SNAG, OGC, RRI, iau
Silver North Resources aka SNAG released more drill results from its 100%-owned Haldane prospect in the Keno silver district in Yukon Territory. The holes directed at the West Fault missed their targets, but there was better news regarding the Main Fault. Drilling intersected three layers of veins yielding assays like 365 g/t Ag, 0.23 g/t Au, 1.80% Pb, and 1.37% Zn over 5.80m true width and 460 g/t Ag, 0.16 g/t Au, 4.34% Pb, and 1.23% Zn over 3.05m true width have elevated the Main Fault to a priority target which will be followed up by more drilling next year.
Now we await the remaining assays from this year's drilling on the Tim JV with Coeur.
Message 34908073
OceanaGold aka OGC has a bit of a problem with its Wharekirauponga property in New Zealand. They are going to release a PFBS in a few weeks but they keep on pulling great drill results, meaning the PFBS will already be at least a bit obsolete on release because there won't be time to include the new assays in the calculations.
It is not a bad problem to have though, considering the assays include the likes of 34.7 g/t Au over 4.2m, 13.0 g/t Au over 6.6m, and 54.9 g/t Au over 1.4m. These are all from the EG vein, which along with side shoots is turning into a monster. The strike length is now over 800M and is expected to grow during ongoing drilling.
Message 34908316
One of the strategies used by prospect generator Riverside Resources aka RRI is to bundle certain assets into separate companies and spin them out to RRI shareholders. Most recently they used this approach to create Capitan Silver aka CAPT.
Now they are planning to create a company called Blue Jay Resources and spin it out next year. Blue Jay will hold the Duc, Oakes, and Pichete gold prospects in Ontario that RRI has been developing the last few years.
Given RRI's track record, I expect the process to proceed smoothly to the benefit of shareholders.
Message 34908325
I have spent the last 24 hours going back and forth on Nevada gold miner i-80 Gold aka IAU. In the wake of yesterday's beatdown after the new development plan was released by new management, the question is what to do in response, ranging from sell all shares and warrants in the face of coming recapitalization -- new equity issues perhaps followed by a rollback -- vs. riding this out for the eventual good return over the coming years, given the quality of the assets they are developing.
I am currently still contemplating my options but leaning toward staying in, except maybe dumping my warrants for a loss
Saville's latest shows exactly where my mistake with IAU was; I wasn't paying enough attention to the balance sheet, particularly the large working capital deficit. Particularly for a company that will have capital requirements for carrying out its plans, this is a vital component, and I am paying the price for not paying more attention to this.
I also listened to the playback of the press conference. I didn't learn a lot that wasn't covered in the PR, but it was good to learn that new management is mostly composed of people who have worked together at other successful companies like Teranga. This is a real positive in my books. It was also interesting to hear the new CEO talk about the development pipeline potentially extended beyond the 5 mines in 6 years to other projects like the Ruby Hill base metal over the next 15 years. It was also good to hear management expressing a desire to limit dilution during the recapitalization, though we will see how that works out in practise.
Management does seem very confident that they can achieve recapitalization on favourable terms by Q1. Let us hope it is not just bravado.
You can access a playback yourself here.
i80gold.com
FWIW, in response Scotia issued a new analyst report on IAU that to my surprise called yesterday's PR a Mild Positive, as they like the new development plan. However, they outline three main risks:
1) dealing with water inflows into the producing mine at Granite Creek
2) renegotiating upcoming gold and silver deliveries
3) restructuring debt and securing sufficient capital to carry out its plans
Pending today's press conference, Scotia has maintained IAU at Sector Outperform with a target of $3. |
