The Energy Report - Colossus Minerals Inc. TSX:CSI

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Colossus Minerals Inc.

TICKER: TSX:CSI

DESCRIPTION: Colossus Minerals Inc. is an emerging mineral exploration and development company focused on Brazilian gold. Led by its skilled management team and world-class Board of Directors, Colossus has developed a robust business model that is sensitive to creating value for its shareholders. To date, the company has two high-grade precious metals projects, one of which, considered to be their "flagship"—Serra Pelada, has proven to be a geologically unique high-grade deposit with potential to delineate a significant gold-platinum-palladium resource. From 1979-1986, Serra Pelada hosted the largest precious metal rush in Latin American history. The deposit that was mined had some spectacular grades of precious metals including historical drill hole FD-032, which averaged 43 meters at 4709 g/t gold, 204 g/t platinum and 1174 g/t palladium.

WEBSITE: http://www.colossusminerals.com
Closing Of $24.7 Million Bought Deal Financing (3/10/09)

The information below is based on the most recent information we have received from analysts and the companies participating in The Gold Report. We encourage you to visit the company's web site for updates.

"Despite a less-than-shining week for gold, shares of Colossus still managed to put in an all-star performance. Early last week, Colossus announced that a Preliminary Environmental License has been issued for the company's flagship Serra Pelada Project in Brazil. According to Canaccord Adams Mining Analyst Nicholas Campbell, this paves the way for a full development permit for the Serra Pelada project. The Brazil government needs to approve of the equivalent of a Preliminary Economic Assessment for the Serra Pelada project. This would be an internal approval, with this approval, the government could then issue the full development permit for Serra Pelada. Following the approval of the full development permit, Colossus should issue metallurgy on the project and likely conclude a land deal with Vale (VALE). With this permit in hand and as these other hurdles are overcome, Campbell believes Colossus should continue to build momentum and achieve a revaluation in the market as investors begin to view this name as an emerging producer, rather than an exploration play."
- Morning Coffee, Canaccord Capital (03/15/10)

"Colossus has generated substantial speculative interest through its exploration program on its 75%-owned Serra Pelada gold-PGM project in Brazil. The drill results highlighted the unique high-grade nature of the project that significantly increased the company's exposure in the market. For 2010, the company is focusing on de-risking the Serra Pelada project and setting itself on the path to emerge as a new junior precious metal producer in 2011. With $100 million in the bank and +$30 million of in-the-money options and warrants, the company has sufficient funds to finance the development of Serra Pelada through to production.

With the approval of the Preliminary Environmental License, Colossus is now on track to receive a mine permit for the Serra Pelada project in H1/10, which could potentially lead to a start of development in H2/10. If the company can begin major development activities and place the major equipment orders by mid to late 2010, Serra Pelada could conceivably begin production in H2/11. Therefore, over the next six to nine months, Canaccord Adams Mining Analyst Nicholas Campbell expects to see a revaluation in CSI shares as investors begin to view the company as an emerging precious metals producer. Campbell notes that junior precious metal producers are currently trading at an average of 1.21x P/NAV (5%, spot) and at an average of 11.3x 2011E P/CF. If one were to value the CSI shares using similar metrics, CSI could be worth as much as $13.61 per share. CSI is currently trading at 5.5x 2012E CFPS and 0.49x P/NAVPS (5%, spot). As CSI de-risks the Serra Pelada project, Campbell believes that a bid for the company could become increasingly more likely."
- Morning Coffee, Canaccord Capital (03/10/10)

"I've got the other portfolio, which we call our "Top 10 for 2009," and we've got a couple of open positions in this one, but this portfolio, the average performance with a basket of 10 stocks is up 157.7%, and within that portfolio, the average is low by our estimation. The highest performer was Colossus Minerals, which has appreciated 341% since our first recommendation. We recommended that at $1.10, and it's now trading at $4.86.
- The Gold Report Interview with James West (03/05/10)

"Shares of Colossus Minerals surged late Friday before being halting—pending news. Earlier in the day, a report came out of Brazil that stated [as translated by Google]: "In voting on Friday, members of the State Environmental (EMCO), approved by eight votes to two, the Preliminary License for the Project Extraction of Metal Ores Serra Pelada." We caution that Colossus itself has yet to comment on the report and the validity of the Brazil report is unknown at this time. The environmental license is one of a handful of catalysts Canaccord Adams Mining Analyst Nicholas Campbell is looking forward to in the near-term. Two others being metallurgical tests results and land acquisitions around Serra Pelada. Campbell notes that Colossus holds a 75% interest in what is arguably one of the highest-grade undeveloped precious metal projects on the planet."
- Morning Coffee, Canaccord Capital (03/01/10)

"Colossus has experienced a pullback in its share price along with the rest of the junior mining space; however, it did not participate in the rally as other junior miners did when the price of gold ran up from October to December 2009. An equity financing and subsequent warrant acceleration slaked much of the investor demand for CSI shares in 2009. In 2010, investors appear to be waiting for the company to de-risk the Serra Pelada project. We are waiting for metallurgy, mining methodology, approval of an EIA, receipt of a development permit and a land deal with Vale. As these hurdles are overcome and investors' confidence builds, we expect the share price to rally. Colossus has C$103 million in cash and an additional C$31 million in in-the-money options and warrants, which we expect will be more than sufficient to finance the development of Serra Pelada."
- Junior Mining Weekly (02/02/10)

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