Gold & Base Metal Stock Picks For 2003

Messina Minerals At The Forefront of Canada's New Exploration Boom

Messina Minerals Inc. (TSX.V-MMI) is one the "new wave" of gold and base metal exploration and mining companies that are leading a resurgence in Canada's mining industry. Recent positive reforms in Canada's mining legislation, as well as favorable new tax policies, have precipitated a boom in exploration. These factors, combined with Canada's renowned mineral-rich geology and excellent infrastructure, once again make it one of the most attractive nations in the world to hunt for lustrous metals.

Among Messina's portfolio of properties are an advanced-stage gold project in a well-established Ontario mining district and an early-stage gold discovery in western Newfoundland. However, in the true spirit of exploration, Messina has also become very active in central Newfoundland -- a part of the country that exhibits considerable untapped mineral potential. The company is strategically located at the margins of a developing mining camp, approximately 300 kilometres (185 miles) west of St. John's, the province's capital. Within just the past couple of years, central Newfoundland -- particularly the Botwood Basin -- has seen a significant area play develop with well over a dozen juniors and several major mining companies vying for gold and base metal discoveries. Among them are mining heavyweights Noranda Inc., Agnico-Eagle Mines, BHP Billiton and Barrick Gold.

It is worth noting as a preface to this article that most major mining companies typically only have an interest in potential world-class discoveries. Therefore, they are often content to pass up on smaller but potentially economic mineral finds providing that they retain a small royalty on any potential future mining revenues. Accordingly, Noranda has entered into an option agreement that allows Messina to earn up to a 100 per cent interest in the Tulks South Property by expending a little over Can. $1.75 million (US $1.28 million) on exploration by July, 2005. As of late spring, 2003, Messina has already spent several hundred thousand dollars towards the fulfillment of this option agreement. These exploration expenditures have focused on two key early-stage base metal discoveries called the Boomerang and Curve Pond prospects, as well as a more advanced project called the Tulks East discovery. Additionally, the property also hosts the Midas Pond prospect which is a gold discovery.

Encompassing 15,135 hectares or 151 square kilometres (94 square miles), Messina's expansive land package covers the whole southern half of the mineral-rich Tulks Volcanic Belt. Recently, a flurry of exploration in the remote island hinterland that hosts this mineralized corridor has produced a number of other highly prospective discoveries. Two adjacent mineral belts in the same geological setting, namely the Long Lake and Tally Pond belts, have also proved to be fertile settings for significant mineral discoveries. They include the Duck Pond and Boundary base metal deposits, which are being jointly developed by Aur Resources and Thundermin Resources. Together, these deposits host 6.2 million tonnes grading 6.2% zinc, 3.4% copper, 1.0% PB, 63 g/tonne (2.03 oz/ton) silver and 0.8 g/tonne (0.03 oz/ton) gold. Aur recently completed a Can. $125 million (US $91 million) financing, much of which is committed to the realization of this mining project.

Significantly, the Duck Pond and Boundary deposits, as well as the historic past-producing Buchans Mine, are within a 45-kilometre radius of the Tulks South Property and exhibit similar geological "footprints." The Buchans mineral belt, which is adjacent to the Tulks Belt, has in the past proved a happy hunting ground for intrepid mineral explorers. It gave life to the Buchans Mine. This high-grade polymetallic deposit became one of Canada's richest base metals mines during its prolific 52 years of production until its closure in the early 80s. It is also worth noting that the Tulks Volcanic Belt is geologically similar to the mineral belt that hosts the Brunswick base metal mine in New Brunswick, which has an impressive in situ resource of 145 million tonnes.

However, exploring for metals is a laborious, high-stakes business that more often than not is doomed to failure for a litany of different "hard luck" reasons. And during the last three decades, a little over Can. $8 million (US $5.8 million) was sporadically spent on the Tulks South Property by several other junior mining companies, as well as by Noranda. This includes reconnaissance drilling, extensive airborne geophysical surveys and follow-up ground geophysics, as well as soil and till geochemistry and other associated exploration efforts. Due to a number of factors including slumps in the Canadian mining industry and logistical problems, most of these projects ran out of steam but not out of promise.

