After issuing a partial sell recommendation on Northland Resources (NAU.TO) on December 11th at C$1.02, we are looking to retake our position now at C$0.14. We sold approximately half of our shareholding as we were up 65% from the August alert. We’ll invest some of it back in Northland and are hopeful we’re averaging down on the bottom. We are spending only 1/3rd of the proceeds from the December 11th sale to triple our position in Northland at an average cost of C$0.30.

We’re obviously extremely disappointed with this funding shortfall and are very curious to hear from the management how a huge shortfall like this could only be detected at this point. We think some members of the management team should draw conclusions and resign from the board.

However, we do feel there still is value in the Kaunisvaara project and that’s our main reason to average down.

Disclosure: The author holds a long position in Northland Resources SA. Please see our disclaimer for current positions.

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