Closeology Pays from all Directions for Bayfield Resources

In the mining industry it's called closeology. The glib term casually refers to what adds up to an excellent strategy for junior exploration companies and Bayfield Ventures (TSXV:BYV) makes use of the strategy to excellent end.

Case in point for Bayfield are its Rainy River properties in Ontario. The company has three properties, Claim Blocks A, B and C, located near and next to those of Rainy River Resources (TSXV.RR). In an interview, Bayfield's President Don Huston said, "We adjoin Rainy River [Resources] on its east boundary. We're about 2000 feet from where they're drilling now and we adjoined them on the south and the southwest about ¾ of a mile from where they're drilling now."

The idea is that Rainy River's success (the company trades at over $5 per share) could, by virtue of its proximity to Bayfield, become Bayfield's success as well.

"I believe that working where majors are working must give you a little better chance of success given that they have a much better geological group of people to draw information from as well as money to spend. And if they're willing to take the money and the time and spend the effort on places like Rainy River for instance [then Bayfield is too.]"

And as Rainy River proceeds with excellent gold assays (55.7 m of 4.01 g/t gold at its ODM zone), a newly identified gold zone, and an outlined ore body, all the while acquiring more property in the area in the year since Bayfield's President began staking ground there, Bayfield management's confidence is escalating right along with Rainy River's dramatic stock price climb that began last November following the news of high grade assays.

Huston's language reveals his closeology strategy: "We are on either end of them on-strike. We're in the same major volcanics, greenstone belt. We are following up on what we think are very similar structures that Rainy River Resources and their precursor, Nuinsco, has seen. We think that we have as much opportunity as they do."

Bayfield's other property choices follow the same logic. The Company's copper-gold and coal Hurmen Uul properties, which are 51% owned by BHP Billiton, located in the South Gobi region of Mongolia are situated to the west of the Rio Tinto/Ivanhoe Mines' world class Oyu Tolgoi copper/gold deposit, while to the north lies the massive Tavan Tolgoy coal deposit. The Tavan Tolgoy is one of the largest coal deposits in the world.

Similarly, Bayfield holds 5 claim blocks in Fort a la Corne, Saskatchewan, an area known to host diamond-rich kimberlite. But more than that, the Bayfield claims are located strategically close to claims owned by Shore Gold and De Beers. Bayfield's Bay #1 leases adjoin the Shore Gold claims on the north, south and west. Shore Gold's "Star" kimberlite body is 6 km away and another Shore Gold/De Beers' kimberlite body is 8km away. Bayfield's Bay #2 claim and 2 other properties are similarly situated close to Shore Gold and Shore Gold/De Beers bodies. The final Bayfield property is surrounded on all sides by Shore Gold properties and is on-strike to Shore Gold/ De Beers joint ventured properties.

Strategic positioning again, next to Goldcorp properties in Red Lake Ontario at the Baird Property has led to negotiations currently ongoing between Bayfield and Goldcorp. At the moment, Bayfield owns a 24.5% interest in the Baird Gold Property where Goldcorp retains 51% interest. The remaining 24.5% is owned by Skyharbour Resources.

Huston explains that Bayfield stands to possibly gain an interest in Goldcorp's large landholding in the area.

"[Goldcorp has] the properties on either side of [Bayfield] and they'd like to incorporate our package and make it into one project. We're in negotiations about that right now and I think that's very much to the betterment of Bayfield. That's what I would assume they're going to suggest. Would I retain the 24.5%? Probably not. I don't know what's going to be proposed here. I have a work proposal from Goldcorp at this time that I have to put up 49% for work and we're talking right now about a $300,000 work program that is scheduled for sometime this summer; I don't know if it would be July or October. There is work proposed, but before that, I think we would be considering doing some sort of merger with Goldcorp on it."

Huston may be uncertain at this point exactly what the future holds at Red Lake, but one thing is for sure, the strategic landholding gives Bayfield a bargaining power with a major that is otherwise very difficult to create.

Bargaining power, proximity to major structures that so far seem to extend onto Bayfield property, association with major names in the industry, all show that the closeology strategy works for an opportunistic junior like Bayfield. - By Rob Staianno