Mining Breaks

Skeena Resources has done a deal with global gold miner Barrick Gold to acquire its Eskay Creek gold/silver project in NW British Columbia, Canada, resulting in Barrick holding 17.2% of Skeena.
Discovered in 1988, the former Eskay Creek Mine produced about 3.3Moz of gold and 160Moz of silver at average grades of 45g/t gold and 2,224g/t silver and was once the world’s highest-grade gold mine and 5th largest silver mine by volume.
The agreement will see Skeena assume 100% ownership/operatorship of Eskay Creek, which it plans to revitalise as an openpit gold/silver mine. On closing in the Dec 2020 qtr (Q4 20), Barrick will own about 12.4% of Skeena’s issued/outstanding common shares and assuming the exercise in full of all of the warrants, that stake will rise to about 17.2% of Skeena.

Edenville Energy expects to take less than a week to repair damage caused by the protracted rainy season at its Rukwa coal project in SW Tanzania after ending its extended COVID-19 shutdown on Aug 3.
Its main tasks will be removing minor silt and sand build up from the pit area and repairing the haul road to the new northern pit. Plant and equipment inspections have revealed no material issues.
The UK-based company expects its first coal shipment early next week, subject to customer truck availability.
Edenville will continue as operator until new strategic partner Infrastructure Logistics Tanzania completes mobilisation and commences operations on Sept 1.

Chaarat Gold Holdings has posted June half-year (H1) production of 26,960oz gold equivalent at its 100%-owned Kapan mine in Armenia, down from the 29,607oz in the corresponding period but slightly better than its 26,906oz in the Dec 2019 half. The H1 production comprised 13,179oz gold, 261,551oz silver, 960t copper and 3,997t zinc.
Although realised gold prices rose 25.5% to $US1,665/oz, the benefit was offset by significant declines in base metals prices.
Chaarat says it remains on track to deliver its 55,000oz guidance for the year.

Indonesian major PT Antam has credited its strong commitment to COVID-19 protocols for a strong Q2 turnaround to a gross profit of IDR1.31T for the June half-year (H1FY2020), down from IDR2.15T for the corresponding period. The Q2 result was IDR747.2B, compared to IDR561.8B in the March qtr.
H1 net profit was IDR84.8B (H1FY19: IDR428B).
Antam says its consistent application of proper health protocol covering mining, processing plant and administration supported the company’s sustainability in the midst of the pandemic.
Net sales of IDR9.23T (IDR2.15T) comprised IDR6.41T from gold and IDR2.02T from nickel within ferronickel.

Eldorado Gold has posted a $US50.5M June 2020 qtr (Q2 20) turnaround for net earnings of $45.6M from Q1 20’s $4.9M loss, with adjusted net earnings up to $43.8M from $12.5M on gold production from its 4 operations in Greece, Turkey and Canada up 19% to 137,782oz.

Leading West Australian miner Saracen Minerals aims to ramp up combined gold production from its Carosue Dam and Thunderbox projects to 450,000ozpa from the June 2023 year (FY23) as its organic growth strategy lifts their overall reserves to a record 3.7Moz, 400,000oz higher in 12 months despite mining depletion of 396,000oz.
After delivering 387,819oz (Carosue Dam 203,281oz and Thunderbox 184,538oz) in FY20, Saracen forecasts FY21 production of 380,000-400,000oz at AISC of $A1,200-1.300/oz.
With mill expansions due at its Carosue Dam mill (2.4Mtpa to 3.2Mtpa) in the March 2021 qtr and Thunderbox (2.8Mtpa to 3.5Mtpa) in FY22, Saracen expects the forecast 450,000ozpa to be sustained for at least 7 years.
All this is separate to its 50% interest in Superpit owner KCGM, where updated reserves and resources, production and cost outlook will be released this qtr.

