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1/18/18

Angry Geologist did SolGold (SOLG.to) (SOLG.L) last night...

...and I've just noticed the post. It's here and it's all about the Maiden Resource on Alpala. TAG's most telling remark was...
"...you get the impression that SolGold wanted a billion tonnes of resource come hell or high water."
...and I'm inclined to agree with her.

Bring Out Yer Dead! Dilutive placements in BS failed juniors abound





1) In a perfect world the market will rebel against PI Fincorp, tell it in no uncertain terms that Rye Patch Gold (RPM.v) is farked and needs even more money that this $15m in order to survive, turn its back on this bought deal and leave the commish-grabber holding a very big and expensive bag as RPM dives to under $1.00 on last night's news.

2) Meanwhile, even more hilarious is the ex-Ameduri pump Inca One (IO.v) which plans Lake Titicaca scale dilution via a placement to raise $2m. Ameduri got people in at 35c and 40c, now IO.v offers a share plus a full warrant for 5c. 

3) The scam lithium play Alset Minerals (ION.v) run by the liar and thief Alan Barry Laboucan is running a 7.5c placement to raise up to $1.2m. It'll then afterwards run a 3-for-1 reverse split and pretend that its previous shareholders have not been ripped a new one. Proceeds from the placement will be dedicated to purchasing high calorie Mexican finger food and tequila.

With Asanko (AKG), the devil's always in the details

In 4q17 Asanko Gold managed to just make the bottom end of its downward revised guidance by producing 205,047oz gold (bottom end of range 205k oz). Here's how that was accurately predicted by IKN in November 2017:
"....it's a fair guess they're going to come in around 205,000 oz to 210,000 oz...AKG will squeeze into the bottom end of the 205koz to 225koz range they revised downwards after the 2q17 earnings."
So far so mediocre. But if you look a little further down today's NR, AKG has left a massive clue as to how bad things really are in this short segment of script:
At December 31, 2017 the Company's balance sheet had approximately US$49.3 million in unaudited cash, US$2.1 million in gold receivables and US$4.1 million in dore (with a market value of US$5.9 million).
Any thought on that owly?

Yeah, that's what I thought too because if you check the financials as at 3q17:
  • Cash was U$60.8m, it's now U$49.3m (11.5m down)
  • Receivables were U$2.3m, they're now U$2.1m (0.2m down)
  • Gold Doré was U$2.2m it's now U$4.1m (1.9m up)

Now for sure that isn't the be-all-and-end-all of the financials, but if you can't take the hint that U$9.8m in real moolah seems to have disappeared from the company in the last quarter, a company burdened with massive financial debt obligations you will surely remember, then I wish you the very greatest of luck with your financial investments. Because you're gonna need it.

UPDATE: It would also seem that Asanko is a proponent of Bistromathics as in its own NR today:
  • AKG states it ran 1,087,000 tonnes of treated ore
  • AKG states the gold feed grade was 1.5g/t
  • AKG states that its recovery rate was 94%

If you do the math on that you get production of 49,282 oz gold but somehow they claim to have produced 51,550 oz  (and oh how convenient, juuuust make guidance).

A rumour on Anglo American with a big copper porphyry in Brazil

This humble corner of cyberspace receives its share of rumour and hearsay mails and normally, they need a bit of back-up bona fides before making the blog. But sometimes I'm good about running with the intel as-is and here's one of those, from A. Reader. According to the Brazil Mining Department (DNPM) Anglo American has quietly filed for copper exploration permits for all the available mineral rights in the Alta Floresta Gold Province. That's because word on the ground in Mato Grosso is "...they have stumbled upon a massive copper porphyry discovery" and they're keeping it quiet because they want to stake as much as possible first. They've staked another 2.2m hectares in the North of Mato Grosso in the last few weeks but still want more.

1/17/18

Rye Patch Gold (RPM.v) announces a $15m dilutive placement

Ah wuz shocked! Shocked Ah wuz!

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

VANCOUVER, Jan. 17, 2018 /CNW/ - Rye Patch Gold Corp. ("Rye Patch" or the "Company") (TSX.V: RPM; OTCQX: RPMGD; FWB: 5TN) is pleased to announce that it has entered into an agreement with PI Financial Corp., as lead underwriter on behalf of a syndicate of underwriters (collectively, the "Underwriters"), under which the Underwriters have agreed to purchase, on a bought deal private placement basis 11,538,500 units (the "Units") of the Company at a price of $1.30 per Unit, for aggregate gross proceeds of $15,000,050 (the "Offering"). Each Unit will be comprised of one common share and one transferable common share purchase warrant (a "Warrant"). Each Warrant will entitle the holder thereof to acquire one common share of Rye Patch at a price of $1.65 for a period of 24 months following the closing of the Offering.
The Company has also granted the Underwriters the option to increase the size of the Offering by up to 3,846,200 Units to cover over-allotments, exercisable in whole or in part at up to 48 hours prior to the closing date of the Offering, for additional gross proceeds of up to $5,000,060.
The net proceeds of the Offering will be used for debt servicing, working capital and the continued ramp up of the Florida Canyon Mine.
The Offering is scheduled to close on or about January 31, 2018, or such other date as agreed between the Company and the Agents, and is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory and other approvals including the approval of the TSX Venture Exchange.
In addition, the board of directors (the "Board") of Rye Patch has also determined to initiate a strategic review process to explore alternatives available to the Company for the enhancement of shareholder value.
Chief Executive Officer Bill Howald commented, "The Board has approved a process to review and evaluate potential alternatives that may further maximize value for Rye Patch's shareholders."
Mr. Howald added, "The strategic review will encompass a careful evaluation of the Company's development strategy, business plan, market valuation and capital structure and will consider numerous opportunities or alternatives for the Company, including potential mergers, acquisitions or dispositions, restructuring or refinancing of its credit facility, and any other options identified with the fundamental objective of achieving the best value for the Company's shareholders."
The Board has appointed a Special Committee comprised solely of independent directors to review and evaluate proposals considered as part of the strategic review process, and to make recommendations to the Board thereon. The Special Committee is chaired by Tim Baker and is comprised of Jonathan Challis, Charles Russell and John Mansanti, being all of the independent directors of the Company.
There can be no assurance that the Company's efforts will be successful or that the strategic review process will result in any transaction.
The Company's mine ramp up at Florida Canyon will be unaffected by this review process.
This news release does not constitute an offer to sell or a solicitation of an offer to sell securities in the United States, nor in any other jurisdiction.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available. 
About Rye Patch Gold Corp.


