VANCOUVER, BC / ACCESSWIRE / February 14, 2023 / Noram Lithium Corp. (“Noram” or the “Company“) (TSXV:NRM)(OTCQB:NRVTF)(Frankfurt:N7R) announces it has initiated a further round of metallurgical testing on mineralized samples from its 100% owned Zeus Lithium Project (“Zeus” or the “Project”) in Clayton Valley, Nevada.
Following the completion of the Phase VI drill program in May 2022, samples were collected from the Zeus drill core and shipped to Bureau Veritas Laboratories in Richmond, BC. During the period of July 2022 through September 2022, a number of tests were conducted on Zeus samples including: sulphuric acid leaching, hydrochloric acid leaching, roasting, neutralization, impurity removal and solid-liquid separation tests. Based on the test work completed and experience in other industries, the Company has refined the process design for lithium carbonate recovery that is based on known and commercially proven technology.
The Company has engaged Kemetco Research Inc (“Kemetco”), a private sector integrated science, technology and innovation company based in Richmond, BC to carry out further metallurgical test work to confirm and refine the process design. Kemetco have extensive experience in bench scale and pilot scale laboratory studies in lithium extraction.
“The proposed process for the Zeus Lithium Project is based on known technology and we are expecting the results from this round of test work will confirm our ability to recover high-purity lithium carbonate from Zeus mineralized material,” stated Greg McCunn, Noram’s CEO. “The team at Kemetco, in conjunction with our metallurgical consultant, have designed a robust test work program to further de-risk the project. The results will be combined with the mine plan optimization currently underway to support the completion of a Prefeasibility Study.”
Proposed Process Description
The proposed process consists of three main steps (Figure 1), as follows:
1. Feed Preparation/Beneficiation:
Mineralized material from the mine is passed through a roll crusher;
Water is added in an agitated attrition scrubber to produce a slurry, and
Coarse particles containing calcite are rejected through hyrdocyloning to reduce the acid consumption in the subsequent leaching stage.
2. Leaching, Neutralization and Filtration:
Lithium bearing clays from feed preparation are leached with sulphuric acid in agitated tanks at 90°C;
Iron and aluminum impurities are removed from the lithium bearing solution using limestone under controlled conditions, and
Iron and aluminum precipitates are filtered for dry-stacking in a tailings storage facility, minimizing water losses from the process and environmental impact.
3. Lithium solution is further purified using known technology from lithium hard rock processing facilities to produce battery quality lithium carbonate for packaging and sale.
Test work is currently underway, initially testing the Feed Preparation/Beneficiation and Leaching, Neutralization and Filtration processes in the proposed flowsheet. It is expected that some testing will also be done on lithium solutions to produce battery quality lithium carbonate. Results of the test work will be used to validate the Company’s metallurgical models and mass/energy balances for the Project.
Figure 1 Simplified Process Flow Sheet
1. Feed Preparation / Beneficiation
Noram Lithium Corp., Tuesday, February 14, 2023, Press release picture
2. Leaching / Neutralization / Filtration
Noram Lithium Corp., Tuesday, February 14, 2023, Press release picture
3. Purification
Noram Lithium Corp., Tuesday, February 14, 2023, Press release picture
This important phase of metallurgical test work is expected to take 5-6 months to complete. Results from the test work will be made available as the work progresses in the coming months.
About Noram Lithium Corp.
Noram Lithium Corp. (TSXV:NRM)(OTCQB:NRVTF)(Frankfurt:N7R) is focusing on advancing its 100%-owned Zeus Lithium Project located in Clayton Valley, Nevada an emerging lithium hub within the United States. With the upsurge in the electric vehicle and energy storage markets the Company aims to become a key participant in the domestic supply of lithium in the United States. The Company is committed to creating shareholder value through the strategic allocation of capital and is well-funded with approximately CAD$14 million in cash on December 31, 2022 and no debt.
About the Zeus Project (100% Noram)
The Zeus Lithium Project contains a Measured and Indicated Resource estimate of 5.2 Mt Lithium Carbonate Equivalent (“LCE”, 1034 Mt at 941 ppm lithium), and an additional Inferred resource estimate of 1.1 Mt LCE (235 Mt at 871 ppm lithium) utilizing a 400 ppm Li cut-off1.
In December 2021, a robust PEA2 indicated the Project could produce an annual average of 31,900 tonnes of Lithium Carbonate for supply to battery manufacturers with an modelled mine life of 40 years (resources support a +100 year mine life). The PEA outlined a US$528 million capital cost to construct the Project with a robust after-tax NPV(8%) of US$1.3 billion and an IRR of 31% using US$9,500/tonne LCE pricing. The PEA indicates an after-tax NPV(8%) of US$2.7 billion and an IRR of 52% at US$14,250/tonne LCE pricing. Note that the current daily prices have increased to over US$70,000/tonne LCE.
Footnote 1 Refer to the News Release dated January 30, 2023 titled ‘Noram Lithium Announces Significant Increase in Mineral Resources at the Zeus Lithium Deposit’.
2 Preliminary Economic Assessment Zeus Project, ABH Engineering (December 2021).
Cautionary Statement Regarding Forward Looking Information
This news release may contain forward-looking information which is not comprised of historical facts. Forward-looking information involves risks, uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward-looking information in this news release includes statements regarding, among other things, the results from this round of test work will confirm the Company’s ability to recover high-purity lithium carbonate from Zeus mineralized material. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to, regulatory approval processes. Although Noram believes that the assumptions used in preparing the forward-looking information in this news release are reasonable, including that all necessary regulatory approvals will be obtained in a timely manner, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Noram disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Vancouver, British Columbia–(Newsfile Corp. – February 13, 2023) – Gladiator Metals Corp. (TSXV: GLAD) (“Gladiator” or the “Company“) is pleased to announce that, further to its news release on November 14, 2022, it has received final approval from the TSX Venture Exchange (the “TSX-V“) for the Mineral Property Option Agreement (the “Option Agreement“) dated November 8, 2022 with H. Coyne & Sons Ltd. (the “Optionor“) whereby the Optionor has granted the Company the right to acquire a 100% legal and beneficial interest in all of the Optionor’s title and interest (the “Option“) in and to 315 contiguous mineral claims located in the Yukon (the “Whitehorse Copper Project” or the “Project“).
Trading of the Company’s common shares will resume on February 15, 2023.
The Whitehorse Copper Project
Project Highlights:
High Grade historical copper production of >10Mt @ 1.5% Cu produced (plus Au/Ag credits) via open pit (1967-1971) and underground (1972-1982).
Whitehorse Copper Project includes 30 known prospects within a 35km x 5km area. Shallow, high grade copper results from multiple prospects. Limited systematic drilling away from existing pits. All previous operations and unmined prospects are all open along strike and down dip.
Approximately 10,000 metres of unassayed core from exploration drilling to be assayed and logged. Year-round access for work programs, good road and drill access network established, low-cost exploration due to proximity to Whitehorse and strong partnership with the Optionors, and an experienced local drilling service provider.
Significant future exploration potential with drilling outside of historic areas of operation including:
Cowley Park: Most advanced prospect area with near term resource potential. Mineralization open at depth and along strike (mineralization drilled to max 150m vertical depth only). Gladiator’s initial focus will be on defining and extending mineralization at the Cowley Park Copper deposit through diamond drilling. Cowley Park had reached feasibility stage before operations in the belt were shut down in 1982 and remains open along strike and down dip.
