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Junior Miner Bucks Market Trend with LOI for Mexican Mineral Exploration Concessions
By: AllPennyStocks.com News
November 23, 2011
There are always bulls, even in a bear market. The markets in general have been taking a pounding for several weeks based on European financial concerns sprinkled with some of our own North American issues. The TSX Venture Exchange has shed roughly 150 points in the last three weeks, taking it back to levels at the beginning of October. But, anyone that has been watching Citation Resources Inc. (TSX-Venture:CTT) has seen a stock price that is swimming upward against the overall market current.
The value of a share of CTT seemed to find a firm bottom at $0.07 in September and has been rising steadily upward since. Unless something dramatic happens during the remaining trading days this week, the stock price will have risen for the fifth straight week and packed on more than 100 percent gains in that time.
What’s more, the upward pressure has come without any news until today. In fact, Citation has remained quiet since announcing the appointment of Matthew Watson, and James Harris to the board of directors of Citation after Trevor Kearnes, Gunther Roehlig and Michael Magrum resigned as directors. Mr. Watson also replaced Mr. Roehlig as Chief Executive Officer.
Today, the silence was broken with news of an inking of a Letter of Intent with Esperanza Resources Corp. for an option to acquire Esperanza's 100% interest in the Biricu Prospect mineral exploration concession located in Morelos State, Mexico. The Biricu Prospect comprises more than 38,000 hectares of highly prospectable ground. Although exploration on the Biricu Prospect has been very limited to date, Citation management believes that the Biricu Prospect is the direct on-strike extension of five skarn deposits in the Guerrero Gold Belt. Those deposits are El Limon-Los Guajes, owned by Torex Gold Resources Inc. (TSX:TXG); Bermejal, Los Filos, and Nukay owned by Goldcorp Inc. (TSX:G); and Ana Paula, controlled by Newstrike Capital Inc. (TSX-Venture:NES).
As customary, the acquisition is subject to due diligence, regulations and the entering into a definitive agreement by the two parties involved. Terms of the deal include, amongst other things, $20,000 cash payment at execution of the agreement, 1,050,000 common shares of CTT, $4 million in exploration expenses and Esperanza to nominate one Director to Citation’s Board of Directors. The targeted date for execution is before December 22, 2011.
If executed, the deal will add the Biricu Prospect to Citation’s portfolio which includes an option agreement with Rainy Mountain Royalty Corp. (TSX-Venture:RMO) and International Bethlehem Mining Corp. (TSX-Venture:IBC) to acquire the right to earn a 60% total interest in the Eva Kitto Property, located approximately 190 kilometres northeast of Thunder Bay, Ontario.
Approximately half-way through the trading day, shares of CTT are up 80.95 percent at $0.19 on 1.79 million in volume.
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