CB Gold (CBJ:TSXV)

CB Gold (CBJ:TSXV)

In the world before Brazilian billionaire, Eike Batista fell from grace, CB Gold (CBJ:TSXV) was a market favorite.  Prior to Batista losing the vast majority of his wealth due, in part, to the commodity price decline as well as some unhealthy personal leverage, Colombian gold juniors had a bid.  In February 2011, after a few attempts, Batista bought Ventana Gold for $1.43 billion which sparked a huge rush into junior gold exploration companies in Colombia.  CB Gold was part of that rush.  However, unlike many of the others in the space, CB Gold appeared to have something real.  The company hit one of the best gold intercepts I have ever seen; 114.98m of 7.57 g/t gold at its Vetas Gold Project.  This was at the end of October 2011 when the stock began to run from $0.70 per share to $2.00 per share.  During that time, Ross Beatty invested $11 million at $1.10 per unit through his Lumina Capital.

Once the damn broke and all of the ‘risk’ money fled the junior markets, CB Gold was left to hit lower lows on less and less liquidity.  While that was happening, the company was quietly moving the project along.  The company has continued to drill (albeit less aggressively) and has continued to hit intervals of high-grade gold at its Vetas Project.  Today, the company announced preliminary metallurgical test work for the Vetas Project.  The results showed 94% recoveries from cyanide leaching and 96.1% from a combined gravity/flotation concentrate.  The company recently completed its 2013 exploration program which was minimal due to management’s goal of conserving cash given the macro-environment.  The company will work towards a NI 43-101 project, but doesn’t sound to be in a rush to complete one, again due the market conditions.  This appears to be the case of another exploration company with a potentially world-class asset not being able to substantiate their project due to the fear of having to raise money at the current, dilutive, prices.

News Release here: CB Gold Inc Announces Gold Recoveries