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Episode 10

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Oreninc Index: September 5, 2017

ORENINC INDEX jumps as gold breaks US$1,300/oz

 

ORENINC INDEX - Tuesday, September 5th, 2017

North America’s leading junior mining finance data provider

 

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Last week index score: 24.70

This week: 70.51

 

Castle Silver Resources (TSXV: CSR) completed 22 drill holes for 2,405m from surface at its Castle silver-cobalt project in Gowganda, Ontario, Canada.

 

The Oreninc Index jumped in the week ending September 1st, 2017 to 70.51 from 24.70 the previous week with Osisko Mining announcing a financing in four parts.

Total fund raises announced more than doubled to C$115.1 million, a nine-week high, which included six brokered financings for C$91.0 million, a ten-week high, and four bought-deal financings for C$88.0 million, a 24-week high. The average offer size grew to C$3.7 million, an eight-week high, whilst the total number of financings announced increased to 31, a four-week high.

After testing the US$1,300 per ounce level several times this year, gold finally broke through this mark in style as the US jobs report came in lighter than expected with some 156,000 jobs added in the August Bureau of Labor Statistics report said on Friday, compares to expectations of around 180,000.

The week also saw Hurricane Harvey hit Houston,Texas and hang around for several days, unleashing a deluge estimated at some 27 trillion gallons of water that caused considerable flooding. The flooding resulted in the shutdown some 20% of US oil refining capacity and caused widespread damage that will make Harvey the hurricane that has caused most financial damage ever, expected to beat the US$160 billion of damage caused by Katrina in 2005.

Gold continued to strengthen and closed the week at US$1,325/oz up from slightly from US$1,297 last week, hitting levels last seen in October 2016, and it is now up 15.5% since the start of the year. The van Eck managed GDXJ was lifted by the gold price increase and is now up 14.9% so far in 2017 to close the week at US$36.26. The recently launched US Global Go Gold ETF also had a strong week to close at US$13.48 from US$12.65 last week. Breaking US$1,300/oz brought new interest to the gold space, which helped the inventory of the SPDR GLD ETF see strong growth to close the week at 831 tonnes from 805 tonnes the previous week.

In other commodities, silver broke clear of the US$17/oz mark and closed at US$17.73 up from US$17.07/oz last week. The copper price continued its recent growth spurt and closed up at US$3.12/lb from US$3.05/lb the previous week. Oil receded for most of the week hitting a low of US$45.96 per barrel before recovering some lost ground at the end of the week to close down at US$47.29 per barrel from US$47.87 last week.

The stock markets also saw growth this week with the Dow Jones Industrial Average increasing to 21,987 from 21,813 last week, whilst Canada’s S&P/TSX Composite Index grew to 15,191 from 15,055 the previous week. The S&P/TSX Venture Composite Index also increased to close at 778.45 from 769.47 the previous week.

 

Summary:

  • Number of financings increased to 31, a four-week high.
  • Six brokered financings were announced this week for C$91.0m, a ten-week high.
  • Four bought-deal financings were announced this week for C$88.0m, a 24-week high.
  • Total dollars doubled to C$115.1m, a nine-week high.
  • Average offer size also grew to C$3.7m, an eight-week high.

 

 

Financial news highlights

Osisko Mining (TSX: OSK) announced a bought deal private placement of C$80 million

  • Two-tranche bought deal of 7.4 million flow-through shares for aggregate gross proceeds of C$50.0 million, amended to include an additional 7.1 million shares @ C$4.20 for additional gross proceeds of C$30.0 million.
  • Underwritten by Canaccord Genuity that has the option to increase the offering size by up to an additional 1.1 million common shares.
  • The proceeds will be used for an expanded infill drilling program at its Windfall Lake gold project in Urban Township, Abitibi, Québec, Canada. Osisko plans to add 400,000m of drilling to the current drill program, for a global total of 800,000m.

 

Major Financing Openings:

  • Osisko Mining (TSX: OSK) opened a C$40.01 million offering underwritten by a syndicate led by Canaccord Genuity on a bought deal basis at C$6.93 per share. The deal is expected to close on or about October 5th.
  • Osisko Mining (TSX: OSK) opened a C$30 million offering underwritten by a syndicate led by Canaccord Genuity on a bought deal basis at C$4.20 per share. The deal is expected to close on or about October 5th.
  • Osisko Mining (TSX: OSK) opened a C$10 million offering underwritten by a syndicate led by Canaccord Genuity on a bought deal basis at C$6.14 per share.
  • Osisko Metals (TSXV: OM) opened a C$8 million offering underwritten by a syndicate led by Canaccord Genuity on a bought deal basis at C$1.90per share. The deal is expected to close on or about September 20th.

Major Financing Closings:

  • Colorado Resources (TSXV: CXO) closed a C$7.24 million offering underwritten by a syndicate led by PearTree Securities on a best efforts basis. Each unit included half a warrant that expires in 30 months.
  • Hannan Metals (TSXV: HAN) closed a C$3.33 million offering on a best efforts basis. Each unit included half a warrant that expires in 24 months.  
  • Umbral Energy (TSXV: UMB) closed a C$2.62 million offering on a best efforts basis. Each unit included a warrant that expires in 24 months.  
  • SRG Graphite (TSXV: SRG) closed a C$2.1 million offering on a strategic deal basis.

 

Company news

Castle Silver Resources (TSXV: CSR) completed 22 drill holes for 2,405m from surface at its Castle silver-cobalt project in Gowganda, Ontario, Canada.

  • Phase 1 drilling from surface was designed to gain a greater understanding of structures carrying potential cobalt mineralization in underground portions of the Castle mine and at shallow levels within 200m of the main adit.
  • Assay results returned an average of 3.7g/t Au in five chip samples from the first level of the Castle mine in addition to the high-grade cobalt, nickel and silver.
  • A Niton Portable XRF analysis of vein structures throughout the first level of the mine, allowing the company to target locations for additional bulk sampling.

Analysis

With assays from drilling pending, the company is building the geological picture of the cobalt potential at Castle. The soon to be initiated bulk sampling program will allow the company to produce cobalt sample products from Castle material through the company’s proprietary Re-2OX process and take another step towards evaluating the project’s potential.

 

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