We must be in at least a temporary mining bear market, given the lack of posting here...
KRR, BTO
We got a bit more news from Karora Resources aka KRR -- the bought deal announced yesterday in conjunction with the purchase of a new mill for their Australian gold mining operations has been upsized by a further $C10M to a total of $C60M. This is good news in one sense -- even more purchasers think they can make money on their new shares priced at $4.80 -- but it also means it will take longer to work off the overhang from those cheap shares. Meanwhile, today KRR's share price is stuck one penny under the offering price.
I'd been wondering how long it would be before B2Gold aka BTO would buy something given the way they had been building up their cash stash. Today we got an answer -- they are buying Oklo Resources aka OKU.AX for a combination of cash and shares. This deal makes perfect sense, as all of OKU's holdings, including the ready to be built into a mine Dandoko gold deposit, are located in Mali on the shear belt that hosts BTO's Fekola mine. Mind you, given that only $27.4M of the $91.3M purchase price is to be paid in cash, BTO has plenty left for more deals if they are so inclined.
FWIW, in response to this announcement TD issued a new analyst report on BTO that saw the impact as Slightly Positive, but kept them at Buy with a target of $9.50.
Even as its share price continues to decline -- why didn't I sell a large portion of my holdings when it was over a loonie? -- Wallbridge Mining aka WM continues to define more and more gold minerlaization at their Fenelon gold project in Quebec. Last year they declared over 4M oz of gold in their initial Resource Report for the deposits on Fenelon. This year they are concentrating on developing more resources close to the existing resource envelope, including establishing underground access at Area 51, where both surface and underground drilling has been fruitful. This year's drilling has also extended the Tabasco and Cayenne zones at depth, and established the Ripley deposit a little further away as a strong candidate for growth.
How much growth? We find out later this tear when the new Resource Report is compiled and published. In the meantime I continue to worry that the current low share price will lead to a premature (from the shareholders' viewpoint) takeover.
Worried that Rio2 aka RIO didn't get the permits for development of its Fenix gold mine in Chile in May as scheduled? IKN says not to worry, that everything was delayed a bit by the changeover to the new government, but other than that things are proceeding smoothly and they should get the permits soon. FWIW, I am not worried.
And reading through Saville's latest, it is clear that he agrees with me that we have left behind last year's unabashed bull market in mining stocks. There are still good opportunities, but only if you pick the right stock run by the right people mining the right minerals in the right locations. I am doing my best to comply, as well as trying to force myself to sell some stuff and build up my cash reserve.
Some of you might recall me occasionally mentioning Orsu Metals aka OSU,a company developing a mine in southern Russia. It was only a small position, which I held on the basis of my judgment of their management, but I sold when Russia invaded Ukraine. Not long after, OSU announced their Russian property was essentially worthless to them thanks to the sanctions, but attesting to that quality management, they have landed on their feet, morphing into exploration for helium, acquiring development assets in the US and Greenland. I have not investigated the helium space, but this time I think I will, and if I like what I see I may buy back into whatever company OSU becomes. (Note that at this point the letter of intent is non-binding.)
Minera Alamos aka MAI released an update on its Santana gold property in Sonora, Mexico. It wasn't the declaration of commercial production we have been waiting for, but it does set the conditions for that to happen in the near future. The on site lab is almost complete, moving blasting in house has cut costs by 80%, they have dealt with the effects of the drought afflicting Sonora, and most importantly, mining will begin shortly at the much larger Nacho Norte pit, leading to a substantial increase in production.
The PR also contains MAI's quarterly results. They managed to make a profit even though the ramp up to full production has taken longer than expected. Their cash stash is at $8.2M, plus they set up a facility to provide up to $3M in working capital to tide them over till full production levels are achieved.
It will be strange not having Yamana Gold aka YRI around anymore. I have owned shares a few times, doing fairly well with them, and have always kept half an eye on them as representative of a certain size and style of gold miner. But clearly Gold Fields International want to move up the rankings among the big boys, and this purchase gives them a long-desired foothold in the Americas. FWIW, the analyst reports I have seen though GFI offered a fair price, but it would not be surprise to see another bid come in.
I-80 Gold aka IAU brought us another update from their Granite Creek gold property in Nevada, from which they plan to start underground mining shortly There are two zones of untapped mineralization near existing underground workings at Granite Creek, SPZ and Ogee. This PR concerns results from drilling right next to that existing infrastructure, including 13.3 g/t Au over 13.1M, 20.3 g/t Au over 7.5M, and 10.1 g/t Au over 17.5M, all from just one of the holes. Ore will begin being trucked to NGM's nearby mill within the next few months. Meanwhile IAU will continue drilling as well as extending the underground workings and completing a feasibilty study.
Northern Shield Resources aka NRN released a PR concerning its Root & Cellar gold/copper prospect in Newfoundland. This ever hopeful bunch of geologists in now concentrating on sampling to follow up on last year's drilling and geophysics at the Conquest Zone, where they have been successful in finding mineralized boulders and outcrops, albeit with no assays yet. They are now starting to make noises about a feeder zone, but these folks have said all sorts of promising things about a variety of prpoerties without ever finding anything substantial.
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