Tag Archives: copper

Interview with Kaizen President and CEO, B. Matthew Hornor

YouTube, Aug 4, 2015

Kaizen Discovery (TSXV: KZD) recently participated in the Sprott Natural Resource Symposium 2015 in Vancouver, BC. In an interview with SNNLive, B. Matthew Hornor, President and CEO provided an overview of Kaizen’s business model and growth strategies.

Please view the interview here: https://www.youtube.com/watch?v=CH0Q7iQXqBA

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Michael Pento: The Real Message of Plunging Commodities

By Michael Pento, Aug 3, 2015

The Chinese stock market recently saw its biggest selloff in 8 years as the dramatic 8.5% fall in Shanghai “A” shares also rattled markets around the world.

For the past few weeks China has been balancing its desire to keep the equity market from a complete meltdown, while still courting the international investment community with hopes of being a dominant player in the capital and currency markets.

But recently The International Monetary Fund (IMF) warned China’s government about its concern over limiting investors’ freedom to take equity out of financial markets. These concerns were raised when the IMF met with officials in to discuss the chances of including the yuan in the fund’s basket of currencies, also known as Special Drawing Rights (SDR).

As China tries to balance the demise of its equity bubble while still keeping the illusion of free markets intact, two delusional narratives have started to circulate around Wall Street.

The first such Wall Street inspired delusion is that the collapsing Shanghai stock market will have no effect on the underlying Chinese economy. However, even though China’s 260 million trading accounts may be a relatively small percentage of its total population, it’s also the richest and most productive portion of its citizenry, which also happens to be equal to the entire U.S. population in 1993. And Chinese GDP growth accounts for 1/3 of total global growth. Therefore, we can already find the manifestation of slowing Chinese growth from the nascent fall in equity prices.

For example, the profit of China’s industrial firms dropped 0.3% in June from a year earlier, that reversed a 0.6% rise in May and 2.6% gain in April. For the first six months of 2015, industrial profits were 0.7% lower than a year earlier.

In June, China’s producer price index fell 4.8% on an annual basis, its 39th straight month of declines. In fact, the economy is headed for its poorest overall performance in a quarter of a century.

The second fallacy is Wall Street believes in the TV commercial that claims what happens in Las Vegas stays in Vegas. Or, in this case, what happens to the Chinese economy stays in China.

But the truth is the meltdown in China is already spreading all around the Asia Pacific region. For example, Taiwan’s year over year export growth has hit multi-year lows due to collapsing trade with China.

But perhaps the biggest indicator of the magnitude of China’s slowdown can be found in the global commodities market. Most pundits are trying to link the recent selloff in commodities strictly to the rising dollar as measured by the Dollar Index (DXY). But that Index is actually down about 3% since March. During which time the rout in precious and base metals, energy and agriculture has greatly accelerated.

We see the Bloomberg Commodities index now at a thirteen year low. Copper is down 28% for the year, tin is down 30%, and nickel is down 44%. And then we have gold. Last week China dumped 4 tons on the market, causing the price of the precious metal to fall almost 4% within a matter of seconds. This had little to do with the value of the dollar on the DXY, but it was rather mostly about the waning demand in China from its imploding economy and the need to sell what you can when capital controls are in place.

Indeed, these commodity prices began to plunge concurrently with China’s steep drop in officially reported GDP growth from 12% in 2010, to just 7% today-the real current growth rate in China is closer to 4% when measured by private data. It is no coincidence that the price of copper dropped from $4.52, to $2.37 during this same timeframe.

The true message of plunging commodity markets is that the Chinese government wasted $20 trillion worth of credit digging holes to mollify the fallout from the Great Recession of 2007; primarily creating a huge fixed asset bubble with little economic viability. And then forced another $1.2 trillion in margin debt to engender a consumption-based economy; primarily by creating a stock market bubble after the fixed asset bubble strategy began to fail miserably.

