HudBay CEO provides exploration update

HudBay Minerals Inc.  [HBM-TSX, NYSE] has announced a substantial increase in Proven and Probable Reserves at its Lalor gold zone, which is part of the company’s Snow Lake operations in Manitoba.

The company said Proven and Probable Reserves at the Lalor Zone have increased to 6.0 million tonnes grading 6.35 g/t gold and 26 g/t silver. That’s up from the previous year’s estimate of 3.0 million tonnes grading 6.72 g/t gold and 23 g/t silver. Total contained gold ounces have increased to 1.2 million ounces, up 90% on a year over year basis. As a result, total gold reserves in the Snow Lake camp now stand at 2.2 million ounces.

HudBay shares advanced on the news, rising 7.1% or 18 cents to $2.71 on volume of 1.6 million. The shares are trading in a 52-week range of $1.66 and $10.42.

HudBay is an integrated mining company, primarily producing copper concentrate (containing copper, gold and silver), zinc concentrate and zinc metal. The company owns four polymetallic mines, four ore concentrators and a zinc production facility.

The operations are located in northern Manitoba and Saskatchewan, Peru and Arizona.

HudBay has said its operational focus in Canada is shifting to Manitoba’s Snow Lake region as its reserves, processing capacity and exploration activities expand in the region, setting the stage for a new phase of growth.

The company said its Lalor Mine (gold, zinc, copper, silver) in Snow Lake is fast becoming a meaningful low-cost gold producer that will benefit substantially from the refurbishment of the New Britannia mill. The refurbishment is expected to be completed in 2022.

Lalor is a gold and zinc mine located in the Flin Flon Greenstone Belt. The 100%-owned mine is spread across an area of 916 hectares, approximately 3.0 km from HudBay’s Chisnel North Mine.

Meanwhile, the updated reserves support an extended 18-year mine plan that utilizes the existing 4,500 tonne-per-day Stall mill and the refurbished 1,500 tonne-per-day New Britannia mill, with ore sourced from the Lalor, WIM and 3 Zone deposits.

Annual gold production is now anticipated to be greater than 150,000 ounces annually over the first eight years after the start-up of New Britannia. That compares to the previous target of 140,000 ounces annually over the first five years.

However, the increase in production is offset by expected life-of-mine average mining costs at Lalor, which have increased to $110 per tonne from $92 per tonne, a 20% increase. Life-of-mine sustaining capital has also increased, the company said.

Separately, HudBay said its 777 Mine in Flin Flon, Man., is approaching the end of its life after 15 years of operations. Final production is anticipated in 2022.

Peter Kukielski, President and CEO of HudBay said he is pleased with the company’s exploration success over the past 12 months in Manitoba and at HudBay’s flagship Constancia mine in Peru.

“In addition to replacing ore that was mined at Constancia last year, we are also encouraged by recent drilling results north of the Constancia pit where high-grade skarn mineralization has been intersected,” he said.

Constancia is primarily a copper mine, situated in southern Peru and consists of the Constancia and Pampacancha deposits. The secondary metals are molybdenum and silver. Commercial production was achieved in April, 2015.

Chris Temple from The National Investor – Tue 31 Mar, 2020

Oil Price War Is Devastating Energy Companies – The Gold Price Sells Off Into The Close

Chris Temple wraps up the day with comments on the oil sector and gold.

The price for oil has dropped into negative territory in some areas of the US. Chris thinks it will get worse and have an impact on the banking system as well.

As for gold, price drifted down throughout the day and closed below $1,600. Chris reiterates his thoughts on the overall market and buyers in gold.

Click here to visit Chris’s site and learn more about his newsletter.

David Erfle – Gold Market Commentary – Tue 31 Mar, 2020

Gold vs gold stocks and silver – It’s all about inflation expectations when this virus is behind us

Dave Erfle joins me to balance the recent moves in gold against gold stocks and silver. Gold clearly has a much better chart pattern than gold stocks or silver but recently the stocks and silver have been holding up slightly better. This brings us into a discussion about inflation and expectations when this virus is behind us and we finally get back to some form of daily life.

Click here to visit Dave’s site and learn more about his newsletter.

Ed Moya – Senior Market Analyst at OANDA – Tue 31 Mar, 2020

A sense of calm for the markets, a new Fed repo facility, and Russia slowing their gold buying

Ed Moya joins me to discuss the decrease in volatility and general rebound for US markets. Even though there is a lot of bad news still released everyday the markets are more shrugging off this news than reacting the downside.

The Fed also introduced a new repo facility for foreign central banks. This could ease some of the volatility in the dollar. Also we touch on the gold market and an announcement by Russia regarding their buying plans.

Click here to visit the OANDA website and follow along with what Ed is writing.

Katoro Gold raises £215 000 in bid to continue uninterrupted work during Covid-19 disruptions

Gold exploration and development company Katoro Gold has raised £215 000 through the placing and subscription of 17.2-million new ordinary shares at 1.25p a share. This will provide the company with additional working capital and further bolster its ability to continue uninterrupted work on its projects during the current uncertainty and unpredictability associated with Covid-19.

Ravenswood sale completed – Resolute

Gold miner Resolute Mining has completed the sale of its Ravenswood gold mine, in Queensland, to a consortium consisting of private equity manager EMR Capital and energy and mining company Golden Energy and Resources (GEAR). Resolute in January this year struck an agreement with the consortium, under which they would pay A$300-million for the project, consisting of A$100-million of upfront value and up to A$200-million in potential payments, which will be contingent on future gold prices, future production from Ravenswood, and the investment outcomes from the Ravenswood project for EMR Capital.

Harmony Gold’s nine underground mines cease operations

Mining has ceased at all of the nine underground gold mines of Harmony Gold but the Johannesburg- and New York-listed company’s surface retreatment operations and opencast mine will continue to function, collectively producing between 650 kg and 700 kg in the 21-day lockdown period in response to the COVID-19 pandemic. The company’s Hidden Valley gold mine in Papua New Guinea will also continue to mine, subject to any directive issued in line with the southwestern Pacific country’s coronavirus response.

Blackham signs supply and alliance agreement

ASX-listed gold miner Blackham Resources has inked a sales contract with Russian gold miner Polymetal International over all of the non-committed gold concentrate from Blackham’s Stage 1 expansion project of its Western Australian operations. The Stage 1 production rates are expected to average some 110 000 oz/y from 2022 to 2027, and would underpin Blackham’s pathway to a more than 200 000 oz/y producer following a Stage 2 expansion.

Gold Fields places South Deep mine on care and maintenance

Johannesburg- and New York-listed gold mining company Gold Fields has placed its South Deep gold mine in Gauteng on care-and-maintenance to coincide with South Africa’s lockdown until April 16. In publishing its integrated annual report for 2019 and a number of associated reports on its website, Gold Fields CEO Nick Holland provided an update on the impact of the Covid-19 pandemic on Gold Fields and its operations, detailing the actions taken by the company to date, both in response to government directives and on its own accord.