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Africa's Newest Gold Region

Nigeria May Have 2 Million Ounces of Gold

Sunday, February 7th, 2010 - By Luke Burgess

Officials from the Nigerian Ministry of Mines and Steel Development hope to begin developing the country's gold and other mineral resources as an alternative its oil and gas industry.

The renewed interest in minerals follows the discovery of 300,000 ounces of gold, with an estimated 2 million ounces contained in Western Nigeria.

The Ministry of Mines believes Nigeria has gold belts in the western half of the country that are very similar to those of Ghana — the world’s second largest producer — which accounts for about 10% of the world’s gold reserves.

Nigerian officials will also focus on the development of oil sands with estimated reserves of 27 billion barrels of oil equivalent, coal (2.7 billion tonnes), iron ores (3 billion tonnes), limestone (2.23 billion tonnes), barytes (14 million tonnes), and lead/zinc sulphides (1 million tonnes).

One company investing in Nigeria gold right now is CGA Mining (TSX: CGA). CGA owns the Segilola project, where the company recently proved the existence of 620,000 ounces of gold at a grade of 4.3 grams per tonne.

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire

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China Remains World's #1 Gold Producer

Gold Output Exceeds Record 300 Tonnes

Thursday, February 4th, 2010 - By Luke Burgess

The China Gold Association reported that domestic gold output increased 11.3% to a record of 312 tonnes last year, clinching the county's position as world's largest gold producer for the third year in a row.

China's booming gold industry reported 138 billion yuan (US$20 billion) of gross industrial output value in 2009 — an increase of 19%, compared to the previous year.

Nearly 60% of China's gold output last year came from the five producing province: Shandong, Henan, Jiangxi, Fujian, and Yunnan.

The ten largest gold firms produced 149 tonnes — 47.3% — of the country's total output. China had more than 700 gold producers in 2009, down from more than 1,200 firms in 2002 as the industry consolidated.

The China Gold Association gave no figures for domestic gold demand. However, metals consultancy group GFMS said last month that it expects China to overtake India as the world's largest gold consumer in 2009. Total Chinese demand is forecast to reach 432 tonnes as investors defy record bullion prices.

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire

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Peru Remains World's Top Silver Producer

Peru Increases Gold Production 1.4% in 2009; Silver Output up 4.6%

Tuesday, February 2nd, 2010 - By Luke Burgess

Production of gold, silver, and copper in Peru increased during 2009, while output of other base metals declined, according to Peru’s Ministry of Energy and Mines.

Gold production in Peru increased 1.41% to 6.4 million ounces. Meanwhile, Peruvian silver production increased 4.56% to 136 million ounces, and copper output rose 0.54% to 45 million pounds.

Peru is the world's top producer of silver and ranks as the third largest copper producer and sixth largest gold producer. Other base metal production fell in Peru last year. Below is a table with annual metal production data from Peru:

Metal	2009 Production	Change from 2008
Gold	6.4 million ounces	+1.41%
Silver	136 million ounces	+4.56%
Copper	2.8 billion pounds	+0.54%
Zinc	3.3 billion pounds	-5.85%
Lead	667 million pounds	-12.37%
Tin	83 million pounds	-3.93%
Iron	9.7 billion pounds	-14.38%
Molybdenum	27 million pounds	-26.47%

As the Peruvian mining industry continues to expand, there will be a growing need for more energy. My colleague, Sam Hopkins, recently returned from the country where he got a first hand look at Peru's growing wind energy projects. To learn about Sam's Peruvian adventure — and two wind energy companies he believes will return expect upwards of 60% in short order — check out his latest report.

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire

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Lihir Gold Joins the 1 Million Ounce Club

Expecting to Produce 1.3 Million Ounces by 2012

Saturday, January 30th, 2010 - By Luke Burgess

Mid-tier gold producer Lihir Gold (NASDAQ: LIHR) wrapped up a fourth consecutive year of record gold output in 2009, with production exceeding one million ounces for the first time in the company’s history.

The company reported production of 1.12 million ounces of gold at a total cash cost of $397 per ounce last year — up 27% from the previous year.

In 2010, Lihir is forecasting slightly lower gold production. The company expects to produce between 960,000 and 1.06 million ounces this year from its three producing operations in Papua New Guinea, West Africa, and Australia.

Going forward, Lihir expects to ramp up gold production to 1.3 million ounces in 2012 as expansion projects boost output at Lihir Island and Bonikro.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire

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Platinum, Palladium Surge to 18-Month Highs

Investors Lulled by Two New ETFs

Wednesday, January 27th, 2010 - By Luke Burgess

Platinum and palladium prices climbed to 18-month highs this week, boosted by demand from two newly launched ETFs.

The ETFS Platinum Trust (NYSE: PPLT) and ETFS Palladium Trust (NYSE: PALL) began trading on January 8 with much fanfare. And in the three weeks since their NYSE listing, both ETFs have witnessed large investments.

These ETFs — like many others — are backed by the physical metals. The platinum ETF currently holds 195,000 ounces; the palladium ETF holds 400,000 ounces. The metal currently held in the platinum ETF is worth over $300 million and is equal to over 11 times the world's daily platinum output.