Australian producer Aeris Resources aims to deliver an openpit mineral resource by end-2020 after a successful first month at the Cracow gold operations 500km NW of Brisbane in Queensland.
Aeris completed the $A75M acquisition - $60M up-front and $15M due in June 2022 - of the mine from Evolution Mining on July 1.
It’s forecasting FY21 gold production of 70,000-75,000oz, but is already ahead of target with 8,138oz from underground mining in July.
Exec chairman Andre Labuschagne says near-mine exploration has begun with RC drilling of the Klondyke and Roses Pride targets to establish an inferred resource. Drilling will expand over the year to other near-mine targets and greenfields exploration targets.

Australian-based Southern Gold is considering exiting its 50% JV interests in the Gubong and Kochang gold mines in South Korea over concerns about the COVID-19 impacts on the timing of their approvals and development.
At a recent meeting with partner/operator Bluebird Merchant Ventures, Southern refrained from voting on the JV budget and development proposals.
Bluebird may now seek to acquire Southern’s interest. If that does not happen, Southern has begun discussions with third parties on options including a partial or full sale of its stake.
MD Simon Mitchell says Southern is initiating a process to test the interest of Bluebird or other investors in the Gubong and Kochang projects.

It’s brought down two companies in the last six years, but diversified Australian-based explorer Jadar Resources has taken on the challenge of making a go of the Granite Belt silver project near the town of Texas in SE Qld.
Jadar has agreed to acquire the mothballed mine together with plant, equipment and inventory for $A0.5M from Moreton Resources, which fell into liquidation in June this year after a long unavailing struggle with financial and performance issues.
Moreton had purchased the project from Alcyone Resources after it shuttered what was then known as the Twin Hills mine and collapsed in late 2014 after running out of cash.
Chairman Luke Martino says the project could deliver enormous value given Jadar’s expertise and funding strength in the current economic cycle. The deal is subject to Jadar’s due diligence.

Centerra Gold has had an excellent, relatively COVID-19 unaffected June 2020 qtr (Q2 20) with net earnings rocketing to $US80.7M from $20M in Q1 20, adjusted net earnings doubling to $97.8M from $46.4M on gold-copper output from all 3 producing operations well up.

West African explorer Tietto Minerals is fully funded for the PFS and DFS on its Abujar gold project in Côte d’Ivoire after receiving binding commitments for an underwritten placement to raise $US45M and a non‐underwritten placement of $12.5M.
MD Dr Caigen Wang says the raising also gives Tietto flexibility to commit to long lead-time acquisitions and continue drilling to complete a mineral resource update in Sept.

Australian explorer Venture Minerals is seeking $A5.5M through a placement and underwritten share purchase plan to take advantage of high iron ore prices by funding the start of mining and production at its 100%-owned Riley mine in NW Tasmania.
Venture says Riley's short mine life and quick time to production present a unique opportunity to realise significant cash-flow.
With on-site infrastructure in place, it could start mining and dry screening about a week after a final investment decision and receipt of funds.
Venture has firm commitments to raise up to $4M by placing 129M shares at 3.1cps, and plans to raise $1.5M through the issue of 48.8M shares at 3.1c.

Australian explorer Carnaby Resources has found a new route to commercialisation of its Tick Hill project near Mount Isa in Queensland, agreeing to sell its historic tailings stockpiles to private miner/processor BIM Metals.
BIM will pay $A4M cash plus $2M royalties to mine the probable ore reserves of 410,900t @ 1.35g/t for 17,800oz gold in Tick Hill’s tailings stockpiles and historical ROM pad, processing the ore at its Lorena processing plant over about 12 months.
Carnaby retains 100% ownership of the Tick Hill project, where its recent PFS outlined openpit production mill feed of 63,300t @ 6.1g/t for 12,500oz. Negotiations to develop, profit-share or sell the openpit project are continuing.

