Randgold Resources, Lonmin and Fresnillo post weekly gains as gold, silver and platinum rally

Gold continued trading within narrow range, settling at US$1,134/oz by mid afternoon on Saturday after a buoyant week, which saw the yellow metal climb from US$1,115/oz to over US$1,140/oz as uncertainly in equity and currency markets increased the appeal of the yellow metal as a safe haven for investors.

The earthquake that hit the world’s largest copper producer Chile drove up the demand for all metals, helping gold steady at about US$1,120/oz level, which is struggled to hold on to last week. The yellow metal bucked the trend of moving inversely to the US dollar, climbing on Monday and Tuesday despite strength in the American currency.

Later in the week, the euro recovered after hitting 10 month lows against the US dollar as the outlook for Greece’s debt crisis improved with the announcement of a new package of austerity measures and Thursday’s overbooked bond issue that helped the debt laden country raise the targeted €5 billion to cover it near term debt paybacks. The new austerity measures, including VAT (value added tax) hikes and expenditure reductions including cuts of civil servants’ bonuses, are expected to save Greece a further €6.5 billion.

Pound sterling, the Canadian dollar and the Australian dollar, which was on the rise after the country’s central bank hiked a key interest rate to 4%, all gained against the American currency during the week, driving up the demand for alternative assets such as gold.

On Thursday, both Bank of England (BoE) and the European Central Bank (ECB) announced the decision to leave their respective interest rates unchanged today at 0.5% and 1, which had little impact on currency markets.

Gold remained steadily above US$1,130/oz at the end of the week as euro was bolstered by Greece’s successful bond issue, while the positive US non-farm payrolls update weakened the greenback, encouraging investors to pour money into riskier assets such as gold.

Gold has been in buying mode this week as holdings in the world’s largest gold denominated exchange fund SPDR Gold Trust increased during the week after declining since the start of the year, rising to 1,116.120 tonnes.

Other precious metals also did well as silver and platinum advanced to US$17.37/oz and US$1,577/oz respectively.

Mining stocks were in buying mode this week, recovering from last week’s falls. In the FTSE 100, gold miner Randgold Resources (LSE: RRS), silver and gold miner Fresnillo (LSE: FRES) and platinum miner Lonmin (LSE: LMI) rallied on higher metal prices as midcaps Aquarius Platinum (LSE: AQP), Petropavlovsk (LSE: POG) and Hochschild Mining (LSE: HOC) followed the majors, posting solid weekly increases.

Large and Mid Cap News

Mexico City-headquartered precious metals miner and FTSE 100 constituent Fresnillo (LSE: FRES) reported record attributable silver production of 37.9 Moz (million ounces) for the year to end-December 2009, which marked a 9% improvement over the previous year, while gold production rose 5% to 276,584 oz, helping the full year revenues to a 18% increase to US$860 million.

Hochschild Mining (LSE: HOC) has sold its 36.9% holding in Zincore Metals (TSX: ZNC) for C$10.3m in cash. The company received the 38.1m Zincore shares as a result of its purchase of Southwestern Resources Corp in May 2009.  Hochschild said the holding did not constitute a core asset for the company, and it disposed of the stake accordingly.

Small Cap News

Rodinia Minerals (TSX-V: RM; OTC: RDNAF) said it has received positive initial sample results from its auger drill exploration program on its Salar de Diablillos lithium-brine project in Argentina. According to Rodinia, these initial results may be indicative of high concentrations of lithium and potash. The company is encouraged by the results but it believes that the nucleus of the salar has yet to be intersected.

African focused mineral explorer and mine developer Discovery Metals (AIM: DME) was tipped in this week’s Shares magazine. The weekly said that the news flow stemming from development of the Boseto copper mine in Botswana will drive the company’s share price in the coming months.

Mariana Resources (AIM: MARL) said it will shortly begin drilling on the wholly-owned Las Calandrias project, which includes the newly discovered El Nido rhyolite dome complex, in the Santa Cruz province of Argentina. The program follows extensive exploration activity in the area, after the Calandria Sur discovery in late 2009. Recent exploration consisted of detailed mapping, rock chip geochemistry and an Induced Polarization Survey (IP).

In an investor update, Forte Energy NL (ASX, AIM: FTE) said it has completed the sale of its 50% interest in the Maroochydore copper-cobalt joint venture to a subsidiary of Aditya Birla Minerals (ASX: ABY). On completion, Forte received A$2m in cash and was released from the JV’s obligations, consequently improving its cash position to around A$7m.

Fairfax noted the transformation of Solomon Gold (AIM: SOLG) over the past year including board changes, diversification of exploration areas and the JV (joint venture) agreement with Newmont Mining Corp (NYSE: NEM) over the gold exploration project on Guadalcanal, Solomon Islands. The broker believes these changes should produce results through the current year.

Rambler Metals & Mining (TSX-V: RAB, AIM: RMM) has entered into an agreement with Sandstorm Resources Ltd. (TSX-V: SSL) to sell a portion of the Ming copper-gold mine’s ‘life-of-mine’ gold production. Under the terms of the deal, Sandstorm will make staged upfront cash payments totalling US$20m, the first US$5m is available immediately.

