Mining and Exploring in Atlantic Canada

While Canada is one of the first places investors and speculators think of when it comes to natural resources and especially precious and base metals, the Atlantic region of Canada is normally not the first geographical area that comes to mind. Provinces like Quebec, Ontario and British Columbia tend to jump out first. This has led to some very significant opportunities in Atlantic Canada being either overlooked and/or undervalued.

One area that was up and coming until it was literally slammed shut was Labrador’s uranium exploration and development. On April 8, 2008, the Nunatsiavut Government imposed a three-year moratorium on uranium mining on Labrador Inuit Lands. While I believe the intentions were honorable, a lack of understanding about the outcomes of those actions has set back this area and those who were working to develop projects within it. Thankfully, there seems to be serious talk of having the moratorium end ahead of schedule. Even if it doesn’t, I don’t believe we’re going to see anything like it going forward. This has created opportunity in a highly-speculative junior resource company that was severely impacted by the moratorium and can now seemingly benefit greatly from its lifting.

That company is Crosshair Exploration [TSX:CXX, NYSE Amex:CXZ], a dominant player in the exploration and development of gold, uranium and vanadium in the U.S. and Canada. The Bootheel Project, an important part of the CXX story, is located in uranium mining-friendly Wyoming. With its in-mining potential and initial NI 43-101 uranium resource estimate of 1.09 M lbs indicated and an additional 3.25 M lbs inferred, the project has exceeded the minimum mining threshold and is designed for near-term production.

In Newfoundland, Crosshair is advancing its gold projects; The company recently completed 7,220 m of drilling and has a bulk sampling program that is set to commence Q3-2010. Stantec Consulting Ltd. has recently been contracted to prepare an Environmental Compliance Plan and design a method of removing the overburden for the trenching that is anticipated to begin September 2010.

In Labrador, Crosshair has already demonstrated the multi-deposit potential of the Central Mineral Belt (CMB) Uranium/Vanadium Project by successfully developing four currently defined resources (C Zone, Area 1, Armstrong and Two Time Zone). All four resources are open for expansion.

Vanadium, already irreplaceable in several industries including aerospace, aviation and construction due to its unrivalled ability to strengthen steel, has also become very important in the advancement of battery technology and its use for connecting large-scale power grids. Phase I of the Vanadium Resource Expansion Program is complete and Phase II commenced mid-July 2010.

Thanks to the great success of Consolidated Thompson and its Bloom Lake project, another developing iron ore play in the Labrador region is Alderon Resources Corp. (TSX.V:ADV). Alderon, which employs several key executives who were instrumental in Consolidated Thompson’s success, is an exploration and development company with an iron ore project slated for near-term production. The Kamistiatusset (“Kami”) Property is located next to the mining towns of Wabush, Labrador City and Fermont in Western Labrador. The property is also within close proximity to roads, the railway and hydro power.

Based on drilling to date, the Kami Property may contain 200-250 million tonnes with grades between 28 to 35 per cent iron. These grades are analogous to those at Consolidated Thompson’s Bloom Lake Deposit. The goal of the 2010 $7-million program is to delineate 400-500 million tonnes at grades between 28-34 per cent iron. The potential tonnage and grade are conceptual in nature and it is uncertain if further exploration will delineate a mineral resource.

Continued worldwide demand for steel will keep driving iron ore prices upward and Alderon is well positioned to benefit from the continued demand. Particularly since the Alderon team is comprised of skilled professionals with significant iron ore expertise to advance Kami towards production.

While Atlantic Canada is well known for its beauty, uranium and iron-ore can add to its popularity among investors and speculators.

NOTE: Peter Grandich is a compensated consultant to Crosshair Exploration and Alderon Resources Corp and own shares of ADV.

Peter Grandich
About Peter Grandich

Though he never finished high school, Peter Grandich entered Wall Street in the mid-1980s with no formal education or training and within three years was appointed Vice President of Investment Strategy for a leading New York Stock Exchange member firm. Now an internationally-acclaimed financial expert, he has made a 25- year career out of his knack for uncanny, accurate market predictions. Labeled the “Wall Street Whiz Kid” by Good Morning America, Grandich gained national notoriety by being among the very few who not only forecasted the 1987 stock market crash just weeks before it happened, but on the very next day predicted that within two years the market would reach a new all-time high. Proving his ‘87 forecast was no fluke, Mr. Grandich said in January 2000 that the year would go down as the year the great mega bull market of the 80s and 90s came to an end. He also called for the market’s bottom in March 2009, earning him a bevy of national press coverage. Each time, he was right on target. His ability to analyze and forecast financial happenings has resulted in hundreds of media interviews including GMA, Neil Cavuto’s Your World on Fox News, The Kudlow Report on CNBC, Wall Street Journal, Barron’s, Financial Post, Globe and Mail, US News & World Report, New York Times, Business Week, MarketWatch, Business News Network and dozens more. He’s spoken at investment conferences around the globe, edited numerous investment newsletters, and is regarded as one of the world’s foremost market strategists. Grandich is the founder of Grandich.com and Grandich Publications, LLC, and is editor of The Grandich Letter which was first published in 1984. On his internationally-followed blog, he comments daily about the world’s economies and financial markets and posts his views on social and political topics. He also blogs about a variety of timely subjects of general interest and interweaves his unique brand of humor and every-man “Grandichism” expressions with his experience gained from more than 25 years in and around Wall Street. The result is an insightful and intuitive look at business, finances and the world, set in a vernacular that just about anyone can understand. In his first year, Grandich’s wildly-popular blog had more than one million views. He is the also the founder of Trinity Financial Sports & Entertainment Management Co. [www.TrinityFSEM.com], a firm with a Christian perspective which he started in 2001 with former NY Giant and two-time Super Bowl champion Lee Rouson. The firm offers services to celebrities, athletes and average folks. Grandich also provides a variety of services to publicly-held corporations on a compensation basis. Peter Grandich is a member of the National Association of Christian Financial Consultants, and a long-standing member of The New York Society of Security Analysts and The Society of Quantitative Analysts. He resides in New Jersey.

1 Comment to “Mining and Exploring in Atlantic Canada”

  1. Very happy to see you have added Peter Grandich to your rostrum. He is a person who can be relied upon for detailed, honest evaulations of the companies he covers. A man of integrity.

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