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Live from the Precious Metals Summit - Ep 13

Episode 13 Oreninc MickeyFulp PaulHarris KaiHoffmann

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Oreninc Index Update: September 25, 2017

ORENINC INDEX increases despite stronger US dollar

 

ORENINC INDEX - Monday, September 25th, 2017

North America’s leading junior mining finance data provider

 

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Last week index score: 25.86

This week: 57.81

Prospero Silver (TSXV:PSL) began a 12-hole drilling program at Petate in Hidalgo, Mexico.

Zinc One Resources (TSXV:Z) entered into a binding letter of intent with Nubian Resources to sell the Esquilache silver project in Southern Peru.

Castle Silver Resources (TSXV:CSR) joined the Cobalt Institute as associate industrial member.

 

The Oreninc Index rebounded in the week ending September 21st, 2017 to 57.81 from 25.86 the previous week.

Total fund raises announced tripled to C$97.5 million, a two-week high, which included three brokered financings for C$45.9 million and one bought-deal financing for C$40.5 million. The average offer size also tripled to C$3.1 million, a two-week high, whilst the total number of financings announced increased to 31, a three-week high.

The trend of metals price growth in recent weeks ran out of steam and retrenched on profit-taking and on increased US dollar strength as the US Federal Reserve meeting indicated that it is likely raise interest rates in the final quarter and it will start unwinding the quantitative easing program.

Gold was pounded back below US$1,300/oz at the start of week and continued the downward trajectory for most of the week before bouncing a little as the week drew to a close, finishing at US$1,297/oz. Gold is now up 13.1% since the start of the year. The van Eck managed GDXJ fell in line with the gold price is now up 8.7% so far in 2017 to close the week at US$34.29. The recently launched US Global Go Gold ETF also had a negative week to close at US$12.95 from US$13.30 last week. The SPDR GLD ETF continued to add ounces and inventories closed up at 856 tonnes from 838 tonnes the previous week.

In other commodities, silver continued the slide it began a couple of weeks ago after peaking over US$18/oz and fell below US$16/oz to close at US$16.99/oz. Copper essentially held ground this week and closed at US$2.94/lb, the same as the previous week. As metals fell, oil saw growth and crept back over the US$50 per barrel mark to US$50.66 from US$49.89 per barrel last week.

The Dow Jones Industrial Average put in another record-breaking week to close at 22,349 from 22,268 last week, pulling back after hitting an intra-week high of 22,412. Canada’s S&P/TSX Composite Index also saw strong growth and closed up at 15,545 from 15,173 the previous week. The S&P/TSX Venture Composite Index fell slightly to close at 778.10 from 779.66 the previous week.

The Oreninc team was in Colorado for the Precious Metals Summit in Beaver Creek this past week to get updates from many companies in the precious metals space, and we found time to record the next in the podcast series with Mercenary Geologist Micky Fulp.

Summary:

  • Number of financings increased to 31, a three-week high.
  • Three brokered financings were announced this week for C$45.9m, a two-week high.
  • One bought-deal financing was announced this week for C$40.5m, a two-week high.
  • Total dollars tripled to C$97.5m, a two-week high.
  • Average offer size also tripled to C$3.1m, a two-week high.

 

Financing Highlights

 

McEwen Mining (TSX:MUX) opened a bought deal private placement to sell 18 million shares @ C$2.25 for gross proceeds of C$40.5 million.

  • Each unit includes half a warrant exercisable for 53 weeks @ C$2.70.
  • The proceeds will be used to fund the acquisition of the Black Fox Complex and associated assets and liabilities in the Township of Black River-Matheson, Ontario, Canada, and the Grey Fox Property, an exploration property located near the Black Fox Complex.

 

Major Financing Openings:

  • McEwen Mining (TSX:MUX) opened a C$40.5 million offering underwritten by a syndicate led by Cantor Fitzgerald Canada on a bought deal basis. Each unit includes half a warrant that expires in 13 months. The deal is expected to close on or about September 22nd.
  • Euro Sun Mining (TSX:ESM) opened a C$10 million offering on a best efforts basis. The deal is expected to close on or about September 29th.
  • Cipher Resources (TSXV:CIFR) opened a C$8.1 million offering on a best efforts basis.
  • Sandspring Resources (TSXV:SSP) opened a C$6.02 million offering on a best efforts basis. Each unit includes a warrant that expires in five years.

Major Financing Closings:

  • Ikkuma Resources (TSXV:IKM) closed a C$12.37 million offering on a best efforts basis.
  • Reunion Gold (TSXV:RGD) closed a C$10.98 million offering on a best efforts basis. Each unit included half a warrant that expires in three years.
  • Osisko Metals (TSXV:OM) closed a C$8 million offering underwritten by a syndicate led by Canaccord Genuity on a bought deal basis.
  • Balmoral Resources (TSX:BAR) closed a C$4.06 million offering underwritten by a syndicate led by PI Financial on a best efforts basis.

Company news

Prospero Silver (TSXV:PSL) began a 12-hole drilling program at Petate in Hidalgo, Mexico.

  • Drilling will test four targets under the on-going 6,950m reconnaissance drill campaign funded by strategic partner Fortuna Silver Mines.
  • Petate is the most advanced of Prospero's projects and where high-level epithermal alteration is exposed over a 5x4km area with highly anomalous gold and silver hosted in extensive outcrops and float of steep to strata-bound jasperoid.

Analysis

Petate is arguably the most exciting and highly prospective of all the targets that will be drill-tested under the funding agreement with Fortuna Silver and so many eyes are eagerly awaiting its results.

 

Zinc One Resources (TSXV:Z) entered into a binding letter of intent with Nubian Resources to sell the Esquilache silver project in Southern Peru.

  • Esquilache is a non-core asset for Zinc One.
  • Nubian paid C$25,000 deposit and agreed to pay C$600,000 on closing in cash and stock.

Analysis

The sale of Esquilache will facilitate the company’s plan to focus on the exploration and development of its Bongará mine and Charlotte-Bongará zinc oxide projects in north-central Peru and focus on being a pure zinc exploration and development company.

 

 

Castle Silver Resources (TSXV:CSR) joined the Cobalt Institute as associate industrial member.

 

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