Friday, 6 September 2019

Gold In The USA, Alaskan Elephant Country: Incrementum - "Gold In The Age Of Eroding Trust".



The sky is falling down on Earth in the Gold market for some people, I do hope that it is not the case for many following our discussions here. Nothing is growing up in the straight line to the skies (apart from debt), all parabolic moves must be consolidated in order to build up the healthy technical picture. Fundamentals are here - "The Paradigm Shifts". It's time to revisit the fundamentals supporting our brave scientific thesis that it is time now to advance "Gold In The USA - Alaskan Elephant Country".




Always make your own research and you will have to pick up the winners. We are talking about the generational Bull Gold market here and the first meaningful correction after breaking out $1,350 resistance zone, taking out physiologically important $1,400 and even assaulting the all crucial $1,500 - for bankers to write those letters to their wealthy clients "The Gold Bull Market Is Back". 






After making a double top on the daily chart at $1,555 gold is entering the long-awaited by so many correction. If anything, this waterfall during the abrupt correction is the indication of the bull market. This consolidation will show the strength of this Gold Bull and now even more gold junior names will be joining FED's Gold Party Summer 2019 finally. 




This correction in the gold market means that the master plan to reset the very tired bull in the general equities markets is in the works as we have discussed it. Risk is on - as the annihilation of the global economy is postponed again. As very talented Nicholas Winton is pointing out: CDNX, the home for junior mining in Canada, has barely witnessed the great summer gold rally of 2019 and is only turning up after the multi-year bear market.





This chart demonstrates our thesis that we have seen nothing yet during this Gold Bull better than any thousand words. "Sign of how unloved gold stock rally so far. Gold ETF inflows have been negative every month year to date" in 2019 so far!




Brilliant charts from Northstar can provide you with some maps to navigate your own journey. The most important part driving these ideas: fundamentals for this Gold Bull to stay here for years to come - are brilliantly presented in the Incrementum report: "Gold In The Age Of Eroding Trust." 




Below you can find links to our summer digest providing more information for your DYOR about the development of this Gold Bull and TNR Gold's strategic plan advancing the Shotgun Gold project.





TNR Gold is developing the Shotgun Gold project in the Alaskan elephant country near Donlin Gold mining district. On the links below you can find more information. Barrick Gold received crucial permits to advance Donlin Gold and this new developing mining district in the US can make the promise of "Gold In the USA" providing stable supply feasible again and it can become that solution to "The Gold Mining Reserve Crisis" McKinsey is talking about:
"The Company's strategy with the Shotgun Gold Project is to attract a partnership with one of the major gold mining companies. TNR Gold ("TNR") is actively introducing the project to interested parties," commented Kirill Klip, Executive Chairman of TNR. "We may be at the beginning of a great discovery. There is a clear path on how to move this project forward using the geological and geophysical research currently available to target drilling to expand the resource and form the basis of a preliminary economic analysis. The next step is to acquire a partner that shares our vision and recognizes the growth potential and value to be added to the Shotgun project over time."




Gold And The Last Snowflake Before The Avalanche: Never Fight The FED... and ECB... and BOJ... and SNB.


Chart by Northstar.


Just a few short months ago we all were holding our breath witnessing the end of the brave scientific experiment performed by FED and their fellow visiting Central Bankers from the BIS Club. The surgery was conducted on the live global economy without any anaesthetics. Coming back to life from the last near-death experience after the Great Financial Crisis was very painful for most of us but worth it for a chosen few.




FED was "normalising rates". This normalisation was finished very abruptly last week after just 225 points level with FED cutting 25 basis points for the first time in 11 years and signifying the change in the trend. There is not a lot of room for any policy mistakes now.




"Growth solves a lot of problems", but what to do when it is not there anymore? US Dollar will be the designated victim and gold is already enjoying FED Summer Party 2019. Last week we had a lot of confusion between very well educated people among investors: the FED was cutting rates with markets at all-time highs. But the simple tweet about new tariffs brought crystal clear clarity for the direction sending US Dollar in a knockout, FED on the ropes and Gold pushing $1,450.




It is very important to note that Gold is breaking out from its bear market to the new 6-year highs when the US Dollar is hitting its own highs. With such powerful allies like POTUS, Currency War and race to the bottom will be very dramatic. POTUS needs a lower US Dollar to reignite the stalling economy.




All Central Banks are easing and flooding the financial system with liquidity again. We have discussed in depth the relationship between Negative Real Interest Rates and Gold already. Today I would like to provide you with my thoughts about the big picture and major drivers for the gold market in the form of a summer digest with links to our recent discussions. You can search for that last snowflake which will start the avalanche. I do not know what will be the last one as we have a hale storm already.




