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Gold/Mining/Energy : BGM

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From: howestreetbull12/17/2014 9:05:27 AM
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BGM.v Gold Summary for Dec. 16, 2014

2014-12-16 21:03 ET - Market Summary

by Stockwatch Business Reporter
Frank Callaghan's Barkerville Gold Mines Ltd. (BGM) added two cents to 26 cents on 227,000 shares, after the company appointed two experienced gold miners, Greg Gibson and Tony Makuch, to its board. Mr. Gibson was the man behind Trelawney Mining and Exploration Inc., when Iamgold Corp. bought it for $585-million in June, 2012. When he first joined Trelawney in 2009 the stock was barely trading at 1.5 cents. He rolled it back 1:5, raised almost $200-million and reported several pleasing rounds of assays from the company's Cote gold project in Ontario. After selling Trelawney to Iamgold, he joined Martin Shefsky's Northern Gold Mining Corp. (NGM: $0.015), where within his first three months he had raised almost $30-million, and had boosted the stock to 45 cents from 20 cents. Mr. Gibson left Northern Gold in May, 2013, just 10 months after joining. This past summer he joined San Gold Corp. (SGR: $0.05), where he is now trying to make the company profitable from production at its Rice Lake gold mine in Manitoba. The possibility of profitability increased greatly last fall, when founder Hugh Wynne retired at the age of 81. Under his leadership, San Gold was spending up to $5-million a quarter on services from the Wynne Group of companies. These services are now provided by other vendors, according to the financial statements for the first quarter of 2014 (ended June 20); San Gold spent nothing at the Wynne Group in its first quarter, down from $4.9-million for the same period in 2013.

Tony Makuch is a mining engineer who runs Lake Shore Gold Corp. (LSG: $0.76) and its Timmins mine in Ontario. There, he completed a successful mill expansion last year, which has brought all-in cash costs down to $860 an ounce from $1,300. Lake Shore is one of the few gold stocks up this year, having risen from 42.5 cents last December. The company recently sold 12.9 million flow-through shares at $1.17, raising $15-million for more exploration in Ontario.

Both men are welcome additions to Barkerville's board, which also includes Frank Callaghan, Norm Anderson, Dave McMillian, Drew Rees and Elena Clarici. The company has been struggling after bringing its Bonanza Ledge mine in British Columbia to production in July. It has said disappointingly little about production since pouring its first Bonanza Ledge gold bar on July 25. This was the bar Mr. Callaghan held high along with his right index finger signifying No. 1. Four days later, he stepped down as president and chief executive officer, and director Anderson thanked him for his 23 years of "selfless hard work and care." Mr. Callaghan remains a director, but Barkerville has since hired Ms. Clarici as interim CEO. She is a mining engineer from Serbia, and has been busy infill drilling and reporting reassays from old Bonanza Ledge core. Needless to say there is a great deal of old core to reassay and this work has become the subject of the company's news rather than any production figures. Ms. Clarici has also managed to renegotiate with the company's lender, Eric Sprott. He lent Barkerville $15-million last fall so it could bring Bonanza Ledge to production. The company was supposed to make its first of three payments (each valued at 4,200 ounces of gold) on July 31, 2014, but it has yet to come up with either the money or the gold. The payment has been extended to Jan. 28. Directors Mr. Gibson and Mr. Makuch should be able to help Barkerville raise some much needed money because the company is also in great need of credibility which they both have.
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