Gold Summary For August 7th, 2019

2019-08-07 17:24 ET – Market Summary

by Stockwatch Business Reporter

New York spot gold leapt another $26.00 to $1,500.00 on Wednesday. The TSX Venture Exchange rose 2.64 points to 597.33 while the TSX Gold Index surged 7.17 points to 253.95. (In late May, the index was below 180 but has since gone on a tear.) Canadian gold miners naturally had another good day, although shareholders of Eldorado Gold Corp. (ELD) suffered a 92-cent drop to $10.43 on 6.86 million shares. The company said today that it would seek up to $750-million (U.S.) over the next two years through new equity or debt issues. Guyana Goldfields Inc. (GUY) helped the charge today, adding 12 cents to $1.35 on 2.95 million shares.

Area 51 hit the news today, stirring up a storm of interest accompanied by a healthy dose of skepticism. No, not that Area 51 — this Area 51 is a zone at the Fenelon project in Quebec, where Alar Soever and Marz Kord’s Wallbridge Mining Co. Ltd. (WM) has been drilling into a new gold zone since early this year. (Conspiracy theorists should stand down; there are no signs of extraterrestrials at Fenelon. The area got its name from the homely identifier for the discovery drill hole: FA-18-051.)

Wallbridge closed unchanged today at 46.5 cents on 3.22 million shares, following word that it has received assays of up to 12.71 grams of gold per tonne over five metres at Area 51. That hit occurred within a 42.8-metre interval that averaged 2.43 grams per tonne. Investors were less than enthused with that hit, perhaps because the company had earlier intersected 2.81 grams of gold per tonne over nearly 99 metres within a 227.8-metre interval that averaged nearly 1.5 grams per tonne. The news today also included assays from Tabasco, where Wallbridge averaged up to 5.5 grams of gold per tonne over 10.96 metres.

Mr. Kord, president and chief executive officer, cheered the “continuity of numerous high-grade gold-bearing structures” along strike and downdip at Area 51, which makes these zones prime targets for future resource growth amenable to an underground mining scenario. (Devoid of promoter-speak, most of the Area 51 gold is too deep for open-pit mining, although Mr. Kord also talks up a “potential open-pit-type resource scenario” based on evidence of strong near-surface mineralization in two holes, although assays are still pending.)

Mr. Kord, a Sudbury resident, has been president since 2011 and CEO since 2012. He had been getting $285,000 per year in salary for the past few years, but he got a modest bump last year, to just over $290,000. Mr. Soever had been drawing $150,000 per year as executive chairman, but the spiffy — and expensive — qualifier fell off his title last summer. He now collects just $72,000 per year as chairman.

Conan Taylor’s Gold Rush Cariboo Corp. (GDBO) said today that it will roll back its stock 1:10 to “enhance its ability to raise institutional capital.” Unfortunately, the news did not sit well with the company’s retail shareholders, as Gold Rush Cariboo lost one cent to two cents on 2.11 million shares on the news. Mr. Taylor, president, says that the move is needed because the company is “currently limited by its cash resources and its ability to raise equity.”

There is a pressing need for cash, as Gold Rush had less than $3,000 in the bank at the end of March, with creditors clamoring for payment of nearly $660,000 in current liabilities. There is a more pressing need for work, as Gold Rush Cariboo has been silent about the “comprehensive drilling program and large-scale bulk sampling” proposed this year for its Horseshoe Bend alluvial gold and platinum property, near Quesnel.

Further, given Gold Rush’s horrid three-year stock chart, finding a promotable new project is arguably its most pressing need. That may now be the plan, as Mr. Taylor says that the company is working with a new technical team to identify, evaluate and develop specific gold opportunities. At the time Mr. Taylor appointed his new advisers, he said they would be “spearheading progression of our mature goldprojects” and “expanding our portfolio of assets both regionally and internationally.” Either way — spearheading or expanding — Gold Rush is going to need cash.

Ari Sussman’s Continental Gold Corp. (CNL) had a good day, adding 27 cents to $4.56 on 2.46 million shares, on word that construction of the company’s Buritica gold mine in Colombia has passed the three-quarters mark. Mr. Sussman, CEO, says that the company remains on track to hold its first gold pour in the first half of 2020. Buritica hosts a reserve of 13.7 million tonnes at 8.4 grams of gold and 24.3 grams of silver per tonne, or 3.7 million ounces of gold and 10.7 million ounces of silver, but there is plenty more glitter to be had: Buritica’s full resource lists over 11 million ounces of gold and 47 million ounces of silver.

 

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