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Energy & Tech Stocks

April 20, 2012

Dynacor Gold Mines Remains a Favorite

Traded TSX: DNG/US OTC DNGDF 35.5 million Shares O/S. Price 4/19/12 $0.66 = $23.4 million Market Cap. - Although I remain bearish on gold mining shares given my general bearish view on equities, now is a time we want to hunt through the universe of gold mining shares to pick that that will not only be able to survive the downturn, but will be able to thrive at the expense of the dead bodies that litter the junior space when the markets finally start to give the gold mining sector the respect it deserves. No doubt that will happen after the next recession reminds people that Ben Bernanke and other statists not only do not have an answer to solving our problems but that they are making our situation sicker and sicker. At some point in time during the bull market in a lifetime for gold, the global economy will need some sort of gold backing in its monetary system. That is when I think we will see a mania in gold and gold stocks that will make the 1980s blow off look like childs play. Sharply in my focus is a small, still largely unrecognized company named Dynacor Gold Mines. Based in Montreal, this company just keeps plodding along increasing gold production and profits from its operations in Peru year after year. Not only has its growth been organic, which means it still has a miniscule 35.5 million shares outstanding, but it has a gold-copper skarn target in elephant country in Peru that could make this tiny company into something much larger. Unlike most junior gold exploration companies, this one has cash flow to fund its exploration efforts and thus avoid the most lethal dynamic of the junior mining sector, namely dilution. Im bringing this name back to your attention this week because the company just put out another very positive report about its most recent quarterly production and revenues achievements. It produced a record 13,101 ounces during Q1-2012. Thats a 32% increase over the like period of 2011. In conjunction with the higher metal production, Dynacor estimates a quarterly gold and silver sales record of US $23.5 million compared to revenues of $14.7 million in Q1-2011 for a 60% increase.

TAYLOR HARD MONEY ADVISORS, INC.

PO Box 780555, Maspeth, NY 11378

(718) 457-1426

April 20, 2012

During the first quarter of 2012, Dynacor continued operating at optimum recovery rates of 94%, processing 17,558 tonnes of ore at an average grade of 22.39 g/t Au or 0.78 oz. tonne. That compares with 13 520 tonnes at 22.11 g/t Au or 0.78 oz /tonne 2011. Leading to this increase in production was an increase in the companys plant expansion during the fourth quarter of 2011. Dynacor also reported record silver production of 41,112 ounces during the quarter. Thats a 94% increase over Q-1 of 2011. Jean Martineau, who is well known to your editor, has a tendency to under promise and over deliver. So when he projects 50,000 ounces of production this year, barring any unforseen circumstance, I think it is likely to happen. Steady growth in production and earnings can be expected. What is harder to predict but what could produce an enormous rocket-like projection in this companys share price would be a major gold-copper discovery on its Tumipampa skarn target, that over lays a highgrade gold vein system that is part of the companys steady growth projectile. Ever since I wondered into the Montreal offices of Dynacor in the summer of 2010 looking for Face the Analyst video prospects, I have loved this company. Jean Martineau is as honest and hard working as anyone you will find in this business. And his honesty and hard work are paying off for shareholders including himself. Jean and other insiders hold a significant portion of this companys shares, which is most often a very good sign. Look for periods of weakness like the present to add Dynacor to your holdings. The stock closed up 2 cents yesterday on the latest production news. But at $0.66 it is only 2 or 3 cents above its 52-week low. This is a buying opportunity in my view though given my bearish macro viewpoint, Im not suggesting immediate gratification with this or any other gold shares.

J Taylors Gold, Energy & Tech Stocks (JTGETS), is published monthly as a copyright publication of Taylor Hard Money Advisors, Inc. (THMA), Tel.: (718) 457-1426. Website: www.miningstocks.com. THMA provides investment ideas solely on a paid subscription basis. Companies are selected for presentation in JTGTS strictly on their merits as perceived by THMA. No fee is charged to the company for inclusion. The currency used in this publication is the U.S. dollar unless otherwise noted. The material contained herein is solely for information purposes. Readers are encouraged to conduct their own research and due diligence, and/or obtain professional advice. The information contained herein is based on sources, which the publisher believes to be reliable, but is not guaranteed to be accurate, and does not purport to be a complete statement or summary of the available information. Any opinions expressed are subject to change without notice. The editor, his family and associates and THMA are not responsible for errors or omissions. They may from time to time have a position in the securities of the companies mentioned herein. No statement or expression of any opinions contained in this report constitutes an offer to buy or sell the shares of the company mentioned above. Under copyright law, and upon their request companies mentioned in JTGETS, from time to time pay THMA a fee of $500 per page for the right to reprint articles that are otherwise restricted solely for the benefit of paid subscribers to JTGETS.

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TAYLOR HARD MONEY ADVISORS, INC. PO Box 780555, Maspeth, NY 11378 (718) 457-1426 Copyright @ 2012 TAYLOR HARD MONEY ADVISORS, INC. ALL RIGHTS RESERVED

April 20, 2012