So where does this leave the global economy now? US GDP is growing at a meager 1.5% for the first half of 2015. And the second half looks even worse, as an organic U.S. slowdown meets cascading global trade. Adding to this malaise, it appears as though the handful of U.S. stocks that have led the rally are finally starting to join the hangover party. For instance, social media stocks are now crashing harder than commodity prices, with Yelp recently falling 27% in one day after dropping 60% YOY; Twitter has also tumbled 45% in the last 52 weeks; and Facebook recently dropping nearly 5% after reporting a miss in the number of eyeballs staring at their cellphones checking the like box.

But here is the most important take; the arrogance that led the Fed to believe it could save the world in 2008 by manipulating markets is causing Ms. Yellen and co. to promulgate the idea that it can now raise rates into a global slow down without negative repercussions-thereby, demonstrating its success in rescuing the economy from the Great Recession by proving interest rates can now rise with impunity.

However, the truth is the Fed hasn’t raised interest rates in a decade and will probably never be able to move much off the zero bound range without totally collapsing markets and the economy. I think the Fed is aware of this and that’s why it is continually finding excuses not to start a rate hiking cycle-just like it did yet again in the July meeting. Therefore, the real money to be made is in fading the massively overcrowded trade that believes U.S. stocks are immune from the worldwide economic slowdown and that the U.S. dollar will be in a secular bull market.

This article is written by Michael Pento of Pentoport and with his kind permission, Gecko Research has been privileged to publish his work on our website. To find out more about Pentoport, please visit:

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NEWS: Kaizen Discovery Receives Remaining Permits for Exploration at Its Coppermine Project in Nunavut, Northern Canada

Jul 30, 2015

Kaizen Discovery (TSX VENTURE:KZD) announced today that it has received the remaining land and water use permits and mineral rights required for its exploration program at the Coppermine Project in Canada’s Arctic territory of Nunavut. The company’s planned diamond drilling program, consisting of 14 holes totalling 1,500 metres, is now underway.

Kaizen’s wholly owned Nunavut operating entity, Tundra Copper Corp., reports the following:

  • The Nunavut Water Board granted an amendment to Tundra’s existing Type “B” licence, which extends the project boundaries and allows an increase in water use;
  • Aboriginal Affairs and Northern Development Canada has issued a Class “A” Land Use Permit covering all Crown Lands held by Tundra in the Coppermine Project;
  • The Kitikmeot Inuit Association has issued Land Use Licences granting Tundra authority to carry out various mineral exploration activities, including drilling on specific parcels of Inuit Owned Lands contiguous with the company’s land holdings; and
  • Nunavut Tunngavik Incorporated and Tundra have signed a Mineral Exploration Agreement, granting Kaizen rights to a 100% interest in the minerals contained in the parcels of Inuit Owned Lands. The Mineral Exploration Agreement includes a form of Mineral Production Lease and details of a net profits royalty benefiting Nunavut Tunngavik Incorporated.

The newly granted permits and mineral rights are important to Kaizen fully exploring the approximately 3,500-square-kilometre Coppermine Project.

“We are pleased to have received all of the permits we applied for, which will allow us to fully explore the prospective licences acquired and staked last year,” said Dr. David Broughton, Kaizen’s Executive Vice President, Exploration.

Kaizen’s current exploration campaign targets district-scale, sediment-hosted, stratiform copper mineralization and high-grade, volcanic-hosted copper-silver within the larger permit area. The Coppermine Project contains 115 kilometres of strike of an easterly-trending belt of Meso-Proterozoic continental flood basalts (the Coppermine River Group) and unconformably overlying marine sedimentary rocks of Neo-Proterozoic age (the Rae Group). Drill mobilization was completed on July 26 and drilling has commenced with initial holes designed to test volcanic-hosted targets.

“Kaizen is advancing discussions with various potential partners, including a number of prominent Japanese corporations, with a view of securing funding for the development of Coppermine,” said B. Matthew Hornor, Kaizen’s President and Chief Executive Officer.

