Kitco MINING

Mining equity investors need to be patient, said Lobo Tiggre, editor of the IndependentSpeculator.com. 

In early May Tiggre spoke to Kitco correspondent Paul Harris at Deutsche Goldmesse held in Frankfurt, Germany. 

Tiggre noted the disconnect between high metal prices and mining equities that are not performing as well as they should. 

Gold has hit several all-time highs in 2024, but the gold miners, measured by the GDX, are only up 12% this year and well-off highs hit early this decade. 

Tiggre notes that the key appeal of mining stocks is their leverage to rising metal prices. With strong gold prices, the underperformance of mining stocks has been a source of frustration.

“If the metal goes up and your stocks are still in the doghouse…something is wrong,” said Tiggre. “Why take the risk if you were better off just buying the metal?”

Tiggre believes mining stocks still have room for significant growth, even if the recent surge was not based on the fundamental factors he anticipated. He expects the market to realize the undervaluation of mining stocks compared to gold, leading to upward price movements in the sector.

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

A general mining recovery begins with producers, said George Salamis executive chair of Integra Resources ( @integraresourcescorp.1721 )    

On Tuesday Salamis spoke to Kitco Mining. 

Integra Resources is focused on the Great Basin of the Western USA. The company has two flagship oxide heap leach projects: the past producing DeLamar project located in southwestern Idaho and the Nevada North project in Nevada.

The Nevada projects came to Integra after a merger with Millennial in 2023. In 2024 Integra will be working on a feasibility study for DeLamar, as well as drafting its permits. 

A recent flurry of M&A and gold hitting record highs have all been good for the resource sector, but there is still a long road to recovery. The gold miner index (GDX) is up only 13% year to date and still well below highs earlier this decade. 

"There's been a lot of value destruction in the last four years in the mining space," said Salamis. "There's a bit of a crisis of confidence in the way investors look at the mining sector. A lot of that I
believe is related to hindsight: inflationary pressure and compression of margins."

In last few years, miners benefited from high metal prices, but energy and labor costs squeezed margins. When miners can control costs, Salamis sees a recovery.  

"I think what it's going to take to turn that around is we need to see the producers start to make real money. The gold price is going to help that. Finally, they'll start producing real cash."

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

The mining market is still subdued despite "violent moves" higher by gold, said Kai Hoffmann, the CEO of Soar Financial. 

On Monday Hoffmann spoke to Kitco Mining. Hoffmann is hosting Deutsche Goldmesse in Frankfurt, a two-day event kicking off May 3 that will showcase 30 resource companies. Some of the keynote speakers will be Brien Lundin, Lobo Tiggre and Jeff Clarke. 

Hoffmann tracks resource financings through Oreninc. Hoffmann is surprised that mining equities are still subdued after copper has run up 20%, and gold has hit several all-time highs. 

"It is still not as rosy as one might expect," said Hoffmann, who notes that the GDX, the gold miner index, is still down over a 12-month period. 

"You would think with a gold price move this violent and copper recovering as nicely as it has that we should be trading much higher. Quite honestly, a lot of people I've spoken with —they've been positioned for 12 months for this breakout, and they're barely breaking even. Maybe they're in the money by 10%. 

"There's no euphoria in this market. The generalist investor is still missing."

Hoffman notes that junior mining companies are still facing challenges in attracting investment. Late-stage development projects are attracting more attention. Gold projects are also gaining more favor. 

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

Newcore Gold jumped 75% this month after releasing an updated preliminary economic assessment. 

On Tuesday President and CEO Luke Alexander spoke to Kitco Mining. 

The mining sector has been enjoying good tailwinds: copper has run up 20%, and gold has hit several all-time highs this year. Still financings remain moderate, according Oreninc. Selective companies are being financed. Alexander hopes the market doesn't run away. 

"I actually hope it remains a selective financing market," said Alexander. "It's really just the quality
projects that get financed, the ones that stand out from the hundreds. [It] is a cyclical business. As the market heats up and as people get more exuberant, the PowerPoint presentations get dusted off and every project out there gets financed. 

"Inevitably...projects that don't have quality assets, that don't have quality teams, that aren't at a stage that they should end up getting financed. The stock prices lag or collapse, and shareholders end up suffering. It then becomes more challenging for the sector to perform overall."

Newcore Gold (TSX-V: NCAU) is advancing its Enchi gold project in Ghana. In April the company released an updated preliminary economic assessment. At a gold price of $1,850 ounce the company showed a $586 million pre-tax net present value discounted at 5%, and a 77% pre-tax internal rate of return rate. The average annual gold production was estimated at 120,000 ounces. The company was up 75% this month. 

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

Management, deposit and social license are all key when considering a resource investment, said Alex Black, executive chairman of Rio2, but time to production plays an important role, too. 

Black spoke to Kitco Mining on Monday. 

