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Addicted to Abcourt By Editor |
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The By The (Note: We had promised
readers that we’d publish a detailed review of our visit to Abcourt
Mines a week ago, but like a kitten with a ball of yarn dangled in front of
it, we got distracted by silver prices and out popped an unrelated screed.
Here is the promised rant.) So, see a great property,
investigate it carefully. Find great people, play them. Not often does one
get the both in the same lot. Enter Abcourt Mines (ABI.V), or as they say in Underground development of
the Vendome-Barvallee silver-zinc mine from an already-driven ramp just to
Abcourt-Barvue’s west, and deep-level exploration from Abcourt’s
Elder gold mine’s 2,500-foot shaft an hour’s highway drive west
near Rouyn-Noranda will be funded from earnings from the Abcourt-Barvue pit.
Three mines (one entering production in 2Q 2007) and three overlapping
metals. That’s not a one-trick pony: it’s a hat-trick. David Zurbuchen, a fellow silver
writer, recently crunched Abcourt’s reserve numbers and came up with
this: each share of Abcourt (trading around 80 cents U.S. right now)
represents reserves of However, in terms of
reserves and resources there’s much more to the story. It gets better.
Abcourt’s currently published numbers of 21 million ounces of silver
and 300,000 tons of zinc from an orebody of 2.393 million tons grading 3.69
percent zinc and 2.02 opt silver are based on an NI 43-101-compliant
feasibility study performed by Roche of Montreal in 1999 and based on 1999
mid-level price projections and 1999 exploration data. Back then, zinc was
running 53 cents a pound and silver was optimistically forecast to hit $7.
Nevertheless Roche found a profitable operation. And the report obviously
didn’t reflect the results of last year’s extensive 46-hole
diamond-drilling program along the 1.6-mile-long Abcourt-Barvue vein. Abcourt has recalculated
its reserve figures based on current silver and zinc prices and the new
diamond-drill data, and shipped them off for 43-101 compliance review. Once
that’s done the new figures can be made public; expect a press release
by month’s end. Can you guess which direction their legally-reportable
reserves of zinc and silver are going to go? We can. So the ensuing updated
feasibility study will be a no-brainer. Let’s add another
component as well. Abcourt doesn’t need to buy anything to fire back
up. Rather than dumping their LHDs, haul trucks and other heavy equipment,
they cleaned the stuff up and mothballed it. All any of those giant rigs
needs to fire back up is a tank of diesel and a battery. The value of the
company’s on-site mining equipment, including a since-installed
350-horse double-drum hoist at the Elder, is roughly equivalent to their current
market cap. Operationally, Abcourt will
presently begin de-watering the original pit, which first produced zinc for
the U.S. government under contract from 1952 to 1957 by a predecessor, and
then zinc and silver as an underground operation from 1985-1990 by Abcourt
Mines, serving up 2.67 million ounces of silver and 34,850 tons of zinc in
that latter period. Also this
summer, stripping of Those are the ponies. Now
meet the jockeys. We caught up with Abcourt
President and CEO Renaud Hinse on a sunny day at the Elder Mine late in
March, bent intently over engineering and geological maps of Abcourt’s properties,
calculator and pencil at hand, checking his own math one more time before the
43-101 guys in Montreal got hold of it. He possesses the expansive persona of
the vindicated miner, the man of faith who has held on when others might have
lost their grip, kept his equipment and properties up and running when the
temptation was strong to let go, who grew and harvested trees just to keep
the taxes and the assessments paid up. The Seeing that there might be
life after retirement, Renaud Hinse (he is Mister or Monsieur Hinse to his
associates, even well beyond earshot) began during the later years of his
career acquiring properties and companies; Abcourt separately from the Elder.
In the post-1990 down times he repaired to his home outside of Along the way Monsieur
Hinse developed a working relationship with 49-year-old geologist Yves
Gagnon, a bearded engineer and professional geologist and fellow Quebecois.
Gagnon formerly was president of Geospex Sciences, Inc., which consulted to
such companies in the region as Barrick and specialized in geology, mining,
environmental and project management. To Renaud Hinse’s reserve, Gagnon
is a firebrand, a racehorse straining at the reins. Earlier this year, Hinse
named Gagnon Abcourt’s vice-president, ensuring a line of succession in
the company. Gagnon will be in charge of day-to-day operations of Abcourt
Mines. Breakfast with the pair of them is a study of intensity: they have
thought this thing out. Now, lastly, to the
racetrack. Abcourt’s three properties are located along As a final caveat: This
writer owns no shares in Abcourt Mines, nor has he ever. But ask us in a few
weeks, after all that 43-101 stuff becomes compliant, and the answer may well
be different. Meantime, Abcourt shares appear to be hugely popular in Europe
and By The |
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