About Kaizen and the Coppermine Project

Kaizen is a Canadian mineral exploration and development company. Kaizen entered into a collaboration agreement with ITOCHU Corporation of Japan in January 2014 and has access to HPX TechCo’s proprietary, geophysical, Typhoon technology under a dedicated services agreement. Kaizen’s long-term growth strategy is to work with Japanese entities to identify, explore and develop high-quality mineral projects that have the potential to produce and deliver minerals to Japan’s industrial sector.

More information on Kaizen and the Project is available at www.kaizendiscovery.com.

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Does A Commodities Crash Mean Global Depression, Mass-Devaluation Or Both?

By John Rubino, Jul 21, 2015

First, precious metals peaked and began drifting lower. Then copper fell, oil plunged and it became obvious that these weren’t isolated events. The entire commodities complex — that is, all the physical inputs a modern economy uses to power, transport and build stuff — was in sustained decline. Here’s the Bloomberg Commodities Index over the past five years:

Bloomberg commodiites July 2015

Now, after the past week’s free-fall, commodities are front-page news:

Commodities crash to 11-year low as deflation fears grow: Latest price slump complicates backdrop for interest rate hikes

Global commodity prices have slumped amid a glut of supply and low demand – and now experts are foreseeing the prospect of deflation in the West.A basket of commodities measured by the Bloomberg commodities index has fallen to an 11-year low, and the index is down 42 per cent since its peak in 2008.

The “commodity supercycle” was the term to describe the boom in commodity prices pre-crisis, when global growth was steaming ahead and supported demand. Although commodities have had a hard time post-crisis, falls in the price of everything from from gold and oil, to copper and nickel have accelerated. Tin has fallen 25 per cent so far this year, Nickel is down 54 per cent from its February 2011 high, and natural gas has slumped 40 per cent over the same period.

There is a glut of industrial commodities on the world market and with growth flagging, demand is simply not strong enough.

Slightly different dynamics are at play in the oil market, as Saudi Arabia has vowed to keep Opec’s production high despite weak demand. Already-low oil prices have fallen 10 per cent in the last month, ahead of the lifting of US sanctions against Iran. There is known to be a significant amount of supply stacked up in Iran and waiting to hit the world market. Brent crude for September was down to $56.75 a barrel yesterday morning.

46% – fall in copper prices since 2011

25% – fall in tin prices so far this year

ASK DOCTOR COPPER
Perhaps most telling is the price of copper, which is trading around its lowest level since the financial crisis.

Known as Dr Copper due to its use as a barometer of global economic health, the industrial metal fell to $5,240 a metric tonne last week, heading towards weakness last seen in the summer of 2008.

The slump in copper is a “direct consequence of the actions we are seeing in China, the increasingly flustered and desperate government [measures]”, says Alastair McCaig at IG Index.

The nation accounts for 50 per cent of global copper demand, and despite official GDP data released last week stating that growth has confounded expectations to hit seven per cent in the second quarter, the figures have been widely ridiculed.

A range of other indicators show China is struggling. Not only is the debt-laden country going through a difficult transition from infrastructure-led growth to a consumption-led economy, but a stock market bubble has recently burst and $3 trillion (£1.9 trillion) has been wiped off the value of local shares. Authorities have taken a heavy-handed approach, banning the sale of some stocks for six months and going after short sellers.

“All of those [measures] independently might not be seen as too much of an issue but bundle them all together and we are seeing increasingly nervous oversight of the Chinese economy,” McCaig says.

DEFLATION
Looking ahead, the ongoing weakness in oil is likely to spell deflation for Western economies. Black gold plays a large part in dictating inflation levels in the West. The last round of inflation data — showing the UK had zero consumer price inflation — was correlated before the latest squeeze on oil prices kicked in.

