Lithium and Resolution

Lithium X closes $3.2M private placement. [Junior Mining Network]  The old Howe Street magic still works.   Whether this amounts to anything, the drill & pump (the real one) will soon tell.


Dajin options 60% of Alkali Lake to Southern Sun.  [Stockwatch]  Looks like they want to concentrate on Teels Marsh.  Alkali Lake has closeology value to late comers trying to jump into the Clayton Valley play.


Nevada Exploration Inc. closes $364K raise. [Stockwatch]  They had a run this fall and have taken advantage of it.

NGE


Desert Star gets a drill permit to drill Copper King. [Junior Mining Network]  The project is 5 km from Resolution and they had $1.1M in the bank in October.

DSR


Speaking of Resolution:  San Carlos Apaches are going after Rio & BHP. [Mining.com]  Apparently the Oak Flat campground is a sacred place.

“It is no different to what people can relate to about Mount Sinai,” Apache tribal leader Wendsler Nosie said.

Who knew?


Comstock Mining update on their underground expansion.  [Junior Mining Network]  They had to move the road to Dayton / Carson City a teeny bit but hopefully this transition to underground will mollify the Gold Hill / Silver City folk who are choked about the whole operation.

No open pits

Chinese zombies and the diamond biz

China gets serious about cleaning up their mining industry. [China Mining]

No new coal mines for three years.   … to clear out their stockpile (which must be huuuge).

Top priority for 2016:  Clean out zombie mining and smelting companies.

killing zombies


De Beers responds to Rappaport’s rant.  [Rough & Polished]  Politely of course…  They’re pinning a lot of hope on buoyant holiday diamond sales in which event they see price stability in 2016.


Diamond industry overview. [Zimtu Research]  Mercifully free of any hype for their wanna-be diamond exploreco’s.   Cautiously upbeat with a good assessment of the upside for anyone who finds a new diamond deposit.


Aussies go to pot. [Northern Miner]  … about 20 months after Canadian juniors tried this “Hail Mary” pass.   Good luck boys.

Aussie pot

Financings and DDC

Dominion Diamonds drama.

Two directors quit on Christmas Eve. [CBC.ca] … one clearly conflicted.

Dissident shareholders lay out their demands. [Reuters]  amid the fluff about compensation, investor communications and a possible share buyback; the real end game:

A source familiar with the matter last week said the K2 group plans to ask for several seats on Dominion’s board and will try to put forward its own slate of directors if it cannot oust the miner’s chairman and its chief executive.

DDC board meeting


With pleasant early winter weather in the eastern US and southern Canada, it’s time to make a call and put out a staple news story: In Canada’s far north, warm weather threatens vital ice road. [Reuters]   Goes nicely with the recent Atlantic Monthly piece on the The Storm That Will Unfreeze the North Pole.   

Plus ca change


Capstone mulls a Minto shutdown. [CBC.ca]  Don’t say you weren’t warned.


Nighthawk drops Kim and Cass to focus on Colomac. [Junior Mining Network]  Cash is king and they are conserving it.


Financing news:

Victoria Gold banks $3.6M for Shamrock and Olive. [Stockwatch]

“The high demand for this flow-through issuance has resulted in an increase in the total amount of the financing from the $1.75-million financing, which closed in late November, 2015, to the $3.6-million financing outlined herein. This increased funding coupled with competitive drilling prices will enable us to achieve a robust drilling program on the Olive and Shamrock targets,” said John McConnell, president and chief executive officer.

IDM closes $1.6M raise for Red Mountain. [Junior Mining Network]

Copper North completes its financing & debt papering. [Junior Mining Network]  Raises $150K

Goldbank closes $100K raise for the Klondike. [Stockwatch]

Banyan Gold to raise $250K. [Newswire]


TerraX talks up Yellowknife Gold. [Northern Miner]  Zones and hits aplenty this year but not much new on the ore front:

The only historical, non-National Instrument 43-101 resource estimate on the property exists for the Central zone, which stands at 145,150 tonnes of 7.54 grams gold and drilled to 150 metres deep. 

“We didn’t have a great amount of success on the Central zone [this year], we’ve basically shown that the high-grade lode is pretty discrete, so we didn’t have much expansion,” he says. “But at the South shoot we’ve increased our strike extensions and dip length to 400 metres and 150 metres deep, and there’s more opportunity to expand on that.” 

Felix Annus Novus

Happy New Year

Happy New Year to all (no – that wasn’t an anatomical reference).

