Zinc For Sale: TCR Network [Actionable]
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By Thom Calandra
on 2/3/2017
Taking Pasinex -- Buy PSE To Galvanize Holdings
TCR Network
,
actionables, aside from this Turkey miner, at close of TCR here.
T
his time I shall skip the long-form come-on about this Turkey base metals producer.
Additions to "Cheap Zinc Mover" for our TCR Network -- after speaking this morning with Steve Williams of Pasinex Resources:
-- Eurasian Minerals
owns about 2 million shares of PSE [Canada ticker] -- that could be why
EMX shares are rising swiftly Monday in NY and in Toronto.
--
The underground zinc mine, started three or so years ago, is now
"paying for itself" after three years. Direct-shipping ore is packaged
onto trucks and sent to Belgium, to newly sanction-free Iran, among
other processing locales. Commodities brokers are often the buyers. "We
have surplus cash," Mr. Williams says -- packing bags for his monthly
trip to Turkey.
-- Grades are probably the factor that make the 50-50 mine with a private Turkey miner, family owned Akmetal,
work well enough to avoid on-site and possibly messy (for permitting
purposes) processing. Average grade for sulphides (45% grades approx)
and oxides (30% approx) come in at about 40%. Maybe two-third of all
zinc is used in the process of galvanizing. There are some who believe
zinc will become an active fertilizer in food crops.
-- Mr. Williams
,
a 62-year-old metallurgist from western Australia, runs the numbers
from Toronto. The company president has a graduate business degree from
Tulane University in New Orleans. He spends a lot of time at the mine,
in the high southern Turkey hills. Altitude of the mine is 600 meters to
800 meters.
--
The mine itself, Pinargozu,
is carbonate replacement and within an easy drive of Adana, a city of
1.8 million in a country of 78 million. Another property, Golchuk, is in a different part of Turkey and came from early work that Eurasian Minerals did there several years ago.
-- Pasinex
at $29 million CAD market worth might be fair value or it might be
below fair value. That depends on: the silver and lead that the Pasinex
miners, more than 200 of them, are extracting for shipment these days;
the rising (for now) prices of zinc, lead and possibly silver; further
underground mine development of promising shoots; perceptions about
Islam and political terrorism and regional conflicts in Turkey.
--
Pasinex has no compliant and filed resource statement or economic
study; the estimates are all internal right now. Mr. Williams, a 20-year
metallurgist for SGS Labs in Canada, zigged to quick production instead of spending $2 million or more on zagging paperwork and engineering blueprints.
See table above for an idea of grades.
--
Pasinex and Akmetal "share" operation of the mine. Akmetal does the
digging and hauling and the mine developing to identify other areas;
Pasinex does the books, the technical, the geology that identifies
further mining based on 12,000 meters of drilling a year; the
"bootstrapping," as they call it. Pasinex rents most of the mining gear
and equipment from Akmetal when it needs it.
--
I bought shares as I indicated I would a day ago, and just minutes ago,
8000 shares at a USD price of 0.1578 cents via the PSXRF OTC ticker in
the USA. The Canada shares trade on the cheaper and less visible CSE
exchange in Canada. The original shell for the company that trades
publicly was called Triple Dragon.
"This
area is known as a zinc province maybe since the 1970s but not explored
at all ... artisan miners -- (my note: essentially hard-working
thieves) -- here and there. The permitting was pretty straight forward
because it is underground with a small footprint and direct shipping so
no processing plant," STEVE WILLIAMS says.
The
property itself did NOT have a mine when Pasinex purchased the claims
and land. That other Golchuk property in the northern part of Turkey is a
copper target -- the one from Eurasian Minerals (whose EMX stock we
believe and have believed since July 2016 is "in play," even today).
The
Canada unit of Pasinex in Toronto spends about a half million CAD
yearly, he says. A strong USD and weak CAD tend to boost the financials.
Steve Williams lives in rural Ontario with his wife, family and a pooch named Mimi. He has lived in Canada since 1987.
I only came across the company,
days ago. Now, I'm almost finished checking it out.
I wanted you to know that this note is not your typical TCR report to subscribers. This report is different for
reason:
1. I'm suggesting this security as a trade -- for those who wish; not as a buy and hold. Naturally, being who I am, I almost surely will buy on Monday, if the shares have not lifted in price
by more than a percent or two. I almost surely will hold those shares until I have visited the working zinc (and lead and silver) mine. Finally, I will give our TCR Network a few minutes' head-start on their "trade" Monday, if they so wish.
TCR Network,
I am delivering you something right now, this Sunday January 29, 2017,
that (almost surely) will make you money on Monday. (If the stock
already has not moved higher in the first 15 minutes of North America
and Germany trading.)
Let
me note here, I actually do own a sliver of this zinc producer,
high-grade zinc producer that looks to be profitable this year of 2017.
That is because I own and cover
Eurasian Minerals
,
Denver mining "dealer" that gets early control of promising mining properties around the world.
That
is how I learned about this little company with the cheap shares --
from my Eurasian contacts. Had I been giving rapt attention to
everything EMX has a hand in -- besides the claims and stakes and
properties in Russia, USA, Sweden, Turkey, eastern Europe from which it
looks to derive royalties and outright sales -- well, I might have
gotten in tune with these cheap, CNX-traded and Germany-traded shares a
week ago, before the stock more or less doubled to $25 million CAD.
Be
that as it may, or may not, the time has come to deliver what I have:
comments from the CEO and another executive of this company. I won't be
waiting until the very end like some movie trailer preview to give the
title.
