Newsletter 09 /2020
This newsletter contains news on the following topics:
Torsten Dennin and Ronald Stöferle with assessments of the impact of the corona crisis + Cardinal Resources + Aurania Resources + Fiore Gold + Revival Gold + Share of the Week: Osisko Gold Royalties + Uranium: Larger mines and processing plants shut down - Utilities have to buy on the spot market - Uranium spot price at 4-year high! + Cameco + Kazatomprom + Energy Fuels + Ur-Energy + Uraniumium School Energy + Anfield Resources + Denison Mines + Fission Uranium + GoviEx + IsoEnergy + Laramide Resources + Skyharbour Resources + Bluestone Resources + Caledonia Mining + Canada Nickel + Discovery Metals + Endeavour Silver + EnWave + Gold Terra Resource + IsoEnergy + MAG Silver + Maple Gold Mines + Millennial Lithium + Skeena Resources + Treasury Metals
A few days ago, we started with online TV interviews and presentations. We were able to conduct some interesting interviews, which we do not want to withhold from you:
Corona and the Big Central Bank Bazooka
Prof. Dr. Torsten Dennin: Corona - Economy Disruptions and Distortions
Ronald Stöferle: Unprecedented Fiscal Stimulus Will Lead to Commodity Bull Run
Cardinal Resources: Road to Gold Production in Ghana
Aurania Resources: Update on Corona Impact, Food Support of Local Shuar People
Fiore Gold: Growth-Oriented Gold Producer - Investor Presentation
Revival Gold: Building a Growth Gold Company - Investor Presentation
Share of the week: Osisko Gold Royalties
Osisko Gold Royalties conducts $85 million financing via share price
Osisko Gold Royalties announced a few days ago that it has entered into an agreement with Investissement Québec, a prominent institution in Quebec and a long-term supporter of Osisko, to make a non-brokered private placement of 7,727,273 common shares of the Company at a price of CA$11.00 per common share. Upon completion of the private placement, Investissement Québec will hold 5.04% of the issued and outstanding shares of the Company. The net proceeds of the Private Placement will be used for general working capital purposes.
The financing was provided at a price above the current Osisko Gold share price! The private placement thus provides the Company with additional flexibility to acquire new royalties and streams. In the future, the number and quality of potential royalty and streaming transactions should improve significantly, particularly given the uncertainties of the corona crisis.
News: OSISKO ENTERS INTO AN AGREEMENT WITH INVESTISSEMENT QUÉBEC FOR A NON-BROKERED PRIVATE PLACEMENT OF $85 M
Newsflash: Newsflash with Osisko Gold Royalties, Gold Terra Resources and Caledonia Mining
Osisko Gold Royalties: Buy recommendations from Canaccord Genuity and Haywood!
Canaccord Genuity recently released a corporate update on Osisko Gold Royalties. The analysts issued a buy recommendation with a target price of CA$16.
Another research report on Osisko Gold was published a few days ago by Haywood Capital Markets. The analysts went one better with their buy recommendation and set a price target of CA$19.50!
Update: Buy recommendation for Osisko Gold Royalties from Canaccord with price target 16 CAD
Report: Buy recommendation with price target 19.50 CAD from Haywood Research for Osisko Gold Royalties
Uranium: Larger mines and processing plants shut down - Utilities have to buy on the spot market - Uranium spot price at 4-year high!
We already mentioned it in our last newsletter: The uranium market is about to explode! We already suspected 10 days ago that the world's largest uranium producer Kazatomprom will have to shut down mines due to the Corona crisis and this is what will happen now. Kazatomprom announced on April 7, 2020, that it expects Kazakhstan's annual uranium production volume in 2020 to decline by up to 4,000 tons of uranium compared to previous expectations as the company implements measures to comply with COVID-19 blocking requirements. It is expected that measures that result in lower levels of ISR activity, and therefore reduced production volumes, will remain in effect for three months. Kazatomprom is the world's largest uranium producer, accounting for 23% of global production of the metal in 2018.
