Gold Mining Report-March 16, 2010

In the last few years, most of the gold mining activities have been located in Southern Hemisphere. Lately, mining activities and consolidations are starting to ramp up in the northern areas of Canada, specifically in the Yukon Territories.

NovaGold Resources was a major player in the gold mining industry, but after the financial crisis and related budget problems, it halted its development activities. However, lately the company has been in the news again due to interest by investors like George Soros and John Paulson, who have increased their positions in NovaGold’s stock.

Kinross Gold announced today that in addition to their press release on March 11, 2010, it has entered into a definitive support agreement with the Canadian Junior mining company, Underworld Resources. Kinross’s friendly take-over bid will acquire 100% of the outstanding common shares of Underworld that they do not already own on the basis of 0.141 of a Kinross common share plus $0.01 in cash per common share. Underworld agreed to support the offer and Underworld's directors and senior have agreed to tender their common shares to the offer. In the deal Kinross will also acquire a development prospect called White Gold, which has already identified an indicated resource of greater than 1 million ounces of gold, and the project's Golden Saddle deposit, ore grades look highly favorable for positive economic feasibility at 3.2 grams per ton.

Yesterday,(yea I now I am slacking) Seabridge Gold announced that an independent review of Seabridge Gold's resource estimates for the KSM project has been completed by a third-party, Behre Dolbear & Company. Behre Dolbear confirms that the KSM resource model is reasonable and appropriate. Furthermore, they confirmed that the resource estimates prepared by Resource Modeling in January were accurate, conformed to industry practices, and complied with industry standards. However, the Seabridge realistically cannot enter production at the KSM project unless one of the major mining groups decides back them financially. Higher gold prices may provide them that incentive.

Back in the U.S., Newmont Mining Corporation stated that the Chinese demand for gold bullion will remain strong this year, despite historically high prices for the metal. Philip Stephenson, Regional Group Executive, Operations, Newmont Asia Pacific is forecasting that they are still going to see strong investment demand from China. Last year, 2009, there was a 20% increase in investment demand from China. Newmont is expecting a similar level of demand in 2010.

Newmont's Boddington gold mine in Western Australia recently opened and expectations are high. They also have several early-stage exploration projects near existing Australian mine sites. However, these are more likely to extend existing mine life, rather than boost production levels.