Historic drill hole intercepts include:
CP-125: 18.44m @ 4.42% Cu, from 56.39m downhole and 1.41% Cu from 87.84m downhole
CP-144: 38.57m @ 1.73% Cu, 7.15 g/t Ag from 33.98m downhole
18-CP-03: 9.14m @ 2.0% Cu, 12.5 g/t Ag from 83.82m downhole
18-CP-06: 23.04m @ 1.59% Cu, 10.28 g/t Ag from 74.98m downhole
19-CP-08: 40.54m @ 2.36% Cu, 4.75.3 g/t Ag including 13.72m @ 5.41% Cu and 19.22g/t Ag from 109.42m downhole
Other prospects within the Project area, with historic drill hole intercepts, include:
War Eagle:
HT-1: 10.55m @ 4.99% Cu, 1.05g/t Au, 40.3g/t Ag from 124.39m.
North Star:
NS-15: 14.63m @ 4.95% Cu from 419.65m.
The drill results reported in this news release are historical in nature. Gladiator has not undertaken any independent investigation, nor has it independently analyzed the results of the historical exploration work in order to verify the results. The Company believes that the historical drill results may not all conform to the presently accepted industry standards. Gladiator considers these historical drill results relevant as the Company will use this data as a guide to plan future exploration programs. The Company also considers the data to be reliable for these purposes, however, the Company’s future exploration work will include verification of the data through drilling.
The Company has filed a technical report for the Whitehorse Copper Project (the “Technical Report“). The Technical Report, entitled “NI 43-101 Technical Report on the Whitehorse Copper Project Yukon Territory” and dated effective November 23, 2022, was prepared for the Company by Derek Torgerson, P. Geo., of Summit Geosciences Ltd, a “qualified person,” as such term is defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101“), and independent of the Company for the purposes of NI 43-101. A copy of the Technical Report is available under the Company’s SEDAR profile at www.sedar.com.
The Whitehorse Copper Project is an advanced-stage copper (Cu) ± molybdenum (Mo) ± silver (Ag) ± gold (Au) skarn exploration project in the Yukon Territory, Canada. The property comprises 315 contiguous claims covering approximately 5,380 Hectares (13,294 acres) in the Whitehorse Mining District. The Whitehorse Copper Project covers a significant portion of what has historically been known as the Whitehorse Copper Belt. Gladiator Metals Corp. has entered into a 6-year option agreement with H. Coyne and Sons Ltd. to earn a 100% interest in the Project.
Copper mineralization was first discovered in 1897 on the Whitehorse Copper Belt, as it became to be known. The Whitehorse Copper Belt comprised over 30 copper-related, primarily skarn occurrences covering an area of 35 by 5 km in a north westerly trending arc. Exploration and mining development have been carried out intermittently since that time with the main production era lasting between 1967 and 1982 where production totaled 267,500,000 pounds copper, 225,000 ounces of gold and 2,838,000 ounces of silver from 11.1 million tons of mineralized skarn ore were milled (Watson, 1984).
The Project is road accessible with numerous access roads located within 2 km of the South Klondike Highway and the Alaska Highway. An extensive network of historical gravel exploration and haul roads exists throughout the project area and provide excellent access to the majority of the claim package. Access to existing electric power facilities is available through the main Yukon power grid.
The Whitehorse Copper Project is located within the traditional territory of the Kwanlin Dün and Ta’an Kwäch’än Council First Nations. Gladiator acknowledges and respects the traditional territory of the Kwanlin Dün and Ta’an Kwäch’än Council First Nations and is committed to developing a respectful relationship with them.
The intrusive rocks of the region are predominantly granodioritic to dioritic and Cretaceous in age (109 – 199 Ma). They are thought to form the upper reaches of a large batholith belonging to the Whitehorse Plutonic Suite and intrude primarily into Triassic to Jurassic Lewes River Group clastic and carbonate metasediments. Throughout the Whitehorse Copper Project, skarning occurs variably through limestone horizons and along the contacts with the intrusive rocks. Skarn deposits within the Whitehorse Copper Project are considered exoskarns that formed within 150 m of the mid Cretaceous calc-alkaline Whitehorse Batholith contact; however, a number of endoskarns are documented within the intrusion as well. Two main types of skarn deposits are observed. Iron-rich, in which copper occurs with magnetite, serpentine, specularite, talc, chlorite and occasional pyrrhotite and pyrite and Iron-poor (calc-silicate) where copper occurs with garnet, diopside, wolastonite, tremolite, epidote, chlorite, calcite and quartz. The copper minerals occur as grains, blebs, pods and stringers that appear to postdate the skarn minerals. Bornite is predominant in the iron-rich skarns and is slightly more abundant than chalcopyrite in the silicate skarns. Silver content is proportional to the copper grade but gold is more erratically distributed, being more abundant in the iron-rich skarn deposits.
The most recent work on the Project and Gladiator’s initial focus is on defining and extending mineralization at the Cowley Park Copper deposit through diamond drilling. The recent drilling campaigns have returned drill core assay intervals consistent in grade with historical results. Cowley Park sits at the southern end of the Project and had reached feasibility stage before operations in the belt were shut down in 1982. Diamond drilling was carried out in the 1960’s loosely defining the main zone mineralization and more thorough drilling was conducted in the early 1970’s culminating in a total of ~125 holes and ~11,500 meters of core (Hureau, 1981).
Gladiator has recently compiled a digital database containing 475 dill holes within the current and historical project boundaries. Many of the drill holes are historical in nature and lack documented modern QA/QC methods, chain of custody documentation, proper GPS collar locations and down hole surveying and would not meet the standard for a current NI 43-101 resource estimate. The more recent drilling, from 2007 onward appears to have been conducted in a much more systematic manner but significant amounts of core is currently in storage and needs to be logged, sampled and assayed.
The Company is planning an initial work program which would include data compilation and digitization of the historical drill logs, geological mapping, surface geochemistry and geophysical surveys. Additionally, approximately 10,000 m of diamond drill core will be logged and assayed. A 250-line km ground-based magnetics survey should be conducted over the south-eastern portion of the Project where a 2014 airborne survey was not completed. Targets generated from this work will guide a follow up diamond drilling program.
Transaction Summary
Pursuant to the terms and conditions of the Option Agreement, the Optionor has granted the Company the right to acquire all of the Optionor’s title and interest in and to 315 mineral claims located in the Yukon that constitute the Project. In order to exercise the Option the Company must over a six (6) year period:
(i) issue the Optionor an aggregate of 15,000,000 common shares in the capital of the Company;
(ii) pay the Optionor an aggregate of $300,000 in cash; and
(iii) incur an aggregate of $12,000,000 in exploration expenditures on the Project.
Following the exercise of the Option, the Company must pay the Optionor, or such other person(s) as the Optionor may direct from time to time, a 1.0% net smelter returns royalty on the Whitehorse Copper Project. Certain mineral claims forming part of the Whitehorse Copper Project are also encumbered by pre-existing royalties which the Company shall be responsible for following the exercise of the Option.
The Company has also granted the Optionor: (i) a right of right of first refusal to undertake each exploration or development program on the Whitehorse Copper Project; (ii) the right to subscribe for and be issued as part of any public offering of the securities of the Company up to such number of securities that will allow the Optionor to maintain a percentage ownership interest of the common shares of the Company that is equal to the percentage of common shares that it then owns or controls of the total issued and outstanding common shares at such time; and (iii) the right to nominate one (1) director to the board of the directors of the Company, each for specified time periods as set forth in the Option Agreement.
All common shares issued in connection with the Option Agreement will be subject to a statutory hold period of four months plus a day from the date of issuance in accordance with applicable securities laws.
Finder’s Fees
In connection with the Option Agreement, the Company has entered into a finder’s fee agreement pursuant to which the Company has agreed to issue a finder up to 1,362,500 Common Shares for introducing the Optionor to the Company.
Change in Officers
The Company announces that Ian Harris has resigned as Chief Executive Officer of the Company. Mr. Harris will continue as a member of the Company’s board of directors. The Company would like to thank Mr. Harris for his service to the Company as Chief Executive Officer.