Tahoe Resources (TAHO) (THO.to): I actually burst out laughing

Just three minutes ago. Link here, my mailbox screenshot here:


Yep, this is indeed the same Canadian domiciled company that bribes Guatemalan elected officials for its permits then shoots people protesting against the decision in the legs. It's the same one that fought tooth and nail to stop the court case from happening in Canada because it knows how deep the excrement gets now. The company that hides workplace fatalities from the market for years. Just wonderful. 

And when Shahuindo locals go on their protest and block all access to the THO mine in Peru at the end of this month, you can be sure CEO Clayton will be urging the Ombudsperson go visit.

Eight days of New Gold (NGD)

On January 9th, while noting the sudden weakness in the stock, this humble corner of cyberspace wrote:
"Without sticking my neck out too far or risking the proverbial pie in the face in a few days' time, I think it fair to surmise that () the market isn't going to like New Gold's (NGD) 4q17 production numbers when they show up."

The 4q17 production NT hit post-bell last night and...


...yup, got that one right.

For what it's worth I'm going to take a good hard look at NGD today. There may be a trade here.

Get ready for the Zinc One (Z.v) pump from Daniel 'Davidoff Cigar' Ameduri

It's coming very soon and, as Davidoff is desperate to clean out his underwater paper to suckers like you, it's going to be one helluva full-court press megapump as well. Expect wave after wave of NRs in the days and weeks ahead. You have been warned.

Because if the thing isn't $1.30 by May, according to his own guarantee he's closing his company down. Just four months to save FMT from your own words, Dannyboy. Go for it!

1/16/18

The word in Lima: PPK will resign in February

There's a well-sourced rumour going round the better informed streets of Lima this afternoon that PPK has simply had enough and he's going to play the age/illness card to resign as President in the near future, perhaps as early as next month. First Veep Martin Vizcarra will then assume the presidency, 2nd Veep and Prime Minister Mercedes Araoz will fade into the background, Vizcarra will put together a new cabinet of ministers with plenty of Fujimori people on board (not Keiko-ists though, she's seriously but SERIOUSLY fallen out with her dad and Kenji is now the chosen one).

But first PPK wants to do his Pope meety-greety thing at the end of this week. After that, hell breaks loose once again in the Peru political class.

Goldcorp (GG) goes Blockchain

From one of IKN's smartest and quick-eyed sources (I would have got there in a couple of hours), this from GG's Q4 production presentation this morning:



Oh my stars.

1/15/18

An IKN Freebie: The weekend's coverage of Wesdome Gold (WDO.to) in The IKN Weekly

As usual in The IKN Weekly published on Sunday evening (issue 452, dated January 14th) we did plenty of things, with one of them a good look at the 4q17 production numbers (as well as preliminary 2018 guidance) as announced by Wesdome Gold Mines (WDO.to) on January 11th. By way of an example of what goes on in The IKN Weekly I've decided to offer the article up as a freebie for anyone interested so if you'd like a copy please send a mail to the usual address...

otto.rock1 (AT) gmail (DOT) com

...with "WDO Report Yes" (or even 'yes please' if you feel so inclined) in the title line and I'll send you over a copy on Wednesday. And rest assured that I won't use your mail address for any other purpose, neither will you be peppered with marketing bumph from me from now until the cows come home because this is IKN, not freakin' Stansberry Research.

The Pan American Silver (PAAS) Navidad project in Chubut, Argentina

A really interesting read on the new move sin politics around the subject, right here.

Hi! My name's Nouriel Roubini

How you doing today? You may remember me from that time in 2005 when I made a prediction about the stock market and then three years later it came true. Well, what I've noticed recently is that a lot of people have been paying attention to other people and not me and that's something we need to fix immediately, don't we?
I'm here to tell you about financial things and what I've done is made some "polemic" comments about Bitcoin and gold on the so-called "Twitter" platform today which should certainly ruffle a few feathers! I called them both scams, pretty daring of me, no?

So have a great day and don't forget to like me. And listen to me more often. And book me on your TV segment (by the way CNBC, since you last phoned I've changed my phone number, so mail me to connect. TIA).

Best wishes, Nouriel.



Hey Nouriel, 26 retweets and 49 likes! Nice job, dude.




B2Gold (BTO.to) prints C$4.00

It's been a while.


Since just after PDAC last year, in fact. What's more, the chart suggests that 4 is an important ceiling level to break through, so a few more pennies this week and we could rush straight to C$4.50. Cool!

This is what i love about technical analysis, by the way: use verbs like "suggest", "seem"  or "indicate", modals like "could", "may" or "might", then make your wild assed call. If it comes in you then toot your horn to the world, if it doesn't you point out that "it was only the chart showing possibilities". And there are people who get paid for publishing this bunkum, bless their hearts.



I was going to do my impersonation...

...of a dumbass gringo CEO who doesn't have the first clue about Latin America, let alone the specific region in which his company operates, doesn't give a flying rat's ass about locals, can't be bothered to find out the true drivers of community culture and instead just wades in like a hundred failed bosses before him, tries to impose his own clumsy corporate culture and ends up with the inevitable disastrous results for company, community and shareholders.

