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Msg  67433 of 67728  at  5/29/2020 7:14:28 PM  by


Gold Summary - 29th

Gold Summary for May 29, 2020

2020-05-29 18:23 ET - Market Summary

by Stockwatch Business Reporter

New York spot gold rose $11.80 to $1,730.80 on Friday. The TSX-V added 9.15 points to 553.77 while the TSX gold index added 2.75 points to 328.61. Pan American Silver Corp. (PAAS) led the way today, jumping $3.40 to $40.49 on 16.4 million shares. The company hopes to raise $40-million (U.S.) by selling nine million shares of Maverix Metals Inc. (MMX: $6.33).

Michael Cowin and John Mirko's Rokmaster Resources Corp. (RKR) gained one-half cent to 32 cents on 1.12 million shares on word that it has opened an access road to its Revel Ridge polymetallic project in south-central British Columbia. Preparations for a 2020 exploration program are now under way, with the work in support of a preliminary economic assessment planned for later this year. At least 5,000 metres of new drilling are expected, says Mr. Mirko, president and chief executive officer, presumably in the Main zone, and at some of the 44 other gold occurrences along the eight-kilometre-long structure hosting the Main zone.

Rokmaster is a newcomer to the old Revel Ridge prospect, having acquired an option on the property late last year from Huakan International Mining Inc., a long-time Howe Street explorer that took itself private in 2014 with the aid of its Hong Kong backers. Rokmaster agreed to pay Huakan a hefty $44.2-million in cash in staged, exponentially increasing payments over a five-year period. (Only $5.2-million is due within the first three years, so Rokmaster has an incentive to work quickly.)

While the name and option arrangement are new, the hunt for a mine at what Huakan called its J&L property has been running for over 100 years. The project comes with a historical resource estimate, with 4.1 million tonnes measured and indicated in the Main zone, grading 5.67 grams of gold and 54.2 grams of silver per tonne, plus 4.4 million tonnes inferred at slightly lower grades, for a total of nearly 1.4 million ounces of gold and 16 million ounces of silver, accompanied by modest amounts of lead and zinc. Another 1.4 million tonnes, mainly inferred, lie within the Hangingwall, Footwall and Yellowjacket zones.

The project had been the subject of a historical preliminary economic assessment, completed by Huakan in 2012. That dream sheet proposed a nine-year, 1,500-tonne-per-day $264-million mine that would support a discounted net present value of $200-million before taxes. At the time, Huakan's crew cheered the "positive results" of the study as having "provided the impetus" to continue to drive the project forward, but from there, the company looked to put someone else in the driver's seat.

Huakan's previous hunt for a partner is still dangling over the Revel Ridge project like a lawyerly version of the sword of Damocles. While the company did succeed in optioning the property to Golden Dawn Minerals Inc. (GOM: $0.08) in 2017, both companies quickly heard from the private Armex Mining Corp, alleging that it had already reached a deal with Huakan.

The pending litigation chased Golden Dawn into the sunset and the Armex matter is still before the courts, so Rokmaster's arrangement includes a provision that Huakan must get clear title to the property, should Armex prevail in court. Either way, the lawyerly huffing and puffing suggests that the "opportunity to rapidly develop" Revel Ridge, as cheered by Mr. Cowin, Rokmaster's chairman, may be stifled by legalities, not geology.

Greg Lang and Dr. Thomas Kaplan's Novagold Resources Inc. (NG) fell 21 cents to $13.19 on 2.16 million shares on word that J Capital Research, a Beijing-based short seller, has issued what Dr. Kaplan, Novagold's chairman, calls a "sloppy and truly meretricious report." (The Oxford-educated Dr. Kaplan, a historian-turned-businessman, likes big words: Presumably he says "meretricious" in the sense of the report being "apparently attractive, but having no value or integrity in reality," rather than it being "characteristic of a prostitute.")

Either way, Dr. Kaplan huffs that "shorting a cash-rich company with an exceptional asset and intelligent long-term investor base is an iffy proposition at the best of times." (Perhaps, but shorters do prey upon companies that have experienced a tripling of their stock over the past year. Indeed, Novagold hit $18 a month ago and traded at $16.35 earlier this week.) While the report, meretricious or otherwise, was unlikely to garner much attention had Novagold not complained about it, Dr. Kaplan is doubling down on his complaint, promising that a "proper response" to the J Capital report will be forthcoming.

Meanwhile, visitors now sufficiently enticed to visit J Capital's website will be hit with the headline: "J Capital is short Novagold." They will also be teased with an indirect quote from Dr. Kaplan, seemingly equating the company's 50-per-cent-owned Donlin gold project with knowing pornography when one sees it. (The full quote is just as odd as the paraphrased version: "My sense is that the moment will come in a not dissimilar way to the way that Justice Potter Stewart when answered the question, 'How do you define pornography? I can't define it, but I know it when I see it.'") Odd words aside, J Capital claims that Donlin is "not feasible to put into production at any gold price."

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