The Reminder is making its archives back to 2003 available on our website. Please note that, due to technical limitations, archive articles are presented without the usual formatting.
It seems itÕs all about who you want to listen to or believe in relation to both the short- and long-term outlook for the metals that fuel Snow LakeÕs economy. Zinc, copper, and gold... all three lie in great abundance below the forests and overburden of the prolific Snow Lake camp. However, will they languish beneath the surface, or be brought above to take their rightful place in the homes, cars, and jewelry boxes of the nation, and the world? In some instances, the heady days of discovery holes and drill results have given way to speculation on whether mines will result in the near or not-too-distant future. Others surmise that markets and supply will be fine, but raising the cash to do anything with either will be the challenge. According to Daniel Sacks, InvestecÕs AAA-rated gold fund manager, a rising dollar and falling oil prices is the fly in the ointment for gold producers, while Andr C. Tessier, CEO of Murgor Resources, says instability in the world economy, fuelled in part by the raising price of oil, has brought a lack of investor confidence and volatility to the base metal market. In that line of thinking, CHR Metals, an Internet-based provider of analysis on the lead and zinc market, says while there may be the occasional upward movement in the zinc price, the current downturn will continue for the next three years at least. ÒAt best, work on some new projects may cease in response to a drop in the price, and thereby ease the downward trend,Ó CHR stated in a Web-based news release. See 'Skilled' on pg. Continued from pg. ÒZinc prices are expected to remain at, or around, current levels until the turn of the year, but as new production comes on stream, they could begin a long-term decline,Ó they added. As gloomy as that outlook reads, a few more clicks of the mouse can bring up one that is a little more palatable. BMO Global Commodity Strategist Bart Melek says ÒRising cost structures, equipment and skilled labour shortages all give support to the BMO thesis that the short- and long-term metal prices are not likely to revert to historic means as long as the global demand outlook remain intact.Ó Melek has forecast that global demand for many metals and bulk commodities, including copper, zinc, and metallurgical coal, is expected to grow as much as 40-50 per cent over the next decade. ÒSince supply is proving to have a very hard time keeping up with demand growth, metal and bulk commodity prices appear well supported over the long term,Ó he said. And in relation to the gold markets, ABN Amro Asset ManagementÕs Franois Mout thinks the gold price could hit $1,600 per troy ounce this year. Regardless of what you read, whom you listen to Ð or whether your glass is half full or half empty Ð it should all be taken at face value. Actions speak much louder than words. As you read this, the NI 43-101 estimate is done on the Lalor Lake property and six drills still turn there while HudBay Minerals Inc. continues to construct the road to access it. The drills at VMSÕs Reed Lake Discovery Zone continue to cut and turn out amazing intersections of high grade copper. The lights are still on in Garson GoldÕs office on the hill, people go to work there every day, and as far as I know, they still have one drill turning on the property. Add to this a recent statement by HudBay CEO Allen Palmiere. He said because of the strength of HudBayÕs balance sheet and the continuation of good cash flow, the company is in a unique position to be able to take advantage of the opportunities the market is creating. Between cash on hand and anticipated cash flow from operations, they could fund their new Fenix nickel project in Guatemala; they could fund Lalor Lake; they could even fund Reed Lake, if and when it turns into a mineÉ without having to access the debt market. My Take on Snow Lake runs Fridays.