This means that in Kazakhstan alone, 10 million pounds of U3O8 of annual production will be lost. Together with the earlier announcements of production cuts at Cigar Lake and in Namibia (Rössing & Husab), this would reduce uranium production by approximately 6.3 million pounds per month or 53% of total monthly production. In addition, in a corporate statement released on April 8, Cameco announced that its uranium hexafluoride (UF6) plant at the Port Hope Conversion Plant and the uranium trioxide (UO3) refinery at Blind River would be shut down for at least 4 weeks. This means that an important processing unit - especially for North America - is now also no longer required.
Well, we do not know how much urgently needed uranium utilities worldwide still have in stock, but we assume that the US utilities in particular have a rather small stockpile.
If even old contracts that are still running cannot be fully serviced for a while, there is only one thing left to do: Buy on the spot market. And it looks as if some utilities are already getting nervous. Because the uranium spot price is rising day by day. On 23rd March, the spot price was still at US$ 24.35. On 8th April, US$ 29.18 per pound of U3O8 had already been paid. A plus of almost 20% within just two weeks! And now the mark of US$ 30 is approaching, which was last reached more than 4 years ago on February 29, 2016. At the latest when this mark is broken, the run on urgently needed uranium should finally begin.
In addition to companies with production-ready projects and approved facilities such as Energy Fuels, Ur-Energy and Uranium Energy, investors are likely to focus on companies with high-grade resources such as Anfield Resources, Denison Mines, Fission Uranium, GoviEx, IsoEnergy, Laramide Resources and Skyharbour Resources.
Latest Interview Special with Amir Adnani about the Uranium Markets:
Further company news:
Bluestone Resources continues to work even in times of crisis
Bluestone Resources recently announced that it is working flat out on the development of the high-profile Cerro Blanco gold project, even during the Corona crisis. The Cerro Blanco Gold Project is in the engineering phase and the Company is focusing on project readiness activities in addition to optimization and engineering efforts, which fortunately can be further advanced remotely. Given the nature of this work, most of these initiatives are progressing and can be driven by desktop or laboratory facilities and the use of video conferencing tools. In addition, the company is expanding its project execution team, which also includes underground construction and engineering tasks.
Caledonia Mining requests derogation from suspension of operations
A few days ago, Caledonia Mining applied for an exemption to be allowed to continue operating its Blanket Gold Mine during the Corona crisis. According to new regulations, all commercial activities with the exception of "essential services" must be suspended for a period of 21 days from March 30, 2020. Although the Zimbabwean authorities have confirmed that gold mining is not an essential service, Blanket is currently allowed to continue its operations as the authorities will grant exemptions to companies that can demonstrate that they can operate in a manner that helps to control the spread of COVID-19 infections. A key measure to reduce the risk of infection among Blanket's workforce will be to increase the "social distance" of workers entering and leaving underground work. This will reduce the number of workers who can work underground and bring daily production up to about 70 to 80 percent of the target production rate.
Blanket may continue to operate at the reduced level until its application for exemption is processed by the authorities.
As stated in the company's announcement on 26 March 2020, Caledonia is entering this unprecedented situation with a strong balance sheet, enabling it to cope with a production interruption of several months. The cash balance on 25 March 2020 was 12.5 million dollars.
Nevertheless, the company announced that it will postpone approval of the declaration of the second quarterly dividend for 2020. The Management Board will constantly review this decision as it monitors prevailing market conditions.
Caledonia Mining reports very good quarterly results
Caledonia Mining recently announced the quarterly gold production from the Blanket Mine in Zimbabwe for the quarter ending March 31, 2020. During the quarter, 14,233 ounces of gold were produced, up 19 percent from 11,948 ounces in the corresponding quarter of 2019.
Canada Nickel encounters high grade platinum-palladium mineralization
Canada Nickel recently announced the discovery of a new palladium-platinum zone and the first intercept of over 1% nickel from drilling at its 100% owned Crawford nickel-cobalt sulphide project near Timmins, Ontario. Five drill holes intersected this zone, starting at bedrock contact and extending to a depth of 500 metres over a strike length of 600 metres. The separate PGM zone returned grades of up to 1.7g/t palladium + platinum over 7.5 metres. These results represent the remaining holes from the initial drilling campaign on the main Crawford anomaly. The main anomaly remains open to the west and at depth.