A few small changes in store here for the coming year. Some of our members are ranging further afield in these hard times and are interested in news from down south.  We’re happy to oblige but this would make a single posting a bit cumbersome.  Henceforth, we’ll post news in three tranches; general stuff, northern news and southern news.  The latter will cover the Southwest US.

More news might mean less gratuitous commentary but that could be  relief to some readers.

We’re committed to providing prospectors and exploration folk with the straight goods on general mining news; the latest hits and misses by the few hardy explorers still out there; and schemes and dreams on Howe and Bay Street.

Here’s to a better 2016.  May year end find us all smiling again.

DDC and lithium

More on ructions at Dominion Diamond Corp.

Rappaport on the causus belli. [Rappaport]

Toronto-based hedge fund K2 & Associates Investment Management, which leads a shareholder group that together owns 5.4 percent of Dominion’s stock, wrote to Daniel Jarvis, the lead director of Dominion’s board, December 21, claiming the miner’s share price has “suffered unnecessarily as a result of misguided policies and missed opportunities.” The letter lists 10 areas of the company’s operations to which these criticisms apply, including business strategy, capital allocation priorities, project priorities, diamond marketing and compensation practices.

Stockwatch’s Will Purcell.  [Stockwatch]

Robert Gannicott and Brendan Bell’s Dominion Diamond Corp. (DDC) leapt $2.53 to $14.01 on 922,000 shares on word the company will meet with a group of disgruntled shareholders, led by K2 Principal Fund LP, who have voting control over 4.6 million shares. The group includes Carlo Civelli, a Switzerland-based investor, Haywood Securities chairman, John Tognetti, a Haywood broker, Kyle Jason McLean, Eric Sprott’s Sprott Inc. and Patrick Evans, who is chief executive officer of two rival diamond companies: Mountain Province Diamonds Inc. (MPV: $3.90) and Kennady Diamonds Inc. (KDI: $2.91).

The investors have a reason to be unhappy of late. Dominion’s stock briefly dipped below $10 earlier this month after having traded at $24.60 in June. The slump is not unusual as most diamond miners experienced similar drops. (Mr. Evans should be well aware of that: Kennady’s stock, just $2.35 earlier this month, had traded as high as $6 at the end of May.) Meanwhile, Dominion is also rumoured to be testing the market for possible suitors, possibly a white knight to ward off a dissident coup. That added fuel to the market’s fire for Dominion today.

sharks


Rick Rule on lithium. [Stockhouse]

I absolutely think it is a fad. I think that lithium demand will grow. But lithium supply is incredible. I remember two years ago reading the annual report from SQM, the big Chilean producer, when they describe themselves in terms of having reserves and resources about 180 years of supply and then taking advantage of increases in demand is simply a function of front-ending capital costs. I think that demand for lithium is going to continue to grow, but I think that the big three lithium producers can easily, easily accommodate the increase in demand growth.
 
I see probably only two or three lithium juniors that are viable. I see them only being viable if they can sell long term supply contracts to people like Tesla who might do that in order to get away from an oligopoly supply situation which is what they are burdened with now.

Lithium grease

Another older application….


Rob Chang from Cantor Fitzgerald says uranium prices are gonna spike.. [Mining.com]    …. in 2017.  See you then.


Peter Epstein on lithium mining and recovery methods. [Metal News]  Like all the new fangled energy metals, the details are in the recovery method and there are several.


Goldbank raises $100K for exploration in the Klondike. [Stockwatch]

Lithium, lemons and Dominion Diamonds

Scotiabank’s Patricia Mohr says lithium’s the place to be in 2016. [Northern Miner]

Lithium

 


When a junior bear market hands you lemons. [CEO.ca]  A cheer-you-up piece with good advice for depressed, downtrodden junior mining CEOs from one of the most determined out there.

knight


Dominion Diamonds may be in play.  [Globe and Mail / Junior Mining Network]   A group of shareholders including Toronto-based K2 & Associates Ltd. have acquired more than 5% of the company and are demanding changes.  The G&M reports Rothschild & Associates have been retained to advise the company.  The shareholders have requested a meeting….

So:

  1. Chairman Bob Gannicott has turned over CEO duties to Brenden Bell after medical leave.
  2. Financially, the company is in an air pocket with a transition to new feed sources and a commitment to develop Jay.
  3. Share price is languishing.
  4. Rough prices are down but… they may rebound in Q2 2016 in time to generate free cash flow.

