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Wednesday, November 08, 2017 Derek Macpherson

RCKS Charts: GSC, NVO, TK, AGLD, ECC, PGE & TRA

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In this edition of RCKS Charts, Keith has evaluated Golden Star Resources (TSX:GSC), Novo Resources (TSXV:NVO), Tinka Resources (TSXV:TK), Austral Gold (TSXV:AGLD, ASX:AGD), Ethos Capital (TSXV:ECC), Group Ten Metals (TSXV:PGE) and Teras Resources (TSXV:TRA). read more


Wednesday, November 08, 2017 Derek Macpherson

RDS Intersects Improved Grades in Widths

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Radisson Mining Resources Inc. (TSXV:RDS) reported drill intersections of 14.6 g/t Au over 6 m and 7.4 g/t Au over 6 m at depth of 218 m and 242.5 m, respectively, in hole OB-17-52 (Figure 1 and Figure 2). The company reported results from 6 holes totaling 2,822m of drilling with assays pending for 3,310m (10 holes). Other notable drill results from this press release include 45m of 1.3 g/t Au from 371m of depth (hole OB-17-44). These results are a part of the company’s 20,000m drill program at the O’Brien project along the Cadillac Break. This press release continues to support and confirm the vertical and lateral continuity of high-grade gold intercepts within low grade mineralized envelopes on the 36E zone. At C$50/oz, Radisson trades closely to peers at C$42/oz; however, this does not properly reflect the recent discovery of the Vintage zone, or the expected resource increase with the pending update (Q1 2018). We note the company continues to be actively exploring in the sediments around the Vintage zone (results pending) and near the current resource. read more


Wednesday, November 08, 2017 Derek Macpherson

FCC’s Sampling Yield’s Impressive Cobalt Grades

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First Cobalt Corp. (TSXV:FCC) has announced sampling results from grab samples taken from muckpiles at the historic Silver Banner mine at the northern part of the company’s Cobalt Camp in Ontario. The company highlighted grades of up to 1.14% Co from a vein-type mineralization, which contained silver and nickel mineralization as well. The relationship between the cobalt, silver and nickel is comparable to that of the large mineralized systems within the Cobalt Camp. These grab samples continue to reflect the potential for the presence of a broader cobalt mineralization in the camp that has been overlooked by previous exploration. We would also highlight that we continue to believe the company’s unique attributes, including its land position and infrastructure are likely to see First Cobalt trade at a premium to other cobalt exploration peers, pro-forma. Besides pending drill results (53 holes pending assay), important upcoming catalysts are likely to include planned metallurgical test results and the completion of the planned mergers.
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Wednesday, November 08, 2017 Derek Macpherson

ANX Recovers 92% from Argyle Sample

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Anaconda Mining Inc. (TSX:ANX) reported the results of metallurgical testing on a 25kg sample of blended core samples with an average grade of 2.7 g/t Au from the Argyle discovery. The sample was able to achieve a flotation recovery of 97.3% and a leach recovery of 94.5% for a combined recovery of 91.9%. The company’s objective was to determine the metallurgical characteristics of the Argyle mineralization and the company was successful in verifying its compatibility with the circuit at the Pine Cove Mill and confirms that the mill will not have to be modified in order to process Argyle ore. Based on our preliminary estimates, we believe that at its current market cap (C$24.8 million), investors are either paying for Point Rousse (~value of C$30-50 million based on our preliminary DCF) or Goldboro (~ value of C$41.5 million based on C$50/oz) suggesting good value at current levels. In our view, the upcoming PEA for Goldboro, is likely to be an important catalyst for Anaconda as it should allow investors to better understand the potential of this asset. Following that, operations later in F2018 (year-end May 31) should see production and cash flow increases as mining at Point Rousse moves to the higher-grade Stog’er Tight deposit. In our view, both these catalysts have the ability to cause the market to ascribe a fair value to both projects.  read more


