" Midas Letter is Buying Evolving Gold Corp (TSX.V:EVG)

By James West
MidasLetter.com
December 6, 2010


Stellar Drill Results AGAIN: 405 Metres Grading 1.31 grams per tonne Gold at Rattlesnake Hills, Wyoming

Evolving Gold (TSX.V:EVG), who has been a win for us since our first coverage on April 23rd, 2009 when we brought it to subscribers’ attention at $0.37, is starting to get a handle on its high grade zones through the 2010 infill drilling program that wrapped up this summer. And there’s a clear fact emerging from this rapidly evolving story (pun intended). At a market cap of $137 million, this stock, in our opinion, is extremely cheap. And so, even at current levels, we continue to accumulate shares.

Evolving gold has two major projects, both shaping up to become economic deposits, and both the handiwork of rock star geologist Quinton Hennigh, who was first pointed out to me by intrepid newsletter writer Robert J. Moriarty of 321gold.com fame. (Quinton is also the star geologist in the Gold Canyon Resources Inc. (TSX.V:GCU) gold discovery saga – also a home run for Midas Letter subscribers who were first alerted at $1.19).

The flagship project is the 100% owned Rattlesnake Hills project in the state of Wyoming, second only to Nevada in terms of mining policy that favours the industry, according to the Fraser Institute of Canada. Rattlesnake Hills is a large gold porphyry system with nothing in the way of base metals.

Approximately 36,500 meters of diamond drilling were undertaken in 2008 and 2009 with final assay results for the two seasons of drilling reported on February 3, 2010. Based on continued encouraging results, the company embarked on an additional 25,600 m diamond drilling between early June and mid-October, 2010. This program encompassed 63 new holes of which approximately 65% were infill and step-out at North Stock and Antelope Basin and 35% tested new targets including deep porphyry mineralization. Assays for thirty-five holes have been received, and results for the remaining 28 are expected back by early January, 2011.

That means there is plenty of great news flow ahead to keep the shares of EVG in demand.

On the Humboldt project in Nevada’s Carlin Trend (which has already produced 75 million ounces of gold in it’s long history), the company reported a 171.8 metre drill intercept that assayed 0.31 grams per tonne gold, with some higher grades intersected within a highly altered igneous dike. Earlier results include an 18.3 metre intercept grading 11.7 grams per tonne gold.

The company has another project in Nevada called the Jake property, which recently reported a drill hit of 45.7 metres grading 0.97 grams per tonne gold, including a 28.9 metre segment that assayed 1.33 grams per tonne gold.

There is no doubt this company is squarely in the sights of at least one major company. Goldcorp (TSX:G) (NYSE:GG), North America’s fastest growing senior gold producer, invested CA$15.6 million in July to acquire a 15% stake in the company.

It will be interesting to see what grades the next group of assay results from Rattlesnake Hills will carry. But if they’re anything like the most recent batch released on the first of December, the company could be snatched up by Goldcorp or another major producer sooner rather than later."