Gold Summary for June 24, 2019

New York spot gold fell $0.80 to $1,341.10 on Friday. The TSX Venture Exchange fell 1.40 points to 587.84 while the TSX Gold Index rose 1.26 points to 204.71. Most Canadian gold miners moved higher with bullion today. Alamos Gold Inc. (AGI) led the way, adding 17 cents to $7.28 on 2.16 million shares. The market was not all hats and horns: Premier Gold Mines Ltd. (PG) dropped 10 cents to $1.92 on 1.1 million shares.

Dr. Morgan Poliquin’s Azucar Minerals Ltd. (AMZ) jumped 2.5 cents to 30.5 cents on 3,000 shares and a rumour yesterday. Today it fell 1.5 cents to 29 cents on 407,000 shares and news from its El Cobre porphyry gold and copper project in Veracruz, Mexico. Azucar has received assays from seven new holes; the best hit — 0.22 gram of gold per tonne and 0.40 per cent copper over 57.75 metres — coming from the Suegro zone. A Norte zone hole produced 0.33 gram of gold per tonne over 103.4 metres while one of three holes into the Villa Rica zone yielded 0.47 gram of gold per tonne and 0.14 per cent copper over 101.1 metres.

Duane Poliquin, Azucar’s chairman and the father of Morgan Poliquin, Azucar’s president and chief executive officer, says that he and his crew “continue to move forward with our systematic two-year intensive drill program” at El Cobre. (Despite the beehive of adjectives, the drilling has moved Azucar’s stock backward, leaving it well below its 2017 high of $1.75.) Undaunted by the market’s reaction, the elder Mr. Poliquin says that the results so far “again indicate the potential for large-scale porphyry mineralization in multiple porphyry centres” over a five-kilometre trend.

Chairman Poliquin adds that the continuing drill program is designed to find not yet discovered — here comes that word again — porphyry intrusive centres, and to provide the geologic framework for discovery and extension of known mineralization within a very large area of intense alteration. (Porphyry has a detailed geological definition, but to investors, it means “big but low-grade.”) He says that Azucar is also completing more geophysics, soil surveys, mapping and geologic interpretation to “best use the results toward future discovery-oriented drilling.” In other words, Azucar is hoping to find higher grades to push its slumping stock higher.

Morgan Poliquin, of Vancouver, received $100,500 as president and CEO of Azucar last year, although the payment came from Almaden Minerals Ltd. (AMM: $0.72). Duane Poliquin, also of Vancouver, received $72,000 as chairman, also from Almaden, which billed Azucar roughly $500,000 last year for its management services. Last year, Morgan Poliquin pulled in an additional $193,000 in salary and $66,000 in bonus as president and CEO of Almaden, while his father got just over $138,000 as its chairman.

Duncan Middlemiss’s Wesdome Gold Mines Ltd. (WDO) jumped seven cents to $5.22 on 2.14 million shares on new assays from its Eagle River gold mine near Wawa in Northern Ontario. The assays are from underground drilling in the No. 7 East and No. 311 zones, and from surface drilling into the recently discovered Falcon zones that could be extensions of the No. 300 and No. 7 zones. The assays ranged as high as 13.9 grams per tonne over a true width of 4.85 metres at No. 7 East, 56.63 grams per tonne over 3.81 metres at No. 311, and 53.8 grams per tonne over 1.1 metres in the Falcon zones.

Mr. Middlemiss, president and CEO, expressed his obligatory pleasure with the “ongoing exploration efforts” at Eagle River, particularly at No. 7 East and No. 311 West, which are proximal to existing development and infrastructure at the mine. The work will continue: “We remain committed to aggressive exploration” using four drills underground and two at surface, he says, adding that the goal is to “identify additional resources and workplaces for increased future production profiles.” (Translation: Wesdome wants to mine more gold.)

Eagle River hosted a reserve of 1.05 million tonnes at 12 grams of gold per tonne, or about 400,000 ounces, at the end of last year. Additionally, the company listed a resource of 109,000 tonnes measured and indicated at nine grams per tonne and 433,000 tonnes inferred at 11.4 grams per tonne, adding a potential 190,000 ounces to the mine, which is expected to produce up to 76,000 ounces of gold this year, compared with 67,315 ounces last year.

Mr. Middlemiss, now 57, has been president and CEO of Wesdome since 2016. Last year he received a salary of $428,000 and the company was sufficiently pleased with him that it awarded him a $588,000 cash bonus. (He drew the same salary in 2017 and he pulled in $455,000 in bonus.) A quick glance at the company’s chart suggests why: A Wesdome share cost just $1.50 in the summer of 2016.


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