Gold Road bidding for 400kozpa Canadian Project Stake

LME has banned Russian metal following sanctions imposed by the US and UK

April 15, 2024

G’day GC #

The Pre-Start

  • Gold Road has confirmed its interest in the sale process of a 40% interest in Canadian Greenstone Gold Mines from Orion (GOR). The project is 5.5Moz at 1.27 g/t Au (400kozpa for the first 5 years) and is in the commissioning phase. Another non-controlling JV interest for the mighty GOR!

  • Predictive Discovery shared its Bankan Gold Project PFS, underpinned by a maiden ore reserve of 3.05Moz. The “Ore Reserve Case” produces 256kozpa at US$1,129/oz AISC. DFS planning is underway (PDI)

  • Emerald Resources declared its bid for Bullseye ‘best and final’ in what seems like the world’s longest takeover ever (EMR)

  • Piedmont Lithium has received mining permit approval for its Carolina lithium Project, which it applied for in August 2021 (PLL)

  • Talga completed its Vittangi anode project FEED study, which has seen the capex requirement rise 14% from the 2021 DFS (TLG)

  • KIN Mining and PNX Metals have shared merger documents, with PNX shareholders to receive 1 KIN share for every 13 PNX shares held (PNX)

  • Tigers’ Realm says it will sell its Russian assets given challenges complying with sanctions (TIG)

  • Southern Cross Gold reports infill results of 473m at 1.7g/t AuEq (gold and antimony). No point looking at the internal intervals, most of this will need to be mined as a single block (SXG)

SXG infill drill results

SXG infill drill results

  • Galan has entered a trading halt pending an update on government permitting (GLN)

High Grade It

  • Closure costs at Rio Tinto’s Argyle diamond mine have ballooned out nearly 50%, to roughly $850m, with $300m spent as of last December (The West)

  • Bullish copper bets on the LME reached a 6-year high, with processing fees falling below zero, though some traders caution over soft refined-metal demand (Bloomberg)

Copper processing fees fall below zero

Copper processing fees fall below zero

  • Hedge funds boosted their bullish bets on Brent crude to their highest level since October 2021, as geopolitical risks escalate (Bloomberg)

  • Australian mining and manufacturing industry leaders are lobbying to include regional mineral processing hubs support in Albanese’s “Future Made in Australia” program (The Australian)

  • The LME banned new Russian metal but is braced for a flood of old stock, following sanctions imposed by the US & UK (Bloomberg)

  • China’s iron ore imports in March inched higher year-on-year while exports of steel products hit their highest level since July 2016 (Reuters)

  • Gold has extended its run, lifting to US$2,400/oz, with geopolitical risks and debt concerns widespread (Mining.com)

  • $26 billion is missing amid Indonesia’s crackdown on corruption in their tin mining industry (ABC News)

  • USA and Japan committed support for the Philippines’ civil nuclear energy program (GMA)

Wheelin’ n Dealin’

  • Gold Road Resources is rumoured to be eyeing a 40% stake in the Canadian Greenstone Gold Mines from Orion (The Australian)

  • Woodside surprised suitors by pulling its domgas assets, Macedon and Pyrenees from the market (The Australian)

  • Amid a live, hostile takeover, Sierra Rutile has stated they will explore a sale of Sembehun to maximise shareholder value (SRX)

New Targets Statement for SRX

We were initially harsh in evaluating the SRX Board but admit their response has been remarkably strong under testing conditions

Rattlin’ the Tin

  • ASM raising $13m via a placement and also conducting an entitlement offer to raise up to a further $5m (ASM)

  • Galan probably hoped this would slip past everyone with a late Friday release… They’ve got a $15 million ATM facility in place now. These facilities have typically not had great outcomes for shareholders (GLN)

  • David Flanagan-led Arrow Minerals has raised $13m across two placements to fund the acquisition & exploration of the Simandou North Iron project (AMD)

  • Lake Resources reminds shareholders that Thursday is their last chance to buy shares for 7c in the SPP while their share price is now 6.2c! (LKE)

  • Minbos Resources has received credit committee approval from the IDC for a US$14m debt facility, whilst an equity raising progresses (MNB)

Word on the Decline

With the latest gold M&A scuttlebutt in the Dataroom column, we think it’s worth pointing out the third sentence in the article:

It is believed that should Australian-listed Gold Road buy Greenstone, it would be accompanied by a monster capital raising.

The Australian

If you’re wondering where the leak came from, this sentence is a good place to look. In banking, we have seen deals that were close to ‘done’ fall apart because they were leaked and the share price started baking in an equity raise. For example, IGO would have ended up owning CSA had the deal not leaked and its share price bled 15% in short order. In sale processes, sometimes the party with the 2nd best bid has the most incentive to rock-the-ship…

Last year’s article from The Australian talked about Evolution and Northern Star being the likely candidates for the stake in Greenstone, though the article then went on to talk all about Ramelius 🤔 (The Australian)

In the Weeds

  • The IEA has criticised Europe for falling behind China & the US after making “two historic monumental mistakes” in energy policy, by relying on Russian gas and turning away from nuclear power (FT)

Today’s Top Tweet

Admittedly the Save Canadian Mining campaign aims to prevent the prevalence of naked short-selling in Canadian markets - which ASIC has banned over here. But we can’t help but agree with all of the above points.

Devil’s in the Detail

Open-ended question here… If a Director uses some shares in their company as collateral to take out a loan, what does the trail of disclosure look like if the loan defaults? We have noticed a few of these arise in recent times. Initially, the Director has to show shares being transferred to a third party. What happens if they default on the loan? Is there further disclosure required? Or could this be a way for Directors to sell their shares without showing an on-market sale? We don’t have the answer to this ourselves yet.

Disclaimer

All information in this newsletter is for education and entertainment purposes only and is of general nature only. The hosts of Money of Mine are not financial professionals. Money of Mine are not aware of your personal financial circumstances. Before making any investment decision, you should consult a licensed financial, legal or tax professional, along with considering any relevant Product Disclosure Statement. Money of Mine does not operate under an Australian financial services licence and relies on the exemption available under the Corporations Act 2001 (Cth) in respect of any information or advice given. Money of Mine strives to ensure the accuracy and currency of the information contained in this newsletter but we do not make any representation or warranty that it is accurate, reliable or up to date. Any views expressed by the hosts of Money of Mine are their opinion only and may contain forward looking statements that may not eventuate. Money of Mine will not accept any liability whatsoever for any direct, indirect, consequential or other loss arising from any use of information in this newsletter.

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