Eagle Plains (EPL-TSE) is itself a product of the merger with Wild Horse Resources way back when.  After the spin off of Copper Canyon (CPY-TSE) this small exploration company went on an aggressive mode to acquire and consolidate it’s properties.  They presently have several important sites.  One is the promising uranium property in the province of Saskatchewan, an equally promising molybdenum prospect in southern British Columbia. 

However their current pride and joy is the Yellow Jacket gold mine in northern BC.  This mine is currently producing gold although I don’t know how much or if it’s profitable.  The plan is to become profitable in the near future, that I do know.  From what I hear, hush hush, wink wink, the idea is floating around for the company to spin off this mine as it did Copper Canyon.  That could be a real boon for current Eagle Plains shareholders.  However, I do believe we’ll have to see EPL’s share price at a higher level that it currently is.

The other exciting development is the ongoing progress at their new Iron Range discovery in south-eastern British Columbia.  About 65 miles north-eastward the Sullivan lead-zinc mine operated for almost 100 years until it closed a few years back.  All during that time mine managers and geologists have been convinced that that the Sullivan deposit was only half of the total. They have been looking for the other half all those years, without success.  The search for the other half has continued but, thus far, all the efforts have been in vain.

Just a few weeks ago Eagle Plains, which owns 100% of several hundred square kilometers of this prospect have found, what they firmly believe, is the other half. Of course much more drilling and exploration will have to be completed before any official claims can be made.  Meanwhile I’m just sitting on my shares.  Sooner or later there will be a payout.

A note on strategy when dealing with these small exploration companies. I like to take a fair position then if the share price doubles I sell one half of my position.  That way I lock in a profit and still have the other half left at no cost to me to enjoy any additional gains, if any.  Then if that half doubles I sell all or just a portion thereby locking in additional profits and maintaining a position for any possible additional gains. Of course if things start to look really bad I try to unload everything as soon as possible.

This is all for the benefit of those who own either EPL or CPY or both.  It has nothing to do with my current ETF program which I know will be very profitable and low risk for the next few years.

Cheers

Ted L.

More than three weeks since my last message.  It’s been a busy time packing, planning, building and travelling.  But now I’m safely back at home in Arizona and will travel no more, at least not for a long while.

The two old friends I mentioned are Copper Canyon Resources (CPY) and Eagle Plains Resources (EPL).  Some of my friends and relatives who are following this may wonder what’s up with these two stocks.  Copper Canyon, as you know was spun off from Eagle Plains in 2006 and Eagle Plains shareholders received one share of CPY for each share of EPL they owned.

Copper Canyon’s sole asset is a huge deposit copper, gold and silver in Northern British Columbia. This property lies directly adjacent to a similar deposit called Galore Creek, now owned jointly by Nova Gold Resources (NG) and Teck Resources Corp.(TCKb) but operated by Nova Gold.

So, here’s the deal.  In order to build a mine Nova Gold needs Copper Canyon.  And in order to sell their shares Copper Canyon share holders have no other suitors than Nova Gold.  During the past few years the prices of copper, gold and silver have not been enough to justify the huge expenses required to build a mine. 

But now things have changed.  Prices are up and things are starting to happen. Copper Canyon’s share price closed at 48 cents today, a two year high.  It is likely that Nova Gold will make an offer for CPY shares around 50 cents.  This may seem like a fair price considering where it has been over the past few years.  It isn’t.  We don’t know if an offer is imminent and what form it will take, all cash,  cash and NG shares or all shares. Whatever the offer is going to be it must reflect a price of at least $1.00 per CPY share.  We’ll just have to wait and see what happens between now and year end.  Share prices have been and will continue to be very volatile. Up and down like cat on a trampoline.

I will cover some exiting news about EPL in few days.

Cheers,  Ted L.