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10/31/19

More cost creep in the pipeline for Mexico's mining companies

Better known to the world as "Napito", congressional senator for Mexico's ruling Morena party and (in)famous in the mining world, Napoleón Gómez Urrutia, this week presented a law bill to Mexico's parliament that will place more stringent rules on third-party sub-contracting of labour. If passed, any law that requires the third party companies to fully comply with existing labour laws (e.g. provide medical coverage/pension/profit sharing to workers) as if they were the end company and would put an end to the use of third party contractor groups if they do not comply with the law, as well as clamping down informal and illegal third party companies. 

As third party contracts are a popular strategy in the mining industry (simple reason; much cheaper), any progress in this law should be watched by the sector.

Sandstorm (SAND) on Friday and today

This humble corner of cyberspace picked out SAND from the pack on Friday as it went into "quiet achiever" mode. Since then...


Further questions?


UPDATE: Over at his place, Gary Tanashian has been thinking about SAND today as well. 

Pretium (PVG) and the gold bull run, June 2019 to date


10/30/19

Ely Gold Royalties (ELY.v): The lady doth protest too much, methinks

This isn't the first time Ely Gold Royalties (ELY.v) has used paid promotion of course, they handed over a five figure cheque larger than the $30k mentioned below to Mickey Fulp back in 2018. But what's really hilarious here is how ELY hires a known promo pump and dump boiler room operation, gets all the lift as the idiot sheep pile in, then feigns indignation by pretending not to know the NIA modus operandi. Your NR:

Vancouver, British Columbia--(Newsfile Corp. - October 30, 2019) - Ely Gold Royalties Inc. (TSXV: ELY) (OTCQB: ELYGF) ("Ely Gold" or the "Company") is issuing this press release to address concerns raised by the TSX Venture Exchange (the "Exchange") regarding certain promotional activities.
In July 2019, the Company engaged National Inflation Association of Fort Lee, New Jersey ("NIA"), and Maiella Investment Holdings LLC, (collectively, the "Consultant") to provide investor relations services, including the production and publication of investor bulletins on the Consultant's https://inflation.us website, distribution of investor bulletins to the Consultant's e-mail list, and promotional posts via the Consultant's blogs and social media accounts (collectively, the "Agreement"). The Agreement was not filed with or accepted by the Exchange. In consideration of the Agreement, the Company paid the Consultant a one-time cash fee of US$30,000 for a 6-month contract.
The Company is retracting fifteen NIA articles dated August 1, 2, 5,19 and 30, as well as October 1, 22, 23, 24, and 28 in their entirety. These publications contained overly promotional statements inconsistent with the principles of factual and balanced disclosure pursuant to Exchange Policy and share price targets, revenue and other financial forecasts that failed to comply with National Instrument 51-102. While the Company does believe certain underlying factual information and technical analyses in the Consultant's publications were accurate, the Company does not endorse the share price, revenue and other financial forecasts that have been published by the Consultant and regrets not having exercised greater control over the manner and means by which the Consultant provided its services.
In light of these concerns, the Company has terminated its Agreement with the Consultant effective October 28, 2019. In addition, the Company has requested that the Consultant take down the online publications listed above and not publish any additional information, regarding Ely Gold.

And here's a price chart:

Southern Copper's (SCCO) Tia Maria copper project has its permits ratified

After the review by Peru's Mining Council of three aspects of its construcyion licence, today the SCCO Tia Maria copper project in the Islay coastal region of South Peru has had its permits ratified and greenlighted.

And now expect trouble.


Almaden Minerals (AMM.to) (AAU) understands the IKN First Law of Mining NRs

Your reminder of the Law:

"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."

And now, Almaden takes it to high levels:
VANCOUVER, B.C. Almaden Minerals Ltd. (“Almaden" or the "Company"; TSX: AMM; NYSE American: AAU) was today notified by SEMARNAT, Mexico’s environmental authority, that the permitting process for the Ixtaca project has been suspended pending resolution of the mineral title lawsuit reported by the Company on September 10 and April 15, 2019 (the “Lawsuit”). 

Under the Lawsuit, certain organisations have supported legal challenges against the Government of Mexico and the Mexican mineral title regime using the Company’s mineral claims as a basis for their challenges. The Lawsuit contends that the issuance of Almaden’s original mineral titles violated human rights and did not respect Mexico’s commitment to indigenous consultation under United Nations Instrument ILO 169. 

Almaden’s original mineral claims, which totalled approximately 14,000 hectares, were granted many years ago in full compliance with Mexican law and in the same manner as all existing mineral titles in Mexico. In April, 2019, a Lower Court in Puebla State ruled that the Mexican mineral title system is unconstitutional and as a result these original mineral claims should be held exclusively for Almaden until such time as consultation can be completed. This Lower Court decision has now been appealed by the Mexican Congress, Senate, Secretary of Economy and Mining authorities, as well as Almaden as an affected party. The Lawsuit remains before the Courts. 

Although the Company understands that SEMARNAT’s mandate is restricted to the review of the technical merits of the environmental permit application, on October 4, 2019, SEMARNAT requested the Lower Court in Puebla to provide information on the Lawsuit. Almaden has reviewed the report provided by the Lower Court to SEMARNAT, which informs SEMARNAT that the purpose of the decision is to protect the complainant’s agrarian rights and lands, in order that the complainant is not affected by the mining concessions or possible mining activities. The complainant is a community of about 150 people, located well outside of the Ixtaca project impact area.

