Morning Briefing: Appian to Invest Up to C$100M in Osisko Metals

Welcome to Mining Stock Daily. I’m Trevor Hall. And I’m Paul Harris.

Today is Wednesday February 22nd.

Despite the bloodbath in the stock market Tuesday, silver managed to close 17 cents per ounce higher than Friday. Gold and the mining stocks, though red for the day, managed to outperform the rest of the stock market. The yellow metal traded lower overnight with stock futures but then bounced from $1839 per ounce to as high as $1853 before succumbing to sell-pressure in the paper futures market, settling at $1844. Silver, on the other hand, powered higher starting about 30 minutes after the London a.m. fix, running from $21.68 up to $22, before pulling back to settle at $21.86. Of note, it made two attempts to push through $22. The Mining Stock Journal is confident that if the stock market had rallied into the close, silver would have popped over $22.

The mining stocks closed down in correlation with the stock market. The GDX was down 1% but outperformed the Dow by at 2 to 1 margin and the Nasdaq by a 2.5:1 margin. A handful of stocks, like Agnico Eagle Mines, managed to close green on the day. The Mining Stock Journal said that, now that the mining stocks, using the GDX as a proxy, have tested the 200 day moving average, and silver came close to kissing its 200 dma, in all probability the precious metals sector is more likely to head higher regardless of the direction of the general stock market.

We will get to the news from the miners and explorers in a moment, but first a word about today’s sponsor.

This episode of Mining Stock Daily is brought to you by…Fireweed Metals

Fireweed Metals is advancing 3 different projects within the Yukon and Northwest Territories, including the flagship Macmillan Pass Project, a large zinc-lead-silver deposit and the Mactung Project, one of the largest and highest-grade tungsten deposits in the world. Fireweed plans to advance these projects through exploration, resource definition, metallurgy, engineering, economic studies and collaboration with indigenous people on the path to production. For more information please visit fireweedmetals.com.

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

Osisko Metals entered into an investment agreement with London-based private equity group Appian Natural Resources Fund to form a joint venture for the advancement of the Pine Point lead and zinc Project in Northwest Territories in Canada which will see Appian invest up to C$100 million over four-years, to acquire a 60% interest in Pine Point, at a pre-money valuation of C$91.3 million. Of this, C$75.3 million will be used to advance Pine Point to a Final Investment Decision or construction approval, and approximately C$24.7 million in cash payments to Osisko Metals. A milestone payment of $16.4 million is due upon a positive investment decision will bring Appian's ownership to 60%, although the final payment will increase or decrease should the actual amount spent to get to the investment decision differ from the estimated C$75.3 million. Appian also agreed to invest C$5 million in Osisko Metals at 25c per share. Osisko Metals (TSX-V: OM; OTCQX: OMZNF) news release

HighGold Mining initiated plans to spin-out its Ontario and Yukon exploration properties into a newco to be named Onyx Gold, which will be listed on the TSX Venture Exchange. Concurrent with the listing, Onyx will complete a non-brokered private placement to fund work programs. Full details of the Spin-Out will be made available in the future. The spin out will allow HighGold to focus on exploration of its Johnson Tract project in Alaska, which has an Indicated Resource of more than 1 Moz at 9.4g/t gold equivalent. The company believes Johnson Tract has overshadowed its Ontario and Yukon gold assets and the spin out will allow their exploration to continue. HighGold Mining (TSXV: HIGH) (OTCQX: HGGOF) News release

Galiano Gold reported a feasibility study for the Asanko Gold Mine in Ghana, where it is the operator of a 50:50 joint venture with Gold Fields. The feasibility features a reinstated reserve and a revised life-of-mine plan to produce 217,000oz of gold per year at an all-in-sustaining cost of $1,143/oz using a base case $1,700 per oz gold price. The mine now has an after tax NPV of $343 million at a 5% discount rate. Mining is to recommence in 2023. The reinstated reserves are 48.9Mt at 1.31g/t ) for 2.1Moz at a gold price of $1,500/oz. Galiano Gold (TSX: GAU) (NYSE American: GAU) Gold Fields (JSE: GFI) (NYSE: GFI news release

GoGold Resources published additional drilling results from Los Ricos South, within the Eagle and Main Deposits in Mexico.  Hole LRGAG-22-113 intercepted 16.3m of 605 g/t silver equivalent containing 6,490 g/t AgEq over 80cm. The hole also intercepted an additional 12.3m of 462 g/t AgEq. The Eagle Deposit adjoins the Main Deposit and represents a northern extension of the previously defined Mineral Resource Estimate in the Los Ricos South PEA. The Company is carrying out a trade-off study to better define what portion of the deposit could be mined in a lower strip ratio pit and what portion would best be mined in more selective bulk underground mining. GoGold trades on the TSX with GGD and on the OTCQX with GLGDF. News Release

Ivanhoe Electric has entered into an earn-in agreement and joint venture with privately-owned Exiro Minerals to acquire up to an 80% interest int he White Hill copper project in Nevada. White Hill is located approximately 20 miles east of Hawthorne and 100 miles southeast of Reno, Nevada. Local prospectors discovered copper mineralization at White Hill in the late 1800s. By 1910, the London, UK-based Copper Hills Mining Corporation had sunk a 220-foot shaft, driven a 310-foot adit, and developed a 340-foot sub level to exploit the shallow, skarn-hosted, copper oxide mineralization. Copper oxide mineralization extended to a depth of 200 feet, beyond which copper-molybdenum sulfide mineralization was reported. Ivanhoe Electric has recognized the potential for buried porphyry, skarn and carbonate-replacement mineralization to exist at the White Hill Project, as well as possible extensions to the areas of currently known copper-skarn mineralization. Ivanhoe Electric trades on the NYSE American and the TSX with IE. News Release

Excelsior Mining announced an Updated Preliminary Economic Assessment on the Johnson Camp Mine Heap Leach project in Arizona, which includes the results of a drilling program completed in 2022 and the implementation of sulfide leaching technology to improve recoveries. The PEA proposes heap leaching of sulfide copper with accelerated pyrite oxidation by mining oxide, sulfide, and transition material from the Burro and Copper Chief pits for 20 years and heap leaching for an additional year to produce 25Mlb/y of copper cathode. To restart JCM for heap leaching, two developments need to take place simultaneously: pre-stripping and mine development, and the construction of a new heap leach pad, which require between six and nine months to complete before irrigation of the new leach pad could commence. It would yield an after tax NPV of $180 million at a 7.5% discount rate and IRR of 30.4% following a capex of US$58.9 million at a  $3.75/lb copper price. Excelsior Mining (TSX: MIN) (OTCQB: EXMGF) news release

The Mining Stock Daily morning briefing is produced by Clear Commodity Network and Investment Research Dynamic’s Mining Stock Journal. It is distributed throughout the world through your podcast network of choice, and by our friends at the Junior Mining Network. 

The information presented should not be considered investment advice. Mining stock daily and its affiliates are not responsible for any loss arising from any investment decision in connection with the material presented herein. Please do your own research or speak with a licensed financial representative before making any investment decisions.