Timing looks perfect.

piranha


Wellgreen reports drill results. [Junior Mining Network]   These are from the earlier campaigns not the current winter drill program.  Intersections range from 6 to over 400 m and grades generally range from 0.3 to 0.5% “Ni eq” (~$24 to ~$55 / t rock).

wellgreen


Western Copper files more paperwork. [Junior Mining News]

Including the most recent submission, and at this point in the YESAA process, the total application submitted represents over 14,000 pages of information and over three years of engagement with regulatory agencies and Federal, Territorial and First Nation Governments.

paperwork


Copper North settles debt with shares. [Junior Mining Network]   Settled at $0.05 (trading at $0.03).   166M shares out there.


Aben raises $139K. [Junior Mining Network]  closing first tranche of a 3 part financing.

Proceeds of this private placement will be utilize to evaluate new business opportunities for Aben and for general working capital purposes.

Predictions and Fission

Battle of the titans in 2016. [Reuters]  “Hoping your rivals will die.” is the title.   Reuters predicts classic market bottom behaviour by the world’s largest mining companies for the year ahead.


Predictions for the year ahead. [Mining.com]  If you’re into predictions try gold at ~$980, copper to stay around ~$2.00 for a while.


Big deal in the Basin. [CEO.ca]  Fission inks an off-take agreement with the Chinese which will inject $82M into FCU and Patterson Lake South.  Deal concluded at a 26% premium to market which should cheer shareholders after a rough fall.


Stockwatch’s Will Purcell on Kennady Diamonds North Lobe results. [Stockwatch]

Dermot Desmond and Patrick Evans’s Kennady Diamonds Inc. (KDI), up 44 cents to $2.84 on 73,000 shares, has diamond counts from another batch of drill core from the northern lobe of Kelvin, one of two complex kimberlites 10 kilometres northeast of Gahcho Kue in the Northwest Territories. The 926.3-kilogram batch held 96 diamonds larger than a 0.85-millimetre sieve and their 3.29-carat total weight yielded “an exceptional sample grade” of 3.55 carats per tonne. Mr. Evans, president and chief executive officer, said the north lobe samples “continue to return outstanding diamond recovery results.” Kennady Diamonds has processed 14.7 tonnes of core from the northern lobe this year and the 41.6 carats recovered work out to 2.83 carats per tonne. Mr. Evans says these tests correspond well with an 18.88-tonne mini-bulk test completed a year ago that averaged 2.59 carats per tonne; a test that he said capped a “remarkably successful year.”

The two largest diamonds in the latest test weighed 0.67 carat and 0.23 carat. Each was a transparent, but off-white, broken octahedron with at least minor inclusions. The third was a white gem with minor inclusions, but it was just a 0.15-carat fragment. Mr. Evans said that diamond breakage during core drilling was common, adding that his company conducts breakage studies after its bulk sampling programs to adjust its diamond pricing models. Common apparently is an understatement — at least for Kennady Diamonds — as two of the three largest diamonds recovered earlier this month were broken, as were two of the three largest gems recovered in mid-November, along with three of the four largest gems recovered in October and all three recovered in June. Meanwhile, other explorers, such as Peregrine Diamonds Ltd. (PGD: $0.13), report broken stones with a much lower frequency.


Red Star and Unga: An interview with Ken Booth. [Mining.com]   the scoop on Shumagin from the boss.


Teuton options out Fairweather Property.  [Marketwired]   The property, 10 km south of Pretium, is being picked up by a private company.  The deal?

Terms call for cash payments totalling $350,000 to be paid over five years. The property is to be sold to a public company (“Pubco”) within six months. Teuton will also receive 700,000 shares of the Pubco over the term of the option. Teuton will retain a 2% NSR on the western portion of the property, and a 1% portion on the eastern claims (5 of the eastern claims are currently burdened with a 2% NSR in favour of a third party which obligation will be assumed by the Pubco). 

Diamonds and Millrock

Moody’s downgrades Glencore to one notch above junk. [Reuters]

abyss


And the winner for 2015 is…. [Bloomberg]

Moly


Bain’s annual diamond report is out. [Bain & Company]   The quick highlights:

  1. The current price squeeze began when Chinese retailers overstocked.
  2. Rough prices are down 15% YoY.
  3. The pain is primarily in the polishing stream (there’s an excellent article on this in the Economist).
  4. Inventory might be cleared by mid-2016.
  5. Supply deficit by… 2019.

Bain diamond prices


De Beers shuts down another diamond mine. [Mining Weekly]   A feeder for Orapa in Botwana.


Millrock in the Golden Triangle. [Petroleum News of Alaska]  Background from Prez & CEO Greg Beischer on their recent acquisition including a gold-rich VMS show Noranda kicked around.


