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Newsletter 08 /2019

This newsletter contains news on the following topics:
Share of the week: First Cobalt + Platinum and Gold best suited for reassurance and hedging + IsoEnergy + MAG Silver + Delrey Metals + Sibanye-Stillwater + Aurania Resources + Endeavour Silver + RavenQuest BioMed + EnWave + Maple Gold Mines + Bluestone Resources

New precious metal report online: Precious Metal Report 2019 + Updates + Additional Stocks
New Battery Metals Report online: Battery Metals Report 2019 - Update
New uranium report online: Uranium Report 2019 - Update

Share of the week: First Cobalt
First Cobalt waves deal with Glencore

First Cobalt's drumbeats! The company announced a few days ago that it had signed a Memorandum of Understanding with mining giant Glencore to supply cobalt raw materials and finance the recommissioning of the First Cobalt Refinery in Ontario, Canada. Once final agreements have been reached, First Cobalt and Glencore will work together to produce the final flowchart to accelerate the recovery of the only North American primary cobalt refinery. Glencore intends to supply the refinery with raw materials leading to an annual production of approximately 2,000 to 2,500 tonnes of cobalt in sulphate per year. Glencore will also consider granting a loan to finance the capital requirements for restarting the refinery and will enter into a fee agreement with First Cobalt.
The refinery could be operational in 18-24 months and discussions are underway with provincial government officials to identify ways to streamline and accelerate the permitting process.

News: Glencore to Support Restart of First Cobalt Refinery

First Cobalt's refinery has the potential to double production capacity

First Cobalt was also able to announce that a scoping study for the restart of the First Cobalt refinery in Canada using a third-party cobalt hydroxide feedstock had concluded that annual production could exceed 5,000 tonnes per year of cobalt, more than double the previous estimate. By eliminating the refinery's autoclave cycle and overcoming production constraints, Ausenco Engineering Canada Inc.'s debottlenecking study estimated the additional cost of capital to double production capacity at US$7.5 million compared to the previous estimate or US$37.5 million in total.

News: Ausenco Study Doubles Production Potential of First Cobalt Refinery

Market overview:

Platinum and Gold best suited for reassurance and hedging

Those who are worried about the stock market, the zero-interest rate policy and the worldwide political squabbles should now bet on platinum and gold. Platinum has unique properties. It is therefore used not only in the jewellery industry and in the industrial sector - for example in catalysts in the automotive industry - but also in medical technology. And that is where it is important, in brain probes, in dentistry and also in cardiac pacemakers. Platinum is particularly biocompatible, i.e. it does not attack the body and is generally well tolerated. A pacemaker is the size of a matchbox, weighs only between 20 and 50 grams and has a lifespan of about 20 years. About one third of all deaths are caused by heart disease. It would probably be better not to get a heart condition from all kinds of adversity, but rather to bet on platinum or on the shares of platinum producers such as Sibanye-Stillwater.
In addition to platinum, gold continues to be a hot topic. At least this seems to be seen by those market players who place billions of gold sales contracts at irregular intervals in order to consciously push down or keep down the price of the yellow metal. The history of open and covert manipulation and suppression of the gold price is long. To get into this topic, books can be read, such as "Gold Wars" by Ferdinand Lips, a distinguished precious metals expert. The central bank management of the gold price since the Second World War is scrutinized there. For him, money or gold and human freedom were inextricably linked. In today's world, in which the state is gaining more and more power, the individual's freedom and possessions are in danger. For Lips, gold is the protection against inflation. Whether one believes the supporters of the gold price manipulation theory or not, gold has acted as a means of payment for thousands of years. In the post-war Bretton Woods system until the 1970s, the US dollar and gold were inextricably linked. In 1971 Richard Nixon abandoned the convertibility of dollars into gold. Since then, the money has been uncovered and can be printed and multiplied at will. Since the bond to gold no longer exists, it is difficult to estimate the value of the dollar. Even though gold is normally not used for payment, it serves as money, because central banks hoard gold as well as foreign exchange - and this is often increasingly the case worldwide - as foreign currency reserves. Many countries have rising debt levels and are therefore likely to like currency devaluation. This is done by expanding the money supply. Gold is still a tried and tested means of securing its future. There should also be no lack of equity exposure to gold companies such as Osisko Gold Royalties. 


Company news:

IsoEnergy accelerates exploration work

IsoEnergy recently announced its target strategy for the drilling program to expand Hurricane next summer 2019 on its 100% owned Larocque East property. The main objective of the drilling will be to evaluate the potential for an extension of the hurricane zone to the east of the current drill pattern. Targets were generated from integrated interpretations of geology, trace element geochemistry, alteration patterns and preliminary results of a 53 km long program for geophysical survey of DC resistivity still in progress. The Hurricane Zone is a new discovery of high-grade uranium mineralization in the productive eastern Athabasca Basin, Saskatchewan.
IsoEnergy is a well funded uranium exploration and development company with an interesting portfolio of highly prospective projects all located in the Athabasca Basin in Saskatchewan, Canada. The company was founded and supported by a team around NexGen Energy and NexGen is also the main shareholder with 53% of the company besides Cameco with 5.4%, Orano (former Areva) with 2% and other institutions with over 19%.

