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TORONTO, Aug. 26, 2016 /CNW/ - SRK Consulting (Canada) Inc. is releasing the following in response to Orezone Gold Corporation's ("Orezone") news release of August 22, 2016.
SRK Consulting (Canada) Inc.'s Ontario office ("SRK") was involved with the Bomboré gold project from 2008 through to early 2013. SRK initially audited two mineral resource models generated by Orezone and subsequently generated two additional mineral resource models based on progressively larger exploration data sets. The first three mineral resource models were each supported by published technical reports in November 2008, November 2010 and October 2012, respectively. The April 2013 mineral resource model prepared by SRK is the last reported mineral resource model, and it is informed by exploration data to November 2012.The April 2013 model was used in a preliminary economic assessment for the Bomboré gold project completed in March 2014 and a feasibility study completed in April 2015.
The August 22, 2016 news release stated that a new mineral resource model update is currently being completed and will be publically released in September 2016. SRK understands that considerable additional exploration data (including 57,258m of exploration drilling) has been generated by Orezone subsequent to November 2012.
The new mineral resource model is not yet complete and SRK has not yet been able to review any aspect of the model. In addition to the application of a different dataset, it is anticipated that the new mineral resource model will be based on updated geological wireframes, updated variography, alternative estimation methodologies and reporting / classification assumptions. For example, to differentiate between gold mineralization and waste the 2013 model applied a geology-based domaining strategy, compared to grade shells that are reported to have been used in the new model. It is also expected that the application of revised metal prices, and the exclusion of certain satellite deposits will contribute to a different outcome to that of the April 2013 model.SRK applied a rigorous QA/QC procedure for the 2013 mineral resource model and looks forward to the opportunity to review and provide comment on any differences that cannot be explained by new data, alternative estimation methodologies and new assumptions.ABOUT SRK CONSULTING
...the change in physical bullion at GLD in 2016:
It started at 642.37mt
It's now 956.59mt
It's up by 314.22mt
At today's gold prices the difference is worth around U$13.44Bn.
...copper, weeklies, with one line drawn on it:
Copper moves up from here and it'll bring in plenty of spec trades in the producers.
And here's a screenshot of the main body of the mail:
Probably just coincidence, innit guv.
PS: Of course it goes without saying that none of the above applies to the stocks I currently own, which to a name are still wildly undervalued and today being unjustly dumped by crazy idiots without an ounce of market nous or common sense. Thank you for your attention, please return to your August.
"With the proceeds from the Q2 2016 financing, the Company will begin surface and underground drilling programs in the fourth quarter."
Between 2011 and 2016, IPT returned a mine operating profit of $14.687m. But then $9.023m of that has gone to EGD, the major cause behind the mine operating profit turning into an overall operating loss over the period (not to mention the net loss). Put another way, in the two “good years” of 2011 and 2012, IPT returned Mine Operating Profits of nearly $17m ($12.9m in 2011, just over $4m in 2012). It was after the big positive results in 2011 that the big money was spent by IPT with Energold, those $8.3m in drilling bills. It’s fair to say that EGD has benefitted far more from operations at IPT’s mines than its shareholders. But that may just be a coincidence, of course.
“How is it possible that companies can drop their stay-in-business capital so much when their operating costs have stayed reasonably constant?” asks Holland. “I believe that they have merely deferred capital that is going to come back, because if you want to sustain the business into the future, you need to spend that money. That for me is a little bit of a concern.”
This from the intro to IKN380, out last Sunday evening.
We’re early in the cycle
If you haven’t seen the 29 minute round table discussion video (1) I stuck on the blog last week featuring Brent Cook and Joe Mazumdar of Exploration Insights, John-Mark Staude of Riverside Resources (RRI.v) (a company I currently own) and Morgan Poliquin of Almaden (AMM.to) and Almadex then do so, it’s one of the better ones I’ve seen recently and there’s plenty of intelligent insight from all four participants to get your mining brain working.
But of all the comments made perhaps the best for me came from Joe Mazumdar who pointed out that, so far at least, mergers and acquisitions in the mining space in 2016 have been 1) friendly and 2) nearly all pure-paper deals, with either very little of no cash component at all. That’s a great point, one of those market generalities that’s easy to spot and shows that we’re still early on in this current cycle. Along with Morgan Poliquin confirming the IKN view that there really has been sea-change in the mining sector and this current rally isn’t about relief in a bear, it truly is a change of trend, Mazumdar’s observation tells us something simple; that mining companies haven’t started to fight between each other for the next round of assets and once they do, the friendly all-share type of M&A that goes through without fuss or mess will become the exception rather than the rule. To the fore will come paper+cash deals, all-cash deals, hostile bids out of the blue, third party interlopers, target companies finding White Knights (to save their own boardroom hides) and all other stripes of mergers and buyouts.
