Revival of Hollister gold mine reaches milestone |
- Revival of Hollister gold mine reaches milestone
- Canadian mining equities improve in Q1, but companies remain cautious
- Make way for more driverless trucks: BHP
- Roxgold's Burkina Faso drilling hits more insane grades
- Lucara increases credit facility to $50 million
- Funding still an issue for miners, especially juniors: report
| Revival of Hollister gold mine reaches milestone Posted: 06 May 2014 06:02 PM PDT The US Department of the Interior, Bureau of Land Management issued the final Record of Decision (ROD) for the Environmental Impact Statement (EIS) of the Hollister gold mine in Nevada on Tuesday. The ROD, first issued on March 31, is a significant milestone for the development of the Hollister project owned by Waterton Global Mining Company, as it is the final stage of EIS approval. According to a statement, this will authorize additional area for surface exploration, reducing operational and regulatory uncertainty for the project and extending the proposed project life. The EIS application process was initiated in 2008 by the previous owner of the Hollister and was continued by Waterton Global who acquired the Hollister in a bankruptcy auction in May 2013. Waterton Global paused production and laid off the majority of its staff last November to "focus on resource definition drilling to enhance asset value and extend the life of the mine." "This significant permitting milestone will allow additional capital investment that will increase the viability of the project and lead to long-term value creation," said Isser Elishis, managing partner and chief investment officer of Waterton Global Resource Management. The Hollister mine is located in northern Nevada, at the intersection of the Carlin Trend and the Northern Nevada Rift, one of the most prolific gold mining regions in North America. The mine has been in production since 2008 and has had a historic production rate of 350 to 400 ore tonnes per day, producing an average of 80,000 oz of gold per year. Waterton Global Mining Company is a Toronto-based private investment company.  |
| Canadian mining equities improve in Q1, but companies remain cautious Posted: 06 May 2014 12:20 PM PDT Canadian mining equities showed modest signs of improvement during the first quarter underpinned by commodity prices and continued cost focus of miners, according to Ernst & Young's recent Canadian Mining Eye report. The index — which tracks Canadian mining sector performance of 100 TSX and TSXV mid-tier and junior companies with market capitalizations between $2 billion and $100 million – gained 13% during the first quarter compared to an 8% loss the previous quarter. It also outperformed the S&P/TSX Composite index, which gained only 5% during the first quarter. In comparison, the London Metal Exchange index (LMEX) lost 6% during the quarter. While gold prices have experienced a modest recovery this year, hitting a six-month high mid-March, E&Y believes they will resume a declining trend. Prices for the precious metal are down 19% over a year and ongoing uncertainty over prices are likely to continue driving some companies to opt for hedging their future gold production. Major players continue to focus on rigorous cost control measures and disciplined M&A activities and juniors still seek the right opportunities, adds the study. The first group gained 10% this quarter compared to a fall of 2% the previous quarter. The world's number one gold producer, Barrick Gold (TSE: ABX), reported a 14% decline in all-in sustaining costs to $899 an ounce for the last quarter compared to the same period in the previous year. Fellow Canadian Goldcorp (TSE:G) reported an 11% decline in all-in sustaining costs to $810 an ounce during the same period. The report concludes that weak share and asset prices in the mining and metals sector provides companies with an opportunity to acquire assets at relatively lower prices. Some analysts are sounding caution that buyers need to maintain a disciplined view to acquisitions so that they avoid overpaying. While some mid-tier companies were able to tap equity capital, fund raising still remains challenging for juniors. Juniors must continue to be creative in their approach to raise money in the market. Overall, the report views the first quarter as a positive start for the year with modest strengthening of investor confidence levels for the sector.
