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Posts tagged ‘Yamana Gold Inc. (YRI)’

In the land of giants

June 24th, 2016

Aurvista Gold sees super pit potential for its Douay gold project in Abitibi

by Greg Klein

A new Abitibi gold mine, maybe the region’s last—could that be Douay’s destiny? Jean Lafleur sees such potential in the project that attracted him to Aurvista Gold TSXV:AVA, where he took on the role of president/CEO. The geologist’s international career includes considerable experience in Quebec’s most auriferous region, including Malartic, where he was instrumental in developing the project’s campaign of bulk gold exploration. He sees similarities in Douay. But this one also stands apart for its distinctions.

Aurvista Gold sees super pit potential for its Douay gold project in Abitibi

This year’s campaign calls for more geophysics
followed by another 4,000 metres.

A bulk deposit with higher-grade “jewelry boxes” on the Casa Berardi fault, Douay’s “unique because it’s never been mined, it’s a disseminated-type deposit, there are no quartz veins so it goes against the grain of these old Archean-type deposits, it’s Crown land, but what makes it really unique is it’s the last one left in the Abitibi,” Lafleur says.

“There might be others farther north, but when you talk about strictly Abitibi, this is the last one.”

Aurvista plans to support that theory with a summer/fall campaign of geophysics and drilling backed by last month’s $1.1-million financing. The 14,500-hectare property features eight zones along a five-kilometre trend. Using a cutoff of 0.3 grams per tonne, a 2012 resource estimate totalled:

  • indicated: 2.69 million tonnes averaging 2.76 g/t for 238,435 gold ounces

  • inferred: 114.65 million tonnes averaging 0.75 g/t for 2.75 million ounces

The resource was limited to a vertical depth of about 400 metres.

With the same cutoff, a west-to-east, zone-by-zone breakdown shows the jewelry boxes amid bulk mining potential:

Douay West zone

  • indicated: 2.56 million tonnes averaging 2.77 g/t for 227,980 ounces

  • inferred: 1.41 million tonnes averaging 1.65 g/t for 74,915 ounces

North West zone

  • inferred: 1.05 million tonnes averaging 2.59 g/t for 87,605 ounces

Porphyry zone

  • inferred: 107.21 million tonnes averaging 0.68 g/t for 2.36 million ounces

20 zone

  • inferred: 340,000 tonnes averaging 0.66 g/t for 7,231 ounces

Central zone

  • inferred: 780,000 tonnes averaging 0.99 g/t for 24,935 ounces

10 zone

  • inferred: 959,000 tonnes averaging 1.32 g/t for 40,705 ounces

531 zone

  • inferred: 1.55 million tonnes averaging 1.54 g/t for 76,620 ounces

Main zone

  • indicated: 130,000 tonnes averaging 2.47 g/t for 10,450 ounces

  • inferred: 1.35 million tonnes averaging 1.97 g/t for 85,480 ounces

Pushing the cutoff up to three g/t, seven of the eight zones still show ounces, with these two standouts—Douay West revealing 153,890 ounces indicated and 28,420 ounces inferred, and the Adams section of the Porphyry zone bearing 274,200 ounces inferred.

A 2014 PEA examined Douay West alone as a combination open pit and underground operation that would cost $56.8 million to build, producing 156,000 ounces over a 3.7-year life. The study used a 5% discount rate to calculate a post-tax NPV of $16.6 million and a post-tax IRR of 40%. But the proximity of other zones, especially Porphyry, encouraged Aurvista to consider other approaches.

To that end the company has an imminent two-stage 2016 program scheduled for a three-by-10-kilometre expanse. Primarily focus will be some eight kilometres of porphyry targets. Also under scrutiny will be a six-by-one-kilometre cluster of EM anomalies immediately south that have affinities to VMS mineralization associated with gold, along with potential copper and other base metal targets, the company states.

Aurvista Gold sees super pit potential for its Douay gold project in Abitibi

Past operators left behind camp infrastructure.

Stage 1 calls for additional mapping, re-logging previous core and flying magnetic, electromagnetic and radiometrics. That would lead to Stage 2’s 4,000-metre Q4 drill program. The company also hopes to find new trends at about 300 to 500 metres in depth, below the currently known mineralization.

With Abitibi infrastructure as well as gold, Douay has road access to a highway five kilometres away leading to Val-d’Or, 165 kilometres south, and an electrical line connecting the property with the grid.

