RCKS talk

Tuesday, October 18, 2016 Derek Macpherson

Marlin May be Entering a Phase of Exceptional Cash Flow

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Marlin Gold Mining Ltd. (TSXV:MLN) provided an operational update from its La Trinidad mine in Mexico, reporting that a record amount of gold has been stacked on the leach pad this month. This marks an important transition as higher grades and a reduced strip ratio should results in significant free cash flow from the mine over the next ~2 years. It is early days, but this is an important data point suggesting that the transition has happened. Besides ongoing operational updates, we expect the next key data point to be Q4 financial results which should start to reflect the cash generating potential. read more

Monday, October 17, 2016 Derek Macpherson

Sierra Metals Announces Record Quarterly Production

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Sierra Metals Inc. (TSX:SMT,BVL:SMT), as anticipated, released strong third quarter production results featuring record throughput and its second best level of quarterly metals production. Overall copper equivalent production was up 25% YoY, 24% higher than in Q1 2016 and saw an 8% improvement QoQ (Figure 1). As mentioned in previous posts, the strong Q3 was driven by higher grades (Esperanza zone) and increased throughput from the company’s flagship Yauricocha mine. Similarly, Bolivar’s production benefited from record throughput; however, lower grades resulted in production being up only ~10% YoY and essentially flat QoQ. We believe continued operational execution by Sierra should facilitate the capital structure changes needed to improve the stock’s liquidity, which we believe has the potential to benefit Sierra’ share price.  read more

Sunday, October 16, 2016 Derek Macpherson

Site Visit: Victoria’s Eagle Project Poised to Soar

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Last week we visited Victoria Gold Corp’s (TSXV:VIT) Eagle Gold project in the Yukon. While our visit highlighted some important points about the project it did not materially change our view on the project’s potential, as highlighted by the recently updated feasibility study. The key takeaways from our visit included the exploration upside at Olive and Shamrock, along with other long-term targets, that the company is looking to take advantage of its balance sheet to reduce pre-production capital costs and the visit solidified our view, pending financing, that the company is planning to start construction in early 2017. We expect a project financing update, along with additional drill results from Olive-Shamrock to be the next catalysts for Victoria. As well, we believe the current valuation only partially reflects the recent feasibility study update and still does not account for the project's shovel ready nature.  read more

Friday, October 14, 2016 Derek Macpherson

Integra Announces Triangle’s Widest Interval to-date

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Integra Gold Corp. (TSXV:ICG) announced further results from its ongoing drill program at the Triangle zone. The results from a combination of infill and expansion drilling continue to highlight the resource growth potential of the Triangle zone and suggest continuity of the “C” zones. In our view, Integra should trade at a premium to peers because of the project’s location, grades, existing infrastructure and ongoing news flow. Upcoming catalysts, including a Triangle zone resource update (Q4 2016) and an updated PEA (Q4 2016), have the potential to re-establish a larger premium to peers.  read more

Thursday, October 13, 2016 Derek Macpherson

New VP Corp Dev Should Help GQC’s Financing Efforts

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GoldQuest Mining Corp. (TSXV:GQC) announced the appointment of David Massola as Vice President of Corporate Development. Mr. Massola will be focusing on the financing of the Romero Project which we expect to be a combination of off-take, debt and equity financing. Previously Mr. Massola worked alongside GoldQuest’s CEO Julio Espaillat and Executive Chairman Bill Fisher at GlobeStar Mining Corp, which financed and built the Cerro de Maimon gold/copper mine in the Dominican Republic. Besides project financing, and the ongoing feasibility study for Romero, GoldQuest continues to explore its district scale land with a 40-hole program.  read more

Thursday, October 13, 2016 Derek Macpherson

More Results from ANX’s Argyle Prove Concept

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Anaconda Mining Inc. (TSX:ANX) released the remaining drill results from the 1.7 km drill program at the Argyle target at Point Rousse. While the results continue to confirm our view that Argyle is developing into a third deposit at Anaconda’s Point Rouse project, the results were slightly lower grade and mineralized widths were narrower than previously set, impacting our very preliminary resource approximation. It is early days and we anticipate that follow-up work is likely to see the deposit grow from our current approximation of ~25-30k oz Au (our previous one was ~40-45k oz Au). In our view, the addition of a third deposit for Anaconda is important for the company to extend the current mine-life, and potentially lead to production growth. As well, the company is actively exploring at three other priority targets which we expect results from in the near-term.  read more

Wednesday, October 12, 2016 Derek Macpherson

Red Pine Discovers Another Gold Bearing Shear Zone

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Red Pine Exploration Inc. (TSXV:RPX) announced the discovery of a new gold bearing shear zone at the Wawa Gold project (30% Red Pine - operator/40% Citabar (private)/30% Augustine Ventures Inc. (CSE:WAW)). Trench samples returned 1.59 g/t Au over 7m (TR16-1B), including 4.85 g/t Au over 2m. While early stage, this result highlights the potential of the Wawa Gold project and continues to suggest that this 1.1 million oz Au deposit has room to grow. In our opinion, relative to other projects in the area the Wawa gold project has been underexplored because of its ownership structure. We believe the planned merger of Red Pine and Augustine should resolve some of these issues and is likely to result in a more aggressive exploration program following the merger.  read more

Tuesday, October 11, 2016 Derek Macpherson

Austral’s High-Grade Amancaya Likely to Grow

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Last week, Austral Gold Ltd. (TSXV:AAM, ASX:AGD) provided an exploration update from its ongoing exploration program at Amancaya. The surface program doubled the strike length of known structures suggesting significant resource growth is possible over the existing 447k oz AuEq (all categories) resource. This is important since production from Amancaya is expected to play a key role in Austral’s plan to expand from the current ~50k oz AuEq to 150k oz AuEq per year by the end of 2017. To follow up on this surface work, Austral is undertaking a 13.3km drill program. We expect these pending drill results along with the completion of the mill expansion at Guanaco and initial production from Amancaya to be key catalysts for the stock over the next 6 months. read more


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