Gold junior M&A has dominated the mining headlines so far in 2015. Monday of the PDAC Convention is when the big announcements have historically occurred and the following companies could be one of juniors making news.
One might think the mood at the 2015 Prospectors & Developers Association of Canada (PDAC) Convention might be a tad gloomy given the resource bear market of the past few years. There have been signs of life in some sectors so far in 2015, though, that could lead to some big announcements on either March 2 or March 3 when the delegates meet in Toronto.
Gold junior M&A tops the list this year with notable deals being announced in January and February that include the pending acquisition of Probe Mines by Goldcorp, the merger of Tahoe Resources and Rio Alto Mining, and the big-dollar joint venture agreement between Centerra Gold and Premier Gold Mines.
All in all some prized gold assets have been taken off the table in the early months of 2015, which could create a ‘gold rush’ among the other miners to snap up the quality projects that remain. Monday of the PDAC Convention is when the big announcements have historically occurred and the following companies could be one of juniors making news.
Timmins Gold Corp. (TSX: TMM): Fresh off an announced $140 million acquisition of Newstrike Capital Inc. (TSXV: NES), Mexico-focused Timmins could now be in the cross hairs of some of the bigger gold miners. Assuming both Ana Paula and Caballo Blanco are put into production the company estimates that its all-in-sustaining cash costs per ounce will fall to less than US$780. Goldcorp has its Peñasquito mine in Mexico and, thus, Timmins Gold could be a good fit.
Pretium Resources Inc. (TSX: PVG): Although its Brucejack gold project in northern British Columbia isn’t expected to go into production until 2017, the 6.9 million ounces of probable reserves in its Valley of the Kings area grading 15.7 g/t is difficult to ignore. A feasibility study done in June estimates average annual gold production of 504,000 ounces during the mine’s first 8 years at all-in sustaining cash costs of just US$448 per ounce using a US$1100 gold price assumption. Silver Standard Resources Inc. (TSX: SSO) has a large stake (about 17 million shares) in Pretium as does China’s Zijin Mining Group Co., Ltd. (nearly 13 million shares).
Primero Mining Corp. (TSX: P): Primero’s CEO Joseph Conway was the former boss of IAMGOLD, taking it from a $50 million joint venture company to a $6 billion gold producer. Primero owns 100% of the San Dimas gold-silver mine in Mexico and 100% of the Black Fox mine in northern Ontario. Its production is expected to increase by up to 20% in 2015 to between 250,000 and 270,000 gold equivalent ounces with all-in sustaining costs estimated at US$1,000 to $1,100. One of Primero’s directors, Rohan Hazelton, is currently Vice President of Strategy at Goldcorp.
Asanko Gold Inc. (TSX: AKG): Asanko’s 10 million plus ounce Asanko Gold Mine in Ghana, West Africa is expect to begin production in a year’s time. Its all-in-sustaining cash costs per ounce is forecast to be US$781 and the company has about US$260 million in the bank. In a recent interview, newsletter writer Brien Lundin said “Asanko is going to be a world-class mine but it is not being valued like one.” Surprising that no one has stepped up to buy Asanko yet.
Kaminak Gold Corporation (TSXV: KAM): Kaminak has been generating a lot of buzz lately with its Coffee gold project in the Yukon, which is estimated to have all-in-sustaining cash costs per ounce of US$688. Mining magnates Ross Beaty and Lukas Lundin both have significant stakes in Kaminak.
Teranga Gold Corporation (TSX: TGZ): Teranga, which mines gold in Senegal, West Africa, is an inspiration to those who still believe small can be beautiful in this industry. The company is expected to produce 200,000 to 230,000 ounces of gold in 2015 at all-in sustaining costs of US$900 to $975 per ounce. The company is debt free and generated $39.1 million in free cash flow during 2014.
