TSX slips, Aug. 22-26

Canada’s benchmark index fell 0.3% to 14,639.88, as U.S. Federal Reserve Chair Janet Yellen noted in a speech that “the case for an increase in the federal funds rate has strengthened in recent months.” The S&P/TSX Global Mining Index declined 5.5% to 62.98 and the S&P/TSX Global Gold Index dropped 9.27% to 240.

Underground drill results from the Kiena mine complex near Val-d’Or, Que., sent shares of Wesdome Gold Mines soaring 46.9%, or 76¢, to $2.38 per share. Highlights included 94.35 grams gold per tonne over 17.4 metres, 223.12 grams gold over 14.3 metres and 8.43 grams over 8.2 metres. The Kiena mine complex is fully permitted, and has integrated mining and milling infrastructure that includes a 900-metre production shaft and a 2,000-tonne-per day mill. The mine produced 1.75 million oz. gold from 12.5 million tonnes at a 4.5-gram gold grade between 1981 and 2013. Operations suspended in 2013 due to declining gold prices and lack of development.

Shares of Eldorado Gold fell 68¢ to $4.63 per share. The slide coincided with new exploration projects in Romania, Serbia and Brazil. In Romania, Eldorado acquired the large Bolcana porphyry copper-gold project, which is contiguous with the company’s land package in the country’s Apuseni mining district. In Brazil, Eldorado will explore the Borborema and Nazareno gold projects under an option agreement with Votorantim Metals, and in Serbia it will explore the Karavansalija project, a large skarn and epithermal system with multiple mineralized ones and untested targets. Peter Lewis, Eldorado’s vice-president of exploration, said all of the projects include defined targets that the company plans to “drill aggressively” over the rest of 2016.

Erdene Resource Development updated the market on its gold projects in southwestern Mongolia. The company has been working on technical studies on the styles and controls of gold mineralization at its Bayan Khundii and Altan Nar projects. Both are near-surface and high-grade gold discoveries in the country’s Tian Shan gold belt. Bayan Khundii is a low-sulphidation, epithermal gold prospect and Altan Nar is a gold-polymetalic project 19 km northwest. Erdene says drilling will resume at Bayan Khundii in September and continue throughout the fourth quarter, and the program will include drill holes at Altan Nar. Among the studies underway are an environmental baseline study on both projects by a Mongolian environmental consulting company; a 3-D model of Bayan Khundii mineralized zones to help with drill targeting; and a review of the deposit by Jeffrey Hedenquist, one of the world’s experts on epithermal gold systems. The company also plans to review its Altan Arrow discovery, 3.5 km north of Bayan Khundii. Meanwhile, it is evaluating copper and gold opportunities throughout Mongolia’s Edren Terrane through an alliance with Teck Resources. Shares of Erdene ended at 31¢, down 18.4%.