Rio2 (TSXV: RIO) is advancing its Fenix gold project in Chile. In April, the company announced a $23 million financing. The company also advanced some of its environmental permits. The company says that its Fenix is the largest undeveloped gold heap leach project in the Americas. The company anticipates production by 2025. 

When assessing a resource company, Black said that the resource, management and social license are all fundamental. Time to develop also has to be weighed. 

"How quickly can [management] develop a project? When you see projects in Nevada and Arizona, it takes five to seven years to get off the ground because of the permitting process. It's not a social issue, but you need to take that into consideration. 

"When you buy into a company...that's not a producer, you've got to say to yourself 'Well, I'm not buying it for now. I'm buying it for what it's going to look like in six or seven years.' [There are] potential takeout takeouts. It depends on the asset."

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

Investors still haven't made the link between high gold prices and mining equities, said Robert Quartermain, co-chairman of Dakota Gold. 

On Monday Quartermain spoke to Kitco Mining. 

Quartermain has a storied career in mining. Most recently he was Executive Chairman of Pretium Resources Inc., which he founded in October 2010. Pretium's Brucejack mine became Canada’s fourth-largest gold mine with annual production of 350,000 ounces. Quartermain was inducted into the Canadian Mining Hall of Fame in August 2022. Newcrest acquired Pretium in 2021 for $2.8 billion. 

Gold has hit several all-time highs, but the gold miners are not seeing the full benefit yet. The VanEck Gold Miners ETF is only up 10% year-to-date and still well under highs hit earlier this decade. 

"[Many] of the miners think the gold price is still going much higher," said Quartermain. "What we need to see a is better connection between where the gold price is and what we're seeing in the equities."

Quartermain said a generational change is partly to blame for the depressed equity prices over the past ten years. 

"Over the last decade we've seen a lot of movement of money out of the gold space," said Quartermain. "Over a decade ago when we were building the Brucejack Mine, many portfolio managers with a lot of gold assets under management. They left or those funds were depleted
in size."

Quartermain's new venture is Dakota Gold, a gold exploration and development company focused on advancing the Homestake District in South Dakota. Properties cover over 48 thousand acres. The has over 145 years of gold mining history. Dakota Gold commenced drilling in January 2022. It listed on the NYSE the same year. Currently the company has four drills operating with over 279,000 feet drilled. 

The company closed an investment with Orion for $17 million in exchange for ~7% ownership. Dakota has a planned $30 Million exploration program for 2024. 

0:00 - Gold price is going higher
1:40 - Is gold's move higher surprising?
2:15 - When do investors come to the space? 
3:18 - Mining is gaining favor
4:55 - Critical mineral strategies spurring mine development

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

Gold should head higher due to debts and deficits, said Peter Grosskopf, chairman of SCP Resource Finance. 

On Wednesday Grosskopf was interviewed by Kitco Mining. 

Gold has been hitting fresh all-time highs late into 2023 and through 2024, but gold miners have only just rallied in the last month. Gold equities, measured by the GDX, is up over 16% in the past month.

"The market finally woken up to these high precious metal prices," said Grosskopf. "[The rally is] definitely led by the big caps. The small caps just started to react in the last day or two after coming out of a long, cold stretch."

Grosskopf said that gold miners could have been held back by costs, which were crimping margins. 

"Miners have put up with some difficult operating conditions from an inflation perspective," said Grosskopf. "Projects are taking longer, they're more expensive to build, and it took a while for both
companies and their shareholders to digest what margins would be in this kind of environment."

Grosskopf said that the main driver for gold prices will be debt concerns. 

"There's just too much debt in the world," said Grosskopf. "Governments have built up these deficits and debt [levels] to the point where they actually do matter."

Grosskopf said that markets have been calm and complacent regarding the debt. 

"But the sheer size of the U.S. fiscal deficit and whether or not they have control over that is starting to trouble investors,” he said. “[You] have two choices to get out of this debt predicament: one of them is to
deflate and face a financial crisis, which I don't think anybody expects. The other is to inflate.” 

"Gold holds its own...even in an environment of rising rates...in a world where deficits and debts are just too big," Grosskopf said.  


0:00 - Gold equities jump
0:45 - Margin compression on cost inflation
2:15 - M&A
3:18 - Junior resource recovery
4:12 - Critical minerals that work
4:40 - It's expensive to build a copper project
5:50 - Can miners charge a green premium? 
7:35 - Why gold will head higher

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

Lithium futures are trading higher, and Asian battery manufacturers are saying demand will surprise to the upside, says Francis MacDonald, CEO and director of Li-FT Power (TSXV:LIFT).

MacDonald spoke to Kitco Mining in early March at PDAC 2024 in Toronto, Canada.

“Hopefully that's an indication that we're coming out of the bottom,” he said, noting lithium carbonate prices have been stuck at around $13,000 a tonne.