Platinum for immediate delivery rose as much as $1,629 an ounce this week, while palladium peaked at $466 an ounce.

Platinum and palladium are mainly used in catalytic converters that lower pollution from combustion engines. Support for platinum and palladium demand is expected to be boosted by China, where up to 17.2 million cars are forecast to hit the road this year — a 26% increase from 2009.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire

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Shares of Junior Miner Explode After Rare Earth Discovery

Investors Gain Nearly 180%

Saturday, January 23rd, 2010 - By Luke Burgess

Share prices of First Gold Exploration Inc. (TSX-V: EFG) skyrocketed as much as 180% after the company announced a new high-grade discovery of rare earth elements and lithium at its Éléonore Property in Northern Québec.

The company reported that recent grab samples from an area between two of First Gold's previous lithium and rare earth element discoveries - contained very high grades of lithium, rubidium, tantalum, beryllium, niobium, and gallium.

The announcement of the new discovery sent the stock soaring from $0.34 to a high of $0.95. Share prices cooled off by the end of the day to close at $0.68 - a 113% gain.

The news even sparked near-panic buying. Investors traded 9.3 million EFG shares by the end of the day - a whopping 4,000% increase over the stock's 3-month average daily volume.

First Gold's press release stated the company was compiling the results of the drill hole that should be released in the coming days.

As the price for rare earth elements and lithium continues to march higher, new discoveries — like those being made First Gold's Québec property or the $273 billion in rare earth elements found in Greenland — will continue to pay off for investors

Luke Burgess
Investment Director, Hard Money Millionaire

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Palladium ETF Launches, Finally (NYSE: PALL)

Up Over 100% in 2009, Palladium is on Fire

Monday, January 11th, 2010 - By Adam Sharp

Palladium has trounced other precious metals over the past year. This 200 day chart shows the period when palladium really broke from the pack:

palladium-chart

New Palladium ETF

Back when I recommended palladium to Wealth Daily readers on Nov 2nd 2009, I suggested physical bullion as the best way to play it. That was partly due to lack of an ETF option.

Well now there is one. It just launched last Friday (1/8/09), and it's backed by physical palladium. It trades on the NYSE under PALL.

The expense ratio is reasonable at .60%. With the premium on palladium bullion high, this new ETF should offer investors a good way to play the rare metal.

Palladium is trading at $430 per ounce today. Here was my bull-case for palladium back in November, when it traded at $320 (also recommended it on my old blog in April, at $250):

I would classify it among the riskier metals as an investment class, but the potential upside is great. As the world continues to print money in an attempt to stimulate economies, palladium could benefit from both increased industrial demand and inflation.

The decline in car sales is partially to blame for the fall in palladium prices. But with governments artificially stimulating auto-sales around the globe, palladium prices should rebound with demand.

I also mentioned Stillwater Mining (NYSE: SWC) as a way to play the metal. That stock is up 99% since.

Palladium has had a fantastic run over the last year. It would probably be prudent to wait for a pullback at this point. That said — I'm not selling mine yet. I'm also not adding any more for now. We'll keep you updated, and let you know if we see a good buying opportunity.

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The Torches Come Out in Iceland

Protests break out in Iceland over bank bailouts

Tuesday, January 5th, 2010 - By Adam Sharp

$5b almost seems like an insignificant amount these days. But to a tiny country like Iceland, it's a ton — 13,000 euros per capita, to be exact.

Icelandic lawmakers have proposed the public cough up $5b to pay back England and Holland, to make up for the failed bank IceSave. English and Dutch depositors lost money when the banks failed, and their respective governments compensated those individuals.

Iceland originally agreed to pay those governments back, but the public is strongly opposed to the bailout. Why should the country as a whole pay for the recklessness of a few (you could say this is a recurring theme worldwide)?

Due to extreme backlash, the President of Iceland has so far refused to sign the bailout bill into law. The U.K and Netherlands aren't happy, but the already hurting Icelandic public are breathing a sigh of relief.

The pictures below are from one of the protests that lead the President to veto the bill. Remember all that talk about torches and pitchforks? Well, Iceland went ahead and broke out the torches (ok - they're flares, technically):

iceland-torches

iceland-bailout-protests

More on the political situation from Spiegel.de:

On Tuesday, however, President Grimsson announced he had refused to sign a law to enable the repayment. It has cast his country into what seems to be a full-blown constitutional crisis, since both the nation's parliament and the rest of its government had already approved the repayment plan.

Under Icelandic law, the president is required to sign all legislation approved by parliament. Refusals to do so are extremely rare. President Grimsson, who is now serving a fourth term in the office he has held since 1996, last did so in 2004 when he refused to approve a new media law.

In the last few days, the president had said he needed more time to come to a final decision on the repayment bill, which had passed through parliament last Wednesday with a slim 33-30 majority. The government had reached a deal with Britain and the Netherlands in June to repay the lost savings, but it required parliamentary approval.

On Dec. 31, 52,000 Icelanders presented him with a petition protesting the law. By Tuesday afternoon, that number had grown to 62,282, representing close to a quarter of the island nation's entire population.

Prime Minister Johanna Sigurdardottir, who threatened to step down if parliament did not approve the repayment bill, has been left with two options. She can either withdraw the bill or call for a public referendum on the matter.

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