A solid share structure supports the company. After vending Douay to Aurvista in 2011, Société d’exploration minière Vior TSXV:VIO now holds 24%. The 1,193-hectare North West zone comes under a JV with 25% partner SOQUEM, the mineral exploration division of the provincial government’s Investissement Québec. Together, the province and company insiders account for 14%. Among them is chairperson Gerry McCarvill, who helped create Repadre Capital, now IAMGOLD TSX:IMG, and Desert Sun Mining, later picked up by Yamana Gold TSX:YRI. McCarvill also helped develop Consolidated Thompson Iron Ore from its $2-million beginning to the $4.9-billion takeover by Cliffs Natural Resources NYSE:CLF.

Lafleur expects this year’s work to further support the “super pit” potential that he believes could position Douay as the next mine to be surrounded by the giants of Abitibi. A resource update could arrive this year but more likely in 2017, he says. Lafleur anticipates a three- to five-year plan for the project. “We want to follow the same story that Detour and Osisko did—just keep drilling and prove up as many ounces as we can.”

Vancouver Commodity Forum adds speakers: Gerald McCarvill, Jon Hykawy and Joe Martin

May 30th, 2016

by Greg Klein | May 30, 2016

Three more names bring additional expertise and insight to the June 14 Vancouver Commodity Forum. Prince Arthur Capital chairperson/CEO Gerald McCarvill, Stormcrow Capital president/director Jon Hykawy and Cambridge House International founder Joe Martin will address the conference at the Hyatt Regency Hotel. Already booked are Chris Berry of the Disruptive Discoveries Journal, John Kaiser of Kaiser Research Online and Stephan Bogner of Rockstone Research.

Vancouver Commodity Forum adds speakers Gerald McCarvill, Jon Hykawy and Joe Martin

The speaker lineup grows as the June 14 Vancouver event approaches.

McCarvill’s 30-year CV includes conducting mining and energy projects globally, as well as private equity and finance transactions. Among other career highlights, he helped establish Repadre Capital, now IAMGOLD TSX:IMG, and Desert Sun Mining, later acquired by Yamana Gold TSX:YRI. McCarvill also helped develop and finance Consolidated Thompson Iron Ore from a $2-million entry valuation to its $4.9-billion sale to Cliffs Natural Resources NYSE:CLF.

An expert in areas such as lithium, rare earths, fluorspar and tin, Hykawy combines a 14-year Bay Street background with an MBA in marketing, along with post-doctoral work as a physicist with Chalk River Nuclear Laboratories and the Sudbury Neutrino Observatory. His technical background also includes work on rechargeable batteries and fuel cells, as well as wind and solar energy.

Starting off in business journalism, Martin created BC Business magazine, then founded Cambridge House International to present some of the world’s largest mining/exploration conferences. He remains active in semi-retirement as a prominent advocate for investment regulatory reform.

The Vancouver Commodity Forum also features a range of companies pursuing lithium, uranium, rare earths, gold, nickel, copper, diamonds, jade, scandium, zeolite, magnesium and potash. Click here for free registration.

Interview: Chris Berry discusses the lithium boom.

April 16th, 2014

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Alluvial and placer mineral deposits Geology for Investors
Dark markets may be more harmful than high-frequency trading VantageWire
Infographic—Unearthing the world’s gold supply GoldSeek

Gold stocks slaughtered, Barrick drops 10%

October 31st, 2013

by Frik Els | October 31, 2013 | Reprinted by permission of MINING.com

The gold price slid more than $24 or 2% an ounce on October 31 to a week low of $1,323 after the U.S. Federal Reserve signalled it may cut back its stimulus program sooner than thought and Chinese demand for the metal waned.

After a fightback from near three-year lows below $1,200 struck at the end of June, gold’s momentum now seems to have turned negative again with gold stocks sold off heavily on a relatively modest fall in the price of the metal.

By the October 31 close Barrick Gold TSX:ABX had lost 5.9%, after announcing results that were in line with expectations and the suspension of its troubled Pascua Lama project on the border between Chile and Argentina.

The world’s number one miner of the precious metal followed up after hours with more damaging news. The Toronto-based miner announced it is raising $3 billion by issuing 163.5 million common shares at $18.35 per share.

Barrick is now worth $19.4 billion, down 44% so far this year and nowhere near its $54-billion market value a mere two years ago.

Investors duly marked down the stock again with the counter shedding an additional 5.7% to $18.31 in after-hours trade in New York, wiping more than $2 billion off the value of the company on the day.

