The BarkerLetter

These new overtures towards Wolfden Resources (WLF.T) by Australian zinc miner Zinifex intrigue me.

Zinifex, an US$8 billion company with diminishing inventories of zinc and lead, has initiated a friendly takeover bid for Wolfden in the hopes of getting the company’s assets in the vast Canadian territory of Nunavut.

But what’s interesting is not Zinifex or Wolfden, but the fact that such a large company would be so interested in Canada’s far north. It’s just polar bears and icebergs up there, right? Plus minerals … a lot of minerals, potentially.

I think Nunavut is Canada’s last, great unexplored mineral frontier. Its vast territory covers millions of hectares below and above the Arctic Circle, comprising all of the eastern Arctic. Mineral companies large and small have been trickling in over the past couple of years and I think that could escalate to a flood.

Which is why I’m interested in Peregrine Diamonds.

Yes, diamonds.

Peregrine is stewarded by Eric Friedland, brother of Robert Friedland, whose Diamond Fields Inc. found almost US$5 billion worth of base metals in Labrador, a vast wilderness in Canada’s eastern region, back in the 1990s. I’ve always asked myself what led Friedland to seek diamonds in Labrador in the first place, since his raison d’etre has always been to seek minerals where they are known to be found. But there aren’t any diamonds in Labrador.

Hmmm….

Earlier this month Peregrine announced it had staked over 2 million hectares in Nunavut, basically all of Baffin Island including Nunavut’s capital city of Iqaluit. The properties are joint ventured with mineral giant Rio Tinto, a soon to be equal partner on Friedland’s Turquoise Hill copper and gold project in Mongolia. A week earlier, Peregrine announced it was buying back its own shares, up to 4.2 million of them, so I think they’re going establish a price base above the current market. The company has 49 million shares issued and outstanding and a recent trading range of just under $2 per share. Its 52 week high is just over $4.

I think a speculator could do worse than to pick up a few thousand PGD shares at the current price.

Just don’t be surprised if they find something other than diamonds.