But Fred Stanford of Torex has beaten me to it.

Canaccord opens coverage on Tinka Resources (TK.v) with a $1.00 target

A bit lowball, but it's a start.


1/14/18

The IKN Weekly, out now



IKN452 has just been sent to subscribers. Full of the usual guff and nonsense, I wouldn't bother if I were you.

What, this week's picture? Okay, if you care enough and want an extra clue, but you really had to be there. In the 70's, that is.

Warren Irwin talking sense

You know IKN by now; Cynical, snarky, mean to people, horrid and smelly and it's just not fair, all that jazz. And yeah I do go out of my way to keep the fanboy thing down to a strict minimum (unless it's the Legendary Legend Brent Legend Cook of course) because the last thing the mining industry needs is yet another place where the out-sized egos of the mediocrity in charge of this pathetically run sector get stoked and massaged like waygu beef before becoming tartare in a Michelin 3star.

But there are exceptions to the rule and here's one today. I got sent this link to an interview with Warren Irwin, head honcho of Rousseau Asset Management and published a couple of days ago as the sender thought it was blogworthy and as it turns out, it really is.




It's not about his incessant promoting of NXE either (he loves it, but however good the deposit might be U is the past, not the future), this interview is worth your time for the points he makes about the market, the traps awaiting the greenhorns, the sharks around every corner. All true, all in line with IKN's main message over the years, all done in a far more diplomatic and intelligent tone than this humble corner of cyberspace will ever bother to achieve. So watch this Q&A, it's a good one.

1/13/18

The Novo Resources (NVO.v) circlejerk: An expensive club

On November 2nd 2017  it would have cost you a mere $25 to get the analysis report written by CEO.ca stock touter "Hedgeless Horseman". It must have been a great read because he (I presume, as somebody that arrogant is rarely a she) was "researching Novo Resources 24/7", doing DD and compiling photos. And things. How you NVO longs must have rejoiced, urging new people into the stock or encouraged to add and/or hold onto your winning shares by his deep and meaningful insight. 

Meanwhile, others took advantage and sold into your circlejerk club's belief. NVO was $7.35 at the close of November 2nd and it's now a $3.39 stock, which is a 53.9% loss from pillar to post.


This humble corner of cyberspace has been informed that Hedgeless Horseman is not a qualified geologist, which bring us to a oft-repeated point about such trades and investments that depend on serious technical ability. NVO is one such trade and while reiterating the IKN house position of complete neutrality on this company and its stock price on November 5th 2017 (which was then published on this blog Nov 10th), wrote this:
"For geology, either 1) be a geologist or 2) understand clearly what a geologist is saying to you when she or he opens their mouth before writing things down and publishing them".
Your humble scribe has never been and will never be under any illusions about his lack of ability about rocks. Not so Hedgeless Horseman, who managed to convince himself of superior knowledge, market it as "what the geologists don't know/understand/get", then proceeded to hoodwink the perennial bunch of naive fools who hang around CEO.ca, marvelling at the company they think they're keeping. Plain fact: He has cost both himself and other people a lot of money by not realizing how little he knows on the subject (i.e. enough to be dangerous). That he cost himself a crap-ton of cash due to his hubris is not of the slightest concern, but I know how bad I feel when one of my trades that others follow me into goes wrong and from reliable accounts (i.e. the person who gave me the heads-up about this situation a couple of days ago, somebody rather annoyed about the way in which the whole sordid affair has evolved), there has been zero zip nada contrition from this Hedgeless Horseman character over his top-ticking report, price $25. But hey Bob Moriarty liked his analysis so you NVO True Believers probably feel a lot better just by knowing that. Ah but wait, Moriarty is another non-geol who likes to fake it, too. Birds of a feather, eh...

Bottom line: NVO was a trade. It stopped being a trade when the story changed and as it turned out, that was right here.

The top three most visited IKN posts this week are...

...in reverse order:


Third Place: "More Michael Ballanger lolz". After which, your author once again received pleasant correspondence from Michael Ballanger in which he repeated his totally false claim that I am some type of pederast (to quote the worm's words to me, "Go f__k yourself, child molester" and I only blank out those letters because Google Blogger doesn't like strong swear words any longer). Not the first time he's spouted this nonsense, either.

Shareholders of Gem International may want to note that this person is being nominated as a "highly qualified nominee" by its proxy slate. If you want somebody who makes up fantasy lies about people using extremely serious and totally false criminal accusations, Ballanger is exactly the type of executive you need to run your company.

Second Place: "Peru declares state of emergency in the South region "copper corridor". IKN reports something in English before the rest. IKN gets more hits on the post. Normal.
 
First Place: "B2Gold (BTG) (BTO.to) and Cormark: Four things". Cormark called BTO the "Cream of the Crop" in its note on Wednesday morning, moved it up to a house Top Pick and this humble corner of cyberspace made a handful of comments on their comments. Notably, since then BTO is up 8.1% so their trade has started well enough. This post got a LOT of hits by the way, clearly a lot of interest in this company at the moment.


PS: Just going to stick this here. No real reason.





1/12/18

I wonder why Fiore Gold (F.v) was so keen to bury this NR...

..., published late Friday night to an obscure newswire and SEDAR only, not even put on its own website. Read on:

Fiore Gold Issues Statement About Recent Stock Trading Activity


Vancouver, British Columbia (FSCwire) - FIORE GOLD LTD. (TSXV: F) (OTCQB: FIOGF) (“Fiore” or the “Company”) was made of aware of and requested by the OTC Markets Group, Inc. (“OTC Markets”) to comment on recent trading and promotional activity related to Fiore’s common shares.