Jason Bontempo, a current director of the Company, has been appointed as Chief Executive Officer following Mr. Harris’ resignation. Additionally, the Company has appointed Kell Ivar Nielsen as Vice President, Exploration, of the Company. The Company looks forward to continuing under the leadership of both Mr. Bontempo and Mr. Nielsen.
Investor Relations
The Company has entered into a consulting agreement (the “Consulting Agreement“) with Zinger Ventures Inc. (the “Consultant“), based in Vancouver, British Columbia, pursuant to which the Consultant will provide the Company with investor relations services (the “Services“). The Consulting Agreement has an initial term of six (6) months, unless terminated earlier in accordance the Consulting Agreement, and which may be extended for ensuing one month terms by agreement in writing between the Consultant and the Company.
The Services provided by the Consultant will include, but not be limited to, consulting with the Company’s management concerning marketing and investor relations services, building relationships with the Company’s investors, and attending conferences while representing the Company.
As consideration for the provision of the Services and in accordance with the terms and provisions of the Consulting Agreement, the Company will (i) pay the Consultant a monthly fee of $5,000 plus GST, (ii) grant the Consultant 150,000 stock options (the “Options“), and (iii) reimburse the Consultant for pre-approved out of pocket expenses actually and properly incurred by the Consultant in connection with the Services. The Options will vest in stages over a 12 month period with 37,500 Options vesting every three months following the grant date.
The Consultant and its principal, Dustin Zinger, are arm’s length from the Company and neither holds any securities of the Company nor has any interest, direct or indirect, in the Company.
The Company’s engagement of the Consultant and the issuance of the Options are subject to the acceptance of the TSX-V.
Qualified Person
All scientific and technical information in this news release has been prepared or reviewed and approved by Kell Nielsen, a “qualified person” for the purposes of NI 43-101.
ON BEHALF OF THE BOARD
“Jason Bontempo“ Jason Bontempo Chief Executive Officer and Director 604-638-8063
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain of the statements and information in this news release constitute “forward-looking statements” or “forward-looking information.” Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “anticipates”, “believes”, “plans”, “estimates”, “intends”, “targets”, “goals”, “forecasts”, “objectives”, “potential” or variations thereof or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) that are not statements of historical fact may be forward-looking statements or information.
Forward-looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, the need for additional capital by the Company through financings, and the risk that such funds may not be raised; the speculative nature of exploration and the stages of the Company’s properties; the effect of changes in commodity prices; regulatory risks that development of the Company’s material properties will not be acceptable for social, environmental or other reasons; availability of equipment (including drills) and personnel to carry out work programs; and that each stage of work will be completed within expected time frames. This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements or information. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. Accordingly, readers should not place undue reliance on forward-looking statements or information.
The Company’s forward-looking statements and information are based on the assumptions, beliefs, expectations and opinions of management as of the date of this news release, and other than as required by applicable securities laws, the Company does not assume any obligation to update forward-looking statements and information if circumstances or management’s assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such statements or information.
Capital Projects Construction Contract Awarded to Dumas Mining
YERINGTON, Nev., Feb. 13, 2023 (GLOBE NEWSWIRE) — Nevada Copper (TSX: NCU) (OTC: NEVDF) (FSE: ZYTA) (“Nevada Copper” or the “Company”) is pleased to provide an update on restart and operational activities for its Pumpkin Hollow underground copper mine (the “Underground Mine”).
Randy Buffington, President & CEO of Nevada Copper, stated, “Our Pumpkin Hollow team is focused on advancing the restart project quickly and safely. We are building on the momentum of the recent achievements by the underground crews as they have progressed through the dike structure and are advancing into the EN Zone in anticipation of the underground development contractor arriving on site and commencing development. The technical and leadership teams are in place and committed to executing this restart plan. We are targeting a mill restart in the third quarter with a quick ramp up to nameplate capacity by the end of 2023.”
Production Restart Highlights
Clear line of site to full-scale production
Simple and low-risk pathway to full-scale production established, comprising:
Phase 1 Q4 2022 to Q1 2023: Finalize dike crossings to access EN Zone initial stoping area (complete), confirm all key technical hires for restart (complete), and award capital projects contract (complete).
Phase 2 Q2 2023: Prioritized development of higher-grade EN Zone stope area.
Phase 3 Q3 to Q4 2023: Restart of proven mill, with surface and underground ore feed developed and short ramp-up to nameplate capacity.
Phase 1 Restart Milestones Achieved
Development into the EN Zone has demonstrated that rock quality is consistent with our geotechnical model, which predicted competent ground within the EN Zone, and development is progressing at full round lengths and standard ground support.
Definition drilling and assaying of all initial EN Zone stopes planned for extraction in 2023 is complete representing approximately 210K tons of stope ore, providing significant visibility on quality and grade of ore feed.
Contract awarded for completion of capital projects to debottleneck restart of development and underground operations.
Development mining contract award well progressed.
All key technical positions in place, with substantially strengthened operational leadership team on-site.
Operations significantly de-risked
Completion of both critical dike headings, securing the Underground Mine with full access to the primary EN Zone stope area. The third dike crossing is progressing well and, while it is not required to meet 2023 operating objectives, is expected to be completed in the first half of 2023.
Building planned surface stockpile of approximately 150K tons of run-of-mine ore ahead of mill start-up provides substantial operating buffer for milling operations.
Debottlenecking capital projects front-ended to provide additional operating flexibility.
Further Details on Production Restart
Underground Development Proceeding as Planned
The Nevada Copper operations team continues to make rapid progress on all underground activities including mine development, hoisting, stope preparation, and underground projects.
The historically reported dike crossings that provide initial stope top and bottom access into the EN Zone were fully established and completed in December 2022, and development is progressing toward stoping areas. Both key development drives that have crossed the dike have encountered ground conditions at or better than expectation, confirming the geotechnical model that predicted higher quality rock. Definition drilling of the initial stopes to feed the restart of milling operations in Q3 2023 have been completed and assayed, and confirm rock quality, grade and geometry represented by the geologic and reserve models.
Underground Development Contractor Update
The Company has completed the bid process for the development mining contractor and is in the final stages of negotiations for a unit rate contract with an internationally recognized major mining services contractor.
Key components of the development contract include:
72,000 feet of lateral capital development over a 24-month contract period;
Delivery of full development stopes by Q3 2023 to provide sufficient faces and stopes to restart and maintain nameplate milling operations (approximately 5,000 tpd); and
Nevada Copper’s operating team will perform all stope mining starting in Q3 2023.
Critical Construction Projects Progressing
The Company awarded Dumas Contracting USA, Inc. (“Dumas”) a $12 million construction contract to complete critical capital projects including the coarse ore bin and installation of an underground jaw crusher, permanent dewatering system, vent shaft stripping and surface fans. Dumas is a leading full-service underground mining contractor providing mine construction, development, production mining, mine services and engineering early-stage projects through well-established operating mines throughout the Americas.
Vent Shaft – Final stripping of the vent shaft commenced in January in preparation for connection of the surface fans, which are expected to be commissioned in early Q2 2023. The stripping is planned to be completed ahead of development contractor mobilization and the vent shaft is expected to provide the necessary ventilation for the life of the mine.
Ore Handling System – The additional ore handling system allows for increased ore throughput rates to the shaft hoisting system, enabling operations to ultimately exceed nameplate production. Engineering for ore handling system has been completed, and all long-lead items are on-site including the jaw crusher. Excavation is underway and planning for the installation of the system has already commenced.
Dewatering System – The pumps for the permanent dewatering system are on site and ready for installation. Once installed, the additional pumps are expected to provide all dewatering requirements for the life of the mine.