Negative Real Interest Rates have brought us to the last all-time high of $1,889.70 in 2011. Now gold will be climbing on the record pile of negative-yielding debt and we are heading to the new all-time high in gold. How high can we go this time? I would recommend the following of the brilliant @Northst18363337 for graphical technical inspirations, his chart is presented opening this post.




On my part, I can only add here that we are in a very good Gold Club company now having Ray Dalio and Judy Shelton among our members. They have their own audience: billionaires and Central Banks are buying gold.




Never fight the FED... and ECB... and BOJ... SNB. The list of most active in the gold market starts with China and Russia and now is wide open up to Turkey, Poland and the Philippines with many others in between. Central Banks are buying gold.




With gold pushing to the new highs, gold miners will start literally "printing the real money" - produce gold with higher margins. Gold exploration and development companies will provide the most upside for the investors who are making their homework right. Gold investing legend Eric Sprott is on the buying spree again. The chart above from Marin Katusa illustrates brilliantly what will be the next catalyst for the valuations of gold companies with the rising price of gold during The Switch. "Rise to the generational average of 0.23% in gold weighting in the S&P 500 could cause gold stocks to skyrocket." I should only add here that some special situations among gold explorations stocks may now provide a truly unique entry point when some motivated sellers among banksters who turned miners are finally fading out of their abrupt disgraceful appearance in the noble mining history. As always, do your own research, read legal disclaimers and consult your qualified financial adviser before investment decisions.





Gold And Snowflakes Before The Avalanche: Something's Broken, Something Unspoken: "After A $354 Billion U.S. Bailout, Germany’s Deutsche Bank Still Has $49 Trillion In Derivatives."






PDAC 2019: TNR Gold Invites Expressions Of Interest For Shotgun Gold Project, Alaska.





Frank Holmes: "The Gold Bulls Just Regained The Upper Hand - Gold And Metal Miners Have Crushed the Market."





Gold In The Alaskan Elephant Country: Kirill Klip On TNR Gold’s Shotgun Gold Project In Alaska.




TNR Gold Shotgun Project: Gold In The Alaskan Elephant Country - Alaska's Donlin Gold Project Receives Crucial Permits.





Gold In The Alaskan Elephant Country. McKinsey: Can The Gold Industry Return To The Golden Age? It’s Time To Dig For A Solution To The Gold Mining Reserve Crisis.





Gold In The Alaskan Elephant Country: TNR Gold Shotgun Gold Presentation April 2019.





































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Saturday, 31 August 2019

Energy rEVolution And The Big Picture For Copper During A Mexican Standoff In The Trade War Against The USA: Barron's - Copper Prices May Take Off As Supply Tightens.




With copper priced to perfection in the scenario which is reflecting the end of the world and total collapse in the global economy, it is time for us to revisit the big picture of supply and demand; and McEwen Mining's "sleeping giant" - Los Azules Copper where TNR Gold is holding NSR Royalty on the entire deposit. As you already know, red metal is going green during the Energy rEVolution and there will not be enough of it. 




Goldman Sachs has been talking about "severe deficit" even before the latest escalations in the trade war and the best cure from lower price is a lower price. Nobody will be building new giant copper mines with prices below $3/lb. Supply shocks are imminent and price shocks to follow.




Northstar is providing a very interesting technical view on the potential future outcome for copper in the recent stage of a Mexican standoff in the trade war between POTUS and the USA. Nobody knows the future and total annihilation of the humankind can be one of the very unfortunate outcomes in any investment scenarios. 




Always do your own research - I do not honestly know how to prepare to that sad end. In all other potential cases, I can only point out to my personal experience of making the best investments by buying when "blood was almost literally on the streets" like with Tenke Mining starting my acquisitions at CAD 40 cents during the civil war in DRC and following Lukas Lundin with his motto: "politics will change, resources in the best projects will stay". Later, Lukas made a lot of investors of Tenke Mining very happy during his buy out by Lundin Mining at CAD$20 dollars. I have followed him and found TNR Gold many years ago - now we have Los Azules Copper NSR Royalty among our other assets and building The Green Energy Metals Royalty and Gold Company.




Can we have a similar situation with Argentina and Los Azules now? Only the future will tell, but the entry point will always determine the investment outcome and now we have legendary Rob McEwen with his Midas touch involved. Giant copper projects are only far and few between, developments of many are being delayed and as Barron's' is pointing out below:

“They are overwhelming[ly] short copper,” Badiali says. “Everyone is on one side of the boat.... When they have to cover, there will be a ridiculous rally in copper prices.” 

