ORENINC INDEX – Monday, November 2^nd 2020

North America’s leading junior mining finance data provider

Last Week: 51.30

This week: 47.52

The Oreninc Index fell in the week ending October 30th, 2020 to 47.52 from 51.30 a week ago as deal flow contracted sharply.

The COVID-19 virus global death toll approaching 1.2 million with almost 46 million cases reported worldwide, with Europe and other parts of the world experiencing a second wave of contagion.

With the US presidential election between incumbent Donald Trump and his Democratic party rival Joe Biden imminent, most markets experienced a volatile week, with many markets selling off including precious metals. Any hopes of a new stimulus package being agreed in the US prior to the election died away as senators departed for a pre-election break.

The election is likely to see one of the largest voter turnouts in recent years with some 80 million postal ballots already cast. Polls and analysts talk of the possibility of a Blue Wave, the Democrats taking the House, the Senate and the presidency. This, it is thought, would be very positive for gold as it would likely mean a large and rapid stimulus package.

On to the money: the aggregate financings announced increased to $65.2 million, a three-week low, which included two brokered financings for $46 million, a five-week high, and one bought deal financing for $15 million, a two-week high. The average offer size increased to $3.8 million, a ten-week high, while the number of financings plummeted to 17.

With less than a month to go before the US presidential election, the gold price continues to exhibit volatility around the US$1,900/oz level as the spot price closed down at $1,899/oz  from $1,930/oz a week ago. The yellow metal is up 25.18 so far this year. The US dollar index strengthened as it closed up at 93.68 from 93.05 a week ago. The VanEck managed GDXJ increased as it closed down at $57.67 from $59.50 a week ago. The index is now up 36.46% so far this year. The HUI Arca Gold BUGS Index also closed down at 333.49 from 340.18 last week. The SPDR GLD ETF inventory sold down a little, closing the week up at 1,272.56 tonnes, or 40.91 million ounces, from 1,271.52 tonnes last week.

In other commodities, Silver fell as it closed the week down at $24.16/oz from $25.15/oz a week ago. Copper closed down at $3.06/lb from $3.08/lb a week ago. Oil continued to strengthen as WTI closed up at $40.88 a barrel from $40.60 a barrel a week ago.

The Dow Jones Industrial Average jumped higher as it closed down at 28,606 from 28,586 a week ago. Canada’s S&P/TSX Composite Index also moved down to close at 16,438 from 16,562 the previous week. The S&P/TSX Venture Composite Index closed down at 725.31 from 732.25 last week.

Summary

• Number of financings decreased to 17.
• Two brokered financings were announced this week for $46 million, a five-week high.
• One bought-deal financing was announced this week for $15 million, a two-week high.
• Total dollars decreased to $65.2 million, a three-week low.
• Average offer increased to $3.8 million, a ten-week high.

Financing Highlights

Kanadario Gold (TSX-V:KANA) is to raise $36.4 million.

• Bought deal private placement to raise $31 million via 62 million units @ $0.50 with 20% overallotment option.
• Sprott Capital Partners as lead underwriter of a syndicate of underwriters including BMO Capital Markets.
• Concurrent non-brokered offering of 10.8 million units for proceeds of $5.4 million.
• Company to be renamed G Mining Ventures along with change of management and board.
• Each unit will consist of one share and half a warrant exercisable @ $0.80 for 18 months.
• Proceeds to be used for general corporate and working capital purposes with an objective of acquiring a significant gold asset.

Fission Uranium (TSX-V:FCU) opened a bought deal financing to raise $15 million.

• 5 million units @ $0.275.
• Eight Capital as co-lead underwriter and sole bookrunner, on behalf of a syndicate of co-led with Sprott Capital Partners.
• Each unit consists of one share and half a warrant exercisable @ $0.41 for two years.
• Proceeds will be used to fund the further development of the Triple R deposit in Saskatchewan, Canada and to repay certain amounts owing under the company’s credit facility.

Major Financing Openings

• Kanadario Gold (TSX-V:ANA) opened a $4 million offering underwritten by a syndicate led by Sprott Capital Partners on a best efforts basis. Each unit includes half a warrant that expires in 18 months.
• Fission Uranium (TSX-V:FCU) opened a $15 million offering underwritten by a syndicate led by Eight Capital on a bought deal Each unit includes a half warrant that expires in two years. The deal is expected to close on or about November 17th.
• Tarku Resources (TSX-V:TKU) opened a $5 million offering on a best efforts basis. Each unit includes half a warrant that expires in two years.

Major Financing Closings

• Bullfrog Gold (CSE:BFG) closed a $22 million offering on a best efforts Each unit included a warrant that expires in four years.
• OceanaGold (TSX:OGC) closed a $61 million offering underwritten by a syndicate led by Scotiabank on a bought deal basis.   
• Superior Gold (TSX-V:SGI) closed a $25 million offering underwritten by a syndicate led by PI Financial on a bought deal basis.
• Aurania Resources (TSX-V:ARU) closed a $52 million offering underwritten by a syndicate led by Cantor Fitzgerald Canada on a best efforts basis.