Regional Exploration Opportunities
The Company has completed a thorough review of regional mapping for its Pumpkin Hollow land position and several high-quality targets of interest have been identified. Surface sampling results from the Copper Ridge area have indicated the high-grade potential, highlighted by grades including 5.03% and 5.43% copper (see table below for additional assay information) that warrant additional investigation. In 2023, detailed mapping, interpretation of recent geophysical analysis and surface sampling are planned to follow-up on other identified high-potential targets on the Nevada Copper land position. The grades identified are conceptual in nature as there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the delineation of a mineral resource. Grades were determined through third-party labs, as detailed below under “Quality Assurance and Quality Control”.
Table of Assays (samples greater than 1%)
Sample ID
Easting (m)
Northing (m)
Elevation (m)
Cu (%)
Au (ppm)
Ag (ppm)
533857
318720
4316510
1451
2.31
0.036
0.5
533861
318751
4316512
1458
2.36
0.008
<0.2
533862
318766
4316512
1459
1.54
0.130
0.2
1615147
319706
4317023
1443
3.35
0.030
4.8
1615150
319603
4317072
1444
3.65
0.011
0.4
1615178
319087
4316782
1517
2.02
0.119
5.4
1669223
319621
4317082
1442
2.65
0.045
2.7
1669224
319678
4317033
1444
3.10
0.056
4.4
1669225
318483
4316515
1413
1.60
1.430
2.7
1669229
318639
4316481
1437
1.19
0.180
0.8
1669232
318607
4316637
1440
1.03
0.104
1.1
M59971*
319729
4317020
1440
5.03
0.150
10.0
M59982*
318739
4316527
1446
5.43
0.075
16.0
M59984*
318789
4316601
1470
4.10
0.055
8.0
M59994*
318438
4316507
1405
2.87
1.490
6.0
* Historic sample
Board Changes
Ms. Kate Southwell will be stepping down as a member of the Board of Directors effective February 28, 2023 to pursue other career opportunities. Stephen Gill, Chairman of the Board stated, “The Board and management team appreciate Kate’s valuable input during her tenure, particularly with regard to financing and commercial matters and as Chair of the Sustainability Committee and wish her well in her future endeavors”. The Nominating Committee of the Board is in the process of identifying qualified candidates to fill the vacant role at or prior to this year’s annual shareholder meeting.
Qualified Person
The technical information and data in this news release has been reviewed by Steven Newman, Registered Member – SME, Vice President, Technical Services for Nevada Copper, and Greg French, C.P.G., VP Exploration of Nevada Copper, who are non-independent Qualified Persons within the meaning of NI 43-101.
Quality Assurance and Quality Control
The analytical work was performed by American Assay Labs (AAL) located in Sparks, Nevada. AAL is an ISO/IEC 17025 accredited laboratory. The Samples were crushed so that >80% passes 10 mesh, followed by pulverizing to >90% passes 75 < 150 mesh. Prepared samples were run using a three-acid digestion process and conventional ICP-AES analysis. Gold determination was via standard atomic absorption (AA) finish 30-gram fire-assay (FA) analysis. Blank, standard and duplicate samples were routinely inserted and monitored for quality assurance and quality control.
The historic analytical work was performed by Chemex Labs Inc., currently ALS Geochemistry (ALS) located in, Nevada. ALS is an ISO/IEC 17025 accredited laboratory. The samples were crushed so that >80% passes 10 mesh, followed by pulverizing split to < 150 mesh. Prepared samples were run using an acid digestion process and conventional ICP-AES analysis. Gold determination was via standard atomic absorption (AA) finish 30-gram fire-assay (FA) analysis.
Nevada Copper detected no significant QA/QC issues during review of the data and is not aware of any sampling or other factors that could materially affect the accuracy or reliability of the data referred to herein.
About Nevada Copper
Nevada Copper (TSX: NCU) is a copper producer and owner of the Pumpkin Hollow copper project. Located in Nevada, USA, Pumpkin Hollow has substantial reserves and resources including copper, gold and silver. Its two fully permitted projects include the high-grade Underground Mine and processing facility, which is now in the production stage, and a large-scale open pit PFS stage project.
Randy Buffington President & CEO
For additional information, please see the Company’s website at www.nevadacopper.com, or contact:
Tracey Thom | Vice President, IR and Community Relations tthom@nevadacopper.com +1 775 391 9029
Cautionary Language on Forward Looking Statements This news release contains “forward-looking information” and “forward-looking statements” within the meaning of applicable Canadian securities laws. All statements in this news release, other than statements of historical facts, are forward-looking statements. Such forward-looking information and forward-looking statements specifically include, but are not limited to, statements that relate to development and ramp-up plans and activities at the Underground Mine and the timing in respect thereof.
Forward-looking statements and information include statements regarding the expectations and beliefs of management. Often, but not always, forward-looking statements and forward-looking information can be identified by the use of words such as “plans”, “expects”, “potential”, “is expected”, “anticipated”, “is targeted”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or the negatives thereof or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements or information should not be read as guarantees of future performance and results. They are subject to known and unknown risks, uncertainties and other factors which may cause the actual results and events to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information.
Such risks and uncertainties include, without limitation, those relating to: requirements for additional capital and no assurance can be given regarding the availability thereof; the outcome of discussions with vendors; the ability of the Company to complete the ramp-up of the Underground Mine within the expected cost estimates and timeframe; the impact of COVID-19 on the business and operations of the Company; the state of financial markets; history of losses; dilution; adverse events relating to milling operations, construction, development and ramp-up, including the ability of the Company to address underground development and process plant issues; ground conditions; cost overruns relating to development, construction and ramp-up of the Underground Mine; loss of material properties; interest rate increases; global economy; limited history of production; future metals price fluctuations; speculative nature of exploration activities; periodic interruptions to exploration, development and mining activities; environmental hazards and liability; industrial accidents; failure of processing and mining equipment to perform as expected; labour disputes; supply problems; uncertainty of production and cost estimates; the interpretation of drill results and the estimation of mineral resources and reserves; changes in project parameters as plans continue to be refined; possible variations in ore reserves, grade of mineralization or recovery rates from management’s expectations and the difference may be material; legal and regulatory proceedings and community actions; accidents; title matters; regulatory approvals and restrictions; increased costs and physical risks relating to climate change, including extreme weather events, and new or revised regulations relating to climate change; permitting and licensing; dependence on management information systems and cyber security risks; volatility of the market price of the Company’s securities; insurance; competition; hedging activities; currency fluctuations; loss of key employees; other risks of the mining industry as well as those risks discussed in the Company’s Management’s Discussion and Analysis in respect of the year ended December 31, 2021 and the quarter ended September 30, 2022 and in the section entitled “Risk Factors” in the Company’s Annual Information Form dated March 31, 2022. The forward-looking statements and information contained in this news release are based upon assumptions management believes to be reasonable, including, without limitation: no adverse developments in respect of the property or operations at the project; no material changes to applicable laws; the ramp-up of operations at the Underground Mine in accordance with management’s plans and expectations; no worsening of the current COVID-19 related work restrictions; reduced impacts of COVID-19 going forward; the Company will be able to obtain sufficient additional funding to complete the ramp-up, no material adverse change to the price of copper from current levels; and the absence of any other factors that could cause actions, events or results to differ from those anticipated, estimated or intended.
The forward-looking information and statements are stated as of the date hereof. The Company disclaims any intent or obligation to update forward-looking statements or information except as required by law. Although the Company has attempted to identify important factors that could cause actual actions, events, or results to differ materially from those described in forward-looking information and statements, there may be other factors that could cause actions, events or results not to be as anticipated, estimated or intended. Specific reference is made to “Risk Factors” in the Company’s Management’s Discussion and Analysis in respect of the year ended December 31, 2021 and the quarter ended September 30, 2022 and “Risk Factors” in the Company’s Annual Information Form dated March 31, 2022, for a discussion of factors that may affect forward-looking statements and information. Should one or more of these risks or uncertainties materialize, should other risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results and events may vary materially from those described in forward-looking statements and information. For more information on the Company and the risks and challenges of its business, investors should review the Company’s filings that are available at www.sedar.com.