Galiano Gold’s (formerly Asanko Gold) June 2020 qtr (Q2 20) after tax net income from its 50/50-owned Asanko Gold Mine in Ghana, West Africa, has plunged to $US14.7M from Q1 20’s $21.8M, despite record gold output up to 69,026oz from 66,333oz (100% basis) and the processing of a record 1.64Mt of ore from 1.4Mt.
The fall came on revenue down to $101.5M from $104.8M from gold sales falling to 61,357oz from $67,820oz, total cash costs jumping to $807oz from $676oz, AISC to $1,067oz from $805oz and adjusted EBITDA down to $18.5M from $21.9M. Cash provided by operating activities, however, rose to $48.8M from $37M.
Galiano remains on track for FY/CY20 production of 225,000oz-245,000oz at AISC of $1,000oz-$1,100oz. At June 30, 2020, the company held cash/receivables of $68M and had no debt.

Strandline Resources has taken another important step towards developing its Coburn mineral sands project in Western Australia, awarding a civil and bulk earthworks construction contract to international mining services contract Macmahon.
The contract, worth about $A23M, covers construction of a 43km sealed access road, site roads, bulk earthworks pads, dams and drainage.
Following last month’s investment approval by the Northern Australia Infrastructure Facility for a $150M loan, MD Luke Graham says it’s the first material contract as Strandline moves to finalise project funding and prepare for construction mobilisation.

West Australian explorer Duketon Mining is moving on to a mining study in the second half of 2020 after updating the mineral resource estimate to 2.56Mt @ 2.9% nickel equivalent containing 49,100t nickel, 10,600t copper and 205,000oz PGE at the Rosie deposit, part of its 100%-owned Duketon greenstone belt portfolio 120km north of Laverton.
The new estimate, a 50% increase in contained nickel metal, now includes the previously separate Nariz prospect and remains open in all directions.
It lifts the combined JORC resource for Duketon’s Bulge Complex mineralisation containing the Rosie and C2 deposits to 87,100t Ni, 12,900t Cu and 205,000oz PGE.

Capstone Mining has posted a June 2020 qtr (Q2 20) $US26.2M turnaround to net income of $US4.3M from Q1 20’s $21.9M loss with revenue jumping to $104.7M from 70.4M on copper production up to 38.5M/lbs from 35.5M/lbs despite minor COVID-19 related production limitations at Cozamin, Mexico.
The result has seen Capstone reinstate its original FY/CY 20 production and cost guidance to 140M/lbs-155M/lbs at C1 cash costs of $1.85/lb-$2.00/lb.

Australian engineer Monadelphous is facing a $A493M claim from iron ore giant Rio Tinto over a fire at its Cape Lambert sinter fines processing facility in WA in January 2019.
Rio Tinto filed a writ of summons against Monadelphous Engineering Associates in the WA Supreme Court on July 30.
The writ does not quantify the claim, but Monadelphous says it’s been advised the global miner is seeking $35M in material damage costs for rebuilding the facility and $458M for loss of business and work-around solutions.
Monadelphous, which was undertaking maintenance shutdown work, is denying liability for the fire and disputes Rio’s estimates of its claimed losses. It will join its insurers to defend the legal action.

After posting a maiden resource last week for its 100%-owned Winu copper-gold project, Rio Tinto has extended its reach in Western Australia’s Paterson province through a new exploration JV over veteran explorer Sipa Resources’ Paterson North tenement package.
The farm-in agreement enables Rio Tinto Exploration to earn up to 80% by funding $A12M and defining mineral deposits while subscribing $0.25M for Sipa shares.
The Sipa tenements are 10km east of Rio’s Winu discovery and adjoin Antipa Minerals’ Citadel project, where Rio is earning 75% interest for $60M. Rio has similar pacts with Alloy Resources’ Waukarlycarly project and Carawine Resources’ Baton and Red Dog tenements.
Sipa, which has been exploring at Paterson North since 2016, will retain project management at least initially with the support of Rio’s funding and expertise.