TSX rises, July 22-26: Torex, Teranga, Scandium, Lundin Gold

The S&P/TSX Composite Index posted a 0.27% gain to 16,531. Spot gold stayed above the US$1,400 per oz. threshold, finishing at US$1,418.30 per oz. — down US$6.70 per oz., or 0.47%. The S&P/TSX Global Gold Index lost 2.23% to end at 205.82, while the S&P/TSX Global Base Metals Index lost 2.11% to 110.20, and the S&P/TSX Global Mining Index lost 2.32% to 79.54.

Intermediate gold producer Torex Gold Resources posted the biggest gain, jumping $1.38 to $17.03. In July the company reported record quarterly gold production of 113,600 oz. during the second quarter, which is 12% higher than the company’s previous quarterly production record set in the third quarter of 2018. The company says it’s on track to sell 430,000 oz. gold in 2019. Torex’s principal assets are the El Limon–Guajes mining complex in Mexico, made up of the El Limon, Guajes and El Limon Sur open pits, and the El Limon Guajes underground mine.

Teranga Gold rose 43¢ to $5.09 per share. The company announced on July 25 that it would undertake a 27,000-metre drill program on its Golden Hill project in West Africa during the second half of 2019. Golden Hill is in the central part of the Houndé Greenstone Belt in southwestern Burkina Faso, and the advanced-stage exploration project has delivered multiple near-surface and high-grade gold discoveries over the last two years. After 18 months of drilling, Teranga released an initial resource in February on Golden Hill. The project has 6.4 million indicated tonnes averaging 2.02 grams gold per tonne for 415,000 contained oz. gold, and 11.95 million inferred tonnes grading 1.68 grams gold for 644,000 oz. gold.

A new mine lease for its Nyngan scandium project in Australia sent shares of Scandium International Mining up 41.7% to 17¢ per share. The company plans to develop Nyngan into the world’s first scandium-only producing mine. Under the new mine lease, the company can build and operate a scandium mine of similar scale to its current plans, within the footprint of the new lease. A landowner had objected to Scandium International’s earlier mine lease application in 2016. In April 2019, the company filed a new mining lease application covering only surface rights owned by its Australian subsidiary (3.64 sq. km) and excluding 5.04 sq. km of surface rights owned by the objecting landowner. The company says it will continue to negotiate with the landowner to buy some or all of the land over which the 2016 objection was lodged.

Shares of Lundin Gold advanced 36¢ to $7.90. The company announced in June that it had begun mining the first production stope at its Fruta del Norte gold project in Ecuador. The company said it is on track to  commission the process plant in the third quarter of this year. At the end of May, the company reported that construction was 73% complete, and that it had committed 88% of the project’s capital expense.


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