The Company provides no assurance that forward-looking statements and information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information.
Inside practically every electric vehicle (EV) is a lithium-ion battery that depends on several key minerals that help power it.
Some minerals make up intricate parts within the cell to ensure the flow of electrical current. Others protect it from accidental damage on the outside.
This infographic uses data from the European Federation for Transport and Environment to break down the key minerals in an EV battery. The mineral content is based on the ‘average 2020 battery’, which refers to the weighted average of battery chemistries on the market in 2020.
The Battery Minerals Mix
The cells in the average battery with a 60 kilowatt-hour (kWh) capacity—the same size that’s used in a Chevy Bolt—contained roughly 185 kilograms of minerals. This figure excludes materials in the electrolyte, binder, separator, and battery pack casing.
Mineral
Cell Part
Amount Contained in the Avg. 2020 Battery (kg)
% of Total
Graphite
Anode
52kg
28.1%
Aluminum
Cathode, Casing, Current collectors
35kg
18.9%
Nickel
Cathode
29kg
15.7%
Copper
Current collectors
20kg
10.8%
Steel
Casing
20kg
10.8%
Manganese
Cathode
10kg
5.4%
Cobalt
Cathode
8kg
4.3%
Lithium
Cathode
6kg
3.2%
Iron
Cathode
5kg
2.7%
Total
N/A
185kg
100%
The cathode contains the widest variety of minerals and is arguably the most important and expensive component of the battery. The composition of the cathode is a major determinant in the performance of the battery, with each mineral offering a unique benefit.
For example, NMC batteries, which accounted for72% of batteries used in EVs in 2020 (excluding China), have a cathode composed of nickel, manganese, and cobalt along with lithium. The higher nickel content in these batteries tends to increase their energy density or the amount of energy stored per unit of volume, increasing the driving range of the EV. Cobalt and manganese often act as stabilizers in NMC batteries, improving their safety.
Altogether, materials in the cathode account for 31.3% of the mineral weight in the average battery produced in 2020. This figure doesn’t include aluminum, which is used in nickel-cobalt-aluminum (NCA) cathode chemistries, but is also used elsewhere in the battery for casing and current collectors.
Meanwhile, graphite has been the go-to material for anodes due to its relatively low cost, abundance, and long cycle life. Since the entire anode is made up of graphite, it’s the single-largest mineral component of the battery. Other materials include steel in the casing that protects the cell from external damage, along with copper, used as the current collector for the anode.
Minerals Bonded by Chemistry
There are several types of lithium-ion batteries with different compositions of cathode minerals. Their names typically allude to their mineral breakdown.
Here’s how the mineral contents differ for various battery chemistries with a 60kWh capacity:
With consumers looking for higher-range EVs that do not need frequent recharging, nickel-rich cathodes have become commonplace. In fact, nickel-based chemistries accounted for 80% of the battery capacity deployed in new plug-in EVs in 2021.
Lithium iron phosphate (LFP) batteries do not use any nickel and typically offer lower energy densities at better value. Unlike nickel-based batteries that use lithium hydroxide compounds in the cathode, LFP batteries use lithium carbonate, which is a cheaper alternative. Tesla recently joined several Chinese automakers in using LFP cathodes for standard-range cars, driving the price of lithium carbonate to record highs.
The EV battery market is still in its early hours, with plenty of growth on the horizon. Battery chemistries are constantly evolving, and as automakers come up with new models with different characteristics, it’ll be interesting to see which new cathodes come around the block.
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North Vancouver, British Columbia–(Newsfile Corp. – February 10, 2023) – Lion One Metals Limited (TSXV: LIO) (OTCQX: LOMLF) (ASX: LLO) (“Lion One” or the “Company“) announces the Company has completed its previously announced debt and equity financing transaction and has received total proceeds of US$25 million from: i) the funding of the US$23 million 1st tranche (“Tranche 1“) of its previously announced US$37 million financing facility (the “Financing Facility“) provided by Nebari Gold Fund 1, LP, Nebari Natural Resources Credit Fund I, LP and Nebari Natural Resources Credit Fund II, LP (collectively, “Nebari“), and (ii) Nebari’s completion of a US$2 million equity private placement in the Company, for the development of Lion One’s 100% owned Tuvatu Alkaline Gold Project in Fiji (the “Equity Investment“).
In addition to Tranche 1, an additional US$12 million is available under the Financing Facility at Lion One’s option in up to two further tranches which may be drawn on by Lion One within 18 months of the date of the Financing Facility. The Equity Investment involved Nebari’s subscription for 3,125,348 common shares of Lion One (“Common Shares“) priced at CAD$0.86 per Common Share.
In connection with the funding of Tranche 1, 15,333,087 warrants (the “Warrants“) have been issued to Nebari with each Warrant exercisable into one Common Share at a price of CAD$1.49 for a period of 42 months from the date hereof. The Warrants are non-transferable and will be subject to an accelerator provision whereby the Borrower may accelerate the expiry date of up to 25% of the Warrants in the event that the volume weighted average trading price of the Common Shares exceeds 100% over the strike price for a period of twenty consecutive trading days on the TSX-V. Lion One has the option to accelerate the expiry of further 25% portions of the Warrants at four-month intervals, up to a maximum of 75% of the Warrants.
The Common Shares subscribed for pursuant to the Equity Investment and the Warrants will be subject to a hold period expiring May 11, 2023 in accordance with Canadian securities laws and policies of the TSX-V. Neither the Common Shares subscribed for pursuant to the Equity Investment nor the Warrants have been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.
About Tuvatu The Tuvatu Alkaline Gold Project is located on the island of Viti Levu in Fiji. The January 2018 mineral resource for Tuvatu as disclosed in the technical report “Technical Report and Preliminary Economic Assessment for the Tuvatu Gold Project, Republic of Fiji”, dated September 25, 2020, and prepared by Mining Associates Pty Ltd of Brisbane Qld, comprises 1,007,000 tonnes indicated at 8.50 g/t Au (274,600 oz. Au) and 1,325,000 tonnes inferred at 9.0 g/t Au (384,000 oz. Au) at a cut-off grade of 3.0 g/t Au. The technical report is available on the Lion One website at U and on the SEDAR website at www.sedar.com.
About Nebari Nebari is a US-based investment manager specializing in privately offered pooled investment vehicles including Nebari Gold Fund 1, LP, Nebari Natural Resources Credit Fund I, LP and Nebari Natural Resources Credit Fund II, LP which are funding the Financing Facility to Lion One. The Nebari leadership team has deep experience with leading global mining companies and financial institutions and is known for partnering with motivated and capable management teams focused on achieving clear plan targets.
About Lion One Metals Limited Lion One’s flagship asset is 100% owned, fully permitted high grade Tuvatu Alkaline Gold Project, located on the island of Viti Levu in Fiji. Lion One envisions a low-cost high-grade underground gold mining operation at Tuvatu coupled with exciting exploration upside inside its tenements covering the entire Navilawa Caldera, an underexplored yet highly prospective 7km diameter alkaline gold system. Lion One’s CEO Walter Berukoff leads an experienced team of explorers and mine builders and has owned or operated over 20 mines in 7 countries. As the founder and former CEO of Miramar Mines, Northern Orion, and La Mancha Resources, Walter is credited with building over $3 billion of value for shareholders.