We’re now two months on from Brexit and gold has just been through another soft and quiet week, with more selling of bullion from GLD to add to the wall of worry (955.9mt as at this weekend) and the edge taken off silver’s run as it drifts back up to 70X. We’ve even had a few of the braver anti-goldbug commentators piping up and telling us that gold’s a waste of time. Again. Pay no heed, nothing goes up in a straight line, August has gone quiet and what’s more, it’s done so at the top of the current gold range rather than at the bottom. Most of the time the advantage in capital markets is skewed enormously in favour of the larger player but there are some times and circumstances in which being small and nimble offers an edge, as noted below I’ve been taking the opportunity to top up on positions thanks to the opportunities offer by smaller weaker hands and impetuous traders. I suggest you do the same, because when gold breaks U$1,400/oz you’ll have to pay more. Make no mistake, Joe Mazumdar is right about where we are in the current mining cycle and anyone bailing now on quality names with longer-term futures is making a big mistake. This has only just begun.
Peru: The new government lays out its plans for mining
On Thursday the new Cabinet Chief, Fernando Zavala, went to Peru’s new Congress in a key moment for the new government. According to the law he needs to get approval for all Ministerial positions from the Congress by vote and to do that, must go and explain what they plan to do. As Peru’s Congress is under an absolute majority of the opposition Fujimorista (FP) party (Keiko lost to PPK in the run off by a whisker) that’s not necessarily a given vote.
I won’t go into every aspect and issue covered, we’re here for mining so that’s the subject to cover today and as Zavala laid out the government’s plans for the sector (14). I took away three things. A soundbite or two for mining friendly headlines, the extended quote that lays out the PPK vision for mining and the new measure this government plans to bring in to help move projects forward (all eyes on Tia Maria, a test-case if ever there were one). All translated from the Spanish by these hands.
“A modern Peru needs sustainable mining”.
“Mining investment is welcome”.
We like those.
The extended quote: “We will generate the conditions which allow our rich natural resources to be converted into products of higher value, not only via foundries and smelters but also through mining clusters that invest in the care of the mining environment, investigation, innovation and automization of the sector.”
The new measure: There are other reforms in the pipeline which are aimed at the small private miner/mining company, such as the phasing out of the use of mercury in gold extraction. But when it comes to our focus the big reform will be the “Adelanto Social”, best translated as the “Social Advance Payment” which reminds me of the way Ecuador requires mining companies to invest and give money to local communities for civil projects before the mine gets going. In Peru, exploration stage companies will also be required to lay down cash for new local works, though presumably the scale will be small (and let’s face it, most decent junior explorecos in Peru already have these types of plans, certainly the ones I invest in).
Here a reminder of the IKN First Law of Mining NRs, which states the following:
"The IKN First Law of Mining News Releases: Considering that anything contained in a mining news release is presented in the best possible way for the company in question, any piece of information contained in a NR that comes across in any way negative means the real news and/or events behind it must be very, very bad indeed."
- Staff reductions will include the departure of the following members of the Company's executive management team by September 2, 2016:
- Shontel Norgate, Chief Financial Officer;
- Kevin Cain, Vice President -- Projects;
- Jonathan Lowe, Vice President -- Strategic Development and Exploration; and
- Karen Hauff, General Counsel / Company Secretary.
So, wholesale layoffs in the office. As the Black Knight so wisely said, just a fleshwound. As for the timeline, back in the last corporate presentation they told us that wet testing of equipment would start in 1h16. And now...
The Company previously disclosed that in the event that the required funding is secured and the Company is able to continue development of the Solwara 1 Project, the schedule would be delayed. The Company has now secured the necessary bridge financing to facilitate the time required to secure that additional required funding. If the additional required funding is secured by June 2017 and subject to ongoing detailed planning, the Company could be in a position to commence the initial deployment and testing operations at the Solwara 1 Project by the end of Q1 2019.
Oh, another three years? Bummer. Still, it's unlikely to get set back any further than that, right?