As you have noticed, I am of the opinion that POTUS is extremely motivated to be reelected as the alternative can be not so desirable due to the statutory limitations. Recession will dramatically reduce the chances of the second term. Orchestrated blowing off steam from the frothy markets in order to "reset the bull run" after squeezing all possible rate cuts from FED comes to mind as a strategy. "The Deal" can be a few tweets away after that and even absence of war can be enough for the exhausted algo traders who have never experienced bear markets. A lot of people will mention, that POTUS is playing not only with fire here but with the inverted yield curves all over the globe. They will be on the same side with a lot of very smart people and I can only reply that all metals require an extensive treatment by fire during the refining stage and for this scenario, we have Shotgun Gold in the Alaskan elephant country and a lot of other blog posts here.  




Today you can find for your further DYOR a very interesting update from McEwen Mining on Los Azules Copper development and presentation of TNR Gold Los Azules Copper NSR Royalty Holding.




From McEwen Mining NR:

TORONTO, July 30, 2019 (GLOBE NEWSWIRE) -- McEwen Mining Inc. (NYSE:MUX) (TSX:MUX) announces its results for the second quarter and first half ended June 30, 2019 ("Q2" and "H1"). 
... Rob McEwen, Chairman and Chief Owner commented: "... At Los Azules we achieved a critical milestone in the project's valuation by validating a new access route that will provide year round access, rather than the current 4-5 months..."


Los Azules Project, Argentina (100% Interest)
Last year, we identified a critical value-adding milestone for Los Azules - a new low altitude all-year access route (Northern access route). Currently access is only possible 4-5 months of the year. The Northern access route was explored by overland expedition during March 2019 and confirmed to be viable for access and also for the proposed electrical transmission line. Preliminary engineering, cost and schedule estimates are in progress. Work will begin on the road later this year.
During Q2, we continued to advance permitting efforts. We are targeting the submission of the Environmental Impact Assessment by the end of the year and expect the Environmental Impact Declaration to be received during 2020.



From McEwen Mining CC transcript:

Chris Stewart:
At Los Azules our world-class copper project in Argentina, we have budgeted $3 million for 2019 to continue our progressing the project. We’re working on project de-risking from an infrastructure solutions perspective. Looking at the runway design for Los Azules, it is now completed, and we are now moving into the permitting phase. We’ve agreed on a memorandum of understanding with the Port of Coquimbo for the export of concentrate through Chile and into the Pacific Ocean. We also made significant advances on our IAA application for the permit for resource exploitation, and we anticipate submitting the permit in the fourth quarter of 2019 and would expect the environmental impact declaration to be received in late 2020.
Rob McEwen:

At Los Azules, we’ve achieved a significant breakthrough. We have determined that a viable alternative access route can be built and that it would give us year-round access versus the current access of only four to five months. We believe this new route will significantly improve the value of Los Azules and accelerate the opportunity to development. 
Jake Sekelsky
Q: Okay, perfect. And then just lastly a similar question at Los Azules, obviously the approval for the northern access route is a big win for the project, when should we see news on that front, just related to estimated costs and to touch whole economic impacts for that?
Rob McEwen
A: Okay. On cost that would be later in Q3 this quarter. And we expect to start construction before year-end.



BN Americas:

Argentina and Chile ratify commitment to develop sustainable mining

Written by: BNamericas 
Published: Thursday, June 27, 2019

By the Argentine production ministry.

"Chile, June 26, 2019 - Argentine and Chilean authorities have ratified their cooperative ties and advanced on mechanisms that facilitate the development of mining projects, within the framework of the meeting of the administrative commission of the treaty on mining integration and complementation between the two countries.
The work teams of the administrative commission of the treaty are formed, in the case of Argentina, by the secretariat of mining policy of the production and labor ministry, headed by Carolina Sánchez, and by the directorate of economic relations for the Americas, part of the foreign affairs ministry, led by Gustavo Infante. On Chile's side was the mining undersecretariat, led by Pablo Terrazas; and the foreign affairs ministry, assistant deputy secretary, ambassador Ricardo Rojas.
The work agenda included topics of common interest such as the strengthening of the permanent working group on safety and environment, with a focus on the development of policies that encourage investment in new mining projects along with the best practices for the development of responsible mining and care for the environment.
The authorities worked on the additional specific protocol (PAE) at Vicuña and Filo del Sol and received the legal representative of the applicant company who highlighted the benefits that the PAE Vicuña implied for the project throughout the exploration stage. McEwen Mining was awarded the PAE for the Los Azules mining project, approved by Argentina and Chile, to facilitate mining activity between both countries. The representative of the company stressed the importance of the treaty in terms of logistics coordination and the competitiveness that this generates for the company.
Likewise, the guidelines of an internal procedure were established to unify approval in the border areas between both countries through the early intervention of the mixed boundary commission.

