ORENINC INDEX up as gold sees volatility

Last week index score: 54.67

This week: 65.15

The Oreninc Index showed growth again in the week ending April 20th, 2017 to 65.15 from 54.67, despite gold having a volatile week.

Total raises announced increased to C$92.1 million, a two-week high, which included six brokered financings for a total of C$64.7 million, a two-week high within which there were two bought-deal financings for C$31.6 million. The average offer size increased to C$2.9 million, a two-week high, whilst the total number of financings announced fell to 32, a three-week low.

The gold price had a volatile week that saw it experience its biggest one-day fall in six weeks before rebounding at the end of the week to close at virtually the same point as the prior week close at US$1,289. Earlier in the week, gold hit a high of US$1,294 as geopolitical risks continue to weigh on people’s minds including the US putting pressure on North Korea and the first round of the French presidential election in which the far right is threatening to do well.

The volatile gold environment saw some profit-taking and as a result the benchmark index, the van Eck managed GDXJ fell and is now up 9.48% so far in 2017. The inventory of the SPDR GLD ETF continued to grow and closed at 858.7 tonnes after hitting an intra-week high of 860.7. Silver couldn’t keep pace and ended the week by falling under US$18 to close at $18.53 despite hitting a five-month high at the start of the week at $18.53

Copper has started to drift down and fell another few cents to US$2.54 a pound, whilst oil had a more definite slide and fell below $50 to close at $49.54 a barrel.

The Dow Jones Industrial Average had a stronger week and resumed growth to close at 20,548 as did Canada’s S&P/TSX Composite Index which closed up at 15,614. Bucking the trend again was the junior space, where the S&P/TSX Venture Composite Index closed down on the week at 825.

Summary:

  • Number of financings decreased to 32, a three-week low.
  • Six brokered financings were announced for $64.7m, a two-week high.
  • Two bought-deal financings were announced for $31.6m, a two-week high.
  • Total dollars increased to $92.1m, a two-week high.
  • Average offer size bumped up to $2.9m, a two-week high.

Financial news highlights

Platinum Group Metals (TSX:PTM) announced a bought deal financing to raise US$20 million with BMO Capital Markets.

  • Proceeds will be used for underground development and production ramp-up of the Maseve mine in South Africa, working capital and to repay US$2.5 million outstanding under a credit agreement with a syndicate of lenders led by Sprott Resource Lending Partnership.

Red Eagle Exploration (TSX-V: XR) announced a brokered private placement to raise up to C$20 million to fund property option and acquisition costs, exploration and development programs at the Vetas, California and Santa Ana gold and silver projects in Colombia.

  • The company was formerly called CB Gold and was formed by the people behind Red Eagle Mining (TSX:R) that successfully developed the San Ramon gold mine in Antioquia, Colombia.

Endeavour Mining (TSX:EDV) reported that shareholder, La Mancha Holding exercised its anti-dilution right to re-increase its stake from 28.1% to 29.9%.

  • La Mancha undertook a C$63.4 million private placement.
  • Proceeds will be used to support the potential development of the Ity CIL gold mine project in Côte d'Ivoire that could extend mine life by more than 14 years.

Major Financing Openings:

  • Platinum Group Metals (TSX: PTM) opened a $61 million offering underwritten by a syndicate led by BMO Capital Markets on a bought deal basis.
  • Razor Energy (TSX-V: RZE) opened a $18 million offering underwritten by a syndicate led by Haywood Securities on a best efforts Each unit includes half a warrant. The deal is expected to close on or about May 4, 2017.
  • Red Eagle Exploration (TSX-V: XR) opened a $20 million offering underwritten by a syndicate led by Haywood Securities on a best efforts Each unit includes a warrant that expires in 18 months. The deal is expected to close on or about May 12, 2017.
  • Treasury Metals (TSX: TML) opened a $06 million offering underwritten by a syndicate led by Haywood Securities 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 May 11, 2017.

Major Financing Closings:

  • Bluestone Resources (TSX-V:BSR) closed a $80 million offering underwritten by a syndicate led by Cormark Securities on a best efforts
  • Coro Mining (TSX:COP) closed a $15 million offering on a best efforts basis.
  • Seabridge Gold (TSX:SEA) closed a $73 million offering underwritten by a syndicate led by Canaccord Genuity on a bought deal basis.
  • Aurania Resources (TSX-V:ARU) closed a $4 million offering underwritten by a syndicate led by Maison Placements Canada on a best efforts basis.

