Colt’s Portugal Looks A Corker
Published in April 7, 2012on
EVORA, Portugal – Land of grapes, rolling hills, cork trees, tungsten and gold.
Colt Resources (GTP in Canada; COLTF in USA) has a shot at doubling to a dollar in four week or less. The 55-cent shares will catch a warm Mediterranean wind any moment now, I believe based on a just-concluded tour.
After that equity event, fate will arrive via an initial resource report for a southern Portugal gold project (that’s June) and ongoing mineral indications from a Tabuaco tungsten property in the north.
Previous tenants, Rio Tinto, Iberian Resources, “barely scraped the surface,” says Steven McRobbie, a rough-and-tumble Scotsman who spent 7 years as a mining geologist for uranium and other minerals in Kazakhstan. Here is what counts in my money book: Jose Borrego, a local field geologist for Colt, told me, pointing to highly altered core with visible specks of gold. “I am seeing gold every month; this is not common.”
Other confirmations of a Colt purchase signal:
- The operating principals are on site full time, having moved their large families to Portugal. The execs brought the dogs, too. They are Nikolas Perrault, CEO, and Declan Costelloe, chief operating officer.
- Maps and modeling show the current near-twinning of historic holes easily will match 600,000 or so ounces. The upside – in dynamics I have seen take place with PMI Gold (PMV) and several other juniors with hugely expanded resource estimates – appears to be holes 18 through 30, under way with 800 meters of rich, shallow gold.
- Underground channel samples (another early indicator of possible parabola to come) show 13 metres of nonstop mineralization just 17 metres deep; the grades average about 3.3 grams/tonne in those samples from the Chaminé target of the Boa Fé Gold Project, some 100 kilometers east of port city Lisbon. “Lots of the silica in the main shear zone,” says Filipe Faria, part of the 1987 Rio Tinto mapping team here.
- Carlos A. Caxaria, sub-director general of the nation’s Direcao-Geral de Energia e Geologia, says the ministry is tracking 47-square-km Boa Fé and its surrounding 700-square-km Montemor gold concession. Experimental mining licenses already are in place, “and we have good reason to believe this one day will be a mine,” says Mr. Caxaria.
I am mercenary, hear me now. Just because a government official tells me eye-to-eye that white is white and black black – is no reason to invest. Still, a good dozen of the 40 Colt tour attendees (last week) were and are relentless graders of fair value. They will not touch an investment lest it is 1) cheap; 2) sound; 3) short term parabolic. These include Arthur Lipper of Del Mar, California, creator of PortfolioComparator.com and an advisory board member of Colt Resources; and Hermann Maurer, a Kevin Kline-lookalike and spokesman for EurAsia Resource Holdings AG of Germany.
There are risks, as there are with all colts and fillies. These include the presence of arsenic in a region known for its sweeping vistas, vineyards and wineries. Colt Resources owns a historic and producing winery, Senhora do Convento, at Boa Fé. (That property alone is worth between $4 million and $7 million by Mediterranean comparables, far more by California standards.)
Area residents, including the owner of surrounding land and the seller of the winery/vineyard/convent, tell CEO Perrault the nation is enduring a 14 percent jobless rate, and even higher in and around the nearby town of Evora. “Sheep, cows and grapes only go so far,” says VP of Exploration Mr. Faria, who has been a geologist in Portugal and Africa for more than 30 years.
On last week’s tour, I also saw Colt’s Tabuaco Tungsten Project in the north. It’s advanced stage, with a pre-feasibility study on the way. Tungsten’s prices are the highest ever. The current drill program concludes this month of April. The company intends to upgrade part of a 16.7 million-pound inferred WO(3) resource into its existing 9.7 million-pound indicated resource.
I will have more about the tungsten project after I return from Costa Rica – sometime by April 20. In the meantime, let me say Mr. Perrault, a Quebecois, and his associates from Portugal, from Canada, from Germany and yes, Russia, tiny island kingdom of Malta of all places and the United Kingdom, are confident he will deliver an asset partner, signed and sealed, to ignite the financing. We’ll see soon.
Colt Resources on the gold project alone and no accounting of its tungsten project (the vineyard/winery and two other Portugal concessions) is selling for about 25 percent below what I consider fair-value. The 55 cents Canadian share price comes to about $65 million fully diluted.
That’s all for now. I own 36,000 shares of Colt Resources, bought at a price of 55 cents last week when I was in Portugal. I intend to double that holding. Colt Resources is not a client of the firm Torrey Hills Capital, where I am a consultant. Colt paid me zero dollars and no cents for any of this research.
Colt’s resource revision for the gold project in the south will come, one hopes, in June 2012. You can see www.coltresources.com for slide shows and such. See the page up front with the roster of directors and execs.
-- Thom Calandra, April 4, 2012