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Oreninc Index: October 29, 2018

Oreninc Index: October 29, 2018

ORENINC INDEX falls as financings fall away

ORENINC INDEX - Monday, October 29th 2018

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Last week index score: 64.42

This week: 23.43

Nexus Gold (TSXV:NXS) reported initial results from recent reverse circulation drilling at the Rakounga gold concession in Burkina Faso.

Avrupa Minerals (TSXV:AVU) will complete a C$1.5 million financing to fund drilling at the Alvalade Cu-Zn,Pb VMS project in Portugal.

 

The Oreninc Index plummeted again in the week ending October 26th, 2018 to 23.43 from 64.42 a week ago as financings fell away following their recent spurt.

The concept of gold as a safe haven refuge is gathering pace and lifted it to three month highs this past week, with the yellow metal trading above both its 50- and 100-day moving averages as geopolitical uncertainty continues to mount. Unfortunately, with many gold names reporting disappointing third quarter results this week, the rising price generally did not lead to higher gold stock prices.

US President Donald Trump says he will withdraw the US from the 1987 Intermediate-range Nuclear Forces treaty (INF), which banned ground-launch nuclear missiles with ranges from 500km to 5,500km that was signed by Ronald Reagan and Mikhail Gorbachev and resulted in the elimination of nearly 2,700 short- and medium-range missiles. Trump also said the US will develop such weapons.

The US is also increasingly unhappy with key Middle East ally Saudi Arabia over the murder of a Saudi journalist and Washington Post correspondent Jamal Khashoggi inside a in the country’s consulate in Istanbul, with President Trump increasingly vocal in his criticism of the Saudi regime.

On to the money: total fund raises announced halved to C$46.3 million, a two-week low, which included no brokered financings and no bought-deal financings. The average offer size decreased to C$2.5 million, a two-week low, whilst the number of financings dwindling to 18, a two-week low.

Gold continued its steady crawl upwards as it closed up at US$1,233/oz a week ago. It is now down 5.32% this year. The US dollar index also increased again to 96.35 from 95.71 last week. Despite the rise of gold the van Eck managed GDXJ pulled back and closed down at US$28.21 from US$29.63 a week ago. The index is down 17.35% so far in 2018. The US Global Go Gold ETF also took a step backwards as it closed down at US$10.65 from US$11.10 a week ago. It is now down 18.14% so far in 2018. The HUI Arca Gold BUGS Index also closed down at 144.65 from 155.58 last week. The SPDR GLD ETF had a steady week with its inventory increasing to 749.64 tonnes from 745.82 tonnes a week ago.

In other commodities, silver added a few more cents as it closed up at US$14.70/oz from US$14.62/oz a week ago. Copper lost a few more cents to close down at US$2.74/lb from US$2.77/lb last week. Oil continues to take a beating as WTI again closed down at US$67.59 a barrel from US$69.12 a barrel a week ago.

The Dow Jones Industrial Average took another pummelling as it closed down at 24,688 from 25,444 last week. Canada’s S&P/TSX Composite Index followed suit as it closed down at 14,888 from 15,470 the previous week. The S&P/TSX Venture Composite Index continued to pull back as it closed down at 643.58 from 682.16 last week.

Summary

·      Number of financings diminished to 18, a two-week low.

·      No brokered financings were announced this week, a two-week low.

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

·      Total dollars fell to C$46.3m, a two-week low.

·      Average offer size decreased to C$2.5m, a two-week low.

 

Financing Highlights

Harte Gold (TSX:HRT) opened a non-brokered private placement of up to 19.2 million flow-through shares @ C$0.52 for gross proceeds of up C$10.0 million.

·      The company closed and raised C$5.6 million and issued 11.3 million flow-through shares as part of an initial closing

·      Sprott Asset Management will take C$4.2 million of the private placement. Sprott is a key lender for its Sugar Zone mine development project.

·      Proceeds will be used to accelerate drilling of high-priority targets near the mine. It is completing a 100,000m drill with a view to updating a NI 43-101 compliant mineral resource estimate and mine plan in 1Q19.

·      Harte is Ontario’s newest gold producer through the Sugar Zone mine that poured its first gold in October.

 

Major Financing Openings

·      Harte Gold (TSXV:HRT) opened a C$ 10 million offering on a best efforts basis.

·      Damara Gold (TSXV:DMR) opened a C$ 7.5 million offering on a best efforts basis.

·      Mexican Gold (TSXV:MEX) opened a C$  3 million offering on a best efforts basis. Each unit includes a warrant that expires in three years.

 

Major Financing Closings

·      Hawkeye Gold & Diamond (TSXV:HAWK) closed a C$ 0.92 million offering on a best efforts basis. Each unit included half a warrant that expires in a year.

·      Newrange Gold (TSXV:NRG) closed a C$ 0.9 million offering on a best efforts basis. Each unit included a warrant that expires in two years.

·      Oronova Energy (TSXV:ONV) closed a C$ 0.8 million offering on a best efforts basis.    

·      Copperbank Resources (CSE:CBK) closed a C$ 0.78 million offering on a best efforts basis.

 

Nexus Gold (TSXV:NXS) reported initial results from recent reverse circulation drilling at the Rakounga gold concession in Burkina Faso.

·      RC drilling was conducted in two portions consisting of step out drilling on previously identified gold mineralization at the Koaltenga zone aiming to extend the strike length and further define the mineralized structure.

·      Results included 10.0m @ 1.0g/t Au in hole RKG-18-RC-027.

·      A mineralized gold structure now outlined with a strike length of at least 600m with an additional 600m identified through recent sampling programs, active orpaillages and coincidental geophysics.

Analysis

Extension of the mineralized system to at least 1,200m bodes well for the future exploration of the project as the company continues to define the extent of mineralization present on the combined Bouboulou-Rakounga project with the goal of producing a compliant resource estimate.

 

Avrupa Minerals (TSXV:AVU) announced a non-brokered private placement of C$1.5 million financing to fund drilling at the Alvalade Cu-Zn,Pb VMS project in Portugal.

·      Avrupa announced a 2,500 to 3,000m drill program to expand currently known mineralized areas and to determine the potential size of the mineralization at Alvalade in Portugal’s Iberian Pyrite Belt.

·      30 million units @ C$0.05. Each unit will be comprised of one share and one warrant exercisable @ C$0.10 for three years.

Analysis

Avrupa is looking to continue to advance Alvalade within an overall aim of being able to secure a partner to continue with its exploration and development. Although the drill program is modest, raising the funds for it could be a challenge in this market.

 

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