Oreninc Index – Monday, July 24th, 2017

Nulegacy Gold (TSXV: NUG) discovered a new structural exploration target with the same geological characteristics as its Iceberg gold deposit in Nevada, USA.

Castle Silver Resources (TSXV: CSR) provided an exploration and corporate update as it ramps up drilling at its Castle cobalt-silver property in Ontario, Canada

Zinc One Resources (TSXV: Z) entered into a five-year surface access agreement to permit surface access for exploration and development work on the Bongará and Charlotte zinc-oxide projects in Peru.

Meet us in Vancouver: Oreninc CEO Kai Hoffmann is in Vancouver this week. If you are planning or thinking of a financing this fall, contact us at [email protected]. We want to talk to you.

The Oreninc Index fell in the week ending July 20th, 2017 to 20.33 from 30.12 the previous week as the summer doldrums saw financings dry up to a trickle. There has been more closing action than openings announced in three of the last four weeks.

Total fund raises announced fell to C$20.0 million, a 28-week low, which included no brokered financings—also a 28-week low—and no bought-deal financings. The average offer size fell to C$1.0 million, a 28-week low, whilst the total number of financings announced fell to 19, a two-week low.

Relief may come as the week ahead sees the Sprott Natural Resource Symposium in Vancouver, which could stimulate appetite for more junior financing action.

Gold continued to recover closing at US$1,255/oz, up from US$1,228 the previous week as the US dollar index hit a 10-month low mid-week.

The strengthening gold price as seen the van Eck managed GDXJ strengthen too and is now up 5.0% so far in 2017. The inventory of the SPDR GLD ETF has not yet experienced this growing confidence however and closed the week down at 813 tonnes from 828 tonnes the previous week.

In other commodities, silver is also strengthening to close at US$16.51 from US$15.99/oz the previous week. The Comex copper price also had a better week to close at US$2.72 per pound up from US$2.69 the previous week. Oil had an up and down week to close down slightly at US$45.77 per barrel down from US$46.54 last week.

The Dow Jones Industrial Average finally had a losing week closing at 21,580 from 21,637 the previous week. Canada’s S&P/TSX Composite Index, however, showed slight growth closing at 15,183 from 15,174 the previous week. The S&P/TSX Venture Composite Index also showed slight growth to close at 760.88 from 757.52 the previous week.

Summary:

• Number of financings decreased to 19, a 2-week low.
• No brokered financings were announced this week, a 28-week low.
• No bought-deal financings were announced this week, a seven-week low.
• Total dollars lowered to $20.0m, a 28-week low.
• Average offer size again fell to $1.0m, a 28-week low.

Major Financing Openings:

• Transatlantic Mining (TSXV: TCO) opened a C$5 million offering on a best efforts basis. Each unit includes a warrant that expires in 12 months.
• Sarama Resources (TSXV: SWA) opened a C$2.5 million offering on a best efforts basis. The deal is expected to close on or about August 3rd.
• Umbral Energy (TSXV: UMB) opened a C$2.04 million offering on a best efforts basis. Each unit includes a warrant that expires in 24 months.
• Westminster Resources (TSXV: WMR) opened a C$1.5 million offering on a best efforts basis. Each unit includes half a warrant that expires in 12 months.

Major Financing Closings:

• Alio Gold (TSXV: ALO) closed a C$50.39 million offering underwritten by a syndicate led by Cormark Securities on a bought deal basis. Each unit included half a warrant that expires in 12 months.
• New Pacific Holdings (TSXV: NUX) closed a C$44.1 million offering on a best efforts basis.
• Lithium Americas (TSX: LAC) closed a C$42.5 million offering on a strategic deal basis.
• Northern Vertex Mining (TSXV: NEE) closed a C$26.92 million offering on a strategic deal basis.

Company news

Castle Silver Resources (TSXV: CSR) provided an exploration and corporate update as it ramps up drilling at its Castle cobalt-silver property in Ontario, Canada

• An 82kg sample of vein material from the first mine level returned an assay of 1.48% Co, 5.7 g/t Au and 46.3g/t Ag.
• Phase I drilling is underway and has been expanded from 1,500m to 2,000m in about 20 holes
• Surface sampling at the Beaver property is underway
• Castle also closed a private placement for C$882,500 by selling 4.4 million units @ $0.20.
• Each unit comprises one share and one warrant exercisable @ $0.30 for two years.

Analysis

The cobalt and gold values from the underground bulk sample support the hypothesis that the former silver mine has much more potential waiting to be discovered with cobalt and now gold within the sightlines. Castle has raised nearly C$2.6 million since March and is fully-funded to advance its business plan for its mineral properties and investigating the use of its Re-2OX process for recycling batteries.

Nulegacy Gold (TSXV: NUG) discovered a new structural exploration target with the same geological characteristics as its Iceberg gold deposit in Nevada, USA.

• The Western Slope anomaly is about 1km west of Iceberg and was initially identified using the CSAMT (controlled source audio-frequency magneto-telluric) geophysical surveys.
• It is interpreted to be similar in length and parallel to the Iceberg fault, the major northwest striking fault that controls the gold mineralization for the Iceberg gold deposit and that are a key structural component of most major gold deposits in the Cortez-trend.
• The Western Slope anomaly is interpreted to have similar size potential as the 3,000m of gold mineralization identified over the Iceberg fault.

Analysis

The Western Slope discovery supports the company hypothesis that its properties host Carlin-type gold deposits that occur in clusters and stacks. As such it represents an exciting drill target, with drilling expected following further analysis of the geophysical and geochemical data, and development of a 3D model.

Zinc One Resources (TSXV: Z) entered into a five-year surface access agreement with the Comunidad Campesina de Yambrasbamba (CCY) to permit surface access for exploration and development work on the Bongará zinc-oxide mine and Charlotte Bongara zinc-oxide project in Peru.

• Zinc One will immediately commence updating the environmental baseline study that is a key component of drill-platform permit applications that are planned to be filed during Q3.
• Drilling is expected to commence in August.

Analysis

Land access and community agreements are a prerequisite for exploration in Peru and so achieving this should facilitate the company’s efforts to define the zinc potential of the project.