TSX slips, Dec. 27–30

The S&P/TSX Composite Index slipped 0.3% to 15,287.59 during the last week of 2016. While Canada’s benchmark index exited the year on a soft note, it gained 17.5% since the end of 2015. The S&P/TSX Global Mining Index rose 2% to 63.05 and the S&P/TSX Global Gold Index climbed 7% to 194.25. Both indexes are up more than 40% over the year. Spot gold added 1.5% to finish at US$1,150.90 per oz. gold. The yellow metal climbed 8.5% over 2015’s close of US$1,061 per ounce. U.S. benchmark West Texas Intermediate crude futures ended 2016 at US$53.72 per barrel, up 45% over 2015’s close of US$37.04 per barrel.

Gold firms dominated the value gainers’ list during trading. Agnico Eagle Mines advanced $3.84 to $56.45 per share, Barrick Gold shares added $1.80 to close at $21.49 and Goldcorp climbed $1.24 to $18.28 per share, all on no corporate news.

Azarga Uranium shares jumped 44% to 36¢. The company said the U.S. Nuclear Regulatory Commission (NRC) dismissed petitions to review the 2015 Atomic Safety and Licensing Board decision regarding Azarga’s Dewey Burdock uranium project in South Dakota. “We are pleased that the company’s NRC licence remains in good standing,” Blake Steele, the company’s president, said in a release. He added that the firm would “continue to support the consultation efforts of the NRC staff and the Oglala Sioux Tribe to remedy the outstanding contentions.”

International Tower Hill Mines jumped 23% to 75¢ per share on financing news. The company closed its non-brokered private placement financing of 45.8 million shares at US48¢ per share for gross proceeds of US$22 million. Its current institutional shareholders participated in the financing: Paulson & Co. bought 32.4 million shares; Tocqueville Asset Management, 9 million shares; and AngloGold Ashanti (U.S.A.) Exploration, 4.36 million shares. Following the offering, Paulson, Tocqueville and AngloGold own 34.2%, 19.7% and 9.5% of the company’s 162 million shares.

International Tower Hill plans to use the proceeds to cover the final January 2017 payment amounting to US$14.7 million for certain mining claims and related rights around its Livengood gold project in Alaska, as well as more optimization studies and required environmental baseline studies for Livengood.

A September 2016 prefeasibility study on an optimized configuration for Livengood envisioned the project mining 52,600 tons (47,700 tonnes) per day to produce 6.8 million oz. gold over 23 years. This configuration lowered capital costs 34% — or US$950 million — to US$1.8 billion, compared to the 100,000-ton-per-day (90,700-tonne-per-day) scenario in the September 2013 feasibility study.

After the financing, International Tower Hill appointed Marcelo Kim, a partner at Paulson, as its board chairman. Steve Lang, who has been chairman since January 2014, will become the lead independent director.


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