Company news

Oreninc sponsors had a busy week releasing several news releases. We have also signed up three new sponsors: Avrupa Minerals (TSXV: AVU), Desert Gold Ventures (TSXV:DAU) and Blue Sky Uranium (TSXV: BSK). Thank you for your support!

Prospero Silver (TSXV: PSL) C$0.29, Mkt Cap C$8.9 million

  • Obtained a C$1.5 million strategic investment from mid-tier precious metals producer Fortuna Silver Mines (TSX: FVI).
  • Fortuna purchased 5.4 million units at C$0.28 each with each unit comprising one share and one warrant exercisable at C$0.35 for three years. Fortuna has developed two mines into production (Caylloma in Peru and San Jose in Mexico) and is working on its third development project in Argentina.
  • Prospero will allocate C$1.2 million to drill test selected projects and the remainder towards generative efforts in Mexico.
  • Fortuna has the right to select one project within 18 months to JV with Prospero and potentially earn a 70% interest by spending US$8 million over six years and completing a PEA on the selected property.
  • Petate in Hidalgo is the most advanced Prospero project and where a significant sized silicified zone indicates the presence of a robust mineralized system with excellent potential to host a replacement type deposit at depth.

Conclusion

The Fortuna strategic investment provides Prospero with the funds for proof of concept drilling on its three main properties, which if successful, could lead to Fortuna entering into one or more JVs with the company to fund ongoing exploration.

Kootenay Silver (TSXV: KTN) C$0.31, Mkt Cap C$53.3 million

  • Said amended permits are in place and preparations underway for a 7,500m drill program at its La Cigarra silver project in Chihuahua, Mexico.
  • Drilling will commence in approximately two weeks and operate concurrently with ongoing geological mapping and sampling programs on peripheral target areas
  • The program will expand on the measured & indicated silver resource that is currently 18.5Mt @ 86.3 g/t Ag containing 51.5Moz Ag and an inferred resource of 4.45Mt @ 80.0 g/t Ag containing 11.4Moz Ag.
  • Drilling will first target an 800m gap between the Las Venadas Zone and the south end of the resource (Las Carolinas Zone). The southern boundary of Las Carolinas previously returned 23.45m @ 138.3 g/t Ag in hole 155.

Conclusion

With drilling to commence shortly, Kootenay looks set to increase the size of its La Cigarra silver deposit whilst working up other targets for subsequent drill testing.

Avrupa Minerals (TSXV: AVU) C$0.10, Mkt Cap C$7.7 million

  • Completed a private placement financing of 2.5 million shares at C$0.09 for proceeds of C$225,000 for exploration and operations in Kosovo, Portugal, Vancouver and for general and administration costs.
  • Insiders purchased 840,000 shares in the placement.
  • Avrupa has funding partners in place with OZ Minerals funding work on the Alvito IOCG project in Portugal and Byrnecut International funding a large drill program at the Slivovo gold project in Kosovo.
  • Colt Resources is currently in default on its funding agreement for the Alvalade project in Portugal and Avrupa is working on a route to consolidation of the program.

Conclusion

Prospect generator Avrupa runs a lean ship but although it has funding partners covering the costs of several of its projects, it still needs to raise money from time-to-time for its other projects and to continue to develop its project pipeline.

Earlier this month Avrupa entered into a JV on its Alvito iron oxide, copper-gold (IOCG) project in Portugal with OZ Minerals that can earn up to 75% over 2.5 years by spending A$4 million, with Avrupa the operator. Avrupa and earlier partners have spent over €450,000 on the license and developed a central IOCG target area covering 4 x 2.5km along the 24 x 4km Alcaçovas copper belt. The new exploration program will commence in April and will include geological mapping, surface sampling, geophysics, further targeted top-of-basement sampling and a drilling program.

Alvito is an exciting exploration target with the potential to result in a sizable orebody. The OZ Minerals agreement will provide the funding for the partners to drill the property and better establish its size and grade potential.

Blue Sky Uranium (TSXV: BSK) ) C$0.32, Mkt Cap C$14.7 million

Is a uranium explorer with more than 350,000 ha of tenements in Argentina. Exploration by the company between 2007 and 2012 led to the discovery of a new uranium district in Rio Negro province with a 140km long trend of uranium mineralization. Blue Sky’s Amarillo Grande project covers the district, including three properties with significant near-surface uranium mineralization where drilling is underway to refine the geological model and prepare for an initial resource estimate.

 

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