Fiore’s common shares commenced trading on the TSX Venture Exchange in Canada, its principal trading market (the “TSXV”), on October 2, 2017, and began quotation in the United States on the OTCQB on November 23, 2017.  Since becoming a public company, Fiore has complied with its reporting requirements in Canada and disclosure requirements of the OTCQB, including press releases and updates on the status of its business and operations at the Pan Mine.  On October 19, 2017, in connection with going public and as part of investor relations activities, Fiore engaged Gold Standard Media, LLC, an independent media company, to provide marketing services with a one-time media campaign.  Other than Gold Standard Media, Fiore has not engaged any third-party investor relations firm.

On January 4, 2018, an independent third-party article was published by E. B. Tucker at The Casey Report, which recommended Fiore and three other mining companies, which Fiore believes led to increased interest and trading activity in each of the companies’ securities recommended in the article.  Fiore believes that there is a correlation between the timing of The Casey Report and increased trading activity of Fiore’s common shares on the OTCQB.  Fiore became aware of The Casey Report after it was published on January 4, 2018.  The Casey Report is an independent third-party, subscription based report and is not affiliated with Fiore or Gold Standard Media.  Although Fiore’s Chief Executive Officer responded to an interview request from The Casey Report on October 3, 2017, as part of ordinary course investor relations, Fiore has no relationship with E. B. Tucker or The Casey Report, Fiore was not aware that it would be included in the article and Fiore did not pay to be included in the article.  Gold Standard Media confirmed to Fiore that it had no knowledge that Fiore would be included in the article.  The Casey Report states that its writers are prohibited from owning or having an interest in any security that they recommend to readers and we have no basis to doubt their representation.

On January 6, 2018, Gold Standard Media commenced a one-time media campaign that included a series of interviews with Fiore’s CEO and one of its advisors, written materials containing information from Fiore’s public filings, creation of a website landing page and a distribution that included a link to the landing page.  Gold Standard Media prepared the materials used in the media campaign solely from Fiore’s public filings and maintained editorial control over content.  Fiore review of the materials was limited to confirmation of factual matters only.  Gold Standard Media confirmed to the Company that other than its own materials, Gold Standard Media has not, directly or indirectly, paid any third party to create or distribute The Casey Report or any other promotional materials.

On January 8, 2018, Fiore issued two positive press releases announcing November gold production results, the operational status of the Phase II leach pad and the appointment of Ross MacLean as Fiore’s Chief Operating Officer.

On January 10, 2018, Fiore was informed by OTC Markets that following publication of The Casey Report and increases in trading volume, other third-parties published promotional materials mentioning or featuring Fiore, which included price targets, encouraging investors to watchlist Fiore’s common shares and initiation of research coverage.  These promotional materials were not authorized, reviewed or distributed by the Company or Gold Standard Media.  Instead, it appears that these materials were distributed following increased trading volume, The Casey Report, Gold Standard Media’s campaign and Fiore’s January 8, 2018 press releases.   Although Fiore observed a correlation between trading volume and the publication of The Casey Report, Fiore cannot predict if these other third-party promotional materials affected trading activity in Fiore’s common shares.  The Company had no advance notice or communications with the sources of these promotional activities.

After inquiry, Fiore confirmed that its officers, directors and, to its knowledge, its controlling shareholders (i.e., shareholders owning 10% or more of the Company's securities) and third-party service providers have not, directly or indirectly, authorized or been involved in any way (including payment to a third-party) with the creation or distribution of promotional materials regarding Fiore or its securities, outside of those produced by Gold Standard Media.

OTC Markets requested that Fiore confirm transactions by any officer, director, controlling shareholder (defined as owning 10% or more of the outstanding stock), and any third- party service providers in Fiore’s securities during the past 90 days.  After inquiry, the Company has determined that officers, directors, and to the best of its knowledge, its controlling shareholders have not sold or purchased the Company’s securities within the past 90 days.   As disclosed in the Company’s press release dated December 22, 2018, the Company granted options to a new Director exercisable into common shares of Fiore at C$0.75, the closing price on the TSX Venture Exchange (“TSXV”) December 21, 2017, which was also the date of grant.  To the best of Fiore’s knowledge, none of Fiore’s other third-party service providers have sold or purchased Fiore’s securities within the past 90 days, except that between October 31 and December 28, 2017, certain third-party financial advisors purchased 876,700 and sold 12,280 Fiore common shares, and purchased 100,000 Fiore common shares on January 8, 2018.  Gold Standard Media confirmed that they do not own and have not owned any Fiore common shares and they have not purchased or sold Fiore securities during the previous 90 days.

In accordance with TSXV policies, Fiore has not issued shares or convertible instruments allowing conversion to equity securities at prices constituting a discount to the current market rate at the time of the issuance.

The Casey Report and the unauthorized promotional materials brought to Fiore’s attention by OTC Markets contain promotional language, including opinions on stock price targets, recommendations and views that are the opinion of the authors.   Although the promotional materials reviewed by Fiore management do not appear to be materially false or misleading, they contain promotional language and  are not endorsed by Fiore or its management.  Investors should not place undue reliance on information contained in these materials.  Fiore does not provide future share price guidance or endorse target guidance.  Fiore encourages those interested in Fiore to rely solely on information included in its press releases combined with its filings and disclosures made with OTC Markets and with Canadian securities authorities on SEDAR (www.sedar.com).

Fiore routinely responds to inquiries from shareholders, potential investors and investment analysts and prepares its own investor relations materials.  As such, Fiore urges its shareholder base and followers to review Fiore’s website and its filings on SEDAR.  Any investor seeking to verify whether a publication was disseminated by Fiore can email info@fioregold.com.