News: IsoEnergy Targets Eastern Strike Extension of Hurricane Uranium Zone


MAG Silver achieves important progress on Juanicipio Silver

MAG Silver announced a few days ago the company's unaudited financial results for the three months ended March 31, 2019. The highlights were:

  • The joint formal approval of the Juanicipio Project by Fresnillo plc and MAG after the end of the quarter.
  • All major permits have been obtained, long-life orders have been placed and construction of the process plant has begun; Fresnillo expects production to commence in the second half of 2020, subject to final detail engineering.
  • MAG is well financed with cash and cash equivalents of US$ 128.6 million as of March 31, 2019.
  • Underground development continues in Juanicipio, with more than 19 kilometers (11.8 miles) of total underground development now reached.

Further details can be found in the:

Delrey Metals reports extremely good sample results from three projects
Delrey Metals recently announced the results of a Phase II prospecting program recently completed on its 100% Star, Porcher and Blackie properties along tidal water near Prince Rupert, British Columbia. A total of 125 rock samples were collected by Delrey Metals Corp. personnel from the three properties (Porcher - 61, Star - 43, Blackie - 21) with assays returning up to 0.513% V205 (49.3% Fe, 4.01% Ti). Further highlights can be found in the:

Delrey Metals Acquires 80% of Four Corners Vanadium Project
Delrey Metals also announced that it has entered into a definitive ownership option agreement with Triple Nine Resources Ltd. with respect to the right and option to acquire an 80% interest in certain mineral licenses comprising the Four Corners Project. Four Corners hosts strong, drill-defined vanadium mineralization in the Keating Hill East Zone with a potential strike length of more than 4.5 kilometres and four additional Fe-Ti-V mineralized zones that have never been drilled.

Court confirms Lonmin acquisition deal for Sibanye-Stillwater
Sibanye-Stillwater and Lonmin Plc recently announced that the South African Court of Appeals for Competition "CACSA" has ruled on the appeal filed with the CACSA by the Association of Mineworkers and Construction Union "AMCU". The CACSA dismissed AMCU's complaint for a fee and therefore upheld the decision of the South African Competition Court of 21 November 2018 to approve the offer under certain specific conditions, including a minor change which clarifies the measure applied in the context of the investigation and implementation of certain mining projects but does not change the framework conditions.
Sibanye-Stillwater and Lonmin remain fully committed to the offer and can complete the merger.
Furthermore, the shareholders have now also ratified the provisions of the increased offer and accepted the merger plans.
News 1: Competition Appeal Court upholds the South African Competition Tribunal’s approval of the Lonmin Transaction
News 2: Sibanye-Stillwater Shareholders approve Ordinary Resolution in connection with the Increased Offer for Lonmin
News 3: Acquisition of Lonmin receives necessary shareholder approvals

Aurania Resources Focuses on Silver-Copper Deposits
Aurania Resources announced a few days ago that it has re-evaluated the exploration model for the discovered copper-silver mineralization at the Lost Cities Cutucu project in Ecuador in light of the latest field surveys. The copper-silver sedimentary mineralization found to date by Aurania is regional in nature and stratigraphically limited to key horizons of carbonaceous sediments extending in outcrops over at least 22 kilometres across the project area. There are only a few geological models that could explain this already very significant lateral extent.

Endeavour Silver shines with top drilling results
Endeavour Silver recently reported several high-grade silver-gold intercepts at the Plateros and San Miguel veins. By mid-April, a total of 19 holes had been drilled, of which twelve high grades on mineable widths and a further four holes intersected old mine workings. Highlights of drilling at the San Miguel Vein north of the Bolañitos plant include 58 grams of silver and 22.1 grams of gold per tonne (1,827 grams silver equivalent per tonne calculated at a gold to silver ratio of 80:1) over a true thickness of 3.5 metres (53.3 ounces silver equivalent per tonne over 11.5 feet) in hole MG-10. New high-grade vein mineralization has now been delineated over a length of 250 metres and a depth of 130 metres below and northwest of the old San Miguel mines, which remain open to the northwest. Highlights of drilling on the Plateros vein west of the Bolañitos plant include 108 grams of silver and 4.25 grams of gold per tonne (448 grams silver equivalent per tonne over a true width of 2.3 metres) (13.1 ounces silver equivalent per tonne over 7.5 feet) in hole PLU-20. New high-grade vein mineralization has now been delineated over a length of 250 metres and a depth of 120 metres below the Plateros pits that Endeavour is currently mining and which remain open at depth and to the southwest.
News: Endeavour Silver Reports High Grade Silver-Gold Drill Intersections from 2019 Exploration Program at the Bolanitos Mine, Guanajuato, Mexico