Tuesday, November 07, 2017 Derek Macpherson

VIT Provides Updates on Eagle Phase 1 Construction

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Victoria Gold Corp. (TSXV:VIT) has reported an update on its Eagle Project Phase 1 De-Risking Program, on its Dublin Gulch project in the Yukon. The objective of the $40M 2017 program was to de-risk the earthwork areas of the capital budget and prepare the construction site for Phase 2. Phase 1 activities included heap leach embankment preparation, control pond construction, project access road and bridge upgrades, pioneering of site roads to crusher and recovery plant, expansion of camp to 250-person capacity, advancing detailed engineering and securing pricing on long-lead items. Management stated that Phase 1 was successful in de-risking the project. We note that the company started construction without the full funding in-place; however, with a cash balance of C$43 million (at August 31, 2017) and a commitment letter in place for a US$220 million debt facility, we estimate the company requires additional funding of ~C$70-100 million. Victoria Gold currently trades at a discount on a per ounce basis, or C$31/oz versus peers at C$46/oz, which we believe does not take into account the exploration potential of the Dublin Gulch property or that the project has just transitioned from shovel ready to under-construction.  read more


Tuesday, November 07, 2017 Derek Macpherson

NVO Announces Strategies for Non-Core Assets

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Novo Resources Corp. (TSXV:NVO) has announced its strategy for its ancillary assets including the company’s 100% owned Tuscarora property in Nevada and several tenements in Marble Bar, Western Australia. Novo has signed an option agreement with American Pacific Mining (“APM”) where it has the option to acquire the Tuscarora property’s 24 unpatented mining claims in Nevada. American Pacific will initially pay to Novo C$375k and issue C$200k worth of shares to Novo once the company is listed on the CSE. Beginning on the one-year anniversary of American Pacific’s listing date, APM will be required to incur annual expenditures of $100k on the property. American Pacific will also grant Novo a 0.5% NSR, which can be repurchased for $500k. As for Novo’s tenements in Western Australia, further to forming a joint-venture with Calidus Resources Ltd. (ASX:CAI), the company will be issued 20M fully paid ordinary shares of Calidus upon the receipt of all necessary environmental approvals. This strategy allows Novo to focus on its Karratha projects, which represents the most value to the company. At Novo’s current share price, the market is pricing in a sizeable resource at Novo’s Karratha project, which based on the data to date, we view as very possible. However, additional data, including additional diamond drilling to determine conglomerate thickness (ongoing) and assay results from the ongoing bulk samples and planned large diameter drilling (early 2018), is needed to fully understand this projects potential.  read more


Tuesday, November 07, 2017 Derek Macpherson

CG’s Bid Leaves Room for Another Bidder on AMI

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Centerra Gold (TSX:CG) has announced a friendly all-cash bid for AuRico Metals (TSX:AMI) at a price of C$1.80 per AMI share, which represents a premium of 38.5% to yesterday’s close for a total transaction value of C$310M. In our view this bid undervalues AuRico’s diverse assets (development assets and royalty portfolio) which leaves room for another bidder. We believe Aurico’s assets are worth more than $2/share (Figure 1); however, the diverse nature of them is likely to require a joint bid from a royalty and operating company. Consequently, we consider the odds of another bid to be ~30% (medium).  read more


Friday, November 03, 2017 Derek Macpherson

AQA Reports Final Drill Results

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Aquila Resources Inc. (TSX:AQA) has reported the final drill results from its 2017 drilling program at the Back Forty project in Michigan. The company had identified a new zone of massive sulphide mineralization during the 2016 drilling program and have just tested the area. Drilling results released by the company include 1.27 g/t gold, 15.78 g/t silver and 12.17% zinc over 7.09m in hole LK-17-537, the hole had tested a southwest extension of the 2016 zone. The drill results support management’s objective of connecting the new zone’s mineralization to the project’s existing resource base in the near future. The drilling indicated that the mineralization extends for more than 120m and is open along strike. Aquila currently trades at a premium to peers on an EV/lb basis (C$0.022 vs. peers C$0.017). We believe a premium is warranted given the company’s advanced permitting stage, good jurisdiction, exploration upside and stage of development. We expect additional exploration results and the pending feasibility study along with the final permit needed for construction to be important near-term catalysts for the company.  read more


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