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Cardero
Drill Results Update
Bob Moriarty
June 19, 2003
I was broken-hearted
when I saw the Cardero drill
results
last night. I got a call last night at 12:30 in the morning from
the other coast. I just knew it was bad news, who would call
you at 12:30 at night with good news? It was Henk van Alphen
of Cardero (advertiser) CDU to talk about the drill results from
La Providencia. Bottom line they sucked. He and I and the geologist
and the drill team were all expecting multi-kilo per ton silver
assays and got a couple of piddling ounces per ton.
The drill results
do not agree with the chip samples. Either the drill results
are wrong or the chip samples were wrong. They got the intervals
of mineralization correct but the grades were way off. Where
they should have been getting multi-kilo grades of silver, they
were getting no higher than 4 ounces of silver per ton. I believe
they did a poor job of drilling.
Henk didn't
try to worm his way out of anything and he didn't blame anyone
other than himself. He said, "I got cocky and we were trying
to cherry pick the drill holes. It didn't work and the drill
results are not good."
I accept that.
I think they did get cocky as I did and the drill results were
not what either they or I expected. You can pretty much know
that this morning when the stock opened, it opened down and a
lot of value disappeared. For anyone who has invested based on
what I have been saying all along, I'm sorry. I own Cardero at
$1.04 a share US and Ascot at $.197 US and I, personally, am
not selling any shares, nor have I sold any in the last month.
Their lead geologist said they were doing a bad job of drilling
and were washing silver down the hole. At the time he was being
ignored. You may believe they are not ignoring him now. Henk
intends to twin a hole and redrill to test the results again.
That will take three weeks to get the results.
When you buy Cardero or any other stock, in the end all you are
buying is management. I don't know of any other company where
the president would have either the balls or the good sense to
call me at 12:30 in the morning to give me bad news. I don't
like these drill results, nor should you. If they truly reflect
the silver grades at La Providencia it would be a strong indication
of a large but low grade silver deposit. The entire story of
Cardero and La Providencia is that it's a large but high grade
system that can be profitable at $4.50 an ounce silver and it's
either one or the other. I believe in the company and right now
I don't have any evidence but my faith in Henk van Alphen and
the original chip samples to prove I'm right.
Meanwhile,
back at the ranch, don't let the panic of others force you into
selling what I believe to be a good stock. If you are 100% convinced
the drill results were accurate, that is not a world class deposit.
If you accept that they probably did screw up and are man enough
to admit it, hang on, the stock is going to be a lot better deal
in a couple of days. And when it bounces back, it will be an
opportunity.
They haven't
drilled 1% of the project and these results are not the end of
the story. Cardero does have $3.5 million Cdn in the bank, and
more than enough resources to continue drilling. As Miss Scarlet
said in "Gone with the Wind" tomorrow is another day.
Bob Moriarty
Email bob@321gold.com
Jun 19, 2003
_________________
321gold
Inc ref 3022
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