BFD

My purchase order for Beaufield Resources(TSX-V: BFD) got filled yesterday. BFD owns about half a dozen gold and base metal exploration properties in Ontario and Quebec. All the properties are in very early stages of development and there are no NI 43-101 compliant resource estimates for any of the properties.

The catalyst for the purchase decision was the Tortigny property, where BFD has encountered copper, silver and zinc at relative high grades. An internal resource estimate of the Tortigny property done by the previous owner in the '90s put the size of mineable rock at 489,900 tonnes with average metal grades of 2.21% copper, 6.15% zinc, 0.24% lead, plus 0.31 g/t gold and 60.08 g/t silver. Based on recent drilling results BFD believes that the resource is bigger than estimated earlier.

BFD has drilled at Tortigny in agregate about 6000 meters this year and in September it signed an agreement with a drilling contractor for additional 10,000 meters. If the new holes hit metals at good grades the size of the resource grows and stock price probably climbs higher. If the fresh holes don't increase the size of the resource then down we go.

Using the old resource estimate and the estimated grading, the Kitco's Rocks in the Box Calculator tells me that one ton of ore from Tortigny would generate $401.59 worth of revenue on current metal prices. Using a recovery rate of 70%(no metallurgical testing has been done on the Tortigny ore, so it's impossible to say what the actual rate will/would be) and operating margin of 20% gives me $26.95 million.