?? - Middle East De-escalation: What's Next for Gold Prices?
CEO.CA Presents the Chairman's Briefing - November 28th, 2024
“There can be no other criterion, no other standard than gold. Yes, gold which never changes, which can be shaped into ingots, bars, coins, which has no nationality, and which is eternally and universally accepted as the unalterable fiduciary value par excellence.”
– Charles de Gaulle
Metals/Crypto Price
In Partnership With
ESGold Corp. (CSE: ESAU | OTC: SEKZF | FSE: Z7D) is advancing clean mining practices at its Montauban Project by evaluating non-cyanide processing technologies and breakthrough milling solutions. These innovations aim to reduce energy, water use, and costs while enhancing gold and silver recoveries. ESGold's strategy aligns sustainability with profitability, positioning it as a leader in green mining.
With construction set to begin, exceptional project economics (142% IRR, <6-month payback) bolster its value. ESGold’s initiatives rehabilitate legacy sites, drive innovation, and align with government sustainability priorities, reinforcing its role in environmentally responsible resource development.
See full press release here.
Gold
In last week's Briefing, we highlighted gold's breakdown, how it breached its 50-period SMA and key support at $2600. We explored the possibility (likelihood) that those with a bearish lean had been caught offside in a classic Bear Trap.
Price action earlier this week suggests the jury is still out on the setup's validity as the precious metal took a solid hit amidst profit-taking, a temporary de-escalation of Middle East hostility, and waning expectations of a December rate cut (the CME Fedwatch tool now shows odds of 56% for a December cut, down from 62% last week).
Trump's nomination of billionaire hedge fund manager Scott Bessent for Treasury Secretary was also cited for the metal's sudden decline. Bessent is viewed by many as a potentially stabilizing, market-friendly force.
The precious metals arena is now marked by extreme chop. Volatility is making its masterpiece (Bill Shakespeare voice).
Another Bank Reiterates Bullish Count
Analysts at UBS see the monetary metal trading upwards of $2900 in 2025 (Goldman went on record recently with a target of $3k) - Gold volatility will continue, but price should hit $2,900/oz in 2025 on geopolitics and fiscal concerns – UBS.
UBS Precious Metals Strategist Joni Teves: “We remain bullish on gold here,” she said. “ We think the outlook is quite positive heading into next year. Easing by the Fed continues to be supportive for gold, and fundamentals continue to be positive as well. We expect central bank buying to continue, and physical demand we think will remain resilient even as prices continue to rally.”
Concerning the average investor's exposure to the metal, Teves went on to add: "Generally, we think the market is still underinvested in gold, and therefore there's room for more allocations to be built up."
In Partnership With
Vizsla Copper reported the final drill results from the summer core drill program at Woodjam and Redgold projects in BC.?
The program successfully accomplished its main objectives: 1) expand on high-grade porphyry-related gold-copper mineralization at the Deerhorn and Southeast deposits, and 2) define new exploration targets to be evaluated in future drill programs (Three Firs, this release and Great Plains). ??
The 2024 drill program is now complete, and assay results have been received from all the drill holes. ?New drilling and geophysical data are currently being integrated with existing project-wide data to prioritize targets for the next phase of exploration which may include drilling at the Three Firs, Deerhorn, and Southeast targets.
See full press release here.
General Mining Sector News
Mali's Bullying Tactics Payoff
There's always a solid case to be made for channeling one's investment dollars into (only) the mining-friendliest jurisdictions, especially in this lofty gold price environment. A twitchy government, one without a clear and fair set of values where mining interests are concerned, can wreak all kinds of havoc on an operation: revising their mining codes (raising taxes/royalties), bullying their way in for a bigger piece of the action, or even outright expropriation. It's been known to happen.
In the Fraser Institute's most recent Survey of Mining Companies, the West African nation of Mali, a country rocked by the 2020 coup led by Colonel Assimi Goita, is ranked way down on the list in terms of investment attractiveness. Foreign companies in the resource extraction business are encountering increased hostility as they attempt to negotiate terms to satisfy the military junta's rapacious appetite for more... waaaay more.
In our Nov. 14 Briefing, we noted ASX-listed Resolute Mining's share price collapse after the government detained the company's CEO over an outstanding tax bill attached to its Syama gold mine. The tactic worked. Resolute coughed up the entire wad - Mali Frees Resolute Executives After $160 Million Deal, AFP Reports.