Corporate Strategy

Fiore’s goal is to build on the existing operations at our Pan Mine in Nevada to become a 150,000 ounce/year gold producer. To achieve this, we intend to:

  • grow gold production at the Pan Mine from a planned 35-40,000 ounces in fiscal 2018 to between 40-50,000 ounces per year by fiscal 2019

  • advance exploration and development of the nearby Gold Rock project, with a resource update planned for late 2018

  • acquire additional production or near-production assets in Nevada and surrounding states

On behalf of FIORE GOLD LTD.
"Tim Warman"
Chief Executive Officer

The Friday OT: Motörhead; Overkill

Fast Eddie has joined Phil and Lemmy in the great gig in the sky. 



Rock In Peace, Mr. Clarke. This from the live album Rolling Stone voted as one of the top 50 of all time, No Sleep Til Hammersmith. The band at its absolute peak and now they're all gone. Youtube here.

Primero/Wheaton/First Majestic: Winners and losers

Having started late this morning (couldn't get to sleep last night, finally nodded off 4am, thanks for asking) and catching up on the big news in the minepatch, that of the deal First Majestic (AG) (FR.to) has done to buy San Dimas from Primero (P.to) and re-jig the streaming deal with Wheaton Precious Metals (WPM) along the way, some thoughts on who wins and who loses. There are four entities:

Primero. Unless of course you're a latecomer who stuck their neck out...

...you are the big loser. Hubris, thy name is Conway.

As a few of you know (but most don't), I'd been looking at P late last year, all the time the revolver-boot-forward NRs were showing up, wondering if there was a spec trade there. But I was too chicken, so I do applaud those who had the cojones on the trade and now reap near-200% benefits. 

However, the vast majority are losers and thoughts go back for just one example to the $2.35 bought deal run by BMO in mid-2016 (plenty more where that IKN post came from, we've been tracking this trainwreck for years). Called your broker yet and fired him?

Wheaton Precious Metals. Clearly the big winner. For several months they've been staring down the barrel of losing a sizeable chunk of their stream income, but ignored their weak flank and played to a position of strength with FR.to. The deal they've done, getting quasi-cash (Fr.to) shares and a re-jigged stream deal that the mine can better support, means they've lifted a weight off their mind. They're also likely to be in less trouble with the Mexican tax people from now on. WPM's share price popped this morning on this news and quite right, too. Good deal guys, kudos.

First Majestic. Even though the stock opened 4% and 6% down on this deal (due to the share dilution) I don't think they've lost out that much, in the near term at least. Their hazard will come further down the line, because at least a part of this is the ego-driven "we can do a better job than the dumbos at Primero" attitude. Yes FR knows Mexico and just for that reason they're probably the best fit company for this deal (i doubt PAAS was interested), but the issues at San Dimas aren't just skin-deep or fixable by giving the workforce a pay rise. The mine is old and needs serious cash to modernize it and make it a safe and correct work environment (one of the main issues the unions have with conditions there). That costs real money and if they do it right, will also add to op-ex. It remains to be seen whether a) FR does the right thing by the employees and gets ops going smoothly again and b) does it in a budget that makes sense.

Mexico tax people. Also winners. With a line drawn under the previous stream agreement, the parties will now be able to come to a clean structure for paying duties on production to the country. 

Bottom line: I'm no fan of FR.to. I'm neutral on WPM. I've been warning you all about the impending death of Primero since the time it was a multiple dollar priced stock. Set those aside however and looking at today's deal without any background and I have to say that it's a good one. Long-term P shareholders were likely resigned to their fate anyway, near-term spec traders will hi-five everyone in the office today, WPM directors will be happy about securing revenue flow again from San Dimas. The question mark has to be over the head of FR.to, as even though the terms of the deal are reasonable they have the mid-term things to prove. San Dimas has been a money pit over two separate cycles, it's up to them to stop it from it happening a third time.

PS: The bottom bottom line: Learn how to read a balance sheet.

PPS: The Primero Mining homepage, right now:



Oh dear.




1/11/18

Peru declares state of emergency in the South region "copper corridor"

As per the announcement in the official government gazette El Peruano this morning, the near-500km road and train transport zone in the South of Peru that connects Apurimac, Cusco and Arequipa has been declared under a state of emergency. This is extra powers to the police force (and potentially army) to quell any protests against copper companies in the zone, particularly road blocks by locals protesting against the amount and frequency of heavy trucks trundling past their doors 24/7 and kicking up inordinate amounts of dust. The main mine in this zone is MMG's Las Bambas, which has been rubbing locals up the wrong way since it started operations. Also in the zone are Antapaccay, Constancia and other smaller outfits.

This move comes at the same time as Reuters reports the government is considering a U$2.4Bn investment for a rail track that would connect the copper producing zone around La Bambas to the coast. A good idea in theory, but it's just the type of pie-in-sky BS you get from Peruvian executives with no idea how to solve a problem. Even if it happens, you can bet on multiple years of studies and delays and whatever.

More Michael Ballanger lolz

Your title is:


And here's an excerpt for your dee leck tay shun:
The purpose of the requisitioned meeting is to remove from office all of the current directors of GEM and to replace them with three highly qualified nominees: Mr. John W. Barr, Mr. Michael Ballanger and Mr. Campbell Smyth (the "Nominees"). The concerned shareholder believes that the current board of directors and management of GEM have consistently failed to act in the best interests of the company and its shareholders. Now is the time for the company to have the management that is aligned with shareholders to ensure the preservation of value for its shareholders.

Can you imagine how bad the current management is if a guy like the self-serving sociopathic idiot savant Ballanger is "more aligned with shareholders"? Sheesh, you'd have to be really but REALLY dumb to own shares in GI.v, in fact...ah, Ballanger owns a million. Worth two cents each. Bless him.

Gracias reader J for the heads-up

4q17 production results digested

How's the market reacting to the swathe of 4q17 production numbers released pre-bell today? A few five day charts of a few examples and to be fair to all*, in ticker alphabetical order:

Alamos sucked. That shouldn't have been a surprise, though

Yamana came in well. The low barrier syndrome.