Barrick is now worth $19.4 billion, down 44% so far this year and nowhere near its $54-billion market value a mere two years ago.

Newmont Mining NYE:NEM, with a market value of $13.5 billion, escaped the worst of it, down 2.8% in regular trading and trading slightly to the upside after hours, after announcing profits up 11% despite a fall in revenue.

Attributable gold production rose 4% to 1.28 million ounces, while attributable copper output decreased 3% to 34 million pounds during the third quarter at the Denver-based company.

The world’s third-largest gold producer behind Newmont, AngloGold Ashanti NYE:AU was one of the worst performers of October 31. The Johannesburg-based company’s ADRs listed in New York slid 6.7% on October 31 and the value of the company has now halved this year.

Fellow South African miner Gold Fields NYE:GFI, the worst performer among the gold majors this year, gave up 4.4% in New York. The world’s fourth-largest gold producer has had its value slashed 63% in 2013, with investors punishing it for its contrarian purchase of high-cost mines amid the slump.

Goldcorp TSX:G, expected to produce around 2.5 million ounces of gold this year, declined 3.9%. The Vancouver-based company retained the top spot as the most valuable gold stock, with a Toronto big board market capitalization of $21.6 billion.

Toronto’s Kinross Gold TSX:K managed to hold above a $6-billion value despite losing 5.3% on the day. Investors in the company are nursing a $5-billion loss in market cap this year after Kinross, like all the majors, took multi-billion charges against the value of its operations.

Canada’s second-tier gold miners also suffered a loss of confidence from gold investors, giving up much of the gains of recent weeks.

Yamana Gold TSX:YRI skid 3.4%, Agnico Eagle Mines’ TSX:AEM losses were fairly modest at 2.5% while Eldorado Gold TSX:ELD declined 5.1% and IAMGOLD TSX:IMG dropped 5.3%.

Reprinted by permission of MINING.com

Investors pile back into gold stocks, Goldcorp up $2 billion in a week

October 22nd, 2013

by Frik Els | October 22, 2013 | Reprinted by permission of Mining.com

Investors pile back into gold stocks, Goldcorp up $2 billion in a week

Good day for the gold team. Photo: Perpetual Tourist

The gold price jumped more than $20 or 1.8% an ounce on October 22 to a three-week high above $1,340 after disappointing U.S. economic data.

The much weaker-than-expected employment numbers in the U.S. convinced gold buyers that any reduction in economic stimulus by the Federal Reserve will come later rather than sooner.

With positive sentiment returning to the gold market, investors took the chance to jump back into mining stocks which have been decimated by the 20% retreat in the price of the metal this year.

On October 22 Barrick Gold TSX:ABX shot up 4.8%, scaling the $20-billion market value for the first time in a month.

The Vancouver-based company has jumped more than $2 billion in market value over the past week and is now worth $21.3 billion.

The world’s number one miner of the precious metal has added more than $5 billion in market value since hitting 21-year lows early July.

Barrick is now worth $20.5 billion on the TSX, still down 41% so far this year amid an aggressive divestment and cost-cutting drive that is beginning to bear fruit.

Newmont Mining NYE:NEM, with a market value of $14.1 billion, added 3.5%. The company recently cut predictions for its copper output, but gold production targets remain unchanged at 4.8 million to 5.1 million ounces for the year.

The Denver-based company has not escaped the carnage in the gold sector and is down 38% this year.

The world’s third-largest gold producer behind Newmont, AngloGold Ashanti NYE:AU was one of the best performers on October 22. The Johannesburg-based company’s ADRs listed in New York gained 9% to a four-month high, but are still trading down 48% this year.

Fellow South African miner Gold Fields NYE:GFI, which is the worst performer among the gold majors this year, jumped 5% in New York. The world’s fourth-largest gold producer has had its value slashed 62% in 2013 with investors punishing it for its contrarian purchase of high-cost mines amid the slump.

Goldcorp TSX:G, expected to produce around 2.5 million ounces of gold this year, jumped 4.9%, helping retain its top spot as the most valuable gold stock.

The Vancouver-based company has jumped more than $2 billion in market value over the past week and is now worth $21.3 billion.

Toronto’s Kinross Gold TSX:K scaled the $6-billion mark, gaining 3.3% but investors in the company are still nursing a $5-billion loss in market cap this year after Kinross, like all the majors, took multi-billion-dollar charges against the value of its operations.

