Cashed-Up Gold Junior with a Huge Resource

My ongoing quest to find the next big way to profit from the precious-metals craze often takes me to explore gold- and silver-mining projects all over the world.

Last week, I had the chance to get up-close-and-personal with a company that’s sitting on a goldmine of opportunity … literally! And I’d like to share this video interview with you today.

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I was in Vancouver recently, speaking at the Cambridge House Resource Investment Conference. While I was there, I had a chance to chat with Rob Grey of Exeter Resource Corp. (XRA on the NYSE-AMEX, XRC on the TSX) — a developer and explorer with operations in Chile.

The company has already successfully developed and sold projects in Argentina that were bundled into a company called Extorre.

You’ll see the highlights of the company include that it has 19.3 million ounces of gold and 4.6 billion pounds of copper at its Caspiche project in Chile — a project I’ve visited. It’s a low-grade resource, but it’s in a rich mining district, surrounded by working mines that are already in production.

The potential for an acquisition is obvious. But I’ll let Rob tell you about that …

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(Link to video: http://youtu.be/nC5PmeppjI0)

What Exeter doesn’t have, though, is ready access to water. It’s in the driest desert in the world. So, the company is drilling for water.

It has $54 million in cash, so it should have time to either make Caspiche work, joint-venture on other projects, or both.

It’s being valued at $5 per ounce of gold.  Meanwhile, using figures from a neighboring mine, it should be able to produce that gold at $175 per ounce, if it counts copper production as a credit.

So, it seems like Exeter is being valued like it will never go into production. Maybe they’re right. On the other hand, heck, with a market cap of just $122 million, 19.3 million ounces of gold and 4.6 billion pounds of copper, it pretty much defines dirt-cheap.

Now, let’s look at a chart …

(Updated chart)

The stock is in a downtrend. It is also rallying from the low it made late last year, and very recently seems to be finding support at its 50-day moving average. This may be a double-bottom that is shaping up.  Certainly, it’s worth watching.

I’ll save any official recommendations for my paying subscribers — my Red-Hot Global Resources members made money on Exeter once before.The gold market is tricky right now, for a number of reasons I’ve laid out for them in recent issues. So if you’re doing this on your own, do your own due diligence and please be careful.

Yours for trading profits,

Sean

Sean travels far and wide to seek out small-cap values in the natural resource sector. His journey started in New England. As a youth he worked on Mt. Washington, on the cog railroad that runs to the summit.