Newsletter 16 /2019
This newsletter contains news on the following topics:
Share of the week: Osisko Gold Royalties + The ECB presents, the FED must deliver - The perfect storm for gold! + Aurania Resources + US Gold + RavenQuest BioMed + Bluestone Resources + Treasury Metals + First Cobalt + White Gold + Sibanye-Stillwater + Auryn Resources + TerraX Minerals + EnWave
Video: Trans-Siberian Gold: Profitable Gold Producer From Russia With High Dividend
Share of the week: Osisko Gold Royalties
Osisko Gold Royalties takes over Stornoway Diamond
Osisko Gold Royalties! The Company recently announced that it has entered into a letter of intent with Stornoway Diamond Corporation and certain of its subsidiaries and other secured creditors under the bridge financing agreement entered into with Stornoway on June 10, 2019, including Diaquem Inc, Under the terms of the LOI, Osisko and the secured creditors have reaffirmed their intention to form a company that will acquire all or substantially all of Stornoway's assets and properties through a credit offering transaction and will assume the debts and liabilities of the secured creditors as well as the ongoing obligations associated with the operation of the Renard Mine, with a few exceptions. According to the Credit Bid Transaction, Osisko will maintain its 9.6% diamond stream at the Renard Mine, continue to receive streaming deliveries and has agreed to reinvest its proceeds from the stream for a period of one year from the closing of the Credit Bid transaction. In connection with the Credit Bid Transaction, Stornoway today applied to the Quebec Supreme Court (Commercial Division) for protection under the Companies' Creditors Arrangement Act to restructure its business and financial affairs. Stornoway will continue to operate during the restructuring. Simultaneously with the closing of the LOI, Osisko and some of the secured creditors have entered into a final and binding working capital agreement with Stornoway providing for an initial working capital facility of US$20 million secured by a priority fee over Stornoway's assets, which may be increased by additional amounts at the option of the secured creditors. Osisko's attributable share of the working capital facility will be approximately US$7 million, of which US$2.46 million has already been forecasted. The Working Capital Facility provides the financing and liquidity required to ensure the continuous operation of the Renard Mine.
In fact, this means a takeover of Stornoway by Osisko and other parties, including integration into a separate subsidiary. A first step towards saving the Renard Mine.
Osisko Gold Royalties Expands Silverstream for Mantos Blancos
In addition to the latest Knallernews, Osisko Gold Royalties announced that its wholly owned subsidiary, Osisko Bermuda Limited, has entered into a definitive agreement with Mantos Copper S. to expand its existing silver purchase agreement for 100% silver from the Mantos Blancos copper mine in Chile. The Stream Amendment Transaction is part of a comprehensive US$250 million financing package completed by Mantos Copper to expand the project's sulphide concentrator plant. As part of the Stream Amendment Transaction, OBL has agreed to make an additional $25 million down payment to Mantos Copper in exchange for certain changes to the existing silver purchase agreement, including reducing the current transfer price payment per ounce from 25% to 8% of the spot silver price on the date of delivery and increasing the stream from 30% to 40% of the payable silver after 19.3 million ounces of refined silver were delivered. Mantos Copper's right to buy back 50% of the silver stream in September 2019 or 2020 was also cancelled.
Osisko Gold thus secures more silver at a much lower price, which represents an additional leverage on a rising silver price.
The ECB presents, the FED must deliver - The perfect storm for gold!
The ECB was once again able to present its report last Thursday, and it did so right away. The focus was not so much on the minimally reduced deposit rate (reduction from -0.4 to -0.5%) as on the announcement of a new bond purchase programme. Starting in November, the ECB wants to "invest" 20 billion euros per month in government and above all corporate bonds, officially in order to strengthen the lame European economy. But isn't that actually the task of politics? Shouldn't the ECB be primarily concerned with the stability of the euro? It sounds absurd: banks are to be forced to pass on as much money as possible in the form of loans with ever higher penalty interest rates. In any case, many companies can get into debt as cheaply as never before and probably more than they would benefit from. In the case of individual countries - first and foremost Greece and Italy - this is already the case. In the meantime, we have already reached the point where the latter nations can get into debt at much lower interest rates than, for example, the USA, which - at least for the time being - still holds the world's most important currency in its hands.
