Good afternoon
nothing stopping these equity markets….money makes the world go ´round! Base metals all green, gold improving - a weaker US$ is helping.
CPI in the States showed few signs of inflation…CPI in Europe is negative. That was good for bonds, which have traded up from pretty weak levels . This is probably very important for gold and markets…it had started to look pretty ugly earlier this week, as the yield curve steepened quite dramatically.
Consumer Confidence in the US fell more than expected in early Nov - probably not beeing suuported by all this election s..t!
Aluminium is continuing to go higher….just about to eclipse the 2019-high!
Oil is retreating from recent highs.
At this stage, corona numbers are massive…150.000 in the US over last few days per day, 22-23.000 in Germany - 4 ( !! ) in Australia!!!
Osino Resources - excellent exploration results out yesterday! Their relatively low grades don´t seem to catch the imagination of the retail investor, though! But 327m at 0,76g gold/t incl 94m at 1,35g / 332m at 0,82 g incl 57m at 2,08g / 149m at 1,12g incl 60m at 1,7 g / 99m at 0,87g incl 8m with 3,7g and 3m with 5,1g are very exciting stuff!! Costs in namibia are low, and I could well imagine, that their resource ( which starts to look like having a low stripping ratio ) could well have an economic cut-off grade of 0,3g gold/t or so - making these kind of intersections very valuable. The company keeps on extending the strikle length and the with as well, auguring well for a very sizeable starter-resource . The company has currently 8 drill rigs drilling 35.000m until Christmas to enable a first resource calculation in the first Quarter 2021. The company already has a reasonable market cap - buit when I look of takeovers like the following, it´s still very cheap!
Aurelia Metals - is taking over a private gold mine in New South Wales …350.000oz at 7g in resources, 202.000 oz at 5,7g in reserves - 50.000 oz in production at about 1250 A$/oz AISC for less than 5 years proven - for 200 mill A$! The mine got comissioned a few month ago and is still ramping up to full production. I think this looks pretty desperate for growth…but I do not know the asset. It must have a lot of exploration potential to validate the price! Especially taking into account, that the company is taking on some hedging to finance the aquisition, and is placing equity at a 20%discount to recent prices! I was starting to look at AMI as I thought, that they look pretty sexy from an exploration püerspective, as well as offering some nice base metal exposure….but this takeover has prompted me to take a wait-and-see approach! Grade is king - but not everything! A potentially very nice and wide open pit at 1g might be more desirable than an underground mine at 5-6g at times!
Horizon Gold - had their AGM the other day, which highlighted just how much esploration potential the company has at Gum Creek. I totally agree and have been advocating exploration/drilling for many month…Well, they are finally drilling - results should be out shortly! If the company would have a different controlling shareholder ( for example one which does not only think of his own benefit ) and if governance would be halfway normal at this company, the share price probably would be substantially higher already!!!
Strike Energy - the well is drilling at about 2460m and all is going ok now. The final target is about 4000m - so some time ago and we will not know full results long before Christmas. Interesting to note, that the well so far is looking very similar to the very successfull West Erregulla 2! Some interesting article in the Australian press today, which could be very bullish for gas demand as well as gas prices in Western Australia in the longer term:
North West Shelf output 'could decline 30pc' (Financial Review)
Output at Australia's biggest LNG producer could fall by about 30 per cent, requiring two of the North West Shelf venture's five trains to be shut down in the next five years because of a lack of gas, Macquarie Equities said.
The estimate follows the outlook given on Wednesday by the venture operator, Woodside Petroleum, for production at its Karratha gas plant, which confirmed that spare capacity would emerge as of next year as gas fields mature. The news has ramped up pressure on negotiations by the North West Shelf venture partners to settle on alternative supplies of the fuel to limit the drop-off.
Woodside signalled that spare capacity at the Karratha plant would grow to up to 50 per cent by 2028 in the absence of gas from third parties to supplement the venture's own supplies.
The company is targeting deals this quarter with third party owners of gas, including Mitsui and Beach Energy, to provide alternative supplies. But agreeing on the terms for processing external gas has been hugely problematic between the five partners of the North West Shelf venture, leading to lengthy delays.
Head of operations Fiona Hick said that in the absence of third party gas, Woodside would likely close down one of the smaller and older of the five LNG production trains in Karratha in 2024.
have a nice weekend!
WS
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