“The latest fall in oil prices will push many economies including the UK into deflation in the next month or two,” says Michael Pearce at Capital Economics.

DELAYING RATE HIKES
Now experts suggest planned interest rate hikes could be delayed. “The UK is already skirting with deflation in the next couple of months and that is going to keep the Bank of England sitting on its hands,” says Neil Williams at Hermes Investment Management.

Consensus in the market is for the first US rate hikes to appear in December, with the UK set to follow suit early next year. But dozens of central banks have been forced to ease policy so far this year, painting a weak global picture. “The US and UK are talking of raising rates but with 30 banks having cut rates, the way things are going those numbers are likely to increase,” says McCaig.

So…

Q: Why did it take so long for the commodities crash to penetrate the conventional wisdom?

Because it conflicted with the general theme of global economic recovery. The US was reporting lower unemployment (though a lot of analysts continued to point out the bogus nature of that stat) and Europe and Japan had begun aggressive QE programs (which always leads to more borrowing and spending, right?). So despite the occasional hiccup, 3%+ growth was a lock going forward. Consider the opening paragraphs of this July USA Today article:

The International Monetary Fund cut Thursday its projection of global economic growth in 2015 to 3.3% from 3.5% issued in April, citing sluggish conditions in the U.S. in the first quarter.

Setbacks in the U.S. – like harsh winter weather, port strikes, and downsizing in the energy sector – have contributed to slower growth worldwide, it said in its latest “World Economic Outlook” update.

While the rest of the world should pick up pace by next year, advanced economies like Germany could make headway faster than developing nations, it said.

Growth of 3.3% is not bad at all, and it remains the consensus forecast for 2016. This implies fairly robust demand for commodities, so the fact that their prices are declining was easy to dismiss as an aberration soon to be rectified by rising sales.

Q: Can there be growth, inflation and all the other good things that governments have been promising while raw materials prices are tanking?

The answer is probably no, which means the other numbers — GDP, deficits, interest rates — will have to be adjusted to conform with the commodities complex rather than the other way around.

Which in turn means that the world’s governments are about to panic. Expect some Hail Marys in 2016, including sharply negative interest rates, a serious war on cash to facilitate those negative rates, and a return to QE in the US, where the idea of raising interest rates will be quickly abandoned.

Since these policies are just more aggressive versions of what has already failed, they’re unlikely to stop the carnage, leaving the developed world with one final weapon against global deflation: a coordinated devaluation of all major currencies, probably against gold. Though it’s taking a really long time, the currency war continues to play out according to Jim Rickards’ script.

This article is written by John Rubino of Dollarcollapse.com and with his kind permission, Gecko Research has been privileged to publish his work on our website. To find out more about Dollarcollapse.com, please visit:

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NEWS: Kaizen Discovery Intersects 78 Metres of 0.5% Copper and 0.15 g/t Gold at the Aspen Grove Project in Southern BC

Jul 20, 2015

Drilling Also Commences at Tanzilla Project in Northwestern BC

Kaizen Discovery Inc. (TSX VENTURE:KZD) is pleased to report that significant copper-gold mineralization has been intersected in the first hole drilled by Kaizen at the Aspen Grove Project’s Ketchan prospect (see location map below).

The Aspen Grove Project covers 11,237 hectares in southern British Columbia’s premier copper porphyry belt, part way between the Copper Mountain and Highland Valley mines. Kaizen owns 60% of Aspen Grove, with Kaizen’s strategic partner, ITOCHU Corporation of Japan, owning a 40% interest.

Exploration at the Aspen Grove Project is being funded by C$4 million in dedicated financing for the project provided by ITOCHU in 2014. Approximately 7,000 metres of drilling is planned for 2015, with Kaizen as the project operator.

The initial drill hole at Ketchan, K15-01, tested a magnetic and chargeability high near the southwestern margin of the Ketchan porphyry. The hole was drilled to a depth of 390 metres, and intersected a 265.5-metre thick zone of copper-gold mineralization, starting at surface. The intersection included a 78-metre interval grading 0.50% copper and 0.15 grams per tonne (g/t) gold.