B2Gold popped and retraced quickly on what I thought were good-not-great numbers (the production beat no surprise), which is fair enough.

The market shrugged its shoulders at Kirkland Lake. Me too.

Nevsun wasn't impressive.

Pan American Silver was impressive and probably deserves more than this pop/drop.


As noted in the pre-open post below, Wesdome put in a good quarter and is getting the love it deserves this morning. Best reaction of them all.


*Which is extremely unusual for me. It must be the bourbon on my cornflakes this morning.

Strong quarter from Wesdome (WDO.to)

There'll be more charts...



...where this one came from on Sunday, subbers.

1/10/18

A Wednesday musical interlude: David Bowie; Space Oddity

Two years ago today. My word, how time flies.




A brilliant piece of music. Youtube here.

What happens next at Rye Patch

And what happens to a strapped for cash junior just after a share rollback? Anyone? Ideas?


VANCOUVER, Jan. 10, 2018 /CNW/ - Rye Patch Gold Corp. ("Rye Patch" or the "Company") (TSX.V: RPM; OTCQX: RPMGF; FWB: 5TN) announces that the TSX Venture Exchange (the "TSX-V") has approved a proposed share consolidation by the Company (the "Share Consolidation") on the basis of one (1) post-consolidation common share for every 6.5 pre-consolidation common shares.

Don't say you weren't warned.

B2Gold (BTG) (BTO.to) and Cormark: Four things

Four things about Cormark and analyst Richard Gray's call to make B2Gold (BTG) (BTO.to) a 'Top Pick' this morning (and raising the target price from C$6.25 to C$6.75)::

1) Here's a bit of the intro:
Upgrading To Top Pick
Fekola is a transformational asset and given the strong track record of the operating team and the history of successful ramp ups at B2Gold, we have confidence that the Fekola ramp up will continue to go smoothly and that investors will be rewarded over the next 3-6 months as free cash flow turns positive and the asset can show off its high margins. Currently trading at 1.06x NAV and 5.6x CF, B2Gold is our preferred name in the sector and we are upgrading the stock to a Top Pick rating (from Buy).
2) Gray seems keen on getting in front of the Q4 production results news release, coming very soon. From what this desk has picked up, that's a smart decision.

3) This is my fave bit of the Bloomie wire note that's out on the call:
"In the past seven years and 10 months, Cormark has rated B2Gold buy three times and market perform twice. The shares were flat in the periods rated buy and rose an average 160 percent in the periods rated market perform."

4) However, this time Gray is right and what's more, right for the right reasons. His zeroing in on the NAV multiple in the note's intro means he's got it. BTO is cheap today and the only issue is that it's been that way for months, with nobody noticing.

In light of the China/US Treasuries news...

...doing the rounds this morning (e.g. here) and its potential effect, IKN repeats on gold's main influence: Don't watch the dollar price, watch TIPS. Two different things and if this new news starts gaining real market momentum (not just a 24 hour flash in the pan), you'll get to see why.
 

1/9/18

The US Dollar

And here we are again:

All I need now to buy the USD versus other currencies is my favourite contrary indicator to pipe up and tell us the Greenback is about to crash and burn. It shouldn't be long now, these dumbasses are like Swiss watches.

Meanwhile and as a bit of a non-seq, reader SB gave the heads-up to this. Which is fun. 



Osisko Gold Royalties (OR.to): Devils, details, things like that

What is it about this morning's NR from Sean Roosen's latest plaything, Osisko Gold Royalties (OR.to), that irritates me so much? It might be because I'm a curmudgeonly bar steward at the best of times, but I don't see why the dude feels the need to smudge, fudge and spin the numbers on his obviously successful company in order to put it in the absolute mega best light possible. 

The main point of the missive (except perhaps to try and prop up a share price that's dropped 15% in the last quarter) was for OR to toot its horn on the Aurico Metals deal, as now that Centerra has bought that one out, the OR position has realized strong gains. All fair enough, but when my eye got to the table presented at the bottom of the NR there was one line that caught it most:


Yeah, that "Other", down $16.3m or so. WTF?

Now if I were a shareholder of OR I'd be really but REALLY interested in the contents of "Other" and why it was down this much, but instead of line items we get a whitewash. And once that had caught my beady little eye, the "3" note at the top of the chart got it too, so it took about five minutes of rootling around the interwebnetpipes to see that the $411m in "current" value is only around $402m today January 9th 2018 if you want to be really current. Which is what OR wanted to do, what with all the Aurico Metals horntootin' an' falutin' in paragraph one.

My annoyance about this OR NR isn't about OR itself, undoubtedly successful to date and run by one of the smartest and feared/respected dudes in the industry. It's more about the way the Canadian mining industry feels is has, at all costs, to pretend they're "killing it" ay any given moment and the slightest weakness or imperfection must always be swept under the carpet. Perhaps that's why the blow-ups, when they happen, are as spectacular as they are. So c'mon Sean, tell us what's in "Other" and give us the respect you demand from us, too. Full transparency won't hurt you, in fact unless you're deliberately courting the mouthbreather end of the marketplace it'll make you look a lot better in the eyes of the world.

New Gold (NGD) this week

Without sticking my neck out too far or risking the proverbial pie in the face in a few days' time, I think it fair to surmise that...


...the market isn't going to like New Gold's (NGD) 4q17 production numbers when they show up.

