Last week index score: 45.96

This week: 35.42

 Zinc One Resources (TSX-V: Z) reported the final drill results from the high-grade zinc discovery in the Mina Chica zone of its Bongará zinc project in north-central Peru.

The Oreninc Index fell in the week ending June 8th, 2018 to 35.42 from 45.96 a week ago as financings decreased, and broker action stayed away.

Gold spent the week flirting again with the US$1,300/oz level in the run up to the G7 summit in Canada, with US president Donald Trumplooking to pick a fight with anyone that would pay him attention as he also prepares for a summit meeting with North Korean leader Kim Jong-un. Despite the trade sabre-rattling, those watching the precious metals space are waiting for the outcome of the US Federal Reserve Market Committee (FOMC) meeting this coming week and any indications related to further interest rate increases.

Financings and broker activity continue to be sparse as Oreninc’s Kai Hoffmann showed at the 121 Mining Investment Conference in New York last week, as interest in the mining sector continues in a funk.

On to the money: total fund raises announced halved to C$50.8 million, a two-week low, which included no brokered financings and no bought deal financings. The average offer size fell to C$2.0 million, an eleven-week low whilst the number of financings fell to 25, a two-week low.

Gold closed up at US$1,298/oz from US$1,293/oz a week ago. Gold is now down 0.36% this year. The US dollar index closed down a tad at 93.53 from 94.15 a week ago. The van Eck managed GDXJ closed down a smidge at US$32.78 from US$32.80. The index is down 3.96% so far in 2018. The US Global Go Gold ETF increased to US$12.95 from US$12.71 a week ago. It is now down 0.46% so far in 2018. The HUI Arca Gold BUGS Index closed down at 178.83 from 179.15 last week. The SPDR GLD ETF continued to sell off and closed its inventory down at 828.76 tonnes from at 836.42 tonnes a week ago.

In other commodities, silver closed up at US$16.78/oz from US$16.41/oz a week ago. Copper’s gain accelerated as it closed up at US$3.30/lb from US$3.09/lb last week. Oil continued to lose ground as it closed down slightly at US$65.74 a barrel from US$65.81 a barrel a week ago.

The Dow Jones Industrial Average saw a strong rebound to close up at 25,316 from 24,635 last week. Canada’s S&P/TSX Composite Index also saw a winning week to close up at 16,202 from 16,043 the previous week. The S&P/TSX Venture Composite Index also closed up at 775.22 from 765.94 last week.

Summary:

  • Number of financings decreased to 25, a two-week low.
  • One brokered financing was announced this week for C$8.0m, a one-week high.
  • No bought-deal financings were announced this week, a one-week low.
  • Total dollars nearly halved to C$50.8, a two-week low.
  • Average offer size dropped to C$2.0m, an eleven-week low.

Financing Highlights

Nouveau Monde Graphite (TSX-V: NOU) opened an C$8.0 million private placement @ C$0.30 with Eight Capital and Haywood Securities as co-lead agents.

  • Syndicate including Canaccord Genuity and Desjardins Securities.
  • Each unit comprised of one share and half a warrant exercisable @ C$0.40 for two years.
  • Net proceeds for capital allocations related to Nouveau Monde’s graphite demonstration plant in Saint-Michel-des-Saints.

Major Financing Openings:

  • Nouveau Monde Graphite (TSX-V: NOU) opened a C$ 8 million offering underwritten by a syndicate led by Eight Capital on a best effortsbasis. Each unit includes half a warrant that expires in 24 months.
  • MGX Minerals (CSE: XMG) opened a C$ 7.01 million offering on a best efforts basis. Each unit includes a warrant that expires in 36 months. The deal is expected to close on or about June 18th.
  • GoviEx Uranium (TSX-V: GXU) opened a C$ 6.06 million offering on a best efforts basis. Each unit includes a warrant that expires in 36 months.
  • Golden Dawn Minerals (TSX-V: GOM) opened a C$ 5.4 million offering on a best efforts basis. Each unit includes a warrant that expires in 36 months.

Major Financing Closings:

  • Troilus Gold (TSX-V: TLG) closed a C$ 10.01 million offering underwritten by a syndicate led by GMP Securities on a bought deal basis.
  • Almaden Minerals (TSX: AMM) closed a C$ 9.44 million offering underwritten by a syndicate led by Sprott Capital Partners on a best efforts basis. Each unit included half a warrant that expires in 48 months.
  • GoviEx Uranium (CSE: GXU) closed a C$ 6.06 million offering on a best efforts basis. Each unit included a warrant that expires in 36 months.
  • Troilus Gold (TSX-V: TLG) closed a C$ 5.75 million offering on a best efforts basis.

 Company News

Zinc One Resources (TSX-V:Z) reported the final drill results from the high-grade zinc discovery in the Mina Chica zone of its Bongará zinc project in north-central Peru.

  • High-grade zinc mineralization is about 200m long and 120m wide.
  • Highlights included 21m @ 27.5% Zn in hole MCH-18-041.

Analysis

With a new high-grade zinc discovery, this phase of drilling has been very successful, adds to the potential of the project, even though the size potential of the Mina Chica zone will have to wait for a future drilling programme. And with only a small portion of the 6km mineralized trend tested, there is a lot more exploration (and results) to come in the future.

About Oreinc.com:

Oreninc.com is North America’s leading provider of relevant financing information in the junior commodities space. Since 2011, the company has been keeping track of financings in the junior mining as well as oil and gas space. Logging all relevant deal and company information into its proprietary database, called the Oreninc Deal Log, Oreninc quickly became the go-to website in the mining financing space for investors, analysts, fund managers and company executives alike.

