Gold prices are starting to push aggressively higher. All as the dollar and U.S. Treasury yields retreat, with investors hoping the Federal Reserve will ease off of its aggressive approach to interest rate hikes. In fact, ING’s head of commodity strategy, Warren Patterson says, “Any hints of an easing in its aggressive hiking cycle should start to provide some support to gold prices. And in order for this to happen, we would likely need to see some clear signs of a significant decline in inflation,” as quoted by Kitco.com. In addition, “ING sees inflation coming down ‘quite drastically’ in 2023, allowing the Fed to start cutting rates in the second half of 2023.” Should that happen, gold prices could push higher, taking gold stocks along for the ride, including NevGold Corp. (TSXV: NAU) (OTCQX: NAUFF), Barrick Gold Corporation (NYSE: GOLD) (TSX: ABX), Newmont Corporation (NYSE: NEM) (TSX: NGT), Franco Nevada Corp. (NYSE: FNV) (TSX: FNV), and Royal Gold Inc. (NASDAQ: RGLD).
Look at NevGold Corp. (TSXV: NAU) (OTCQX: NAUFF)
NevGold Corp. announced further assays from the Company’s drill program at the Cadillac Valley target area at its Limousine Butte Project, Nevada located on the southern part of the Carlin Trend. The Company has intercepted more oxide gold at the newly discovered Cadillac Valley South area expanding the mineralized footprint by over 100 meters to the northwest. Further assays from the Company’s inaugural 10,000-meter drill program at the Project are expected to be released over the coming weeks.
- Cadillac Valley South Discovery Has Expanded by Over 100 Meters to the Northwest: CV22-007 intercepted 0.44 g/t oxide Au over 36.6 meters from a drill pad over 650 meters away from CV22-002 (0.83 g/t oxide Au over 126.2 meters released on April 6, 2022) and expands mineralization over 100 meters to the northwest of CV22-006 (0.51 g/t oxide Au over 73.1 meters released on June 2, 2022). The Company has only drilled two holes at the Cadillac Valley South discovery and both holes have shown positive, consistent, oxide gold intercepts with many areas open for infill and delineation drilling. Cadillac Valley South is a high potential resource growth target.
- Large, Open, Growing Mineralized Footprint at Cadillac Valley: the mineralized area at Cadillac Valley has further increased and now extends over 1.6 km along strike and over 450 meters laterally. Hole CV22-007 was drilled with reverse circulation (“RC”) to target an area between CV22-002 and CV22-006 to infill the open mineralized footprint. (Figure 1, Figure 2) There is also another +1.5 km of untested strike length to the southwest of Cadillac Valley South. (Figure 3)
- Highly Oxidized Mineralization: oxidized mineralization has been seen in all of the holes drilled to date by the Company at Limousine Butte.
- Exploration Upside: large areas of the 67 km2 Limousine Butte Project are untested and there are various identified targets based on the current Company geological model. (Figure 4) The mineralized system continues to grow as drilling occurs along strike with large step-out holes.
NevGold CEO, Brandon Bonifacio, comments: “We are continuing to build a meaningful, near-surface, high-grade oxide gold story at Limousine Butte. The two holes that we have drilled to date at the newly discovered Cadillac Valley South target area have had consistent economical oxide gold grades over positive intercepts and have further expanded the mineralized footprint at the larger Cadillac Valley target. The drilling at Limousine Butte over the past 12 months has consistently shown higher grade material than many heap-leach projects in production or development in the Western USA. As previously indicated since the announcement of our option agreement on Nutmeg Mountain which closed on July 5, we will continue to aggressively and systematically advance Limousine Butte to a near-term resource. The remaining assays from our 10,000-meter drill program are expected shortly and will be released over the coming weeks.”
NevGold VP Exploration, Derick Unger, comments: “Hole CV22-007 further confirms the extents of the gold system at Cadillac Valley and speaks to the broader potential for discovery at the Limousine Butte project. While the drillhole crossed the major northeast striking fault, it confirms the fault was an important conduit for the gold-bearing fluids and shows that the CSAMT geophysical surveys that we inherited with the property can identify both the conductive zones associated with the faults and the resistive zones associated with the mineralization. The CSAMT surveys extend to the south of holes CV22-006 and CV22-007 and we are excited to continue to test the Cadillac Valley South area which has the potential for additional mineralization over a minimum strike length of another 1.5 kilometers.”
Other related developments from around the markets include:
Barrick Gold Corporation announced the closing of the previously announced sale of a portfolio of 22 royalties to Maverix Metals Inc. Following the exercise by Skeena Resources Limited, the operator of the Eskay Creek mine in British Columbia, of its buy-down right to acquire 0.5% of the 1.0% net smelter returns royalty on the Eskay Creek mine, Barrick has received total consideration equal to $50 million in cash in respect of the Portfolio. Barrick has the right to receive up to an additional $10 million from Maverix if certain conditions relating to the Portfolio are satisfied within six years of closing.
Newmont Corporation and Glencore International announced they have reached an agreement in which Glencore will acquire Newmont’s 18.75% shareholding in the MARA Project (MARA). Following completion of the transaction, Glencore will own 43.75% of MARA. Under the terms of the agreement, Glencore will pay $124.9 million upon closing and a $30 million deferred payment upon commercial production subject to an annual interest charge of 6%. Total deferred consideration is capped at $50 million. The closing of the transaction is subject to customary conditions and regulatory filings. The MARA Project, located in the Catamarca province of Argentina, is a joint venture formed in December 2020 between Yamana Gold, Glencore and Newmont following the integration of the Minera Alumbrera plant and mining infrastructure and Agua Rica project. Under the new structure, Yamana Gold Inc. will remain the operator with 56.25% of MARA, with Glencore owning the remaining shares.
Franco Nevada Corp. announced second quarter results. “We are proud to report record quarterly and half-year results on many financial metrics,” stated Paul Brink, CEO. “The low-risk nature of our business is most pronounced in today’s inflationary environment. Our top-line precious metal stream and royalty interests helped generate our highest margins since starting streaming. Our Energy assets performed well and are the driver behind our record revenues. We are pleased to add exposure to the construction-ready Tocantinzinho gold project and to have received good organic growth news from several of our assets during the quarter, in particular the further expansion of the Detour Lake mine. Franco-Nevada is debt-free and is growing its cash balances.”
Royal Gold Inc. announced that its wholly owned subsidiaries, International Royalty Corporation and 1370553 B.C. Ltd., have completed the previously announced plan of arrangement to acquire all of the issued and outstanding shares of Great Bear Royalties Corp. “I am pleased to announce the closing of this friendly transaction with Great Bear Royalties Corp.,” commented Bill Heissenbuttel, President and CEO of Royal Gold. “The acquisition provides Royal Gold exposure to Canada’s newest major gold discovery, the Great Bear Project, and furthers our strategic objective of acquiring quality, long lived assets with excellent operators in favorable jurisdictions.”
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