On behalf of the Board of Directors of Lion One Metals Limited “Walter Berukoff“, Chairman and CEO
Neither the TSX Venture Exchange nor its Regulation Service Provider accepts responsibility for the adequacy or accuracy of this release
This press release may contain statements that may be deemed to be “forward-looking statements” within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical fact, included herein are forward-looking information. Generally, forward-looking information may be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “proposed”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases, or by the use of words or phrases which state that certain actions, events or results may, could, would, or might occur or be achieved. This forward-looking information reflects Lion One Metals Limited’s current beliefs and is based on information currently available to Lion One Metals Limited and on assumptions Lion One Metals Limited believes are reasonable. These assumptions include, but are not limited to, the actual results of exploration projects being equivalent to or better than estimated results in technical reports, assessment reports, and other geological reports or prior exploration results. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Lion One Metals Limited or its subsidiaries to be materially different from those expressed or implied by such forward-looking information. Such risks and other factors may include, but are not limited to: the stage development of Lion One Metals Limited, general business, economic, competitive, political and social uncertainties; the actual results of current research and development or operational activities; competition; uncertainty as to patent applications and intellectual property rights; product liability and lack of insurance; delay or failure to receive board or regulatory approvals; changes in legislation, including environmental legislation, affecting mining, timing and availability of external financing on acceptable terms; not realizing on the potential benefits of technology; conclusions of economic evaluations; and lack of qualified, skilled labour or loss of key individuals. Although Lion One Metals Limited has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information. Lion One Metals Limited does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
TORONTO, Feb. 8, 2023 /CNW/ – Collective Mining Ltd. (TSXV: CNL) (OTCQX: CNLMF) (“Collective” or the “Company”) will be presenting at the OTC Markets Group Precious Metals Virtual Investor Conference on Wednesday, February 15, 2023, at 11:00am ET.
Using the link below, investors can register and listen to the presentation, and take part in a question and answer session at the end. The presentation is expected to last 30 minutes.
DATE: Wednesday, February 15, 2023 TIME: 11:00am ET – 11:30am ET LINK:https://bit.ly/3JCTs89
Please log in 5-10 minutes early to register. An archived webcast will also be made available after the event.
Ari Sussman, Executive Chairman of Collective Mining will be providing an overview and will discuss the Company’s “Main Breccia” discovery at the Apollo target. The Main Breccia discovery is a high-grade and bulk tonnage, copper-silver-gold porphyry-related breccia system characterized by two main, yet distinct pulses of mineralized fluids flooding the breccia with metals.
The Company’s Guayabales project is located in the mining-friendly department of Caldas, Colombia, in the heart of a long-established mining camp with ten fully permitted and operating mines located within three kilometres of the project. As a result, the Guayabales project is blessed with excellent infrastructure with roads and hydroelectric powerlines traversing the project and an abundant labour force located nearby in the townships of Supia and Marmato.
The phase II drilling program is underway with three rigs currently operating focused on testing near surface mineralization and expanding the dimensions of the Main Breccia system. Assay results are expected in the near term for the final three holes of the 2022 program, including westwards step-out hole APC-28, which cut more than 600 metres of continuous mineralization. Additionally, the first hole of the Phase II program is now complete, and core has been dispatched to the lab for assaying.
About Collective Mining Ltd.
To see our latest corporate presentation and related information, please visit www.collectivemining.com
Founded by the team that developed and sold Continental Gold Inc. to Zijin Mining for approximately $2 billion in enterprise value, Collective Mining is a copper, silver and gold exploration company based in Canada, with projects in Caldas, Colombia. The Company has options to acquire 100% interests in two projects located directly within an established mining camp with ten fully permitted and operating mines.
The Company’s flagship project, Guayabales, is anchored by the Apollo target, which hosts the large-scale, bulk-tonnage and high-grade copper, silver and gold Main Breccia discovery. The Company’s near-term objective is to continue with expansion drilling of the Main Breccia discovery while increasing confidence in the highest-grade portions of the system.
Management, insiders and close family and friends own approximately 52% of the outstanding shares of the Company and as a result, are fully aligned with shareholders. The Company is listed on the TSXV under the trading symbol “CNL” and on the OTCQX under the trading symbol “CNLMF”.
Information Contact:
Follow Executive Chairman Ari Sussman (@Ariski) and Collective Mining (@CollectiveMini1) on Twitter
FORWARD-LOOKING STATEMENTS
This news release contains certain forward-looking statements, including, but not limited to, statements about the drill programs, including timing of results, and Collective’s future and intentions. Wherever possible, words such as “may”, “will”, “should”, “could”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict” or “potential” or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect management’s current beliefs and are based on information currently available to management as at the date hereof.
Forward-looking statements involve significant risk, uncertainties, and assumptions. Many factors could cause actual results, performance, or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully, and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this news release are based upon what management believes to be reasonable assumptions, Collective cannot assure readers that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this news release, and Collective assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.
Credit Suisse (CS) has reported its biggest annual loss since the financial crisis in 2008, highlighting the scale of the challenge facing the scandal-plagued Swiss bank as it attempts a turnaround.
The lender on Thursday posted a loss of 1.4 billion Swiss francs ($1.5 billion) in the fourth quarter of 2022, extending a losing streak that started in 2021 and taking its full-yearloss to 7.3 billion Swiss francs ($7.9 billion). In 2008, Credit Suisse made a loss of 8.2 billion Swiss francs ($8.9 billion).
The bank’s shares fell 5% in early trade. The stock has plunged 65% over the past 12 months but is up 12% so far in 2023.
Credit Suisse said in a statement that the fourth-quarter performance was impacted by “the challenging economic and market environment, significant deposit and net asset outflows at the beginning of the quarter and the execution of our strategic actions.” It added that it expected to make another “substantial loss” in 2023.
Customers withdrew 111 billion Swiss francs ($121 billion) in the final three months of 2022, when the bank was hit by social media speculation that it was on the brink of collapse.
The rumors, which sparked a selloff in the shares, followed a series of missteps and compliance failures that have cost the bank dearly.
For example, the collapse of US hedge fund Archegos Capital Management, a client of Credit Suisse, in 2021 cost the bank $5.5 billion. An independent external investigation later found “a failure to effectively manage risk.”
Credit Suisse has since embarked on a major restructuring plan that entails cutting 9,000 full-time jobs, spinning off its investment bank and focusing on wealth management.
In a step towards this, the company announced Thursdaythe acquisition of M. Klein & Company, an investment banking business.
Credit Suisse CEO Ulrich Körner said the deal “marks another milestone in the carve-out of CS First Boston as a leading independent capital markets and advisory business.”
The bank also announced that it had finalized the first stage of the deal to sell its securitized products group to Apollo Global Management, which is expected to conclude in the first half of this year.
“We have a clear plan to create a new Credit Suisse and intend to continue to deliver on our three-year strategic transformation by reshaping our portfolio, reallocating capital, right-sizing our cost base, and building on our leading franchises.” Körner said in the statement.
Silver ETFs** (Total Known Holdings ETSITOTL Index Bloomberg)
760.17
749.00
11.18
1.49%
1.49%
First real uptick since summer selling
Gold ETFs** (Total Known Holdings ETFGTOTL Index Bloomberg)
93.17
93.75
(0.58)
(0.62)%
(0.62)%
Last positive month was April 2022
Source: Bloomberg and Sprott Asset Management LP. Data as of January 31, 2023. *Mo % Chg and YTD % Chg for this Index are calculated as the difference between the month end’s yield and the previous period end’s yield, instead of the percentage change. BPS stands for basis points. **ETF holdings are measured by Bloomberg Indices; the ETFGTOTL is the Bloomberg Total Known ETF Holdings of Gold Index; the ETSITOTL is the Bloomberg Total Known ETF Holdings of Silver Index.