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| Make way for more driverless trucks: BHP Posted: 06 May 2014 11:26 AM PDT In an attempt to boost productivity and cut costs, Australia-based BHP Billiton (ASX: BHP) is expanding the use of the driverless trucks from its Pilbara iron ore mines to New South Wales and Queensland coal mines. BHP, the world's largest mining company measured by 2013 revenues, has been using the robotic haulage fleet in the Pilbara region since late 2012, following the lead of its rival company Rio Tinto (NYSE: RIO). The expansion to its coal mines comes after successful trials in New Mexico, according to the Australian. "There's no doubt it will happen, and I'd like to think that within 12 months we will be running trials," BHP coal president Dean Dalla Valle told the Australian Monday. Valle said the autonomous trucks cut costs by reducing the need to house, feed and employ four drivers and there was little difference between hauling coal and iron ore. He also added the coalmines are where it most needs to save money due to depressed thermal and coking coal prices. The use of autonomous trucks had previously been expanded within the Pilbara region to reduce costs and protect profits against commodity price dips. The idea of automation is not a new one. A variety of approaches to autonomous underground navigation has been used with varying degrees of success around the world over the years, although all have relied on the installation of some form of additional infrastructure to guide the vehicle. |
| Roxgold's Burkina Faso drilling hits more insane grades Posted: 06 May 2014 10:51 AM PDT Shares in Roxgold Inc (CVE:ROG) gained nearly 6% in massive volumes on Tuesday, after announcing another set of spectacular drill results from its ultra-high grade Yaramoko project in Burkina Faso. In midday dealings the Toronto-based junior was trading near its highs for the day changing hands at $0.72, up 5.9% on the Toronto Venture Exchange. Around 1 million shares in the $169 million company had changed hands compared to the usual daily average of half that. Roxgold announced intercepts of 226.76 grams per tonne gold over 3.1 metres (2.7 metres true width) including 442.00 gpt gold over 1.6 metres (1.4 metres true width) from the Bagassi South target of its regional exploration drilling program at Yaramoko. This and other meaningful intercepts at Bagassi South, one of many highly prospective targets, has the potential to expand the scope of the project substantially. Roxgold's regional drilling covers 55 square kilometres while another 5,000m of diamond drilling is planned for Bagassi. Roxgold's share price is up 62% since the start of the year after announcing a robust feasiblity study for Yaramoko in April on the back of a string of good drilling results and a number of financing deals to push the project forward. Yaramoko stands out as a project thanks to a combination of one of the high-grade undeveloped deposits in the world containing probable reserves of 759,000 oz of gold at an average grade of a whopping 11.83 g/t gold and some of the lowest costs in the industry – all in sustaining costs of $590 an ounce. The Yaramoko feasibility improves on the PEA and calls for a low capex – only $106 million placing it in the bottom 5% of African gold projects – underground mine producing 99,500 ounces on average annually for an initial 7.4 years. Underground development and engineering starts end-2014. Roxgold owns 100% of Yaramoko, but the government of Burkina Faso is entitled to 10% of the project after the formal award of permits. Burkina Faso with a population of 16 million people, is the continent's fourth largest gold producer after Mali and has commissioned eight new mines over the past six year. Image of butterfly mask signalling the rainy season and planting season created by Nuna people of Burkina Faso via catface3. |
| Lucara increases credit facility to $50 million Posted: 06 May 2014 10:43 AM PDT Canada's Lucara Diamond Corp. (TSX:LUC) renewed its revolving term credit facility with the Bank of Nova Scotia (Scotiabank) for a three-year term and an increased limit of $50 million. The facility would contain financial and non-financial covenants customary for a facility of this size and nature, and the applicable interest rate of any loan under the facility would be determined by the company's leverage ratio at any given time. "While Lucara continues its strong cash flow generation the credit facility provides for future risk mitigation and allows the company to react quickly to potential growth investment opportunities," said president and CEO William Lamb in a statement Monday. The southern Africa-focused precious gem producer has discovered rare diamonds in the past including a 9.46-carat blue diamond that fetched $4.5 million in 2012. Lucara share performance has outpaced competitors such as U.K.-based Petra Diamond Ltd. and Gem Diamonds last year and the miner is reportedly on the hunt for new properties. Vancouver-based Lucara's two key assets are the Karowe Mine in Botswana and the Mothae Project in Lesotho. The 100% owned Karowe Mine is in production. The 75% owned Mothae Project has completed its trial mining program. |
| Funding still an issue for miners, especially juniors: report Posted: 06 May 2014 10:03 AM PDT
In its latest report on the state of the market published Tuesday, SNL Metals&Mining reveals that the combination of investment banks falling out of love with commodities, and IPOs not serving the smaller companies, continues to burden mining companies big and small, particularly explorers. This, say the analysts, is reflected by the mere US$7 billion raised by the mining sector in the first quarter of the year, with only $1.6bn going to juniors. Metals markets, says the report, remain dull, but stable. Copper, a main indicator of global economic health, is expected to remain lethargic for the remainder of the year, with most investors seeing better opportunities in other metals, particularly nickel and tin, SNL says. Nickel continues to be the sector's star, as the metal hit a 14-month high of US$18,000/t in mid-April. Price for the commodity have jumped 29% so far this year thanks mainly to the Indonesian ore export ban, which came into force last January. Gold barely shining SNL experts say that while the Ukraine-Russia conflict has had little effect on the gold price, which seems to be locked within a tight range around $1,340 per ounce, bullion prices are expected to keep falling through 2015.  Click to expand. Adding to the bad news, the report highlights that —based on the number of prospects reporting drilling results in the quarter just ended (856)— exploration is at only 56% of the year-ago level (1,517), which was itself just 62% of the number of prospects reporting drilling in the first quarter of 2012 (2,465). And while the mount of merger and acquisitions (M&A) in the first quarter of the year shows an undeniable increase, the experts note that jump was achieved in conditions of tight finance, raising about $7 billion, compared from the $9.8 billion registered in the quarter ending in Dec. 2013. When it comes to regional activity, SNL experts say that although Asia is dominating metals production, Latin America remains an important target for mine development. The region maintained its top position in 2013 in terms of the number of projects and the capital expenditure commitments for the 1,307 development projects with capex estimations. |
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