Gold needs dollar weakness to rally further (from IKN451)

The trading in the two days since IKN451 came out confirms this view, too. It was a short note to kick off the edition, here it is:

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Gold needs dollar weakness to rally further
Today’s intro is quick and simple. What the TIPS chart is telling us is also simple:




Unless this time is different and unless real interest rates in the USA drop to 0.4% (on the 10 year TIPS, our preferred benchmark), we’re not going to get much more of a rally in gold in these first days of the year. But the good news is that it’s looking more likely that we’ll get that sort of scenario, just not immediately. With the Fed apparently keen set on raising rates perhaps three times in 2018 (dot plot dixit) unless inflation does what the Fed wants it to do and starts rising we start looking at a zero or negative real interest rate scenario. That’s what will show on that chart above and if it does, my U$1,400/oz gold (plus U$20/oz silver) predictions should be set fair. Just not in January. Trade on, guys.


1/8/18

Garibaldi (GGI.v): The curious case of the missing assay results

Follow the bouncing ball, ladies and gentlemen:
  1. October 13th 2017: Holes 1 to 12 at the Garibaldi Resources (GGI.v) "Nickel Mountain" project completed. Holes 13 and 14 either underway or about to be drilled.
  2. November 20th 2017: Hole 14 completed and photos published*, but assays still pending (which means of course that 13 was done by then too). 
  3. December 6th 2017: Hole 9 assay reported
  4. December 8th 2017: Hole 14 assay reported

But since then, ladies and gentlemen? Nothing. Not a single NR from GGI on any subject, let alone drill results. Not a sausage. Nada, zero zip cicadas crickets and yep, your logic does not go awry, the holes were indeed drilled in numerical order. Therefore to be clear on what we've had from GGI in the last month or so by way of assays and in order of their completion...
  • Hole 9: Assay reported a month ago
  • Hole 10: Pending
  • Hole 11: Pending
  • Hole 12: Pending
  • Hole 13: Pending
  • Hole 14: Assay reported a month ago
And we know that at least to hole 12 they were in the box 88 days ago. Any ideas as to why holes 10 to 13 are so delayed, kind reader? If you have a thought, IKN suggests you pop it on a postcard and send it to the following address:
Department of Material Disclosures
BCSC
Vancouver
Canada


*Yeah you got it, this was the NR that got the mouthbreathers all jizzed up and the BS hype started.

Part Deux of "The performance of major gold mining companies, February 29th 2016 to date"

The first installment of this list came in July 2017 in this post (and for the record, the Feb 29th 2016 date is chosen because that's the day David Garofalo became CEO of Goldcorpse (GG). So as we're nearly six months on from that, it's a quiet Monday and I'm slightly bored with watching my screen and the 2c moves in this'n'that, let's see how things have progressed since then using the same stocks as before:

Since Feb 29th 2016, the following mining stocks have done this (notes below):
  • Barrick (ABX) up 6%
  • Agnico Eagle (AEM) up 33%
  • Newmont (NEM) up 48%
  • Kinross (KGC) up 47%
  • Franco Nevada (FNV) up 32%
  • Royal Gold (RGLD) up 79%
We can even add these:
  • Gold and Silver Index (XAU) up 35%
  • Precious Metals ETF (GDX) up 21%
  • Gold bullion ETF (GLD) up 6%
And then, this:
  • Goldcorpse (GG) down 6%

NOTES
Back in July GG was down 10%, so that's better. Or less worse. Still crap though and we note the "underweight" called and U$12 target on GG made by Peter Ward of Renaissance Macro Research was indeed hit late last year, so well done to him.

Notable deterioration in ABX, which was up 20% in July 2017 and is now up just 6%. It's not just GG that's a crapsville gold name these days.
AEM was 36% in July, now up 33%. Ho hum.
NEM was up 42% in July, now up 48% and motoring on as the world's number one goldie these days. Definitely the horse to have backed in 2017 among the tier one names.
KGC was up 42%, now up 47% so similar decent performance to NEM.
FNV continues to impress, it was up 21% and it's now up 32%. The world's best run precious metals stock.
RGLD was up 84% in July and has slipped a few points, now up 79%. Still darned good for a goldie, though.

As for the indices, not much change in the XAU or GDX, but the gold bullion ETF (GLD) was at +1% in July and is now +6%. In other words, any gold mining stock not up 5% in the last six months is lagging gold.



on February 29th, 20


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I'm beginning to truly appreciate cryptocurrencies as time saving devices

Cryptocurrencies are making my life more efficient and for that I thank the new growth and interest in the sector. To be specific, I love the way they are taking over waste of space junior mining companies and changing them into crypto companies of all shapes and sizes. The way they are thinning out the numbers of explorecos on the TSXV is a wonderful thing for me, I have less crud and mediocrity to worry about and don't have to dedicate as much time to filtering out the utter dogs that should have been given the humane bullet years ago.

The latest, out a few minutes ago:
January 08, 2018 08:35 ET

Malbex Resources to undertake Change of Business to Merchant Banking with a focus on the Cryptocurrency and Blockchain Sectors



TORONTO, ONTARIO--(Marketwired - Jan. 8, 2018) - Malbex Resources Inc. ("Malbex" or the "Company") (TSX VENTURE:MBG) is pleased to announce that it has entered into a non-binding letter of intent dated January 8, 2018, to complete a change of business transaction (the "Transaction") pursuant to the policies of the TSX Venture Exchange (the "Exchange") with Samara Capital Inc. ("Samara") and become a merchant banking and financial advisory company focused on the small-cap market, with investments in cryptocurrency and blockchain sectors (the "New Business").
Under the proposed Transaction, the Company intends to etc etc



The IKN Weekly, out now




IKN451 was sent to subscribers last night and I forgot to press publish on this post. Words and things.

1/6/18

The #stablegenius hashtag on Twitter is too much fun

Right here. Thank you reader TR for the heads up.

PS: Dear subbers, if the weekly arrives late tomorrow I'll...err...make up some sort of excuse.

1/5/18

The Friday OT: Chocquibtown; Hasta el techo

Get your tropical heatwave on with the Colombian mega-trio.



