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Aggressive Company In The Gold Field:
Dhanoa Minerals Limited (OTCBB: DHNA)
By Glenn Wilkins - AllPennyStocks.com News Reporter
June 11, 2007 (AllPennyStocks.com Media
Inc.) – It’s a competitive game, gold mining.
Success in the field is determined by being tougher, smarter
and more determined. Toronto-based Dhanoa Minerals Limited
(OTCBB:DHNA) is
hitching its wagon to star gold deposits in Central and South
America, areas it’s certain are swimming with the shiny yellow
metal, much as the early Spanish explorers to the region were.
Dhanoa is a progressive, production-stage
junior mining company focused on exploration, acquisition and
development of natural resource properties. The company has
scored some of its biggest coups of late in three particularly
active gold mines in the Bella Rica district of southwestern
Ecuador.
Of course, it’s never just a matter of
looking at a map to locate the promising gold strikes. Dhanoa
prides itself on basing project feasibility on five main
points. The first and most obvious, of course, is highly
promising geology and mineralization; the second, significant
and proven local reserves; thirdly, good past production with,
according to the company website “only primitive and/or
artisanal mining practices.” The final two factors include
good local infrastructure and a politically favourable
environment. Such factors have led the company to focus on
Ecuador, where the results have been most favourable.
The Company has
recently initiated a new program to evaluate undervalued
assets for potential addition to its mineral claim portfolio.
What’s getting
the company greater attention these days is the success of its
Bonanza mine, one of three located on the western end of the
Ecuadorian metallurgical gold belt, home to more than 10
million ounces of the precious metal. It is from this
particular mine that Dhanoa has extracted about 25 kilos of
gold a month. It is the consensus of gold industry watchers
that, even if gold stays at its current price levels (about
$680 US an ounce), the approximately 100,000 ounces of gold
yielded by these three operating mines (Bonanza, Guanache and
Mollopongo) will generate revenues of upwards of $68 million
(all amounts in Canadian dollars unless specified otherwise)
by the end of June 2008. Analysts project the figure to
skyrocket to 250,000 ounces by the end of the following year.
Dhanoa is planning to complete an acquisition of 80 per cent
interest in the three gold mines.
Modernization
of mining techniques involves in part round-the-clock
monitoring of its gold processing activities, via television
cameras installed in the mines. The cameras, expected to be
operational by about the end of June, will enable prospective
shareholders to view the extent of the operations up close.
This and other measures are to have cost the company up to $5
million by the end of the calendar year.
Dhanoa has
indicated it wishes to fund future projects from the revenues
generated by successful current exploration. The success of
Bonanza has enabled the company to approach investment banks,
brokerage firms and private investors for its expansion plans.
Last April, the
company arranged $1.3 million U.S. in financing through a
private placement at $1.90 U.S. per share. Dhanoa’s stock
currently trades on the Over-the-Counter market under the
symbol DHNA.
Positioning
themselves for what they see as explosive growth has entailed
a shuffling of the deck in management. Lee Andrew Balak was
welcomed aboard in late May as President. Balak brings 29
years’ experience in the public markets, having worked on
projects in Asia, Africa and (vital to Dhanoa’s purposes)
Central and South America. The company pegged Balak for his
expertise in dealing with governments in the latter regions.
Around the same
time, William McNerney was brought on as Chief Financial
Officer.
McNerney has founded and led several companies,
including Golden Exploration and Development. He has 36 years
in the business.
Daniel Kuhn,
Chief Operating Officer, comes with a mining career that spans
more than 40 years, including several as a mine captain with
INCO in Sudbury, Ontario. Kuhn has also assisted in building a
number of successful mining operations in South America.
As Henry Ford
once said, “when a man is fully at work, he needs no title.”
The Dhanoa website echoes that sentiment: “Regardless of role,
everyone on the Dhanoa team is hands-on in relation to the
property and operations. Each member is being recruited for
specialty and will be empowered to act and succeed in that
capacity.” Such is the sense of teamwork the company is aiming
to foster from top to bottom.
What should get
the blood of individual small-cap investors going is that DHNA
is significantly undervalued compared to local competitors,
also digging in Ecuador. The website mentions the seven-dollar
U.S. per-share price charged by IAMGOLD
(NYSE: IAG), and the
five dollars-plus for International Minerals
(TSX-Venture: IMZ). Throw in the examples of Aurelian Resources
(TSX: ARU),
Corriente Resources
(AMEX: ETQ) and Dynasty Metals and Mining
(TSX-Venture:DMM) and DHNA’s economical price comes out most
favorably.
Equity research
firm Princeton Research put out a $4 U.S. price tag for Dhanoa
over the next 24 months, only slightly above the $3.60 U.S. at
its 52-week peak last November. Achieving this price would
mean a over 537-per-cent climb in the stock’s value from its
current $0.67 U.S., significantly above its 48-cent U.S. gully
from last October, but apparently a bargain nonetheless.
Given the rich regions in which it works, the steps it’s
taking to boost revenues, and the aggressive moves it’s making
in the acquisition and exploration fields, Dhanoa Minerals
merits a closer look.
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Although the majority of
AllPennyStocks.com reports are independent, it has received
compensation for carrying the report on Dhanoa Minerals Limited,
the compensation is four thousand dollars by a non-affiliated
third-party, European American Investments . This creates an
inherent conflict of interest and readers are encouraged to
view the main disclaimer at
/aps_us/company_spotlights/archives/dhna.asp
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