Having reviewed the Court’s response to SEMARNAT, on October 24, the Company submitted a writ to SEMARNAT in part to confirm that the Company completed the necessary steps to abandon its mineral claims in the area of the complainant in 2017, and has no interest in holding any mineral claims in this area. 

Almaden is studying measures it can take to resolve this suspension.

By the way, there's a reason why they only refer to the complainants as "a community of about 150 people", rather than name the community. That's because their mine project name is "Ixtaca" and the community is called "Ixtacamaxtitlán" and what with the name being the same, it would be that much tougher to BS you friendly investor people with their one-sided guff and nonsense. The locals have been dead set against this project for years and not just because they feel like annoying a bunch of gringos. The town didn't just turn up as Semarnat's door and ask them not to emit the permit, either. Instead they presented 17 technical documents to the Mexican environmental authority that they state as a whole, demonstrate that the mine project is a serious threat to regional biodiversity.

10/29/19

Wesdome Gold (WDO.to) and its 303 Jewel Box

Those that have followed the Wesdome (WDO.to) story over the last couple of years will immediately understand the significance of this news today, entitled "Wesdome Announces Exploration Drilling at the Eagle River Mine Extends the High Grade 303 Lens an Additional 300 Metres Down Plunge and Remains Open". Here's the meat of the NR:
"The Company is continuing to develop the 303 Lens that was initially discovered in 2015. This continued development has demonstrated the good continuity of the gold mineralization up and down plunge and highlights the consistent high grades and widths in the 303 Lens as a result of local folding. The 303 Lens, initially defined from the 750 m-level to 1,000 m-level has now been extended an additional 300m down plunge to the 1,300 m-level, while continuing to illustrate above average widths and grades."
And here's what CEO Middlemiss said about that:
"This additional expansion of the 303 Lens an additional 300 metres down plunge provides an opportunity to mine these high grades well into the future with additional mine development"
Which is an impressive understatement, when you consider that the 303 zone has been the reason WDO has recently run at over 100k Au/year at Eagle but was only expected to affect some quarters of 2020. Not any more folks, Wesdome will produce the freak out of this market if 303 turns into the gift that keeps on giving. As for the price chart, there's a hint that something may have leaked. Freakin drillers, eh...



Argonaut Gold (AR.to) and more negative optics for Mexico mining


TORONTO, Oct. 29, 2019 /CNW/ - Argonaut Gold Inc. (TSX: AR) (the "Company", "Argonaut Gold" or "Argonaut") announces that the El Castillo mine is subject to an illegal blockade.  At this time, leaching and gold absorption operations are continuing and metal production has not been impacted.
The Company has a legal and binding agreement in place with Atotonilco ejido that was signed and recognized by both the Atotonilco ejido and the Mexican government in 2012 and runs through 2022.  The Company understands that certain members of the Atotonilco ejido are seeking to amend the binding agreement in a manner inconsistent with the existing agreement and the law.
The Company is attempting to work with the Atotonilco ejido and the government to resolve this issue in a mutually satisfactory manner.  Argonaut reaffirms its commitment to treat all local ejidos fairly and work with its local communities in an open and transparent manner for the benefit of all stakeholders. 

What they don't tell you about the community landowners (ejido) of Atotonilco is that Argonaut pays them 13,800 Pesos per hectare for use and rights to their land. However, in separate agreements with other ejidos in the area, they pay 17,000 pesos. And that the locals have been riled about this for a long time and threatening to take the action they've now done since August, but AR has just laughed in their face and practically told them "You're the stupid people that signed the legally binding contract, not our fault we pay you less!!" How the ripping off of one set of locals compared to others "...reaffirms its commitment to treat all local ejidos fairly and work with its local communities in an open and transparent manner for the benefit of all stakeholders" is beyond my ken.


Mexico: New taxes on mining concessions in the pipeline

This humble corner of cyberspace is surprised that very few people are talking about the proposed hike in taxes for the mining industry in Mexico in 2020. Here's a section from IKN454, out last Sunday, on the exchange in Mexico's Senate last week:


The National Senate was the place to be when ruling Morena Party Senator Napoleón Gómez Urrutia, the single most powerful Congressional politician in Mexico’s mining sector and known to the world as Napito, used his opportunity to address the floor by proposing a hike in concession upkeep costs (23) and as part of the Congressional debate on the 2020 Federal budget, Napito said that he would present a law project to this effect. In his words, “Why not raise taxes on mining, on the rights for mining exploration, the taxes on mining concessions? It’s shameful that when the 7.5% royalty was imposed, the companies said that they would take their investments elsewhere. How can they take the land of Mexico, the national patrimony, or the mountains or hills or mines?”

If you’ve spotted a populist tone in that, you’re not the only one.  As for the reaction, the leader of the Morena party in Congress, Senator Ricardo Monreal, said the following: “I say to Senator Gómez Urrutia you are right, and it would be correct for us to prepare initiatives that the parliamentary sub-committee will analyze seriously, rationally with (governmental) backing. I believe it is a good proposal. You know the mining sector very well, both you and your father have dedicated your life to this and due to that, your intervention is both sensible and opportune. I am in favour of it.” You heard it here first.

10/28/19

Gold, silver and the S&P500 since Labor Day

Go silver!



The IKN Weekly, issue 544


Swedish beauty


IKN544 has just been sent to subscribers. A massive fail.