CCW, KDK, SVB, EDV, WM
Canada Silver Cobalt Works aka CCW has already defined a number of a high grade Ag/Au veins in and around its past producing Castle Mine complex in Ontario. Now they are bringing in Goldspot to run some high tech geophysics over its properties in the hope of finding new veins to drill up. The helicopter will be flying near the end of the month.
Message 34335589
Kodiak Copper aka KDK announced the arrival of a second rig as they move forward on this year's 25-km drill programme on the MPD property in SE BC. They are primarily searching for (and finding) large Cu/Au porphyries, but the arrival of the second rig pushes forward when they will drill test a potential high grade gold deposit they discovered last year.
Message 34337245
Silver Bull Mining aka SVB announced they have begun arbitration proceeding under against the Mexican government in the Arbitration with International Centre for Settlement of Investment Disputes. They are seeking $178M in damages due to the government's failure to remove an illegal blockade that has kept SVB from accessing their their Sierra Mojada project.
They give no timeline for the proceedings, but so far this year things have been moving through the steps briskly, so let us hope that pace continues.
Message 34338555
Today we get two PRs concerning west African gold producer Endeavour Mining aka EDV.
First we hear that they are selling their 90% interest in two of their Burkina Faso mines, Boungou and Wahgnion, now described as 'non-core', to an African investment fund. In return, over time they will receive a variety of compensation including cash, loan forgiveness, and NSRs which EDV estimates will eventually amount to about $300M.
As a result of the sale, EDV is reducing its full year 2023 production guidance for continuing operations from 1,325-1,425koz to 1,060-1,135koz Au,, while AISC guidance from continuing operations has improved by $45/oz to $895–950/oz. They expect this decrease to be more than made up for by next year due to a number of projects to be put into production by the end of 2024.
Message 34338584
Then we hear that recently Kinroos Gold rejected a takeover attempt by EDV. EDV has long been acquisitive. In the last few years they successful acquired rivals Teranga and Semafo, and failed to consummate a deal to buy Centamin. There is no word on whether talks between K and EDV will resume, but I am sure EDV will remain on the hunt as they continue to build their cash stash out of gold production.
Message 34338595
This week we witness a development that should eventually help Wallbridge Mining aka WM out of the doghouse. For the first time I have seen, they are being covered by a major Canadian brokerage. In the wake of this week's release of a PEA for the Fenelon gold project in Quebec, BMO has instituted coverage with a rating of Outperform and a target of 75 cents. It turns out they like the PEA more than I did, citing Fenelon as one of the few gold projects worldwide that are targeting low cost production of 200k+ oz Au per year in a good mining jurisdiction. They also cite the low gold price used in the PEA ($1600/oz) and the upside as the nearby Martiniere deposits becomes included in future economic studies, and see Fenelon as very marketable to a major looking to bolster their production.
BMO are modelling a construction start in 2026 leading to first production in 2028, but like me they expect that WM will have sold off the properties before that.
Saville reminds us that even as the price of gold sets a three-month low, the key factor right now for the PoG is the 10-year TIPS yield, a proxy for the real US long-term interest rate, which is currently messing around near the top of the range it has occupied for the last nine months. If it breaks out to the upside, look for gold to decline to the low $1800, he says, but when the 10-year TIPS yield eventually breaks down, that will catalyze a serious liftoff in the PoG. |