It's high summer this end of the world and we down here watch in amusement as you up there wrap youself in layers of things. Al we listen to Chocquibtown all day. Youtube here.

Tough to find value in the market today

Instead of posting blather and nonsense on the blog, I've spent a decent slug of this week away from the screen and purposely doing other things. However, when at the desk I've also been doing a bit of a New Year's inventory on my own brain, checking out many mining stocks I don't own, trying to find a bargain and shake up my own entrenched thoughts about them. The results aren't wonderful:
  • There are mining stories that are priced to perfection. Sorry not interested in stock picking to to rise and fall with the tide, if I want that I'll buy GDX and go fishing.
  • There are a whole bunch of hyped-up dogs. This is of course that special time of year when your friendly neighbourhood agenda-laden market shark will give you that special piece of free advice on stock XYZ (and jeesh Casey Research laid it on strong yesterday, sucking deeply at the throbbing member of the Vancouver show by getting its flock into overpriced names run by their special friends).
  • There are another bunch of Value Traps, which look decent enough for their price on paper, but trade like molasses and offer no exit strategy (or width if you want in/out at the day's price). And hell's teeth, I own too many of them already.

But by dredging and trawling the sea floor of the Canadian markets this week I have come across one stock that interests me enough to make a decent feature of it this weekend in the weekly. Run well, tight share structure and most importantly, doing the right things in the right places at the right time. And though even now, midday-ish Friday, I'm still not sure whetherI'm a buyer next week, i have owned some shares in it before so have some idea what I'm letting myself in for if the trigger gets pulled. The numbers are done, what's left is to write up the note and that will keep me out of mischief and sunlight this weekend.

1/4/18

There will be no posts on this blog today

For secret reasons.

1/3/18

What I most liked about Rye Patch Gold's (RPM.v) NR this morning...

...wasn't the the phrase, "...our priority is the reduction of this debt", which makes it sound like they have a choice in the matter:

VANCOUVER , Jan. 3, 2018 /CNW/ - Rye Patch Gold Corp. (TSX.V: RPM; OTCQX: RPMGF; FWB: 5TN) (the "Company" or "Rye Patch") reports that in December, 2017, the Company completed its US$4.0 million principal repayment and paid US$609,000 in interest pursuant to its credit agreement with Macquarie Bank Limited. An aggregate of US$5.1 million in principal repayments was made in 2017, reducing the outstanding principal balance to US$21.8 million. The credit facility was used in the construction and re-start of the Company's flagship Florida Canyon mine in Pershing County, Nevada.
"Now that the Florida Canyon Mine is up and running, our priority is the reduction of this debt.  With approximately 20% of the outstanding balance already repaid in 2017, and with repayments scheduled for 2018, the majority of the credit facility is forecast to be repaid by year's end," commented William C. Howald, the Company's President and CEO.

Nah, the best bit was the way in which they forgot to mention just how they're going to pay down the debt. That'll be with the dilutive placement coming soon. More likely placements with an S.

SolGold (SOLG.L) (SOLG.to): Here's how I put it...

...to a mailpal who asked for a thought or two on the Maiden Resource Estimate out of the company today (NR here). The only thing I forgot to add was my throughput assumption of 80,000tpd, but he knew that one already. Mail reproduced verbatim.

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The 120mt high grade gives 4 years of feed.

Assuming reasonable things ($3/lb copper price, 85% overall recoveries incl gold portion which will be lower than copper recovery), the 1.8% CuEq core gives "rock worth" of U$101.2/tonne....let's call it a hundred.

Therefore, that high grade core is worth U$12Bn.

Capex estimate $5Bn. Overall margin estimate 50%.

The capex is paid by the hi grade with a billion to spare in less than four years. Then the rest is gravy, and we're talking literally decades of gravy, even without the next porphyry drilled at Cascabel.

This is a solid maiden resource.
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1/2/18

Gold at U$1,321/oz is about as high as it goes, unless...

...TIPS drops soon.



It's not about the dollar, it's about what the dollar can do for you. The less its yield, the more attractive the monetary metal. QED.

Sandstorm 4q17 sales coming...

...very soon. And should be a beat, too.

Chart of the day is...

...fifteen years of zinc:

FWIW, this humble corner of cyberspace was the one that pooh-poohed the incessant calls for rising zinc prices all the way through that flat period, 2009 to 2015. However, we also changed position and went bullish on the metal in May 2016, just before the time it finally got its act together and crossed through the $1/lb for the last time. And if you'd followed me into Zn play Tinka Resources (TK.v) at the time (then priced around 20c) your portfolio would be doing pretty well, too. Just saying.



My secret weapon

When you're a value investor and a company analyst in the mining sector, you need to remain focused on the subject at hand but at the same time, there's no way you can ignore the big macro picture and trends in the things that move all mining stocks back and forth (e.g. you can be exactly right on your interpretation of any gold miner, but if the metal drops $100/oz out of the blue you are going to be plain dead wrong with your target price call). The problem is that there macro is a big subject, spend too much time on it and you're left with none to do your own thing.

The solution is to have a secret weapon, someone who is smart, trustworthy, approaches the market with your level of skepticism, has been around the block a few times BUT instead of doing what you're doing, covers the macro in a weekly missive that you can digest at your leisure then feel up to date about what's going on in the wider world of money. That's what I've enjoyed by being a reader of Notes From The Rabbit Hole every week for the past nine years. The best value letter out there, get your back covered too.

For the record, this post is unsolicited. I receive nothing from anyone for reco'ing Gary Tanashian's most excellent service. Gary and I have swapped our weekly letters on a quid-pro-quo basis for many years, he pays me nothing and I pay him nothing. The benefit I get from this post is the reflected kudos of (hopefully) getting more people to subscribe to his letter and remembering me for the reco.

1/1/18

The IKN Weekly, out now




IKN450 has just been sent to subscribers. Woof.