Li-FT Power is advancing the Yellowknife lithium project in Canada’s Northwest Territories. The project contains 13 lithium pegmatite systems that are exposed at surface and visible from satellite imagery. Historical channel sampling produced average grades of 1.10 - 1.59% Li2O over 7- to 40-meter widths. Strike extents of pegmatites visible on surface are 100 to 1,800m.

The company drilled 34,000 meters and 200 holes last year, with the goal of moving the project towards a maiden resource estimate in 2024.

Another 18,000 meters is currently being drilled from four rigs.

“There was a lot of work done historically and all we had to do is go in there and start drilling,” MacDonald said of the project adding: “The grades and widths that we're seeing are pretty similar to what we see on surface. We had some big intersects of 80 meters at 1.13%, and there's quite a few intersects in that 30- to 40-meter range at 1.2 to 1.6% Li2O.

He said the Yellowknife project is unique in that it has railway access and a paved highway that goes through seven lithium deposits. Another advantage is the railway runs to the Pacific coast, allowing Li-FT to ship the spodumene concentrate to Asia for processing.

Coverage is sponsored by UEC (Uranium Energy Corp.), URC (Uranium Royalty Corp.) and GoldMining.

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

Uranium is “a very unique commodity” that even at $100 a pound is still seeing a supply deficit, says John Ciampaglia, CEO of Sprott Asset Management.  

In February Ciampaglia spoke to Kitco Mining at the BMO Global Metals, Mining & Critical Minerals Conference 2024 in Hollywood, Florida.  

“We don't see a real meaningful supply response coming for the next few years and in the absence of that we think uranium prices are going to be higher for longer,” he said.

Ciampaglia said uranium is being recognized for its importance in achieving three goals: decarbonization, energy security, and as a complement to renewable energy. Nuclear power has a capacity factor of 92.5 percent, making it suitable for base-load power, compared to solar’s 25 percent.

“Countries realize that they need to have a diversified source of energy production in order to have a grid-stable economy and affordable energy prices,” he said.

The uranium market is dominated by a handful of countries, most of them unfriendly to Western interests. “It’s a very concentrated supply profile which makes it more vulnerable to shocks,” Ciampaglia said, adding: “I think the West has realized that they need to incentivize the reshoring of a lot of supply chains. Uranium mining is one of them.”

Several uranium producers are re-starting mines to capitalize on higher prices. This should trickle down to the uranium explorers, said Ciampaglia. “They have a fighting chance to actually raise some capital and move their projects down the pipeline.”

Sprott is bullish on copper, having recently launched a copper ETF. Ciampaglia noted that energy transition-related demand has held up the price. “We think there is going to be tremendous long-term durable demand for copper,” he said. “Investors are becoming increasingly interested.”

Ciampaglia said copper is like uranium in that both face deficits and both need significant amounts of capex (capital expenditures); the only way for that to happen is higher prices. However, “the demand for uranium is completely inelastic, it's unlike most other commodities,” he said. “And then I think copper is going to be the slower, emerging story that that is going to play out for the coming years.”

Coverage of the BMO Global Metals, Mining & Critical Minerals Conference sponsored by First Majestic Silver (NYSE:AG).

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.

The disconnect between gold prices and gold equities are explained by central bank precious metal purchases, said Wheaton Precious Metals CEO Randy Smallwood. 

On Friday, Smallwood spoke to Kitco Mining. 

Wheaton Precious Metals is a precious metals streaming company headquartered in Vancouver, B.C. Last week the company released its 4Q and year-end. Gold equivalent ounces produced was 619,608 ounces, nearly the same as the year prior. Gold production was up, but silver fell. Silver was down due to a labour strike at Peñasquito. The company set 2024 guidance between 550,000 to 620,000 gold equivalent ounces. The company is targeting over 800,000 by 2028. 

Operating cash flow in the fourth quarter of 2023 amounted to $242 million, with the $70 million increase due primarily to the higher gross margin.

Smallwood noted the disconnect between gold prices and gold equities. The metal has hit several all-time highs in 2024, while the miners are down year-to-date. The VanEck Gold Miners ETF has fallen 1% year-to-date, and the metal is near the middle of its 52-week range. 

“Gold prices are up because central banks are buying,” said Smallwood. “They're nervous about the U.S. dollar, so the challenge is: ‘How are we going to expand beyond that.’”

Last month the WGC published its 2023 fourth quarter and full-year gold demand trends report, saying that annual gold demand, excluding over-the-counter markets, totaled 4,448 tonnes, a 5% drop below robust demand reported in 2022; however, when including OTC markets and stock flows total gold demand rose to a record 4,899 tonnes last year. 

Smallwood noted the closure of First Quantum’s Cobre Panama mine, one of the world’s top copper mines. It puts the emphasis on social license to operate. Copper is going to be an essential metal for energy transition.  

“It’s a shame that happened,” said Smallwood. “It's not good for the industry as a whole. It's not good to have this: ‘No copper in my backyard approach.’ That's not healthy for society.”

Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.