Accordingly, a real firework on Twitter by US President Trump was not long in coming. He once again slapped the FED in the face and called the FED members "boneheads". These would miss the historic opportunity to lower interest rates to zero. He also said that the USA should have the lowest interest rate in the world anyway. So, a powerful pressure is building up on the FED, which will almost be forced to lower the US key interest rate next Wednesday as well, and that drastically.
Once again, a perfect storm is brewing for the gold price. A weakening of the US dollar as the next piece in the mosaic in an unstoppable spiral of devaluation should give the gold price a further strong boost. And with it, of course, the corresponding gold titles.
Aurania Resources Encounters Additional Gold-Silver Targets
Aurania Resources recently reported that subsequent exploration has defined additional extensive epithermal targets for gold and silver in the Tiria target area on the flanks of a 15-kilometer silver-zinc-lead mineralization trend at the Lost Cities - Cutucu project in Ecuador. The epithermal target of Tiria was originally referred to as "Tiria East" and "Tiria West". The company has now identified four different destinations within Tiria's extensive destination area. These targets are at the margins of a silver-zinc-lead core and provide strong indications of a large mineralized system.
The company is thus further expanding its portfolio of epithermal targets, which currently comprises 20 targets, in the search for the next Fruta del Norte. The way the Tiria gold-silver targets are arranged around a silver-zinc-lead corridor indicates a large and coherent mineralized system. The Company believes that silver, zinc and lead have accumulated in the hotter core in the middle of the system and that gold and silver have precipitated at the cooler edges. This should enable us to achieve the silver-zinc-lead target in the near future.
US Gold acquires Orevada Metals
US Gold Corp. recently announced that it has completed the acquisition of Orevada Metals, Inc. through a pure stock transaction. Orevada Metalsis is a Nevada-based company wholly owned by a Canadian private company. Orevada is now a new wholly owned subsidiary of U.S. Gold Corporation. Orevada has an option to acquire a 70% interest in the Maggie Creek project.
With the acquisition of Orevada and the option to acquire the Maggie Creek project, U.S. Gold Corp. is receiving its second promising exploration project in the Carlin trend in Nevada. The Maggie Creek project is at the heart of the Carlin trend, right next to Newmont Mining's 26-million-ounce Quarry gold mine. The project is located along the northeast projection of the Gold Quarry fault zone, which is an important mineral control at the Gold Quarry mine and indicates significant potential to discover Carlin-type gold deposits in one of the world's most sought-after gold districts.
RavenQuest BioMed takes first big step to Europe
RavenQuest BioMed recently announced that it has signed a joint venture agreement with Cannabis Biocare to grow cannabis crops with a planned capacity of 35,000 kilograms of medicinal cannabis in Europe. The joint venture plans to initially build two cannabis crops in Portugal, with the option of further expansion throughout Europe and beyond. RavenQuest holds a 50% stake in the joint venture, which is expected to be called "RQBeu". Under the joint venture agreement, Cannabis Biocare will provide full financing for the construction of cannabis production facilities and cannabis technologies, including orbital gardens, as well as start-up costs for the joint venture. RavenQuest will grant the joint venture the use of its Orbital Garden breeding technology, cultivation know-how, intellectual property and beneficial microbes.
A big step for RavenQuest, after all, Europe is a huge market with over 700 million inhabitants and a progressive attitude towards the legalisation of cannabis.
News: RavenQuest Signs European Joint Venture With Cannabis Biocare
Bluestone Resources Reports Top Sample Results
Bluestone Resources recently reported results from channel sampling of high-quality veins in two separate development areas in both the north and south zones of the Cerro Blanco underground mine. The sampling during the further development of the advance along the vein line has led to constant degrees and widths with good continuity. The VS_10 vein had a south average of 22 g/t Au over the 22 metres of completed development.