January Review
Gold had another strong month and the best start to a year since 2015 as spot gold rose $104.34 (or 5.72%) to close January at $1,928.36. While the gold price was supported by the decline in the U.S. dollar (USD) and real yields in January, the magnitude and persistence of the bid for gold were high. Gold bullion trading desks have confirmed this strong interest is a continuation of flow demand from China since early November 2022, and the estimated tonnages bought would align with the most significant numbers since 2017. Price action and trading desk anecdotes denote large buying from China’s “official sector” (possibly any combination of People’s Bank of China, central bank-related entities or state banks) for undisclosed reasons.
January was a solid month for risk assets as investment funds were underexposed for a positive, right-tail8 outcome. The significant left-tail risks of 2022 quickly faded or reversed as we headed toward the new year. In the U.S., fears of hyperinflation and additional Federal Reserve (“Fed”) rate hikes ended abruptly as the Fed signaled it would slow its rate hikes just as inflation data finally moderated. In Europe, a far warmer-than-expected winter prevailed, allowing the EU to dodge the worst of an energy-spiking-induced hard landing and associated stress events. After years of a strict zero-COVID policy, China quickly reversed to a full re-opening, instantly giving the world an unexpected growth shock. With all three major economic regions experiencing a sudden reversal from left-tail (negative) to right-tail (positive) outcomes, massive forced buying was triggered.Gold has outperformed U.S. Treasuries over the past two decades despite the bond market having the advantages of a dovish accommodative Fed.
Furthermore, with the pause in Fed rate hikes in sight, both the USD and interest rates declined sharply, easing financial conditions and paving the way for a rebound in many financial assets. Whether this rally is the beginning of the consensus-desired soft landing or yet another bear market rally remains to be seen. We expect that macro volatility will likely remain high in the months ahead.
Gold Bullion Update
Gold bullion since the autumn lows, based on a three-month rate of change, had the most significant increase since 2011. Since the lows, the gold price has broken through technical resistance levels and Fibonacci retracement levels9 with remarkable ease, reinforcing the evidence that the buyer(s) are not likely financial market types. From gold’s early November lows of approximately $1,625 to $1,775, the price action has the look and feel of short covering in the face of an aggressive buyer. But since gold has reached the $1,775 level, the narrow up-channel and low bid-ask dispersion indicate a persistent large bid in gold that is not concerned with market-related overbought conditions. Lastly, the weekly Relative Strength Index (RSI)10 put in a positive divergence during the autumn lows and has broken above the RSI downtrend line (lower panel of Figure 1).
Figure 1. Gold Bullion Rally with Technical Strength
Source: Bloomberg. Data as of 1/31/2023. Included for illustrative purposes only. Past performance is no guarantee of future results.
Gold Investment Positioning Remains Low
Despite the rise in gold, the long gold CFTC(Commodity Futures Trading Commission) net non-commercial positions and ETF holdings remain muted, like a deer caught in a headlight (Figure 2). Gold held in ETFs (mainly retail and smaller funds) remain near +2.5-year lows and has not shown any buying indication yet. CFTC non-commercial long gold positioning, too, remains near the low end of its 10-year range. Neither of these two sources of investment “longs” is likely to sell off further as they are more trend-following than leading. The last source of investment flows, short positions, are even less likely to add to selling flows. Firstly, there is no overriding primary bearish macro driver (interest rate hikes are near the end, and the USD is weakening); secondly, shorting into massive buying is outright dangerous. The combined CFTC gold longs plus ETF gold holdings are now at their -2 standard deviation lows (lower panel, Figure 2) with macro drivers positive and massive buying from China and central banks. The risk from long positioning remains skewed to increasing longs, not divestment.
Figure 2. Gold Investment Demand Remains Muted
Source: Bloomberg. Data as of 1/31/2023. Included for illustrative purposes only. Past performance is no guarantee of future results.
U.S. Dollar Strength and U.S. Treasury Liquidity Functioning
The US Dollar Index (DXY) reached the upper end of its 16-year-long uptrend and has now fallen at a remarkable pace last seen in the volatile years of 2008 to 2010. The 3-month rate of change of DXY has recorded its second sharpest decline in the past 20 years. This dramatic fall in the USD has also eased financial conditions, creating a powerful tailwind for gold and other risk assets. Typically, policy coordination comes to mind when currencies sharply reverse from levels detrimental to market functioning quickly, with such high correlations. Unfortunately, if policymakers have decided on a coordinated USD strength reduction policy, we won’t know until much later when it becomes evident in hindsight.
The Bloomberg US Government Securities Liquidity Index (a measure of liquidity condition for U.S. Treasuries) surpassed the crisis levels of March 2020, the last time the Fed was forced to intervene to restore market functioning with interest rate cuts, liquidity injections, swap facilities, etc. Generally, a strong USD reduces systematic market liquidity, and Figure 3 highlights this relationship. The U.S. Treasury Market is the world’s largest and most liquid market. If it were to cease functioning properly, the spillover effects could be catastrophic in an overleveraged financial system under the wrong conditions. We would expect the days of runaway USD strength will not be allowed due to liquidity functioning alone.
Figure 3. U.S. Dollar Index and U.S. Treasury Liquidity Index
Source: Bloomberg. Data as of 1/31/2023. Included for illustrative purposes only. Past performance is no guarantee of future results.
Foreign Selling of U.S. Treasuries is Accelerating
Foreign holdings of U.S. Treasuries as a percentage of total holdings peaked in 2013, a decade ago. Most of this time, the Fed provided QE (quantitative easing) programs, negating the need for foreign funding of Treasuries. In Figure 4, we highlight foreign ownership of U.S. Treasuries and the rapidly decreasing percentage of foreign ownership of U.S. Treasuries. In March 2022, foreign holders saw notable selling (~$516 billion). There were several reasons, including 1) the Fed ending its latest QE program; 2) geopolitics (the Russia-Ukraine war and intensifying de-globalization; 3) the start of an aggressive string of Fed rate hikes along with tightening by other central banks; 4) USD weaponization had been occurring for several years, but the seizure of Russia’s foreign exchange (FX) reserves was likely the final straw. After these events, U.S. Treasury Liquidity began to deteriorate, even worse than in March 2020. Without liquidity support for U.S. Treasuries, the probability of another QE program (or a variation built around YCC, i.e., yield curve control) within the next few years is no longer remote, even in the face of high inflation.
Figure 4. Foreign Buyers are Dumping U.S. Debt
Source: Bloomberg. Data as of 1/31/2023. Included for illustrative purposes only. Past performance is no guarantee of future results.
China Replacing U.S. Treasuries with Gold?
Since 2008, China has been the largest foreign holder of U.S. Treasuries. Though the peak has been in place since 2013, China has recently accelerated its selling of Treasuries. The reason for China selling U.S. Treasury securities are varied and not disclosed. Still, since the U.S. sanctioned Russia’s FX reserves, China has a tremendous incentive to diversify its foreign exchange reserves. Figure 5 highlights the cumulative change in China’s gold imports and U.S. Treasures since 2018, measured in USD. 2018 was the first year of the U.S.-China trade war. The recent accelerated selling in U.S. Treasuries occurred at the start of the Russia-Ukraine war and in response to sanctions on Russia’s FX reserves. We expect China to continue reducing its U.S. Treasuries holdings as the economic war extends and intensifies, and the risk of future U.S. sanctions on China’s FX reserves remains present.
Since 2018, we estimate that China has sold $310 billion of U.S. Treasuries ($199 billion in 2022 alone) and has imported $230 billion of gold. China is estimated to have the seventh-largest global bond market, with the top six positions held by the U.S. and its allies. The list of the most liquid tradeable currencies has the same size ranking. In terms of market liquidity, safety as outside money and convertibility (sanctions resistant), gold remains a highly desirable asset for China.