The company's stock, listed on the ASX, remains under pressure...
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Barrick Detained. Again
Well, it worked like a charm on Resolute. Why not pull the same bully tactics on ABX?
In a sparsely worded Nov. 26 press release, the mining colossus confirmed that four employees of its Loulo-Gounkoto mining complex in the West African nation had been charged and detained pending trial. According to Reuters, these are the same four that were (briefly) arrested back in September - Barrick Confirms Arrest of Four Malian Employees, Reaffirms Commitment to Resolution of Disputes.
The junta is seeking a bigger piece of the Loulo-Gounkoto pie and roughly $500 million for unpaid taxes. Last month, Barrick proposed to split the concessions ownership in favor of the military junta—55% to 45%, but the offer was rejected. Both sides have been attempting to hash out a deal for months. According to CEO Mark Bristow: "Our attempts to find a mutually acceptable resolution have so far been unsuccessful, but we remain committed to engage with the government in order to resolve all the claims levied against the company and its employees and secure the early release of our unjustly imprisoned colleagues."
Back on North American soil, in the mining-friendly jurisdiction of Nevada (ranked in the top five on Fraser's investment attractiveness list), the mining giant highlighted a bright spot in its development project pipeline - Barrick's Fourmile Project Shows Further World-Class Potential.
This updated resource estimate at Barrick's Fourmile project shows a 192% increase in Indicated ozs (1.4 million ounces grading 11.76 g/t Au), a 137% increase in Inferred ozs (6.4 million ounces grading 14.1 g/t Au), and a 35% increase in grade relative to the company's 2023 year-end MRE.
The increases reflect the addition of 25 new drill holes to the 2023 mineral resource estimate across the southernmost portion of the orebody, immediately adjacent to the Goldrush project at Cortez which is part of the Nevada Gold Mines joint venture (NGM).
CEO Bristow: "Since the formation of the NGM joint venture in 2019, we have added more than 19Moz of proven and probable mineral reserves to the life of mine plan on a 100% basis2. This does not yet reflect the additional exploration upside that we see today, including Greater Leeville and Hanson in Cortez Underground."
Osisko Snags Key Permit
Shares of Osisko Development (ODV.TO) have firmed up in recent sessions after the developer announced a key permitting milestone for its wholly-owned Cariboo gold project in central British Columbia - Osisko Development Receives BC Mines Act Permits for Cariboo Gold Project; Environmental Management Act Permits Referred.
With project construction and operating permits now in hand (the remaining Environmental Management Act permits are expected shortly), the company is advancing discussions concerning various funding options, including a comprehensive financing package.
Sean Roosen, Founder and CEO: "Receipt of the construction and operating permits for the Cariboo Gold Project is a major milestone and monumental achievement for Osisko Development and its stakeholders. It is the culmination of almost five years of extensive discussion and consultation with provincial regulators, Indigenous nations and host communities in ensuring the Project becomes a model for responsible mine development and environmental stewardship that redefines mining for a better future."
The project's ounce count currently stands at 1.57 million ozs grading 3.33 g/t Au in the M&I categories, plus an additional 1.71 million ozs grading 3.44 g/t Au in the Inferred category.
A 2023 feasibility study for Cariboo envisions a robust and scalable underground operation geared to produce roughly 1.87 million ounces of gold over a 12-year mine life, with an after-tax NPV5% of C$502 million and 20.7% IRR using a conservative $1,700 gold price input.
The company is now advancing work on an optimized feasibility study, due to be released in Q2 of 2025.
Newmont Turfs éléonore
Since its discovery by Virginia Gold in 2004, the éléonore deposit has changed hands three times: In 2006, Goldcorp took out Virginia for $420 million. In 2019, Newmont took out Goldcorp in a deal valued at $10 billion. Earlier this week, Newmont announced the sale of the éléonore mine, with an annual production of roughly 215,000 ounces, to London-based Dhilmar for $795 million cash - Newmont Announces Agreement for Sale of éléonore for $795 Million in Cash.