Additionally, past drilling efforts have only focused on areas where mineralization is exposed at surface, while other important drill targets have remained untested. For instance, significant massive sulphide drill intercepts with base metal values such as the Tulks East discovery have demonstrated good potential. However, they now need to be properly investigated by way of follow-up drilling during 2003. It is also important to note that much of the Tulks South Property has only recently been made accessible by logging roads, which now fortuitously connect to the Duck Pond and Boundary deposits. The advent of a mill facility at this mine site would certainly improve the logistical viability of any potentially economic discovery at the Tulks South Property.

Indeed, probably the most advanced of all of the South Tulks Property's best prospects is the Tulks East discovery. This involves three massive sulphide lenses. The largest lens, known as the A-Zone, contains in excess of 6 million tonnes of mineralization with some zinc and copper showings that even outcrop at surface. This known sulphide body is 30 meters (98 feet) thick and has a strike length of at least 650 metres (2,132 feet). It also remains "open" to depth and "along strike" to the northeast (its depth and mineralized length are continuous). Recent work has identified metal zonation with significant zinc and copper values. Also, a 1999 drill program encountered 7 metres (23 feet) of massive sulphide containing 5.1% zinc and 5 meters (16 feet) containing 1.24% copper, thus suggesting that the base metal content increases at depth.

In the B-Zone, exploration has to date outlined a resource of 230,000 tonnes grading 8.7% zinc, 0.66% copper, 1.2% lead, and 58.7 g/tonne (1.9 oz/ton) silver. This mineralized target lies just a few metres above the A-Zone. Recent work has indicated that the B-Zone massive sulphide lens remains open to depth and along strike to the northeast. The C-Zone lens lies 1,000 metres (0.6 miles) northeast of the A-Zone and also outcrops at surface. Five drill holes have intersected massive sulphide thicknesses of up to 13 metres (43 feet). However, the scope and size of this body remain unknown at this time. Meanwhile, a drill program consisting of 8 to 10 holes over 4,000 metres (13,120 feet) is scheduled for the A-Zone with a view to outlining a potential resource of up to 50 million tonnes. Several of the deeper holes are also expected to intersect the B-Zone, while a further three-hole drill program totaling 750 metres (2,460 feet) is planned to test the potential of the C-Zone.

Elsewhere on the property lies the Boomerang prospect which is a massive sulphide occurrence that was discovered by way of a single 500-metre (1,640 feet) drill hole that intersected 3.6 metres (12 feet) containing 7.4% zinc, 2.3% lead, 0.45% copper, 76.5 g/tonne (2.46 oz/ton) silver and 0.67 g/tonne (0.02 oz/ton) gold. This same hole also intersected 12.9 metres (42 feet) containing 133.2 g/tonne (4.3 oz/ton) silver and 0.37 g/tonne (0.01 oz/ton) gold below the massive sulphide occurrence. The two nearest drill holes, which were located 400 metres (1,312 feet) away, both intersected mineralization containing 1.3% zinc over 50 metres (164 feet). This relatively new sulphide lens remains open in all directions. Accordingly, a five-hole drill program totaling 3,750 metres (12,300 feet) is planned to trace the extent of this mineralized structure along strike.

Other mineralized showings that will be the subject of further exploration during the 2003 season include the Curve Pond massive sulphide. This discovery consists of a four-metre (13 feet) wide surface exposure of massive sulphide which assays up to 26% zinc. Recent mapping and trenching work have extended the showing for 50 metres (164 feet) along strike and suggests the sulphide body plunges northeast. Grab samples have also assayed between 3.5% and 11.3% zinc, along with copper, lead and silver values. Four holes drilled in 2002 by Messina along a 150-meter (492 feet) strike length all intersected massive sulphides at shallow depths. Four shallow 100-metre (328 feet) drill holes are scheduled this year to test the known boundaries of the Curve Pond mineralization.

Last but not least, the South Tulks Property also hosts a gold prospect known as Midas Pond. A vein system that is traceable over a strike length of 800 metres (2,624 feet) with mineralized widths of up to 12 metres (39 feet) is the subject of current exploration. Selected gold assays include 7.3 g/tonne (0.24 oz/ton) over 0.9 metres (3 feet) and 14.7 g/tonne (0.47 oz/ton) over 1.15 metres (3.8 feet).