Endeavour Silver Announces Major Cost Reduction Measures
Endeavour Silver recently provided an update on its silver-gold mining operations in Mexico. In recent months, management has taken a number of measures to improve operational and financial performance. These include changes in the management and contractors of mine sites, changes in the management of employees and contractors, the lease of used and new mining equipment, and the revision of the 2019 mine plans for all four mines, particularly Guanaceví. The company has reduced operating and administrative costs, reduced the workforce of employees and subcontractors by 18% and postponed all voluntary expenses.
The immediate objective of these measures is to turn the current metal prices in the third quarter from losses in the first half of 2019 to the generation of a free cash flow.
News: Endeavour Silver Provides Update on Mining Operations

RavenQuest BioMed goes Europe
RavenQuest BioMed recently announced that it has signed an agreement with the Norwegian Cannabis BioCare A/S to establish a joint venture to develop cannabis production facilities using RavenQuest's Orbital Garden cultivation method in certain geographic regions. Production facilities with a capacity of up to 35,000 kilograms of cannabis per year are expected to be built within 24 months. RavenQuest will hold a fifty percent interest in the joint venture.
News:  Ravenquest Biomed Expands Into Europe

EnWave with big step into cannabis production in South America
EnWave recently reported that Aurora Cannabis Inc. has exercised its option and that the companies have signed an exclusive, rights-managed commercial license agreement with sublicensing rights for Aurora to use EnWave's proprietary Radiant Energy Vacuum ("REV™") dewatering technology to dry cannabis in South America (excluding Peru). Aurora will have the exclusive master license to dry cannabis at REV™ in the South American license area and will work with EnWave to develop additional sublicensing opportunities. Aurora will receive an undisclosed portion of royalties resulting from any cannabis product dried with REV™ technology from sub-licensees in the South American license area. This is the third such agreement signed by Aurora and EnWave.
News: Aurora Cannabis Exercises License Option with EnWave for South America

EnWave doubles gross profit
EnWave also presented the Company's consolidated interim financial statements for the second quarter ended 31 March 2019. The Company reported record second quarter 2019 net sales of $8.773 million, an increase of $4.601 million compared to $4.172 million in the second quarter of 2018. Sales growth was driven by increased sales and distribution of the Company's Moon Cheese® product and increased sales of REVTM devices in the cannabis sector. Gross profit more than doubled to US$ 3.120 million for Q2 2019 from US$ 1.295 million for Q2 2018, an increase of US$ 1.825 million or 141%. The gross margin as a percentage of sales was 36% for Q2 2019 compared to 31% for Q2 2018.
News: EnWave Announces 2019 Second Quarter - Consolidated Interim Financial Results

Maple Gold Mines Reports Top Drilling Results
Maple Gold Mines recently reported initial results from the porphyry zone where the company has now received assays for three full holes. This included the presence of higher grade near surface mineralization at 16 m averaging 1.57 g/t Au and a further 11 m averaging 1.00 g/t Au. Another drill hole intersected several higher-grade zones of 19m averaging 2.46 g/t Au, including 6m averaging 5.11 g/t Au, which also included 26.7 g/t Au over 1m.
News: Maple Gold releases initial drill results from the Porphyry Zone

Bluestone Resources with high profile drilling results
Bluestone Resources has recently announced additional high-grade intersections drilled as part of the infill resource conversion program at the Cerro Blanco Gold project. These included 11.9 g/t Au and 84.5 g/t Ag over 5.4 metres and 3.9 metres with 11.8 g/t Au and 83 g/t Ag.
News: Bluestone Drills More High-grade Intercepts including 5.4 meters of 11.9 g/t Au and 84.5 g/t Ag


Swiss Resource Capital AG and the authors of Swiss Resource Capital AG currently hold or intend to hold shares in the following companies mentioned in this issue: First Cobalt + Osisko Gold Royalties + IsoEnergy + MAG Silver + Delrey Metals + Sibanye-Stillwater + Aurania Resources + Endeavour Silver + RavenQuest BioMed + EnWave + Maple Gold Mines + Bluestone Resources.

Swiss Resource Capital AG has concluded IR consulting agreements with the following companies mentioned in this issue: First Cobalt + Osisko Gold Royalties + IsoEnergy + MAG Silver + Delrey Metals + Sibanye-Stillwater + Aurania Resources + Endeavour Silver + RavenQuest BioMed + EnWave + Maple Gold Mines + Bluestone Resources.

This publication is based on Swiss Resource Capital AG's detailed risk warnings, limitations of liability and disclaimers, which can be viewed here: Risk Disclosure and Disclaimer

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