With palladium prices in excess of US$3,000 per ounce and few new palladium discoveries worldwide, the discovery of this new multi-gram near-surface palladium-platinum zone, which is parallel to Crawford's existing nickel-cobalt palladium resources, highlights Crawford's significant potential and provides additional options for shareholder value development. To date, less than 20% of this anomaly has been drilled, and this is expected to happen in a future campaign.
News: Canada Nickel Company Announces Discovery of New Palladium-Platinum Zone at Crawford and First Intersection of Nickel Grading More than 1%, Provides Update on Transaction with Noble Mineral Exploration
Discovery Metals ceases exploration activities and reports very good drilling results
Discovery Metals announced a few days ago that it has temporarily suspended all exploration activities at its operations due to the increased health and safety risks associated with the growing number of COVID-19 cases in Mexico. The Company has established plans to maintain operations so that exploration activities can be quickly resumed as soon as deemed safe.
Discovery has already completed 48 holes totaling 17,500 metres of the planned 30,000 - 35,000 metre Phase 1 drill program. The Company has initially reported additional drill results from previously completed holes. These include 1.0 metre at 2,153g/t silver equivalent and 62.8 metres at 217g/t silver equivalent.
Endeavour Silver must temporarily close mines
Endeavour Silver announced a few days ago that the Mexican government has declared a national health emergency due to the COVID 19 pandemic. Numerous health precautions have been taken, including the suspension of non-essential businesses while only essential services remain open. Mining is not considered an essential service, so Endeavour has begun the process of suspending its three mining operations in Mexico by April 30, as ordered by the government, to protect its employees, contractors and communities.
Endeavour strives to retain essential personnel at each mine site during the downtime to maintain safety protocols, environmental monitoring, security measures and equipment maintenance.
EnWave receives new patent approvals
EnWave recently announced that the company has received nine new patent approvals from a number of major international patent offices. The company currently holds fifteen patent families relating to its radiant energy vacuum technology ("REV™"), which have been approved in several international jurisdictions. In addition, EnWave has six patent applications that have been finalized and submitted to the international examiner for the Patent Cooperation Treaty for review and possible approval for the national phase.
The company has a large number of additional pending national phase applications which should be approved in the coming months.
News: EnWave Expands Strong Intellectual Property Portfolio
Gold Terra Resource expands Sam Otto
Gold Terra Resource recently announced results from five drill holes from the Winter 2020 drill program at Sam Otto. These holes were designed to test a previously undrilled zone between the Sam Otto Main Zone and its southern extension. All five holes in the Connector Zone intersected gold mineralization outside the current 43-101 Inferred Mineral Resource estimate dated November 4, 2019, which demonstrates the previously assumed continuity of the Sam Otto Zone. Highlights included 1.06g/t Au over 12.90 metres and 1.63g/t Au over 7.25 metres in drill hole TSO20-063 and 0.45g/t Au over 41.96 metres.
To date, Gold Terra has reported 8 of 34 holes drilled this winter, with results pending.
News: Gold Terra Extends the Sam Otto Gold Structure and Provides Corporate Update
Newsflash: Newsflash with Osisko Gold Royalties, Gold Terra Resources and Caledonia Mining
IsoEnergy delivers world-class drilling results
Iso Energy has recently once again delivered world class drilling results. The Company reported that the LE20-51 hole returned an average of 14.5% U3O8 and 3.5% nickel over 7.5 metres. A higher-grade subinterval within LE20-51 averaged 30.9% U3O8 and 7.1% nickel over 3.5 metres.
Thus, IsoEnergy could once again prove the exceptional position of its Larocque East project.
News: IsoEnergy Intersects 7.5m of 14.5% U3O8 in Drill Hole LE20-51 Including 3.5m of 30.9% U3O8
Newsflash: Newsflash with Bluestone Resources, IsoEnergy and Skeena Resources
MAG Silver publishes annual results
MAG Silver recently announced the Company's audited consolidated financial results for the fiscal year ended December 31, 2019. Among other things, the Company reported that production from the underground mine is expected to commence ahead of schedule in mid 2020. The mineralized material from the underground mine will be processed at the Fresnillo plant until the Juanicipio plant is commissioned. The Juanicipio plant is expected to start up in mid 2021 and is expected to reach 85% of its planned capacity of 4,000 tonnes per day in Q4-2021. The ramp-up is expected to be much faster than previously anticipated, as the metallurgical output of Juanicipio is no longer as risky due to the processing of the mineralized material at the Fresnillo plant.
