hello friends,

friday was GREAT news for noront and ALL of the area plays.  here is what was announced and why it may prove to be both important AND impressive.

news release by mcdonald mines (an area play in the james bay lowlands):

The Company (area play McDonald Mines bmk.v) is very pleased to announce that Sheldon Inwentash - Chairman & CEO, Pinetree Capital Ltd., Robert McEwen - Chairman & CEO, US Gold Corporation, Pierre Lassonde - Chairman, Franco-Nevada Corporation, and Randall Oliphant - Chairman, Western Gold Fields Inc. have agreed to purchase a substantial portion of the Units available in this Offering.

here is a view on this news and why it is great news for ALL of the area plays:

the above release is from fridays mcdonald mines $10 million private placement.  the $10 million $'s matter only a little, the 4 names above matter very much.  i will call them "THE BIG 4"

a bit of background from what i know of "THE BIG 4" whom are most impressive additions to bmk's shareholder roster and as such the credibility of entire james bay lowlands area and ALL related firms.

pierre lassonde one of the saviest engineer/financiers in the mining business. along with associate seymour schulich they created the franco nevada royalty firm (which by the way took a royalty interest on the voisey's bay deposit- ring any bells out their friends?).  franco nevada was later merged into newmont (one of the worlds largest mining firms) where lassonde was president.  top of the line in every way.  lassonde can open ANY door either governmental or finance.  independantly wealthy because of the wealth he created for shareholders.  made a lot of fortunes for his early followers.  i like how he treats his shareholders. 

robert mcewen, can't say enough good about this guy.  a champion of the small shareholder.  this is the guy who led the unlocking of the red lake mine for goldcorp by figuring out the fractured gold zones and at depth logic that had eluded all earlier land owners. (if you do not know it that is a very good analogy to the windfall lake noront strike)  goldcorp was one of the most successful mining stories of the last several decades. made a lot of fortunes for his early followers.  independantly wealthy because of the wealth he created for shareholders.  after leaving goldcorp recently led a CONSOLIDATION OF A MINING DISTRICT (did you notice that word consolidation!) via the u s gold company and some smaller firms in the same mining district. (this is a very important fact to understanding what is likely coming soon)  robert ran his goldcorp shareholders market cap from $50 million to over $8 billion.  his u s gold shareholders have also done extremely well.  treats his shareholders as equals.  my kind of guy.

inwentash (inwentash/pinetree capital have a big shareholding in noront already) and oliphant (former president and ceo of barrick gold one of the worlds largest mining firms) are both big players in the mining business.  one in mining finance and one in mining management.

here is what this might mean, this is just an opinion, like all of my postings on this site, so do your own homework, do your own thinking in all of this.  you are the only one responsible for your own investments.  get educated and make good decisions and you will have a chance to make some money in the markets.

many believe that this james bay lowlands is soon to be a mining district.  a major district.  many are guesstimating that the double eagle find is the first of many excellent finds in the area.  the theory is that the ore and distance of the strike etc are just too substantial for it to exist in a unique one off occurence.  i agree of course.  also what do you think richard nemis thinks of the area? coining a name like "ring of fire" instead of choosing a name like "one hole wonder of fire"?

based on who just joined with bmk ("THE BIG 4"), it would seem some very bright investors and mining people agree with the above thoughts.  note lassonde, mcewen, etc got a big discount when they bought their shares and could flip them for a quick 100% profit, thus making millions quick and easy so there is that chance.  however if you understand the net worth of these individuals you will quickly realize they likely would not be annoyed with extra paperwork and this publicity for a few million - that is not likely an exageration.  after you reach a certain high net worth such as these guys they only do things they want to do and are excited about.  money (in the low millions) is not a big motivator here, in my opinion, for "THE BIG 4".  they are after much bigger game and a challenge.

also and this is very important, it has been mentioned that the private placement was negotiated when bmk had a share price under what the private placement sold at. if so that means these guys actually paid up to get in. if that is correct that is great additional news.  what that also would logically infer is that the recent very strong share price movement in bmk, way above the offering,  was because word got around bay street regarding "THE BIG 4" coming on board.  that would account for the recent very strong share price movement in bmk AND some of the strength over that last few weeks in noront. so this news of "THE BIG 4" is somewhat factored into the share prices already even though the masses are just getting word and understanding.

it is important to note "THE BIG 4" are NOT NOT and i repeat NOT noted in the announcement as directors, so it is not a slam dunk announcement just a great announcement.  some of "THE BIG 4" becoming directors at bmk, will likely only come for "THE BIG 4" (or their representatives) if bmk hits something real interesting.

after mcewen left goldcorp, he launched a successful  consolidation of a major new mining district via u. s. gold.

does that give any clues as to what is about to occur, or is the correct word - repeat?

a good guess would be as soon as the next major drill results hit, either a major extension for noronts double eagle, or other camps hitting a big strike that the consolidation will begin shortly thereafter.

right now another good guess would be that there are likely 1 or 2 new 9% shareholders (near the disclosure threshold level) with muscle silently behind most of these area plays and maybe noront as indicated by the volumes traded and the share price movements.  a probable scenario is they will step out of the shadows as each firm strikes something.  if nothing is found they will sit tight and watch the play fade away, not harming their reputation by being seen as wrong.  if the strike occurs they will stand up and begin their moves.  then the consolidation can begin. 

will it be a clash of titans like the copper wars in the butte, montana area  100 or so years ago? (neat mines to visit in the butte area by the way) or will everybody just merge and smile? who knows? time will tell.

i of course hope for a clash of titans including lots of outside interest as this would give the shareholders not connected to management, the best return in most circumstances.

this is the early stages of a game of chess, the drills will tell who has the king and queen and many will try to capture them.  in the end, if and when something is found by drilling, whoever has the best mining financiers and mining talent will be able to consolidate the area.

if it works out,  in less then 6 months this area will be so well drilled that it will be a well known district (or a total bust if they drill dust) and the investment community will have a good idea how big it will be by that time.  any consolidation that is going to occur will likely begin with the next major strike from ANY of the area firms and within that next  6 month time frame, most of the area plays - assuming the ore is there, will be consolidated into a major firm, either a newly created firm exclusively from the firms with the big hits in james bay area or from a major outside mining firm aggregating all the firms that hit. 

who will make money on all of this?  easy, whomever hits the big strikes with quantity and quality.

if they all drill dust going forward then we all go down the toilet.

only time will tell. but not much time, 6 months max and this will all be understood for better or worse.  likely 6 months after another big hit and the consolidation will be fait accompli.

bottom line, the addition of "THE BIG 4"  is a MAJOR plus for ALL area firms in the james bay lowlands.  this will greatly expedite the drilling and discovery process and brings major attention to ALL the area firms once it is widely understood what these guys mean to the area and its credibility.

i am going to enjoy the next 6  to 9 months. it is all going to come down to drill results.

regarding my writings. am i an idiot, or a dreamer? not knowing me you can not be sure. the beauty of knowledge AND understanding is you do not have to know me.  with YOUR OWN knowledge and understanding you don't need to know me, you just need to be able to understand and research the facts so you have the knowledge. then you can add to this agoracom community and other communities with good questions and insights.

if you see something to get you thinking, double check it elsewhere. and above all "know your circle of competence", that is one of warren buffets favorite maxims. 

as with all of my writings and all things you read whether on the internet or in someones newsletter, etc, they are just opinions and you are always best served by doing your own homework and being able to figure it out for yourself. 

the harder i work, the luckier i get.

be right and sit tight.

all the best and regards,

jsq