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Oreninc Index: January 21, 2019

 

ORENINC INDEX rebounds as conference season gets underway

ORENINC INDEX - Monday, January 21st 2019

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Last week index score: 9.88

This week: 28.08

Nexus Gold (TSXV:NXS) completed the acquisition of the New Pilot gold-copper exploration property project in the Bridge River mining camp in British Columbia, Canada, and entered into a letter of intent with an arm's-length third party to provide financing of up to C$250,000 towards the development of its recently acquired New Pilot project in the Bridge River mining camp in British Columbia, Canada.

Nexus Gold (TSXV:NXS) reported additional sample results from its Dakouli 2 gold project in the Goren Greenstone Belt in Burkina Faso, West Africa.

 

The Oreninc Index rebounded in the week ending January 18th, 2019 to 28.08 from 9.88 as financings reemerged as conference season gets underway.

US stocks jumped and gold took a hit as the week ended as reports said that China offered to go on a six-year US$1 trillion shopping binge to ramp up imports from the US. Despite ending 2018 strongly, gold has had its worst start to a year since 2013.

On the political front, the US government shutdown continues with little sign of rapprochement between US President Donald Trump and the Democrats, who are adamant that they will not fund the construction of a wall on the Mexican border to keep out illegal immigrants.

The political impasse continues in the UK as Prime Minister Teresa May suffered the worst ever defeat as the House of Commons voted to reject the exit deal she negotiated with the EU. She survived a vote of no confidence the following day which essentially leaves things as they were a week ago: neither the UK or EU are any closer to getting clarity on when, if or how the UK will leave the EU.

On to the money: a much better week for the index as total fund raises announced increased to C$33.6 million, a three-week high, that included one brokered financing and no bought-deal financings. The average offer size quadrupled to C$2.24 million, a five-week high, whilst the number of financings increased to 15, a two-week high.

Gold continues to be rangebound between US$1,280/oz and US$1,300/oz although it ended the week giving up ground to close down at US$1,282/oz from US$1,290/oz a week ago. The yellow metal is up 0.03% this year. The US dollar index recovered to close up at 96.33 from 95.67 last week. The van Eck managed GDXJ followed the gold price down and closed the week down at US$29.33 from US$30.69 a week ago. The index is down 2.956% so far in 2019. A similar tale at the US Global Go Gold ETF that closed down at US$11.30 from US$11.61 a week ago. It is up 0.96% so far in 2019. The HUI Arca Gold BUGS Index closed down at 150.77 from 159.40 last week. The SPDR GLD ETF inventory however saw meaningful growth to break over 800 tonnes to close up at 809.76 tonnes from 797.71 tonnes a week ago.

In other commodities, silver continued to shed cents to close down at US$15.34/oz from US$15.60/oz a week ago. Copper finally broke above US$2.70lb to close up at US$2.71/lb from US$2.66/lb a week ago. Oil continues to bounce as WTI closed up at US$53.80 a barrel from US$51.59 a barrel.

The Dow Jones Industrial Average continued in growth mode to close up at 24,706 from 23,995 last week. Canada’s S&P/TSX Composite Index also continued to grow as it closed up at 15,303 from 14,939 the previous week. The S&P/TSX Venture Composite Index closed down however at 595.51 from 601.77 last week.

 

Summary

·       Number of financings increased to 15, a two-week high.

·       One brokered financing was announced this week, a five-week high.

·       No bought-deal financings were announced this week, a one-week low.

·       Total dollars grew to C$33.6m, a three-week high.

·       Average offer size grew to C$2.24m, a five-week high.

                                                    

Financing Highlights

NGEx Resources (TSX:NGQ) announced a C$20.0 million financing.

·       Agreement with National Bank Financial and Cormark Securities to sell on a best efforts private placement basis up to 10.0 million shares @ C$1.00 for aggregate gross proceeds of up to C$10.0 million.

·       The banks can increase the offer size by up to 30%.

·       Concurrent with the offering, the NGex is arranging a non-brokered private placement of up to an additional 10.0 million @ C$1.00 for aggregate gross proceeds of up to C$10.0 million.

·       The offering is expected to close on January 31st.

·       NGex plans to use the net proceeds for ongoing work programs in Argentina and Chile, including completing a feasibility study on the Josemaria project, engineering and exploration studies on its other projects and repayment of existing balance owing on its US$5.0 million debenture.

 

Major Financing Openings

·       NGEx Resources (TSX:NGQ) opened a C$20.0 million offering. C$10 million is underwritten by a syndicate led by National Bank Financial on a best efforts basis. $10 million is on a non-brokered basis. The deal is expected to close on or about January 31st.

·       Velocity Minerals (TSXV:VLC.H) opened a C$3.91 million offering on a strategic deal basis. Each unit includes half a warrant that expires in three years.

·       Columbus Gold (TSXV:CGT) opened a C$2.0 million offering on a best efforts basis. Each unit includes half a warrant that expires in a year.

·       Cameo Cobalt (TSXV:CRU) opened a C$2.0 million offering on a best efforts basis. Each unit includes half a warrant that expires in two years.

Major Financing Closings

·       Gabriel Resources (TSXV:GBU) closed a C$26.3 million offering on a best efforts basis. Each unit includes a warrant that expires in five years.

·       Northern Dynasty Minerals (TSX:NDM) closed a C$9.4 million offering on a insiders only basis.    

·       Royal Nickel (TSX:RNX) closed a C$ 6.0 million offering underwritten by a syndicate led by Haywood Securities on a best efforts basis.

·       Royal Nickel (TSX:RNX) closed a C$3.0 million offering on a bought deal basis.

 

Company News

Nexus Gold (TSXV: NXS) completed the acquisition of the New Pilot gold-copper exploration property project in the Bridge River mining camp in British Columbia, Canada.

·       Nexus issued 3.5 million shares to the vendor Warren Robb.

Nexus Gold (TSXV:NXS) entered into a letter of intent with an arm's-length third party to provide financing of up to C$250,000 towards the development of its recently acquired New Pilot project in the Bridge River mining camp in British Columbia, Canada.

·       The investor will earn a 10% beneficial interest in the project

·       Nexus will have the right to redeem the interest from the investor in consideration for a payment of $250,000 that will be satisfied through the issuance of stock

Analysis

This financing will provide a kick-start to development at New Pilot including mapping and sampling, geophysical and geochemical programs, through the summer months and should enable the company to get its work programs up-and-running rapidly.

 

Nexus Gold (TSXV:NXS) reported additional sample results from its Dakouli 2 gold project in the Goren Greenstone Belt in Burkina Faso, West Africa.

·       13 samples were taken with five returning values between 1.74g/t Au and 17.6g/t Au.

·       Of the first 25 samples now collected, five exhibited coarse, nuggety visible gold.

·       Ground reconnaissance identified two new mineralized zones and a secondary vein structure.

Analysis

The amount of coarse visible gold and identification of new structures makes Dakouli 2 an exciting prospect. However, recent security incidents in Burkina Faso may deprioritise this project in the near term.

 

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