Kalahari Minerals (AIM: KAH) has announced that its wholly owned Australia subsidiary has closed the acquisition of Coronet Resources after receiving acceptances in respect of 99.44% of the issued shares in the company, whose main asset is a 7.65% stake in Kalahari.

Kenmare Resources (AIM: KMR) plans to raise approximately £179.6m through the issue of 1.4bn new Shares at 12p each. Kenmare intends to significantly increase production, at a relatively low cost per incremental tonne, at the Moma titanium minerals mine in northern Mozambique to generate a substantially expanded revenue base and subsequently pay down debt.

Mariana Resources Ltd (AIM: MARL) said it appointed Glen Parsons as director finance and corporate development with immediate effect.  He will oversee the financial operations and corporate strategies of the company as it advances its gold, silver and copper projects in Argentina and Chile.

Amur Minerals (AIM: AMC) has completed the construction of a 300 kilometre long ice road to its Kun-Manie nickel deposit, which will allow it to restock the project with essential supplies and materials for the upcoming year.

Canadian investment bank Versant Partners has issued a 'buy' recommendation on Discovery Metals (AIM, ASX: DME) with a one-year price target of A$0.85 (approx £0.54) per share. The dual listed mine developer is currently focused on bringing the Boseto copper project into production in Botswana. According to Versant, Discovery is on track to benefit from a positive fundamental copper environment, with a bankable feasibility study expected to be completed in the current quarter.

Kalahari Minerals (AIM: KAH) has appointed Richard Lockwood as a non-executive director to assist Kalahari’s 40.44% owned Extract Resources (ASX, TSX: EXT) with advancing its Husab uranium project in Namibia.

Patagonia Gold (AIM: PGD) has retained independent Toronto-based consultants Micon to prepare a NI43-101 resource estimate for the La Manchuria high grade gold and silver project in Argentina, after the explorer recently completed an infill drilling campaign there.

In its full-year results, Cromex Mining (AIM: CHX) said much of the year was taken up with construction of the Stellite processing plant in South Africa, while producing sufficient chrome to provide positive cash flow, and retaining valuable chrome resources in the ground, pending an upturn in prices. The company turned a profit in the year ended 30 September 2009, reporting adjusted net profit of £195,000 compared with a £1.4m loss in 2008

EMED Mining (AIM: EMED) has further advanced its Biely Vrch gold project in Slovakia towards production. It has commissioned a refinement of the scoping study to adjust the siting of infrastructure, and improve the project economics by adjusting the slopes of the planned open pit. The study is also to evaluate the potential for additional revenues from selling waste rock mined from the open pit for use in building roads.

Edison Investment Research said that following regulatory and permitting setbacks in the past, EMED Mining is now well positioned to move the Rio Tinto copper mine project in Spain forward. Furthermore the investment researcher said the company’s shares are trading at a discount of 67% to Edison’s 39p per share valuation, based on the Rio Tinto mine alone.

Griffin Mining (AIM: GFM) announced the latest JORC Mineral Resource for Zone III at its Caijiaying mine in the People's Republic of China.  The new JORC-compliant statement identifies extensive resources and a long mine life for the company’s continuing mining operations and adds 4.7m tonnes at 6.7% zinc, 0.9 grams per tonne (gpt) gold, 34.3gpt silver and 0.4% lead to the Measured Resource category.

Broker Fox-Davies Capital (FD Capital) said the recent increase in the copper resource at Exco Resources’ Mt Colin deposit could lead to a revision of its valuations of the company, which stands at A$0.65 per share with a 'buy' recommendation, compared to the current stock price of A$0.25.

Selwyn Resources (TSX-V: SWN) has extended the exclusivity period under the proposed joint venture with Yunnan Chihong Zinc & Germanium Co (Chihong), as the respective parties finalize their negotiations and seek shareholder approval. The transaction, which sees Chihong invest C$100m into the Canadian project and gain a 50% interest, is still on track to close in May 2010.

Minera IRL (AIM: MIRL) has announced the appointment of Napoleon Valdez Ferrand as a non-executive director of the company.

Orosur Mining (AIM: OMI) has upped the resource grade estimate of its Arenal Deeps gold deposit at the San Gregorio project in Uruguay after Mine Development Associates carried out a NI43-101 compliant estimate.

Connemara Mining (AIM: CON) has intersected high grade zinc-lead mineralisation in another drill hole at the Stonepark North zone located in Limerick, Ireland. The company said the latest results suggest the presence of a continuous zone of zinc-lead mineralisation, at a depth of approximately 200-220m. At Stonepark, Hole 36 intersected 5.35m at 13.2% zinc and 3.2% lead from a depth of 202.7m.

European Nickel (AIM, PLUS: ENK) and Rusina Mining NL (AIM: RMLA, ASX: RML) announced that they have satisfied the due diligence conditions of their proposed merger. The transaction is now expected to complete in May 2010. In February European Nickel signed an agreement to acquire Rusina in an equity-based deal, with a capped value of up to 27.1m.

Stratex International (AIM: STI) has released what it called an "extremely encouraging" preliminary in-house resource estimate at its Öksüt gold project, located in the Central Anatolia region of Turkey.  The in-house resource estimate determined that the Ortacam Zone, contained a total of 147,814 ounces of oxide gold across all resource categories. The in-house estimate was carried out to JORC standards.