Pick it up at the factory: Stockhouse sets up a deal room.  [Stockhouse]  If you want to get in on the ground floor of the next hot private placement and you’re an accredited investor, here’s the place to go.   Looks like there could be one prospector in the Yukon who might qualify to get in….

nose against the glass


TSX proposals to fix the Venture Exchange are out. [TMX]    Things noted:

  1. Reduce costs by cutting out the brokers (sponsorship not required).  The rest of their ideas were pretty small change.
  2. Expand the base of investors  with a bunch of wishy-washy ideas around “education” and “promotion”.  Should keep the backroom guys busy with presentations and road trips.
  3. Diversify and grow the stock list.  Let’s chase tech listings.  At the end of our course, they remind all that “TSXV remains dedicated to our natural resource clients.

Hill of beans


Millrock options Stellar to Vista. [Junior Mining Network]  This is the Zackly gold-copper skarn, worked by RAA and Noranda among others.   Vista is a private Australian company.  Another success for Millrock’s prospect generator model.


Ascot hits again at Premier. [Junior Mining Network]  1.0 m @ 572 g/t Au in the golden lunchroom and 8.0 m @ 15.6 g/t Au including 111 g/t Au over 1.0 m in the “Obscene Zone”.

Yellen, NQ, BAY and EQT

Yellen spoke.  The only chart you need to worry about this morning; dollar’s up / all metals are down.

DXY


At the Christmas party, Yukon Chamber of Mines Prez provides colour commentary:

"Interest rates are up; fake organisms are over"

“Interest rates are up; fake organisms are over”


Rio Tinto wants to dominate lithium. [Mining.com]   They’re talking to Tesla (who isn’t?) about their Jadar project in Serbia.  Howe Street should take note:

Rio has declared an inferred resource of 125.3 Mt with a weighted average Li2O concentration of 1.8% and 16.2 Mt of B2O3 for the lower zone only. [Rio]

That’s about 8,400 ppm Li or 42 times the production grade at Clayton Valley for you brine afficionados out there.   Don’t know about metallurgy…

Rio


 Indonesia’s nickel plans backfire. [Bloomberg]   So Economics 101 graduates out there, what was going to happen when the Indonesian government mandated that nickel be processed in-country at locally owned, quickly erected, two-bit smelters?

The chief executive officer of one of the biggest producers, a Chinese-Indonesian venture called Tsingshan Bintangdelapan Group, says with output costs at $10,000 to $11,000 a metric ton, he’s making a $2,000 loss on every ton he ships. 

NI


Crowd funding is the wave of the future! [Mineweb]  An Australian pumper offers some good advice:

Jofre added that the “golden rule” of crowd funding is that companies should secure 30% of the amount they intend raising before going to the crowd, as it proves the credibility of their offering.

I’d be a little concerned about the company you’re keeping however:

Thus far, the most successful mining-related crowdfunding campaign appears to be that of asteroid mining company Planetary Resources. Through a 33-day Kickstarter campaign in 2013, it raised more than $1.5 million from over 17 000 backers to fund the world’s first public space telescope.

They gave us how much?

They gave us how much?


Nordgold to take over Northquest. [Mining Weekly]  .. offering $0.253 per share to get Pistol Bay.

NQ


Rappaport thinks diamond producers are screwing themselves by not lowering rough prices before January.  [Rappaport]  All the profits from post-holiday restocking to end up with private auctioneers.


KDI releases another bulk sample from the North Lobe. [Canada News Wire]   … a very respectable 3.55 c/t but the sample was only 930 kg. .  Results from a larger sample are out in January.


Morgan Stanley thinks nickel, copper and zinc are going to run in 2016.  [Australian Mining]  … sure – just like this year.

Broken clock


The cheque’s in the bank: IDM closes their $1M financing with Oban. [Marketwired] … and pays off Seabridge for Red Mountain.  The remaining $2.2M private placement  “is expected to close in January”, along with the deal on Oban’s Ryan Gold properties.


Aston Bay secures 100% of Storm Copper Property from Commander.  [Junior Mining Network]  The happy couple exchanged paper at the altar and Commander will own 25% of Aston Bay.

Wedding


Time to check in on Zimtu’s latest venture:  Equitas – aka Voisey’s Bay 2.0. [Resource Clips]   After a summer of drum rolls and hype about geophysical anomalies, Deeps, nickel going to the moon, etc., they drilled and hit…. disseminated sulphides.

EQT

To quote Robert Friedland (and they do)

“Creative people shouldn’t be punished for failure, because in the exploration business we are in the business of drilling dry holes.”

Well – there’s good news!  The only people who got punished here were retail investors.