Today, Trio Gold has made an important announcement, the headline being:
Journey Resources options Empire from Trio Gold
Here is the link:
http://www.triogold.com/NewsDetail.php?id=21
I wrote the Update about a week ago and for my own personal reasons did not release it. However, now that a Trio Gold (TGK) potential joint venture has been announced, I thought it a good time to update the story. I know not of Journey Resources (JNY-V) but did discover a bit of interesting news about their company (http://www.journeymining.com). It would appear that they have other interests in Idaho making the geographic tie a good fit in so far as Trio’s Empire Project is concerned. To wit….
Journey Resources Corp. News Release: January 06, 2006
Mr. Jatinder Bal reports
MINERAL CLAIM OPTION AGREEMENT
Journey Resources Corp., further to the company’s news release of Nov. 30, 2005, and Stockwatch news dated Dec. 1, 2005, has now closed its acquisition of an option to acquire all the rights, titles and interests of Wave Exploration Corp. and its subsidiary, Wave Mining Inc., in and to certain mineral claims located near the state of Idaho known as the Musgrove Creek gold project.
They also have a very conservative share structure-about 21 M shares outstanding on a fully diluted basis.. At first blush, something very positive appears to be unfolding.
Please remember that in all situations such as this, T’s have to be crossed and the i’s dotted. The Securities Exchange guidelines need to be followed, and the JV deal will be consummated upon the financial parameters of the transaction being completed.
Now, on with the Update
January 18, 2006
I first brought Trio Gold to your attention approximately five months ago. I wanted to offer a brief update because we’ve had a good number of inquiries from the general public and a few from some large shareholders.
To quickly recapitulate: Trio gold is based out of Calgary Canada and currently has two properties that are receiving a significant amount of attention. The one in Idaho is called the Empire Property (copper, gold, and silver) and it’s the most advanced in terms of development and exploration. The other one called Rodeo Creek (gold) is in Nevada. Trio Gold is the only Junior Mining Company that holds a significant stake on the world famous Carlin Trend in Nevada. This is a small company, with an extremely dedicated and hard working group of people running it. Philip van Angeren is their chief geologist.
Harry Ruskowski is the CEO and President of the company and I believe he has been diligently working to create joint ventures on the Empire Property in Idaho and on the Carlin Trend in Nevada; especially over the past several months. He was at the San Francisco Gold Show even though he was “under the weather”. To me that showed real grit because I heard him on the phone and know he should have been home in bed. Instead, he was out working for the company and its shareholders.
Since that San Francisco Gold Show, there has been interest in trio from a myriad of sources.
I know the stock was halted on December 21, 2005 after it started to spike up to around $.16 (sixteen cents Canadian). Trio halted the stock and it remained halted for what appeared to be an inordinate amount of time but in fact it was only four or five business days because it was around the 2005 Christmas Holiday period.
The text of the PR around that same time was short and sweet: “Trio Gold Corp. is continuing negotiations with a third party for a joint venture participation to develop its Empire mine property in Idaho and to continue exploration on its Rodeo Creek property on the Carlin trend in Nevada.”
Short and Sweet
That’s about as short and sweet as it gets. I think the intention is to keep the expectations low and when something develops it will be announced. This makes sense to me because I’ve been receiving quite a few questions as to what is occurring with these properties.
Why was the stock halted? Was that good or bad? Is there a deal? Did a deal fall through? Is there another deal? So many questions and so few answers!
What’s going on? Many investors were confused because of the fact that the stock was halted after it spiked up, giving the appearance that something positive was going to be announced. Then it appeared that nothing had transpired. However, we all know that appearances can be deceiving! If you go to commonsense.com, (your own cognitive thinking that pertains to your own common sense), you’ll most likely be close to what is really happening.
The bottom line is that Trio controls some valuable properties with excellent potential. A substantial amount of work has been completed at the Empire over the years and their geologist is top notch. They are the only active “Junior” on the Carlin Trend and the possibilities are endless. They need that first step forward to get excitement flowing back into the company. Visit their website at www.triogold.com for a more complete picture.
On January 11, 2006, I spoke with insiders at the company and from what I understand negotiations with potential JV partners are ongoing. I believe that the management of Trio Gold believes they’ve stuck it out through thick and thin for all these years and at this point, just when the gold/resource market is really heating up, they want their valuable properties to participate in the market in a fair and equitable manner. They are not about to hand them over on a gold or silver platter (pun intended) for little in return.
All Junior Mining Companies have to deal with the sort of thing. Yes, there are always companies wanting to JV but many are not willing to offer what properties are really worth. It’s called “low-balling” and whether someone is trying to buy a house, a car, or a resource property from you, the process is the same. They make an offer that is ridiculously low with the hope that someone will “meet you in the middle” which still turns out to be unrealistically low. So you get these endless rounds of negotiations until both parties hopefully meet on the REAL middle ground; you know, the one that is realistic.
Trio is determined to make deals that are good for their shareholders and deals that will aggressively advance their projects in a timely fashion. That means they want to joint venture with a company or companies that will aggressively move their work programs forward. They don’t want to JV up with a company that is going to “shelve” the project for a year or two as many Senior Mining companies are want to do. Trio wants to strike while the iron is hot. Can you blame them? I can’t. In fact, as a shareholder, I want them to make the best possible deal even if it takes a bit more time.
Again, foremost in their thinking is the size, duration, and time frame for an aggressive exploration program that will commence immediately if not sooner. (“Immediately, if not sooner”, are the immortal words of W.C. Fields or Bugs Bunny!)
Yes, earn-in interest, money on the table and all the peripheral elements of a JV deal are all important, but this group knows the value of timing. Someone once said, “Don’t tell me what to buy, tell me when to buy it!” That pretty much sums up the mind set of this group—the timing is what is so important because they know that the time is NOW. The resource sector is hot—now!
The pivotal point is that no one should jump to conclusions one way or the other. My recommendation would be to sit tight and see what develops. It wouldn’t be a bad time to “nibble away” if you are without a position. It was my opinion that the share price was undervalued even at $.25 US based upon the work that had been completed at Empire over the years. The share price is still below that level and the only thing that has changed is that the gold/resource market has gotten stronger and Trio appears to be attracting more interest!
Don’t forget, these are only my opinions, I am not a licensed financial advisor and I do own a significant position in the company. However, it is my opinion, based upon what I know the values of these properties to be, that before all is said and done, Trio Gold might surprise us all.
Until next time,
D. Stewart Armstrong
Posted by D.Stewart Armstrong in Articles