Buoyant metals too weak to float TSX

The Toronto Stock Exchange’s gold index tacked on another 4.5 points to end the May 31-June 6 report period at 186.7 points. After an early dip, gold advanced US$7.60 to close at US$425.85 per oz. in the afternoon in London on June 6; the rest of the precious metals tagged along. Likewise, higher base metal prices nearly across the board helped the Diversified Metal & Mining Index edge 1.81 points higher to 295.45. Still, the S&P TSX composite managed to yo-yo itself 19.23 points lower to 9,653.97.

Junior Afcan Mining made a rare appearance as the TSX’s most-traded mining issue, with just shy of 20 million shares trading their way a penny lower to 42. Eldorado Gold has tabled plans to buy Afcan via a $60-million, friendly share-swap deal. For its part, Eldorado shed 6 to $2.90. Eldorado also recently said that start-up of its Kisladag gold mine in Turkey would be delayed by two months owing to weather and the late delivery of key parts. The project’s capital costs have also climbed by 25% to US$83.4 million on higher fuel costs and a weaker greenback.

Next in line on the volume table was Queenstake Resources, adding a penny to make 28 on just shy of 19 million shares. The Denver-based company’s ongoing underground exploration program continues to cut new high-grade gold mineralization at the SSX, Smith, Murray, and Steer mines in northeastern Nevada’s Jerritt Canyon.

Bema Gold outpaced its bigger brothers to end 14 higher at $2.74 on a trading volume of 13.6 million shares. A recently completed feasibility study pegs the net present value of the company’s 75%-owned Kupol gold-silver project in Russia at US$730 million. The US$364-million project is expected to pay for itself in just 18 months.

Major producer Kinross Gold grabbed 28 to make $6.93 after boosting the exchange ratio for its long-delayed offer for Colorado-based Crown Resources to 0.34 of a Kinross share for each Crown share. The increase reflects the recent slide in Kinross’ share price as it continues to respond to queries by the Securities and Exchange Commission in the U.S.

Gitennes Exploration ended with an impressive 24, or 44%, advance to reach 79. While there was no immediate news out of the company, it did complete a fully subscribed private placement of 3.4 million units to raise $1.53 million in mid-May. Work also continues on a new gold discovery at the Tucumachay gold project in Peru, optioned from Inmet Mining. Inmet gained 38 to make $16.

Other nice percentage gainers included Caledonia Mining, which was up 30% to 15; there was no immediate news out of the company. Lumina Resources, Canadian Zinc, and Diamond Fields International all jumped by around 29% to end at 97, 53, and 40, respectively.

Metallurgical test work by Canadian Zinc has returned good results from the company’s Prairie Creek mine in the N.W.T. Meanwhile, Inco has agreed to sink up to US$3 million into Diamond Fields’ Ammassalik Island nickel project.