The Oreninc Deal Log keeps track of over 1,400 companies, bringing transparency to an otherwise impenetrable jungle of information. The goal is to increase the visibility of transactions and to show financings activity in a digestible format. Through its daily logging activities, Oreninc is in a position to pinpoint momentum changes in the markets, identify which commodities are trending and which projects are currently receiving funding.

Last week index score: 45.59 (updated)

This week: 37.75

Oreninc: Interview Session with Mickey Fulp – Episode 22 now live

The Oreninc Index fell in the week ending April 27th, 2018 to 37.75 from an updated 45.59 a week ago as the number of deals fell despite some broker action returning.

A calmer and less volatile week all round with the presidents of North and South Korea meeting for the first time in decades, thawing tensions over the north’s nuclear ambitions, whilst in the US, president Donald Trump eased his position on sanctions against Russian aluminium producer Rusal. Maybe spring is in the air and the world is feeling more positive.

Another range-bound week for gold, this time ending in negative territory as the US dollar strengthened, although there are signs that gold stocks are starting to strengthen.

On to the money: total fund raises announced more than quadrupled to C$96.3 million, a four-week high, which included one brokered financing, a four-week low, and one bought deal financing, also a four-week low. The average offer size also more than quadrupled to C$4.8 million, a four-week high. However, the number of financings decreased to 20, a four-week low.

Gold closed down at US$1,324/oz from US$1,336/oz a week ago. Gold is now up 1.63% this year. Meanwhile, the US dollar index continued to strengthen and closed up at 91.54 from 90.31 a week ago. The van Eck managed GDXJ gave up ground and closed down at US$33.03 from US$33.49 last week. The index is down 3.22% so far in 2018. The US Global Go Gold ETF also fell to close down at US$12.99 from US$13.04 a week ago. It is down 0.12% so far in 2018. The HUI Arca Gold BUGS Index closed down at 182.04 from 184.18 last week. The SPDR GLD ETF saw a growth week as its inventory grew to 871.20 from 865.89 tonnes where it had been for nine-days straight.

In other commodities, silver’s recent growth spurt deflated and closed down at US$16.51/oz from US$17.11/oz a week ago. Copper also gave up a lot of ground as it closed down at US$3.06/lb from US$3.15/lb last week. Oil consolidated despite a slight loss on the week to close down at US$68.10 a barrel from US$68.40 a barrel a week ago.  

The Dow Jones Industrial Average lost some ground and closed down at 24,311 from 24,462 last week. Canada’s S&P/TSX Composite Index put in a strong growth week as mining stocks showed growth to close at 15,668 from 15,484 the previous week. The S&P/TSX Venture Composite Index closed down at 783.76 from 804.96 last week.

Summary:

  • Number of financings decreased to 20, a three-week low.
  • One brokered financing was announced this week for C$15m a three-week low.
  • One bought-deal financing was announced this week for C$15m, a three-week low.
  • Total dollars nearly doubled to C$96.3m, a three-week high.
  • Average offer size grew to C$4.8m, a three-week high.

Financing Highlights

SilverCrest Metals (TSX-V: SIL) announced a C$15 million bought deal financing

Syndicate of underwriters led by PI Financial and Cormark Securities for 7.1 million shares @ C$2.10.

  • 15% over-allotment Option.
  • Net proceeds will be used to continue exploration and drilling to deliver an updated resource estimate and maiden Preliminary Economic Assessment for the Las Chispas project in Sonora. Mexico.

Major Financing Openings:

  • Africa Energy (TSX-V: AFE) opened a C$57.98 million offering on a best efforts basis. The deal is expected to close on or about May 4, 2018.
  • Silvercrest Metals (TSX-V: SIL) opened a C$15 million offering underwritten by a syndicate led by PI Financial on a bought deal basis. The deal is expected to close on or about May 18, 2018.
  • Pacton Gold (TSX-V: PAC) opened a C$4 million offering on a best efforts basis.  Each unit includes a warrant that expires in 36 months. The deal is expected to close on or about May 22, 2018.
  • Max Resource (TSX-V: MXR) opened a C$3.75 million offering on a best efforts basis. Each unit includes half a warrant that expires in 24 months.

Major Financing Closings:

  • Nemaska Lithium (TSX-V: NMX) closed a C$99.08 million offering on a best efforts basis.
  • Trilogy Metals (TSX-V: TMQ) closed a C$31.48 million offering underwritten by a syndicate led by Cantor Fitzgerald Canada on a bought deal basis.  
  • Stina Resources (TSX-V: SQA) closed a C$12.5 million offering on a best efforts basis. Each unit included half a warrant that expires in 36 months.  
  • Ashanti Gold (TSX-V: AGZ) closed a C$2.64 million offering on a best efforts basis.

Company News

Prospero Silver (TSX-V: PSL) provide an update on planned exploration work on its Mexican projects for 2018.

  • The key objective is to complete first-pass, proof-of-concept drill testing of three projects in the Altiplano belt of northern Mexico: Bermudez, Buenavista and Trias. Neither Trias or Bermudez have been drilled before.
  • About 6,000m of diamond drilling is planned.
  • A 4th hole for Pachuca SE project may be drilled once drilling is complete at the projects above.

Analysis

Having recently announced a fund raise, the work plan shows that Prospero will continue to drill test the targets it has identified via its geological hypothesis for discovering large, blind silver deposits. Whilst the news release did not explicitly state that its strategic partner Fortuna Silver (TSX:FVI) would co-fund this exploration program, that seems likely given the technical success of the 2017 exploration program and that Fortuna has yet to select a project to joint-venture under its strategic agreement with Prospero.

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