News: Bluestone Announces Consistent High-Grade Channel Sampling Results in Development Drift averaging 22.4 g/t Au and 122 g/t Ag over 22 meters along vein
Treasury Metals finds new gold finds
Treasury Metals recently announced top exploration results, including 0.75 metres at 450 g/t Au and 1.40 metres at 11.85 g/t Au in two drill holes completed by Earn-in option partner G2 Goldfields Inc. on the 100% Weebigee-Sandy Lake gold project in northwestern Ontario.
News: Treasury’s Weebigee-Sandy Lake Gold Project is reporting new gold discovery at the W3 Zone, Sandy Lake, Ontario
First Cobalt drives refinery studies forward
A few days ago, First Cobalt announced that it had awarded important contracts to carry out a feasibility study on the planned expansion of the First Cobalt refinery with a daily capacity of 55 tonnes. Ausenco Toronto was commissioned to prepare various engineering studies to support the re-commissioning and expansion of the refinery near Cobalt, Ontario. Three engineering studies will be completed including an interim scenario for the re-commissioning of the refinery with its current capacity of 12 tpd in a PFS and a DFS for the expansion of the refinery with a throughput of about 55 tpd. A third study will examine a scenario in which production is first resumed at 12 tpd and then increased to 55 tpd.
The First Cobalt Refinery is an approved facility that is in excellent condition and has a more recent history. The company's strategy is to work with Glencore to expand the refinery to meet the growing needs of the North American electric vehicle market.
News: First Cobalt Awards Contracts for Refinery Studies
Video: Updates Cobalt: Glencore And First Cobalt Sign Definitive Agreement
Canaccord recommends First Cobalt for purchase
The analysts of Canaccord Genuity Capital Markets published a study on First Cobalt a few days ago. They confirmed their speculative buying scenario and set a price target of CA$ 0.70, which is more than four times higher than the current share price.
Study: Canaccord Genuity gives buy recommendation for First Cobalt with target price 0.70 CAD
White Gold encounters several high-calibre gold targets
White Gold recently announced the results of its 2019 regional soil sampling program which has identified several new high priority gold targets, including a new discovery of high-grade gold, the Titan target. Titan is located on the road-accessible Hen property adjacent to the Company's JP Ross property, less than 15 km WNW from the Vertigo discovery site in the Yukon, Canada. Exploration results on Titan include soil samples of up to > 100,000 ppb Au, the highest soil value ever recorded in the Company's White Gold District soil database, which contains more than 400,000 soil samples. These soil samples are interpreted as in situ and representative of the underlying bedrock due to the non-glacial nature of the area, indicating high-level targets for upcoming follow-up activities such as probing, trenching and RAB/RC drilling. The Company's regional exploration program, supported by partners Agnico Eagle Mines and Kinross Gold Corp., is currently being conducted on several high-grade gold targets, with activities including GT sampling, geophysical surveys, trenching, geological mapping, prospecting and RAB drilling, with results to be released in due course.
News: White Gold Corp. Makes New High-Grade Gold Discovery 15km West of Vertigo; Ongoing Regional Exploration Program Identifies Multiple Additional High-Priority Targets
Video: Gold Exploration In The Yukon – White Gold Is The Future Gold Mine Generator
Sibanye-Stillwater wins further acquisition litigation
Sibanye-Stillwater has recently announced that the South African Constitutional Court has ruled on the applications for appeal and direct access by the Greater Lonmin Community, in which the GLC has attempted to substantially overturn the acquisition of Lonmin Plc by Sibanye-Stillwater. The Con Court dismissed the appeal motion free of charge as it had no reasonable chance of success and dismissed the direct access motion as the GLC had not presented a case that was in the interest of the judiciary sufficient to be heard directly by the Con Court. As a result of the Con Court's decision, the judgment of the Competition Appeal Court (which essentially upheld the judgment of the Competition Tribunal) remains in force. All procedures are now complete.
