUY), it continues to struggle to gain respect and traction in a gold investment climate that should result in a much better price movement for the gold miner.

Scotia interrupted the attempted party again, downgrading Yamana from "Sector Outperform" to "Sector Perform."

With analysts having eight "strong buy" ratings, six "buys," and four holds" on Yamana, we will probably see more downgrades for them in the near future.

Most people continue to hold out hope that Yamana will take off, and yet it continues to linger, even though it does seem to have a number of reasons to be a solid investment and outperformer.

Their extremely low production costs alone make it a desirable company, coming in at a little over $100 a gold-equivalent ounce.

That gives them a lot of flexibility and enables them to operate in weak and strong markets when competitors would flounder.

Yamana also has significant metal resources like zinc, copper, molybdenum and silver, all of which are positioned to move up nicely in price, especially copper and silver.

From last year at this same time, Yamana has generated a loss for its share price, closing Monday at $11.17, losing $0.10, or 0.89 percent.

Goldcorp (NYSE:GG) Announces Commercial Production Hit at Penasquito

Although the first lead and zinc concentrates were produced by Goldcorp (NYSE:GG) at their Penasquito project in Mexico in 2009, the company decided to wait until the second 50 000-t/d mill and flotation line was operational before making the declaration it had officially hit commercial production, which they now have done.

Goldcorp is on track to finish construction on high-pressure grinding roll circuit in October, which will produce 30,000 tons a day, which will reach as high as 130,000 tons a day in early part of 2011.

The company's estimate of 180,000 ounces of production from the project remains in place for 2010.

COO Steve Reid said, “Peñasquito has achieved every significant operational milestone on schedule, culminating in today’s declaration of commercial production.”

The Penasquito project, which is estimated to have a 23-year lifespan, should produce 500,000 ounces of gold, 28 million ounces of silver, 450 million pounds of zinc, and 200 million pounds of lead on an annual basis.

TD Newcrest Upgrades Goldcorp (TSE:G) to 'Action List Buy'

TD Newcrest analyst Greg Barns has upgraded Goldcorp (TSE:G) (NYSE:GG) to 'Action List Buy' this week, and increased the target price to $55 a a share from $50 a share.

Barnes said the reasoning behind the upgrade was this, "We believe Goldcorp has the best growth profile among its senior peers. We use higher multiples for Goldcorp than Barrick (TSE:ABX) (NYSE:ABX) or Kinross (TSE:K) (NYSE:KGC), given our view that it has a better growth outlook, lower costs and lower political risk."

The specifics of that are related to production at Peñasquito, which has a projected increase in production for all four metals there, including gold, lead, silver and zinc.

Annual payable production, according to TD Newcrest, for each metal is estimated at 470,000 ounces of gold, 28 million ounces of silver, 450 million pounds of zinc, and 200 million pounds of lead; all on an annual basis.

gold could go far beyond that, with it reaching 800,000 ounces of annual production from 2010 - 2015, based on increased quality of grades.