This deal marks the second divestment by Newmont in as many weeks as the miner fixes its sights on raising cash and the operation of Tier-1 assets (a Tier-1 Gold Asset has a reserve base sufficient to deliver a minimum 10-year life, annual production of at least 500,000 ounces of gold and total cash costs in the lower half of the industry cost curve).
éléonore's proven and probable ounce count currently stands at 1.57 million ozs.
Tom Palmer, Newmont's President and CEO: “Today’s announcement is another step forward in Newmont’s journey to create a go-forward portfolio of Tier 1 gold and copper assets, each with the scale and mine life to generate strong free cash flows for several decades. When we announced the acquisition of Newcrest in 2023, we committed to generating at least $2 billion in cash through portfolio optimization. With this announced sale, we have meaningfully exceeded our target by more than $1.5 billion to date. Proceeds from this transaction will support Newmont’s comprehensive approach to capital allocation, which includes strengthening our investment-grade balance sheet and returning capital to shareholders.”
On Nov. 18, the company sold its Musselwhite Gold Mine in Ontario to Orla (OLA.TO) in a deal valued at $850 million.
Aldebaran Trots Out ("Very") Significant Resource Update at Altar
Aldebaran (ALDE.V) made an impression on the market by dropping a resource update for its Altar Cu-Au Project in San Juan Province, Argentina, a JV with Nuton, Rio Tinto’s sulphide leaching technology venture -?Aldebaran Reports a Very Significant Increase in Mineral Resources at the Altar Copper-Gold Project in San Juan, Argentina.
This updated mineral resource estimate (MRE), which forms the foundation of three main porphyry discoveries (Altar Central, Altar East, and Altar United) within a single conceptual open pit, comes on the heels of 63,000 meters of drilling since the last MRE in 2021.
Updated MRE Highlights:
Dr. Kevin B. Heather, Chief Geological Officer of Aldebaran: “We believed there was geological evidence that the gap between Altar Central and Altar East could host significant mineralization that had never been drilled. Fast-forward to today, after seven years of conviction, hard work, and the discovery and definition of the Altar United porphyry, we’re happy to report a very significant increase in the 2024 Altar Resource Estimate. Just as important as the size of the deposit, 66% of the resource tonnes are classified as Measured and Indicated, indicating a very high confidence level in the resource estimate. This will prove very valuable while working towards a PFS on Altar, which we plan to complete in H2-2026. This important milestone clearly adds substantial value and positions Altar as one of the very few truly giant copper-gold projects still in the hands of a junior exploration company.”
Hits of the Week
Donald Trump has leveled his most severe threat against Canada in years, warning that on his first day in office he might impose punishing economic sanctions across North America. The U.S. president-elect threatened Monday evening to slap a 25 per cent tariff on all products entering the country from Canada and Mexico on Jan. 20, 2025, his inauguration day, unless those countries curb the flow of drugs and migrants across their borders - Donald Trump threatens 25% tariff on products from Canada, Mexico
British Columbia’s exploration sector has over 60 critical mineral projects waiting for permits. It’s a C$38 billion ($27bn) pileup of economic opportunities, some waiting indefinitely, according to Association for Mineral Exploration (AME) CEO Keerit Jutla. Without action, BC risks falling further behind Ontario and Quebec, whose streamlined policies and targeted funding have helped them attract more exploration funding, Jutla said. AME represents about 5,000 members - Permitting delays impact British Columbia projects valued at C$38 billion, AME says
A proposed increase in mining royalties in Mexico could block more than $6.9 billion in investments over the next two years, the industry’s local chamber said on Thursday. As part of its budget proposal published last week, the Mexican government proposed raising mining royalties under the argument that metal prices have risen in recent years - Mexico’s proposed higher mining royalties could block nearly $7bn in investments
Artemis Gold (TSXV: ARTG) says its Blackwater mine in central British Columbia is now in the final stages of construction and commissioning, tracking towards its scheduled first gold pour by the end of this year. In an update provided Thursday, the company said first ore has been fed to the processing facility’s crushing circuits, with full handover from commissioning to the operations team expected within the next few weeks - Artemis Gold’s Blackwater mine at final commissioning stage
The global economy is at a tipping point, driven by green energy, AI breakthroughs, urbanization and soaring EV adoption. This is resulting in an explosive demand for critical metals - (Watch) The Perfect Storm: Why AI, EVs, and Green Energy Can't Survive Without Mining
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