TOP STORY - ProspectingJournal.com - April 1, 2011 - Earlier this year we published a story about the $4 million non-brokered private placement of 1,000,000 shares in Providence Resources [PV - TSX.V] (then known as Providence Capital) purchased by Teck Resources [TCK.A - TSX] at $4 per share. Without having seen the results, the conclusion drawn from this end was that the price point paid by Teck was implicitly a vote of confidence in the Iron Range project of Providence and partner Eagle Plains Resources [EPL - TSX.V].
Confidence remained in the stock upon the release of a drilling activity update on February 15 that included highlights from Hole IR10-010. These included 14.0m grading 5.1g/t gold and 75.3g/t silver from 192.0 to 206.0m and 8.5m grading 6.0g/t gold and 47.8g/t silver from 272.0 to 280.5m. Accompanying base metal values include 13.24% combined lead-zinc over 1.6m from 196.9-198.5m, and 9.24% combined lead-zinc over 2.0m from 277.5-279.5m, the latter of which is interpreted to lie at Sullivan Time.
This update held the stock at $2 per share, but then things started to change. As the price bumped around a bit, the last positive spike in the $2 realm was on March 2, 2011, when 16,500 shares were traded bringing the price back to $1.94. But without news arriving fast enough for the faint of heart, coupled with an overall lack of confidence in the market with the updates on world events, the price dipped down to $1.21 before a slight uptick to $1.50 on March 21. But then the sellers hit the scene, dropping the price to $1.13 with 34,400 shares being traded on March 23. Another 68,000 moved on the 24th, and the stocks entered this latest weekend at $1.12.
Then the results hit the wires on Monday, which to many didn't represent what they were looking for as far as Sullivan-type values. Monday saw 228,100 shares change hands, as the price crossed the $1 threshold to $0.83. Tuesday again saw movement with a volume of 364,400 and a new price of $0.65. Wednesday another 310,100 shares, and a price of $0.61.CLICK FOR THE ENTIRE ARTICLE (445 more words)
Disclaimer: No fee has been paid for the distribution of this article. The author does not own shares in any of the companies mentioned in the article, but reserves the right to change that position after 72 hours have elapsed from the time of publication. The author currently does not have any vested interest in the companies mentioned, other than previous coverage of the story in question, and thus this article should be seen as a clarification follow-up. Though the author does not own shares, Providence Capital has at one time been a paying client of Cordova Media Inc., and members of Cordova Media Inc. may or may not hold shares in companies mentioned in the article.