Auryn to Acquire Eastmain at a 137% Premium

Welcome to Mining Stock Daily. This is your host, Trevor Hall

Today is Thursday July 30th.

Gold traded higher on Wednesday for the 9th day in a row, weathering the FOMC policy announcement, which historically is a day when gold gets manipulated a lot lower. The price management squad tried to take gold lower on a best efforts basis when gold was given a $14 beat-down on no news at 10 a.m. NY Time and $28 dollar waterfall ride over a 15 minute time period at 3:00 p.m NY time right after the Jay Powell propaganda show. Silver was up slightly on the day while the mining stocks were hit for 1% using GDX as a proxy. The Mining Stock Journal said that the rally in the precious metals sector has been a lot of fun but it needs a pullback or consolidation period to build a base for the next move higher. Certainly the Fed's policy stance which calls for a lot more money printing will provide the fundamental back-drop for gold to shoot over and stay over $2,000. 

We’ll get to the news out of the miners and explorers here in just a quick moment, but first a quick mention of today’s sponsor. 

This episode of Mining Stock Daily is brought to you by… Integra Resources.

Integra Resources trades on the TSX-V under ITR and the OTCQX under IRRZD. Integra Resource is advancing its past producing DeLamar  Gold-Silver project in SW Idaho through aggressive drilling and exploration. The latest Resources Estimate released earlier this summer showed approximately 4 million Gold equivalent ounces in the measured and indicated category.The maiden PEA for the project established a net present value of C$473-million and an IRR of 43%. The management of Integra successfully sold its previous brownfields project for C$590 million in summer 2017. Read more about the company and its successful management team at integraresources.com.

And here’s what you need to know this morning…

Auryn Resources and Eastmain Resources announced they have entered into a definitive agreement pursuant to which Auryn will acquire all of the issued and outstanding shares of Eastmain, immediately following a spin out of Auryn's Peruvian projects to Auryn shareholders and completion of a concurrent financing. The Transaction will create Fury Gold Mines Limited and two independent spin-out entities. Concurrent with the spin-out of the Peruvian projects, Fury Gold will consolidate its shares by approximately 10:7 such that approximately 110 million Fury Gold shares will be outstanding after the Eastmain acquisition, of which 69% will be owned by current Auryn shareholders and 31% will be owned by current Eastmain shareholders. Fury Gold is expected to remain listed on the TSX and NYSE American exchanges, and will be led by new President & CEO, Mike Timmins. The C$121M offer represents approximately C$0.42 per Eastmain share, representing a premium of 137% to the closing market price of the Eastmain shares. Auryn trades on the TSX and the NYSE with AUG. Eastmain trades on the TSX with ER. News Release

Yesterday, Northway Resources announced they entered into a letter of intent dated July 28, 2020 whereby the Company will acquire all of the issued and outstanding securities of Kenorland by way of a share exchange, amalgamation or such other form of business combination as the parties may determine. Upon successful completion of the proposed acquisition of the securities of Kenorland, it is anticipated that the Company will be listed as a Tier 2 Mining issuer on the TSX Venture Exchange and will carry on the combined business of Northway and Kenorland. The Transaction constitutes a 'reverse takeover' of the Company. Later in the day, Kenorland Mineral shared drill results at the Regnault target on it Frotet Project in the Frotet-Evans Greenstone Belt in Quebec. Results included 8.47 g/t gold over 29 meters and included an interval of 18.43 g/t gold over 11.13 meters. The company says the discovery in the Frotet Evans greenstone belt is in an area with no known mineral occurrences or historic drilling. Kenorland Minerals is a privately owned company. Northway trades on the TSX Venture with NTW. News Release

Ascot Resources shared results front he first seven drill holes of their 2020 season. The drill site is located to the west of the Premier deposit and will potentially add to existing resources outlines in the feasibility study. Results included 20 g/t gold over 3.23 meters and 9.21 g/t gold over 6 meters. The significance of this prospective corridor is further highlighted by high gold grades in surface grab samples even further along strike to the west at Hope, Cascade Creek and Woodbine. Ascot trades on the TSX with AOT and on the OTCQX with AOTVF. News Release

O3 Mining provided new drill results front he East Cadillac Property in Val D’Or, Quebec. Highlights today included 17.8 g/t gold over 1.1 meters and 1.7 g/t gold over 10.3 meters. Current drilling on the East Cadillac property is focused on the North Contact zone, which continues to show continuity laterally and at depth. The North Contact zone is located along the northern splay of the Cadillac Larder-Lake Fault, which can be traced over 6 kilometres within the property. O3 trades on the TSX Venture with OIII. News Release

Canada Nickel shared the remaining assay results from the East Zone and additional results from infill drilling on the Main Zone at its Crawford Nickel-Cobalt Sulphide Project. Hole 43 returned .33% nickel over a core length of 357 meters.The company says they remain on track to complete the Preliminary Economic Assessment by eyear end and a resources update by end of next month. The Crawford Nickel-Cobalt Sulphide Project is located in the heart of the prolific Timmins-Cochrane mining camp in Ontario, Canada. Canada Nickel trades on the TSX Venture with CNC. News Release

And there were lots of financials out this morning. We can’t get to them all but here’s a few takeaways. Kirkland Lake Q2 adjusted net earnings totalled more than $219 million or $.79 per share, double the level from the same time period last year. 

New Gold revenues for the quarter reached $129 million while all-in sustaining costs were $1,283.

Oceana Gold is reducing their guidance for production due to lower Macaes production primarily related to the impact of the 5-week New Zealand COVID-19 restriction which were lifted in April. 

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I’m Trevor Hall. Have a wonderful day. Be well.

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