This company has a few
; the spots have campy music and some of them are in German. They're here: http://pasinex.com/video-archive/ The CEO, Steve Williams,
is a Toronto businessman who comes off eager to show off what he says
will be a cash-flow positive miner of zinc (with silver and lead) this
year of 2017.
This link and the video archive mean you have the name of the company. Spoiler alert: Pasinex Resources is looking for some attention as zinc's pound-price rises to about $1.25 from as low as 75 cents a few months ago.
Pasinex Resources
, a contact I met in Germany four or five years ago, Sven Olsson,
tells me this weekend, is "going wonderful." Mr. Olsson, Austrian I
believe, got involved in PSE (Canada ticker) four or five years ago, in
the thick of the worst of commodity times. He is an executive at
Pasinex.
The
mine that Pasinex owns on a 50-50 basis with a private Turkey company
is in the southern part of that nation. So far, no security concerns in
that zinc (and lead and silver) belt.
"We built it over the past 4 years during the worst times in the market," Mr. Olsson tells me. "Bootstrapped operation."
Now, Pasinex has three adits at the mine. The ore is direct shipped on trucks from Pinargozu,
the name of the mine, and it is high grade ore -- sulphides and oxides
whose zinc averages about 40 percent. That is high grade.
I know, I know. The PSE stock rose sharply on thick volume last week. The market cap of $28 million CAD or so is about twice what projected 2017 sales will be from Pasinex's half of the mine joint venture, I tend to think. (I need to nail down this part, TCR Network.)
So look. I still have to go through
I
also would like to see the condition of underground -- having been
burnt to a crisp as an investor in another base metals mine, one in
Montana -- Troy -- that fell apart, literally crumbled.
I have a few answers from Steve Williams in Toronto via email this weekend, and I will talk
(in factoid, did talk)
to the businessman Monday before he leaves for the mountains of southern Turkey on Tuesday.
Here is the short Q-A with Mr. Williams:
ME (TCR):
Steve, I recently was at IG Copper's Malmyzh
in far eastern Russia.
I am a long
time shareholder of EMX, which owns part of IG Copper.
Long time here is 5 or more years.
Can you tell me, is it Akmetal who owns the other half of the Pasinex zinc mine in southern Turkey?
Steve Williams:
Yes – Akmetal AS is the mining arm of a Turkish private company called
the Kurmel group – owned by the Kurmel family. Akmetal is their major
subsidiary but they are also in cows / textiles / carpets / real estate.
TCR: Also cash on balance sheet?
Steve:
As of today Pasinex Canada has about $200,000 CAD although we have a
lot of warrants due in the next few months that are all in the
redeemable zone now.
And if you could, fully diluted total on PSE?
141 million share fully diluted.
I take it, PSE trades in Canada, Germany and France?
We trade the CSE in Toronto symbol PSE and on Frankfurt (Xtera) – symbol PNX – We do not trade in France.
The shares look to have moved higher this past week.
Yes
yes – we went up 100% this last week to 22 c CAD but I still believe we
are undervalued. This year the JV company will do $24 M USD in sales
with a net 50% margin. And we have about 7 years in front of us at the
mine.
Enough for now. TCR Network,
I will be buying some shares "blind" Monday morning -- as long as the
stock has not moved much higher from 22 cents CAD. This trade OTC in
USA: PSXRF. If Pasinex stock keeps climbing, well, at least I own it via
EMX, as I own many "hidden" securities held by that company (and a few
other project spawners whom we all by now know the names of -- or, of
whom we all by now know the names.)
I
look to fill this out some Monday before the North America markets
close. In the meanwhile, here is a January slide deck from Pasinex. http://pasinex.com/wp-content/uploads/2013/07/Pasinex-Corporate-Presentation-January-2017.pdf
The zinc in our TCR Network research and in the portfolio at home comes largely from Ivanhoe Mines,
whose shares have outpaced most billion-dollar mine builders in terms
of price appreciation this month of January 2017. IVN in Canada and
IVPAF ticker in USA
Several zinc producers and explorers, including Trevali Mining and much smaller names -- Thunderstruck Resources (an early stage Fiji Islands developer)
for one -- are benefiting from the rising zinc prices this early 2017.
I DO NOT HAVE TO SAY THE FOLLOWING EVERY TIME, BUT THIS TIME I WILL: THESE CATS DO NOT PAY ME. NONE OF THEM.
This report will be reproduced on ThomCalandra.com for freeloaders -- but without the actionables.
Please do not give this report away; buy it instead for a friend.
-- THOM CALANDRA
Actionables:
Also in play this week: Golden Valley Mines/Abitibi Royalties just before new Odyssey Zone assays are shown from Canadian Malartic in Quebec).
... Biomedicals: Immunovaccine continues to rise in thick trading (IMV in Canada and IMMVF in USA). ... CanAlaska Uranium
and SkyHarbour Uranium are about the only uranium companies whose
market values are building this Monday -- CVV in Canada and CVVUF in
USA. I continue to purchase shares of CVV and of obscure Virginia Energy
(another uranium-co VUI in Canada and VEGYF in USA. I also own Fission
3.0 shares. ... Selling on strenghth: Gold Standard Ventures (GSV
ticker); buying on declines: RMP Energy (nat-gas RMP ticker) ...
Additions include Midland Exploration and Alexandria Minerals, both
explorers in Quebec, Canada. ... Holding remainder of, and hoping for
greater trading activity and actionable events: Angkor Gold (CAMBODIA)
and Nouveau Monde (graphite). ... Holding easily for long term: Predator
Gold (Yukon) ... holding and having held since 2003: Ivanhoe Mines. --
TC
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Thom
Calandra & TCR are researchers and investors. Research and material
they offer to subscribers are meant as editorial opinion.
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