The company will need to raise additional capital in the future to cover its full share of the initial capital required for the development of the Juanicipio project, but this should not be a major problem given the top indicators.
News: MAG Silver Reports 2019 Annual Results
Presentation: MAG Silver: Next Silver Producer in Mexico - Corporate Update
Maple Gold Mines discovers new target area
Maple Gold Mines recently announced that the Company's infill-induced polarization lines on the Northeast IP target now include a 1,500 metre drill-ready target area in the SW portion of a 3 kilometre long corridor of chargeability anomalies, where both the known local geology and response to induced polarization are interpreted to be favourable to new Vezza-type gold discoveries.
The Maple Gold pipeline continues to grow with new discovery targets for both gold and VMS style mineralization. In addition to the drill-ready Northeast IP target, the Company has several new gold targets generated from top-of-bedrock drilling completed in 2018 on the western margin of the Douay property and a number of base metal targets throughout the central portion of the property.
News: Maple Gold details 1,500 metre long drill-ready target area with new Induced Polarization survey
Millennial Lithium: Research Report of Raiffeisen Centrobank
Raiffeisen Centrobank recently published a research report on Millennial Lithium.
Report: RaiffeisenCentrobank with initial research on Millennial Lithium
Skeena Resources extends financing and completes first tranche
Skeena Resources recently announced that it has completed the first tranche of the non-brokered private placement offer announced on 10 March 2020. Skeena raised gross proceeds of approximately CA$15 million from the sale of 13,000,000 BC Superflow Through Shares at a price of CA$1.155 per share. Due to strong demand for flow-through shares outside British Columbia, the Company has increased the offer to CA$30 million and added a national flow-through component at CA$1.05 per share. The Company expects to complete the remainder of the offer in mid-April. The net proceeds of the offering will be used to fund exploration activities on the Company's Golden Triangle projects in British Columbia.
A financing at a much higher rate than the current one at the moment - that looks good!
News: Skeena Closes First Tranche of Oversubscribed Private Placement
Newsflash: Newsflash with Bluestone Resources, IsoEnergy and Skeena Resources
Treasury Metals continues to deliver bombing drill results
Treasury Metals recently announced technical program updates from the Goliath Gold Project in northwestern Ontario, including additional drill results from the Main Zone. The Company has encountered very high-grade gold mineralization including 19.5 metres at 6.3g/t gold and 12.0 metres at 9.7g/t gold.
Each of these results continues to show strong continuity of the mineralized zone in the Goliath Main Zone.
News: Goliath Drilling Continues To Intersect High Grade Gold Across Main Zone, including 6.3 g/t Au over 19.5 m
Swiss Resource Capital AG and the authors of Swiss Resource Capital AG currently hold or intend to hold shares in the following securities mentioned in this issue: Aurania Resources + Fiore Gold + Revival Gold + Osisko Gold Royalties + Cameco + Kazatomprom + Energy Fuels + Ur-Energy + Uranium Energy + Anfield Resources + Denison Mines + Fission Uranium + GoviEx + IsoEnergy + Laramide Resources + Skyharbour Resources + Bluestone Resources + Caledonia Mining + Canada Nickel + Discovery Metals + Endeavour Silver + EnWave + Gold Terra Resource + IsoEnergy + MAG Silver + Maple Gold Mines + Millennial Lithium + Skeena Resources + Treasury Metals.
Swiss Resource Capital AG has concluded IR consulting agreements with the following companies mentioned in this issue: Aurania Resources + Fiore Gold + Osisko Gold Royalties + Uranium Energy + IsoEnergy + Bluestone Resources + Caledonia Mining + Canada Nickel + Discovery Metals + Endeavour Silver + EnWave + Gold Terra Resource + MAG Silver + Maple Gold Mines + Millennial Lithium + Skeena Resources + Treasury Metals.
This publication is based on the detailed risk information, limitations of liability and disclaimers of Swiss Resource Capital AG, which can be viewed here: risk information and disclaimer