Figure 5. China Buys Gold and Sells U.S. Bonds
Source: Bloomberg. Data as of 11/30/2022. Included for illustrative purposes only. Past performance is no guarantee of future results.
Japan Yield Curve Control (YCC) and Selling U.S. Treasuries
The Bank of Japan (BoJ) began yield curve control in 2016 (0.25% cap on its 10-year yield) to achieve an inflation target of 2% and stimulate economic growth by controlling long-term interest rates. By late 2022, the BoJ did “technically” achieve its goals, although not the hoped-for “virtuous growth cycle” outcome. However, the costs were enormous as global yields soared while Japanese government bond (JGB) yields were capped at 0.25% by the BoJ. The yen had fallen in value by 22.5%, driving import cost inflation so high that the Ministry of Finance had to intervene in the currency market to defend the yen, while at the same time, the BoJ continued with YCC weakening the yen. If this makes no sense, then you have read this correctly.
In December 2022, in a surprise move, the BoJ lifted the YCC cap to 0.50% from 0.25%, signaling to the market that the BoJ YCC had likely reached its best-before date. Since then, the yen has strengthened by ~15%, contributing to USD weakness. Capping JGB yields in the second half of 2022 as global yields soared required massive purchases of JGBs via quantitative easing. This 2H 2022 QE event was a monetary stimulus of 76 trillion yen or $550 billion (~14% of GDP, i.e., gross domestic profit). The end of this stimulus is likely to act as a defacto global tightening. Raising the yield cap also removed a global “low-yield anchor” on global rates. Not only is this yield anchor fading, but Japanese institutional investors, one of the world’s largest foreign bond buyers, are returning to JGBs. Year to date as of this writing, U.S. Treasury holdings in Japan have declined ~$220 billion since the start of 2022. For various reasons, the two largest holders of U.S. Treasuries have sold $420 billion, or 17.5% of their combined holdings, in 2022.
Foreign selling of U.S. Treasuries is increasing, and the Fed in quantitative tightening (QT )mode leaves U.S. domestic investors as the primary buyers for U.S. Treasuries. Maintaining U.S. Treasury liquidity is now more critical than ever, and the looming debt ceiling standoff will be the next challenge. For gold, the immediate bullish catalyst is a weaker USD and lower real yields. Rising JGB yields will lead to higher U.S. nominal yields but lower breakeven yields (removal of stimulus weakens growth), resulting in lower real yields.
Figure 6. U.S. Treasuries Held by Japan and China, $Billions
Source: Bloomberg. Data as of 1/31/2023. Included for illustrative purposes only. Past performance is no guarantee of future results.
Gold vs. Bonds, Heresy Anyone?
Thus far in 2023, there have been near-record capital inflows into the bond market after 2022 recorded the worst year for bond returns in 48 years of available data. In Figure 7a, we update the gold bullion to the U.S. Treasury Index ratio, highlighting that gold has outperformed over the past several years since 2016 and even over the past 20 years. The gold-Treasury ratio is testing the upper resistance level, and we expect an eventual break higher. Figure 7b highlights the performance of gold versus U.S. equities and U.S. bonds over the past five and 20 years, with performance and portfolio metrics highlighting how well gold has performed and behaved.
Despite these positive metrics, gold is still not widespread in investment portfolios. In the past five years, gold compared to both equities and bonds, has a better Sharpe ratio (risk-adjusted return), a better Sortino ratio (lower downside volatility) and the lowest market correlation (increased diversification).
Gold has outperformed U.S. Treasuries over the past two decades despite the bond market having the advantages of a dovish accommodative Fed (QE, ZIRP, NIRP)11 with volatility-destroying practices (forward guidance, Fed put). Furthermore, most of the past 20 years were dominated by low inflation, low macro volatility, negative stock-bond correlations, etc., all favoring bond performance. In our 2023 Top 10 Watch List, we highlighted several significant macro changes underway, all pointing to higher inflationary pressures and increasing volatility. If gold outperformed U.S. Treasuries in the past decades, we believe the chances are excellent that it is likely to do so in the next several years.
Figure 7a. Gold to U.S. Treasury Index Ratio: Gold Significantly Outperforming U.S. Treasuries
Source: Bloomberg. Data as of 1/31/2023. Included for illustrative purposes only. Past performance is no guarantee of future results.
Figure 7b. Gold vs. Equities and Bonds: 5 & 20-Year Returns and Metrics
Dec. 2017 to Dec. 2022
5 YR CAGR*
Standard Deviation
Max Drawdown
Sharpe Ratio
Sortino Ratio
Market Correlation
U.S. Stock Market
8.67%
19.06%
-24.94%
0.46
0.68
1.00
Total U.S. Bond Market
0.02%
5.09%
-17.57%
-0.23
-0.29
0.34
Gold
6.86%
13.45%
-18.06%
0.47
0.85
0.16
Dec. 2002 to Dec. 2022
20 YR CAGR*
Standard Deviation
Max Drawdown
Sharpe Ratio
Sortino Ratio
Market Correlation
U.S. Stock Market
9.52%
15.29%
-50.89%
0.59
0.87
1.00
Total U.S. Bond Market
3.06%
3.95%
-17.57%
0.48
0.7
0.12
Gold
8.65%
16.87%
-42.91%
0.51
0.83
0.08
*CAGR refers to compound annual growth rate.
1
Gold bullion is measured by the Bloomberg GOLDS Comdty Spot Price.
2
Silver bullion is measured by Bloomberg Silver (XAG Curncy) U.S. dollar spot rate.
3
The NYSE Arca Gold Miners Index (GDM) is a rules-based index designed to measure the performance of highly capitalized companies in the Gold Mining industry.
4
The Bloomberg Commodity Index (BCOM) is a broadly diversified commodity price index distributed by Bloomberg Indices.
5
The U.S. Dollar Index (USDX, DXY, DX) is an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies, often referred to as a basket of U.S. trade partners’ currencies.
6
The S&P 500 or Standard & Poor’s 500 Index is a market-capitalization-weighted index of the 500 largest U.S. publicly traded companies.
7
Any event that is extremely rare, beyond the sixth standard deviation in a normal distribution, is known as a six sigma event.
8
Source: Investopedia. Tail risk is the chance of a gain/loss occurring due to a rare event, as predicted by a probability distribution. Right-tail risks are associated with substantial investment gains, while left-tail risks are associated with unexpected losses.
9
Source: Investopedia. Fibonacci retracement levels are horizontal lines that indicate where support and resistance are likely to occur. They are based on Fibonacci numbers. Each level is associated with a percentage. The percentage is how much of a prior move the price has retraced. The Fibonacci retracement levels are 23.6%, 38.2%, 61.8% and 78.6%. While not officially a Fibonacci ratio, 50% is also used. The indicator is useful because it can be drawn between any two significant price points.
10
Source: Investopedia. The Relative Strength Index (RSI) is a momentum indicator that measures the magnitude of recent price changes to analyze overbought or oversold conditions.
11
QE-ZIRP-NIRP is Fed speak and refers to “quantitative easing”, “zero interest rate policy” and “negative interest rate policy”.
Paul Wong, CFA, Market Strategist Paul has held several roles at Sprott, including Senior Portfolio Manager. He has more than 30 years of investment experience, specializing in investment analysis for natural resources investments. He is a trained geologist and CFA holder. Read Bio
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Past performance is no guarantee of future results. You cannot invest directly in an index. Investments, commentary and statements are that of the author and may not be reflective of investments and commentary in other strategies managed by Sprott Asset Management USA, Inc., Sprott Asset Management LP, Sprott Inc., or any other Sprott entity or affiliate. Opinions expressed in this commentary are those of the author and may vary widely from opinions of other Sprott affiliated Portfolio Managers or investment professionals.
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