News: Constitutional Court of South Africa dismisses applications brought by Greater Lonmin Community
Auryn Resources Receives $6 Million Bridge Loan from Auryn Resources
Auryn Resources announced a few days ago that it has agreed to a bridging loan commitment of up to CA$6 million to fund the Company's short-term corporate and working capital needs. The bridge loan will consist of two tranches of CA$ 3 million, with the first tranche being brought forward to the reporting date, which is currently scheduled for 12 September 2019. The progress of the second tranche shall be subject to the mutual consent of the Parties. The lender is an existing shareholder of the Company. The bridging loan shall bear interest at the rate of 10% p.a. and shall be repaid no later than one year after the grant date; however, the bridging loan may be repaid at any time and without penalty after 90 days after the grant date at the discretion of the Company.
The company has chosen to use the bridge loan as a means of financing rather than a dilutive equity raising to maintain operations while expecting various catalysts. The bridging credit line should provide the Company with sufficient working capital for approximately one year in the event of full utilisation. The Company currently expects drilling results from the Committee Bay Project, exploration results from the Homestake Ridge Project and, in particular, in-process drilling permits for the Sombrero Project in Southern Peru to progress as planned.
News: Auryn Receives $6 Million Bridge Loan Commitment
TerraX Minerals Drastically Expands Gold Mineralization
TerraX Minerals recently announced the extension of gold mineralization at Sam Otto by an additional 600 metres strike length with results from 1,182 metres of drilling in six holes. These results, combined with drilling from three holes in 2018, now extend the Sam Otto South Zones for 1.2 kilometers and remain open in all directions. The gold mineralization of the Sam Otto trend was defined for at least 2.5 kilometers along the 5-kilometer Sam Otto structural corridor. Highlights from Phase 1 drilling from the Sam Otto South Zone include: 7m at 2.93 g/t gold (within a wider interval of 40m of 0.6 g/t Au) 14m at 1.36 g/t gold (within a wider interval of 34m of 0.64 g/t Au), 11m at 1.24 g/t gold and 9m at 1.2 g/t gold.
The prospects for Sam Otto have significantly improved with these results as gold mineralization has been extended over 2.5 kilometres of strike length.
News: TerraX Extends Gold Mineralization Another 600 Meters In Phase 1 Of Drilling At Sam Otto
EnWave presents another deal
Unbelievable: EnWave can now present a new license deal almost every week. Most recently, the company reported that it had signed a commercial license agreement with Kameya Foods Corporation. Kameya Foods was founded in 1947 and started as a Japanese pickle supplier in Shinshuku, Shimizu-cho. Located in an agricultural environment, it has access to a variety of local, high-quality raw materials, including some of Japan's finest wasabis on the edge of Mount Amagi and fresh vegetables and seafood from Suruga Bay. Under the license, Kameya Foods purchased a 10kW commercial radiant energy vacuum machine (REV™") to commence commercial production in Japan. The license grants Kameya Foods the non-exclusive right to process a variety of high-quality seafood and fruit products and the exclusive right to process wasabi, tofu and tea products in Japan.
This license is the second to be signed by EnWave in Japan and further demonstrates the promise of REV™ technology as a tool for developing innovative, high-quality food applications.
News: EnWave Signs Commercial License Agreement with Kameya Foods and Receives Purchase Order for REVTM Machinery
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: Osisko Gold Royalties + Aurania Resources + US Gold + RavenQuest BioMed + Bluestone Resources + Treasury Metals + First Cobalt + White Gold + Sibanye-Stillwater + Auryn Resources + TerraX Minerals + EnWave.
Swiss Resource Capital AG has entered into IR advisory agreements with the following companies mentioned in this issue: sisko Gold Royalties + Aurania Resources + US Gold + RavenQuest BioMed + Bluestone Resources + Treasury Metals + First Cobalt + White Gold + Sibanye-Stillwater + Auryn Resources + TerraX Minerals + EnWave.
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