Market Update

Correction? - Perseus - Resolute - Lucapa

Good afternoon

is the long-awaited consolidation of gold with us now? it almost fels like it - but interesting is, that so far - 1 hour into US-trading - gold stocks are giving up less even than they made yesterday...today is crucial, for my feeling, as we will find out, whether market participants are still buying any dip, or whether we need a break!

European markets are recovering a little today - as is the british pound. oil is trading better ( hoops - as I am closing, it moved from +2% to miuns 1.5% ! ), but base metals are mixed to weaker.

The People´s Bank of China bought some 500.000 oz of gold again in June, after pausing in may.

Mrs. Lopez, the Enviroment Secretary of the Philippines and the newly found, best friend of nickel bulls, empazised again her willingness to close non-compliant mining operations over the next few month. I think as a minimum expectation, nickel ore mining will become more expensive, driving potentially costs of Chinese nickel pig iron producers up.

Chilean exports of copper at the lowest since 2009 last month, driven by lower grades, and a lack of water in the country. But Peru with it´s rising production nearly makes up for it. The low copper prices is making it hard for new projects - CRU estimate, that just 6 new, larger projects will make it until 2020, which might well not be enough to satisfy demand.

Perseus - a better Quarter than feared for! just above 40.000 oz were 8% up on the March-Quarter, and 24% up on the Dec-Quarter, as per guidance. Costs will only be known, once the full Quarterly has been released, but will be within guidance as well. Very encouraging to see, that the grade control issues seem to be in hand - grades improved by 19% vs previous Quarter to 1.01g/t, and improved further in June to 1.04g/t. Guidance for Financial Year to June 2017 remains unchanged for Edikan: 226.000 oz at 1207 US$ all-in-site costs, followed by 282.000 oz in 2018 at 996 US$. It´s this imporvement, which I like - and which I hope to be achieved. Sissingue, the new and much smaller mine, should be in production early in the 4th Quarter of 2017 - probably 2-3 month later than expected as to delays in final approvals.

The relocation project makes good progress - first houses have been moved into now.

Resolute - also with a first update of production during the June-Quarter. Debt is fully repaid, cash and bullion of 101 mill A$. Production of 315.000 oz was exactly in line with guidance, AISC of 1210 A$/oz were marginally better than guidance. POiutlook for this financial year is for a minimum of 300.000 oz - again, more or less in line withe xpectations, which are 310-315.000 oz, at AISC of 1280 A$. Exploration budget has been increased to 19 mill A$. More exact update to come in the Quarterly Report.

Lucapa Diamonds - Quarterly out today. No big surprises - mining numbers up, plant throughput up, production up in line. No "mega"-diamonds have been found in the Quarter, which was still subject to very wet conditions. Production and Mining-numbers are showing the increased investment in equipment. Exploration has started in earnest now - that could/should be the main driver, alongside the potential discovbery of very large stones, as the company will be mining in the area which delivered the best diamonds so far.. Following the capex, LOm have 15 mil $ cash in the bank, and had 1220 cts in inventory. 

Have a nice eveing, and enjoy the soccer, if you are French or Germany!

WS

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