The objective of the mining treaty between Argentina and Chile is to promote physical integration and economic cooperation. In this sense, both countries are committed to work on border facilitation with the objective of promoting the development of the mining sector, enable access and exit from the areas of operations from both territories and allow the use of natural resources, inputs and infrastructure as established by the teams of technical specialists."

Tesla Energy rEVolution And The Golden Age For Copper: Kirill Klip GEM Royalty TNR Gold Copper Presentation May 2019.




In a news release dated February 21, 2019, McEwen Mining Inc. ("McEwen Mining") stated: "Our focus is on delivering near-term production growth from our projects in the United States and Canada, and on advancing Los Azules." The statement gives TNR confidence that McEwen Mining is keen to move the Los Azules project forward. 
In addition, McEwen Mining stated the following on its 100% owned Los Azules project: "We spent $6 million at Los Azules during 2018. The activities performed were mainly technical site investigations and environmental baseline monitoring work, to advance permitting efforts. We are currently investigating a new access route to the project that, if developed into a road, could provide year-round access to Los Azules, greatly accelerating the potential development of the project and reducing operating costs. Our 2019 exploration budget for Los Azules is $3 million." 
McEwen Mining's press releases and website material appear to be prepared by "Qualified Persons" (as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101")) and the procedures, methodology and key assumptions disclosed by McEwen Mining are those adopted and consistently applied in the mining industry, but no Qualified Person engaged by TNR has done sufficient work to analyze, interpret, classify or verify McEwen Mining's information, nor to determine the current mineral reserve or resource or any other information referred to in their press releases. Accordingly, the reader is cautioned in placing any reliance on these disclosures. 
The Company holds a 0.36% royalty on the net smelter return ("NSR") royalty of the entire Los Azules copper project in Argentina. TNR summarized the PEA results in a news release issued on October 10, 2017."




LEGAL DISCLAIMER

Please read legal disclaimer. There is no investment advice on this blog. Always consult a qualified financial adviser before any investment decisions. DYOR.




Barrons':

Copper Prices May Take Off as Supply Tightens

 By Myra P. Saefong

"Copper recently touched its lowest price level in more than two years, reflecting investors’ worries about muted economic growth and the temperamental trade dispute between the U.S. and China.
As supplies of the red metal tighten, however, analysts think commodities traders could overcome concerns about the economy, prompting copper prices to move higher.
“The current stagnant-to-declining copper price is accurately reflecting a slowing global economy,” says Brent Cook, an economic geologist and co-editor of the newsletter Exploration Insights. “The numerous central bank [interest] rate cuts support this conclusion as well.”
Copper futures settled at $2.544 a pound on Aug. 5, the lowest for a most-active contract since June 2017, according to FactSet data. Prices for the metal had dipped below $3 in June of 2018 as tariff threats heated up; copper hasn’t been able to trade above that level since.
“Copper was in a steady two-year bull market right up until the trade war escalated,” says Matt Badiali, senior research analyst at Banyan Hill Research, adding that the current troubles with copper are more about global economic woes than China’s impact on copper.
Sentiment for copper, however, could turn bullish because demand fundamentals show strong support for higher prices, Badiali says. Basing his estimates on reported figures, Badiali thinks that the world will need to produce 5 million metric tons of copper per month by 2030—about 2.5 times more than it will produce this year—in order to meet projected demand from the electric-vehicle industry.

World refined copper is expected to see a deficit of about 190,000 metric tons in 2019, with that deficit widening to 250,000 metric tons in 2020 as refined production lags behind usage, according to an International Copper Study Group report released in May. 
With an increase in the world’s population and climate change, demand for base metals will grow because they are environmentally friendly, says Stan Bharti, CEO of Forbes & Manhattan, a private merchant bank focused on the global resource sector. “Demand for electronic cars will only keep demand high for copper as the cars become more mainstream.”
“Delays in production from the large Oyu Tolgoi underground copper/gold mine in Mongolia” suggest a potential supply risk for copper concentrates, says Joe Mazumdar, an economic geologist and co-editor of Exploration Insights.
An Aug. 9 U.S. Commodity Futures Trading Commission report showed net positions for large speculators in U.S. futures markets at minus-58,400 contracts as of Aug. 6, according to Investing.com.
“They are overwhelming[ly] short copper,” Badiali says. “Everyone is on one side of the boat.... When they have to cover, there will be a ridiculous rally in copper prices.” 
For investors, the safest way to play the copper market is through giant mining companies such as BHP (ticker: BHP), Southern Copper (SCCO), or Rio Tinto (RIO), says Badiali, who lists the first two of those stocks in the Real Wealth Strategist newsletter’s suggested portfolio.
Copper’s real driver will be “the adoption rate of alternative energy and electric vehicles,’’ he says. “If the trend is real, then we are watching the birth of an epic bull market in copper.” 
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