Elsewhere, Messina is exploring for gold on its wholly-owned Fost Hill Property, which is located in northwestern Newfoundland, approximately 5 kilometres (3 miles) from the fishing community of Pollards Point in White Bay. Located in an area with good infrastructure, the Fost Hill Property consists of 240 claims covering 6,000 hectares or 60 square kilometres (37 square miles). In 2002, a total of 13 samples were collected from an outcrop with quartz veins assaying between 5.7 g/tonne (0.18 oz/ton) and 18.4 g/tonne (0.60 oz/ton) gold. This grass-roots project will be the subject of follow-up exploration work in 2003 that includes more sampling and a ground geophysics program to trace the extent of the mineralization. Previous work by Noranda has indicated that it may be up to 50 metres (164 feet) in width with a strike length exceeding 200 metres (656 feet).

Finally, Messina is also actively involved in gold exploration in Ontario's Sault Ste Marie Mining Division, approximately 65 kilometres (40 miles) west of Wawa. The company's wholly-owned Pukaskwa Property covers the western portion of the Mishibishu Deformation Zone. Messina's immediate objective is to target extensions to the known 40,000-ounce inferred gold resource at the Champagne Vein. This rich epithermal vein system has returned gold values in excess of 160 g/tonne (5.15 oz/ton) gold from channel samples. It has also been stripped along a strike length of 2,100 meters (6,890 feet). The central main zone to the vein has been channel sampled at 10-metre (32 feet) intervals while its thickest intercepts remain untested by drilling.

This gold vein, which remains open at depth, was originally discovered by Noranda and was extensively drilled in the mid 90s. Accordingly, it has considerable potential to host up to 200,000 ounces of gold, according to Messina's management. It will therefore be subjected to more in-fill drilling in 2003 to better outline its potential. Already, an independent estimate of the inferred mineral resource that was made in 1999 calculated approximately 80,000 tonnes grading 15 g/tonne (0.5 oz/ton) gold. (This estimate predates the federal government's latest resource calculation guidelines but is based upon sufficient data to qualify as an inferred mineral resource estimate under the new criteria. Also, this estimate is primarily being used by Messina in exploration targeting and not as an economic validation).

Messina also benefits from an adept management team with a diversity of skills and accomplishments that add considerable intrinsic value to the company's prospects. On the corporate front, Messina is presided over by Robert Eadie, a very successful entrepreneur with over two decades of experience in this realm. Furthermore, he has been involved in the financial sector for over 12 years, during which time he has overseen the development of a number of public companies and has been instrumental in the raising of over Can. $30 million (US $22 million) in venture capital financing.

Mr. Eadie's talents in the office are well complimented in the field by the expertise of company Vice President Peter Tallman, P. Geo. With over 22 years of experience as a geologist, Mr. Tallman has worked on company-building projects in Canada, Mexico, South America and Australia. Among his many accomplishments, he spent four years as Vice President, Exploration for Prime Equities International Corp where he focused mainly on Newfoundland and Labrador. He previously spent four years with Noranda Inc. and six years with BP-Selco Inc. working on gold and base metal properties in Newfoundland. There, he participated in the discovery of the Hope Brook Gold Mine and directed the discovery of the Beaver Brook antimony deposit.

Another key company director is Mr. Steve Brunelle who has spent over 20 years primarily in mineral exploration with junior resource companies, during which time he raised capital and explored the America's for precious and base metals. Among his credits, he has been involved in discovering and operating several gold mines in Canada and South America. Most recently, he was involved in the discovery of the Alamo Dorado silver deposit in Mexico.

On a technical note, Messina is still a thinly traded, tightly-held stock that has yet to show up on the radar screens of most investors and stockbrokers, alike. This is because the company is a consolidation of a former mineral exploration company and did not come to trade under its new name until January of this year. The share price has settled into a Can. $0.20 to $0.30 (US $0.14 to $0.20) trading range. However, this situation is likely to change in the coming months with an increase in trading volume and a continuation in the share price's upward trend. The scenario is expected to be precipitated by the advent of a steady flow of exploration results, as well as the imminent implementation of a concerted investor relations campaign. Accordingly, SmallCapMedia believes that Messina Minerals' share price is primed to make impressive strides during the balance of 2003 and beyond.