Australia’s Newcrest Mining declined 0.5% on the Sydney bourse, missing out on the gold price rally in New York. The Melbourne-based company earlier this month ousted its CEO and chairman after its August results showed an AU$5.6-billion loss.

Canada’s second-tier gold miners also enjoyed a rerating with Yamana Gold TSX:YRI adding 4.6%, Agnico Eagle Mines TSX:AEM jumping more than 4.7%, Eldorado Gold TSX:ELD advancing 3.8% and IAMGOLD TSX:IMG upping its value 4.5%.

Reprinted by permission of Mining.com

Clarifying cash costs

June 27th, 2013

The World Gold Council wants miners to report expenses more thoroughly

by Greg Klein

According to convention, gold can be mined for a few hundred bucks an ounce. Or, when byproduct metals are factored in, for less than nothing. But that method of reporting cash costs might be coming to an end, thanks to the World Gold Council. On June 27 the agency prodded companies to report “all-in sustaining costs” and “all-in costs metrics” to include “additional costs which reflect the varying costs of producing gold over the life cycle of a mine.” That includes exploration.

The guidelines aren’t compulsory, even for WGC members. Nevertheless council spokesperson Terry Heymann said, “We expect that many will use these new metrics, providing further consistency for investors and other stakeholders.”

The World Gold Council wants miners to report expenses more thoroughly

Goldcorp’s Porcupine fleet comprises just one of many mining expenses. With the company’s predicted all-in sustaining costs already close to the price of gold, total all-in costs would be even closer under the
World Gold Council’s new guidelines.

The WGC, which describes itself as “the market development organization for the gold industry,” devised the formula in consultation with its mining company members. Some of them began reporting all-in sustaining costs earlier this year. Barrick TSX:ABX explained its new approach in February. “Our current definition of all-in sustaining cash costs starts with total cash costs and adds sustaining capital expenditures, general and administrative costs, mine site exploration and evaluation costs, and environmental rehabilitation costs.”

As a result the company reported traditionally calculated cash costs for 2012 at $584 per ounce of gold, but all-in sustaining costs of $972. The company predicted 2013 cash costs holding firm at $584 but a drop in all-in sustaining costs to $945.

The previous month Goldcorp TSX:G explained that it considered “byproduct cash costs, sustaining capital, corporate general and administrative expenses and exploration.” But “as the measure seeks to reflect the full cost of gold production from current operations, new project capital is not included in the calculation.”

The company’s 2012 cash costs came to $645 or, after factoring in credits for other metals, a measly $315 an ounce. (Byproduct credits have given other companies negative cash costs.) But under the all-in sustaining cost formula, Goldcorp reckoned $865 an ounce for 2012. The company’s January statement forecast 2013 all-in sustaining costs at $1,000 to $1,100 an ounce, attributing the increase to inflation and “the impacts of lower grades and byproduct production at Peñasquito,” the company’s second-largest producer.

Newmont TSX:NMC and Yamana TSX:YRI ranked among others reporting all-in sustaining costs. The WGC suggests others start the next calendar year with the new guidelines.

But those announced June 27 go further than all-in sustaining costs. Now considered are costs not related to current operations: community, permitting, and reclamation and remediation. Also included are non-sustaining costs: exploration and study, capital exploration, capitalized mine development and other capital expenditures. Added together, they form the “all-in cost.”

Not factored in, however, are income tax, working capital, financing charges, “costs related to business combinations, asset acquisitions and asset disposals [and] items needed to normalize earnings, for example impairments on non-current assets and one-time material severance charges.”

The WGC considers the new approach “helpful to investors, governments, local communities and other stakeholders in understanding the economics of gold mining.” Presumably that might help clarify discussions about investment return, royalties and community benefits.

Of course the guidelines come at a time when bullion prices are falling towards or even below inflationary costs. Among last week’s most widely publicized mining news was Barrick’s announcement that it was slashing 100 desk jobs. Looked at less dramatically, that amounts to about 0.004% of the company’s 25,000 employees.

More troubling news, however, came from smaller companies. Golden Minerals TSX:AUM, Huldra Silver TSXV:HDA and Atna Resources TSX:ATN have all suspended mining over the last week, while Troy Resources TSX:TRY cut pay, staff and exploration, among other expenses. In a statement accompanying Troy’s June 27 announcement, CEO Paul Benson said, “Although we are bullish on the gold price over the medium and longer term, we will position the company to operate in the current price environment and any rise in the price of gold will be a bonus.”