Table 1: Assay results for drill hole K15-01, July 2015.
Drill Hole From
(metres)
To
(metres)
Drilled
metres
Copper
(%)
Gold
(g/t)
K15-01 4.5 270 265.5 0.265 0.112
Incl. 30 58 28 0.310 0.167
and 192 270 78 0.502 0.145
and 248 262 14 1.032 0.125
Note: The true width of the drill intersections reported throughout this release is unknown as the geometry of the mineralized zone is not yet known.

The upper part of the mineralized zone (to a depth of approximately 170 metres) consists of strong magnetite-K-feldspar (potassic) and epidote alteration, veining in diorite porphyry, and intrusive and hydrothermal breccia. Chalcopyrite (copper mineralization) occurs in magnetite and chalcopyrite-pyrite veins and as disseminations. Below 201 metres, the higher-grade chalcopyrite mineralization occurs mainly in hydrothermal breccia with remnant potassic alteration overprinted by intense epidote, chlorite, sulphide stringers and disseminations.

The highest copper grades occur in the deepest part of the intersection, which from 248 to 262 metres returned 1.03% copper and 0.13 g/t gold over 14 metres. This interval also returned 126 ppm (parts per million) molybdenum.

The assayed copper grades reported to date at the Ketchan prospect are consistent with average head grades of mines operating in the region. In Q1 2015, the average copper grade of ore milled at Teck Resources’ Highland Valley Mine was 0.31% copper and at the Copper Mountain Mine, 25% owned by Mitsubishi Materials Corporation, it was 0.345%.*

“We are very encouraged that our first drill hole at the Ketchan prospect has yielded significant copper-gold mineralization over a lengthy interval,” said B. Matthew Hornor, President and CEO. “We plan to undertake step-out drilling from this intercept later in the summer after completing the rest of our planned initial 10 exploration holes at Aspen Grove.”

*Source: Copper Mountain Mining Corporation and Teck Resources Q1 2015 production results.

To view the map of the location of the Ketchan and Par prospects at Kaizen’s Aspen Grove Project, please visit the following link: http://media3.marketwire.com/docs/MapLocationKetchanParProspectsKaizensAspenGroveProject.pdf.

The second drill hole in the Ketchan program, K15-02b, was collared 255 metres east of K15-01 and tested a second magnetic and chargeability high near the southwestern margin of the Ketchan diorite. K15-02b was completed at 485 metres after intersecting the contact between the diorite and Nicola Group marine sedimentary rocks at 401 metres. A 386-metre thick zone of copper-gold mineralization was intersected.

Table 2: Assay results for drill hole K15-02b, July 2015.
Drill Hole From
(metres)
To
(metres)
Drilled
metres
Copper
(%)
Gold
(g/t)
K15-02b 4.65 391 386.35 0.136 0.097
Incl. 57 129 72 0.340 0.060
and 275 351 76 0.141 0.268

Higher grade mineralization between 57 and 129 metres is marginal to the magnetic high and is associated with multi-stage texturally destructive alteration including early potassic and later epidote, chlorite, actinolite, albite and chalcopyrite. Higher gold values (up to 1.81 g/t over a single 2-metre sample width) in the lower zone occur at depth beneath the magnetic high.

Exploration at Ketchan is continuing with 150- to 250-metre spaced drill holes, designed to test the entire 300-to-500 by 1,800-metre-long mineralized system as defined by airborne magnetics, geological mapping and rock sampling, and induced polarization surveys. Follow-up drilling is expected once the initial program is complete.

To view the photo of the mineralized copper drill core from Ketchan prospect, please visit the following link: http://media3.marketwire.com/docs/mineralizedcopperdrillcoreketchanprospect.pdf.

