 |
| | |
Dear Fellow Shareholders,
The past year has been challenging for junior exploration and mining companies along with the global market as a whole. We have been witness to one of the most significant financial downturns of the modern age. The rapid fall in commodity prices and massive redemptions by mutual funds decimated most junior exploration stocks. However, we must look ahead to the reality that the world economy and markets will recover and growth will be renewed.
It is instructive to look at the sharp pullback in commodity prices in a recent historical context. During the prolonged downturn only 10 years ago, copper dropped to the $0.60 per pound range -- now it's $1.80, gold was in the sub $300 area -- now it's $950, and oil was below $20 per barrel -- now it's $50. Major mining companies have slashed exploration and the junior exploration companies have lost access to capital. Much less money will be spent on exploration and project generation over the next year or more. This will lead to an even greater demand for metals and advanced exploration properties when the market ramps up again from a much higher price and scarcity base than ever before.
As a company owning an exciting portfolio of mineral properties in Canada, Commander is well-positioned to take advantage of a renewed demand for metals.
On the corporate front, in early 2008, we added close to $1 million in working capital without issuing any new shares in the Company. With this capital in hand, we required only one financing in 2008 to achieve our exploration objectives, raising about $2.2 million in July. Commander achieved some remarkable exploration milestones in 2008 in spite of activities being scaled back due to poor market conditions. New copper and zinc prospects were acquired in Nunavut, a new high grade gold discovery was made on the Baffin Gold Project, and drill-testing advanced our understanding of the South Voisey's Bay nickel properties in Labrador.
One of the milestone events of 2008 was the acquisition of the Storm Copper Property in Nunavut. We successfully acquired 100% of this advanced copper asset through the permit application process covering crown lands. The property includes a zinc resource located on tidewater and an extensive copper system with high grade copper intersections in previous drilling. The first step was to acquire the asset, the second was to complete and file a 43-101 technical report to verify the historical data. Now, with the outlook for copper improving along with the copper price, we will work to maximize the value of this asset in the coming year.
On the Baffin Gold Project, we made a significant new gold discovery from a showing initially found in 2007. The zone, named Hébert, carries some very high gold grades in quartz veins and disseminated in sediments, demonstrating potential for bulk tonnage open-pit geometry. This target is still at the very early stage, having never been drilled, but it shows great promise. When taken in context with the other gold zones on the property, including Malrok and Ridge Lake, it is our belief that we are truly witnessing the birth of a new gold district. Given the strength and future bullish outlook for gold prices and the increased level of activity in the region by major gold players such as Newmont and Agnico-Eagle, this new discovery not only helps our marketing efforts, but opens up more opportunities for us to realize significant value from the project.
As part of our strategy, we continue to look at all of our assets for ways to leverage and extract value. As an example, we recently completed an assessment of our Green Bay Property in Newfoundland, which is host to the Orion Gold Deposit with a potential resource ranging from 80,000 to 120,000 ounces. In the current gold market, we believe there is significant potential to either sell the asset outright or attract a development partner to advance the project.
There is no question that 2009 will be a difficult year for the junior resource sector, but I am confident that the good times will return and probably sooner than expected. In the meantime, we have taken steps to reduce operating costs and overhead and will continue with these efforts with the goal of advancing and maximizing value of our main assets.
I look forward to better markets and success in 2009 and above all else, I would like to thank you, our shareholders for your support.
Respectfully,
"Kenneth E. Leigh"
Kenneth E. Leigh
President & CEO
April 2, 2009
|
