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Oreninc Index Update: December 18, 2017

Oreninc Index Update: December 18, 2017

ORENINC INDEX falls as year-end beckons

 

ORENINC INDEX - Monday, December 18th, 2017

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Last week index score: 123.85 (Updated)

This week: 92.05

 

Zinc One Resources (TSXV:Z) obtained a permit for 124 platforms for resource definition drilling at its Bongará zinc mine project in Peru.

 

The Oreninc Index fell in the week ending December 15th, 2017 to 92.05 from an updated 123.85 as year-end flow-through financings continue.

Gold showed signs of recovery after the US Federal Reserve announced an expected quarter point interest rate increase. The past week potentially saw the tax-loss selling peak and it can be expected that most money managers have completed their tax loss trades. If not, the coming week for sure will end tax-loss selling season.

On the international news front, unrest and stone-throwing continues in the Middle East related to US President Donald Trump declaring Jerusalem the true capital of Israel. UK prime minister finally made enough of a commitment to the European Union regarding key aspects of the exit talks to more onto the thornier issues of the UK’s future relationship with the EU. Compromise is the name of the game in such negotiations, which means it is likely that this on one will be pleased with the terms of the divorce.

Total fund raises announced fell to C$190.6 million, a two-week low, which included eight brokered financing for C$106.6 million, a two-week low, and six bought-deal financings for C$83.4 million, also a two-week low. The average offer size halved to C$3.8 million, a two-week low, whilst the total number of financings announced fell slightly to 50, a three-week low.

Gold returned to growth after its recent slide bottomed-out mid-week to close at US$1,257/oz from US$1,248/oz a week ago. The van Eck managed GDXJ followed suit and closed up at US31.46 from US$30.33 last week. It is now down 0.25% so far in 2017. The US Global Go Gold ETF showed a similar chart to close at US$12.22 from US$11.81 last week. The SPDR GLD ETF also returned to growth to close at 844 tonnes from 842 tonnes a week ago.

In other commodities, silver recovered slightly to close at US$16.05/oz from US$15.86/oz a week ago. Copper had a strong week to close at US$3.13/lb from US$2.97/lb last week. Oil had a mixed week to close down a smidge at US$57.30 a barrel from US$57.36 a barrel a week ago.

The Dow Jones Industrial Average put on more mode to close at 24,651 from 24,329 last week. Canada’s S&P/TSX Composite Index fell to close at 16,041 from 16, from 16,038 the previous week. The S&P/TSX Venture Composite Index saw growth to close at 801.23 from 792.96 the previous week.

 

Summary:

  • Number of financings decreased at 50, a three-week low.
  • Eight brokered financings were announced this week for C$106.6m, a two-week low.
  • Six bought-deal financings were announced this week for C$83.4m, a two-week low.
  • Total dollars fell to C$190.6m, a two-week low.
  • Average offer size also fell to C$3.8m, a two-week low.

 

Financing Highlights

Mason Graphite (TSXV:LLG) opened a C$45 million offering underwritten by a syndicate led by National Bank Financial on a bought deal basis.

  • The deal is expected to close on or about January 4th.
  • 18.75 million shares @ C$2.40
  • Net proceeds will be used for development and construction expenses related to the Lac Guéret graphite mine and Baie-Comeau, Québec concentrator plant project.

 

Major Financing Openings:

  • Mason Graphite (TSXV:LLG) opened a C$45 million offering underwritten by a syndicate led by National Bank Financial on a bought deal basis. The deal is expected to close on or about January 4th.
  • Excelsior Mining (TSXV:MIN) opened a C$26 million offering on a best efforts basis.    
  • Harte Gold (TSXV:HRT) opened a C$25.99 million offering underwritten by a syndicate led by Cantor Fitzgerald Canada on a bought deal basis.
  • First Cobalt (TSXV:FCC) opened a C$18.04 million offering underwritten by a syndicate led by Canaccord Genuity on a best efforts basis. Each unit includes half a warrant that expires in 24 months. The deal is expected to close on or about December 21st.

 

Major Financing Closings:

  • Largo Resources (TSXV:LGO) closed a C$35 million offering on a best efforts basis.  Each unit included half a warrant that expires in 60 months.
  • Bunker Hill Mining (CSE:BNKR) closed a C$10.16 million offering underwritten by a syndicate led by Red Cloud Klondike Strike on a best efforts basis. Each unit includes a warrant that expires in 36 months.
  • Desert Star Resources (TSXV:DSR) closed a C$7.62 million offering underwritten by a syndicate led by BMO Capital Markets on a best efforts basis. Each unit included half a warrant that expires in 36 months.
  • Desert Star Resources (TSXV:DSR) closed a C$7.01 million offering on a best efforts basis.  

 

Company news

Zinc One Resources (TSXV:Z) obtained a permit for 124 platforms for resource definition drilling at its Bongará zinc mine project in Peru.

  • Drilling is expected to commence early January 2018.
  • Up to three holes per platform with an average drill depth of about 25m.
  • Results will be used to advance Bongara towards a preliminary economic assessment.
  • Aim to confirm the historical measured and indicated resource of 1Mt @ 21.6% Zn and inferred resource o 0.21Mt @ 21.2% Zn.

Analysis

Obtaining the drilling permit is a key step towards completing resource definition drilling, a resource estimate and then undertaking an initial economic analysis of the potential to restart the high-grade Bongara zinc mine.

 

Positions

  • 3 (465x328) px

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