Drill results at Par prospect

The Par prospect west of Ketchan contains a central chargeability and magnetic high not tested by Kaizen’s 2014 drill program. This anomaly was tested by drill hole AG15-01, which intersected over 100 metres of mineralized breccia from surface before being completed at a depth of 459 metres.

Table 3: Assay results for drill hole AG15-01, July 2015.
Drill Hole From
(metres)
To
(metres)
Drilled
metres
Copper
(%)
Gold
(g/t)
AG15-01 1.8 105 103.2 0.204 0.084
Incl. 1.8 75 73.2 0.245 0.096
Incl. 48 75 27.0 0.380 0.114

Mineralization consists of polyphase magnetite-hematite-pyrite-chalcopyrite stockwork veining and disseminated sulphides in a hydrothermal breccia which cuts chlorite-silica altered microdiorite porphyry. The porphyry intrudes a thick sequence of intensely phyllic altered, silicified quartz-feldspar porphyry and volcanics containing widespread quartz-pyrite-molybdenite veins and minor disseminated sphalerite.

Table 4: Azimuth and dip of Ketchan and Par prospect drill holes.
Drill Hole Azimuth
(degrees)
Dip
(degrees)
Length
(metres)
K15-01 30 -60 390
K15-02b 235 -60 485
AG15-01 110 -50 459

Tanzilla Project

Drilling also has been initiated at the Tanzilla Project near Dease Lake, in northwestern BC. Approximately 1,800 metres of drilling is planned to test deep porphyry potential of the Silica Ridge and Gopher Zone targets in 2015. The Tanzilla program is being funded under an Earn-in Agreement by Freeport-McMoRan Corporation of Canada Limited, a wholly owned, indirect subsidiary of Freeport-McMoRan Copper & Gold Inc. Freeport can earn an initial 51% interest by funding cumulative expenditures of C$8 million over a four-year period. Kaizen is the operator under the agreement for the 2015 program.

Qualified Person

Kaizen’s disclosure of a technical or scientific nature in this news release has been reviewed and approved by John Bradford, M.Sc., P.Geo. a geological consultant for Kaizen, who serves as a Qualified Person as defined under National Instrument 43-101. Mr. Bradford is not independent of Kaizen for purposes of NI 43-101.

Drill-core samples (2-metre sample length) for the Aspen Grove Project were prepared at Kaizen’s core logging facility in Merritt, BC, and samples were shipped to ALS Minerals’ preparation lab in Kamloops, BC. Ketchan samples were analyzed at ALS’s ISO 9001:2008-certified North Vancouver laboratory for gold, platinum and palladium by fire assay and ICP-AES, and for 35 elements, including copper, molybdenum and silver, by ICP-AES using an aqua regia digestion. Par samples were analyzed at ALS’s ISO 9001:2008-certified North Vancouver laboratory for gold by fire assay and ICP-AES, and for 35 elements, including copper, molybdenum and silver, by ICP-AES using a four acid digestion. Core intervals cited above represent apparent, not true widths; true widths are not known. Assay intervals above have been calculated with no cutoff value. Blanks, standards and duplicate samples were inserted into the sample sequence with a ratio of approximately one sample out of 15. The 2015 drilling program and sampling protocol is supervised by Nils Peterson, M.Sc, P.Geo, a geological consultant for Kaizen, and by John Bradford, M.Sc., P.Geo. Mr. Bradford has verified the data disclosed in this news release.

About Kaizen Discovery
Kaizen is a Canadian mineral exploration and development company. Kaizen entered into a collaboration agreement with ITOCHU Corporation of Japan in January 2014 and has access to HPX TechCo’s proprietary, geophysical, Typhoon technology under a dedicated services agreement. Kaizen’s long-term growth strategy is to work with Japanese entities to identify, explore and develop high-quality mineral projects that have the potential to produce and deliver minerals to Japan’s industrial sector.

More information on Kaizen is available at www.kaizendiscovery.com.

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