TSX rises, May 11-15: Victoria Gold, Loncor Resources, Guyana Goldfields, First Quantum

After starting the May 11-15 trading week with some gains, the S&P/TSX Composite Index closed down 2.24% to 14,638.90. Spot gold continued to rise, ending the week at US$1,742.20 per oz., a gain of US$39.30 per oz., or 2.26%, and the S&P/TSX Global Gold Index advanced 4.86% to 370.32. The S&P/TSX Global Base Metals Index fell 3.57% to 75.88, while the S&P/TSX Global Mining Index increased 2.84% to finish the week at 88.01.

Shares of Victoria Gold climbed $4.69 to close at $13.06. This followed the release of an operations update on Victoria’s wholly-owned Dublin Gulch property located in the central Yukon, where the company operates its Eagle gold mine. The update stated that April had seen gold production at the mine increase substantially and higher gold output is expected to continue over the coming months as more ore is placed under leach. The company says that the Eagle mine produced 6,768 oz. of gold in April, with a grade of 0.86 gram gold per tonne. This added considerably to the first quarter production total of 10,544 ounces and the year-to-date total of 17,312 ounces.

Gold explorer Loncor Resources surged $0.26 to close at $0.69 per share, as the company released an update on its activities within the Ngayu Greenstone Belt in the Democratic Republic of the Congo. Loncor has a dominant footprint there through its joint venture with Barrick Gold (Congo) SARL, and announced that Barrick rigs were to commence drilling on several priority targets in this quarter. Drilling had been intended to start in March, but some delays were encountered at the border due to additional permitting requirements resulting from the COVID-19 pandemic.

Shares of Guyana Goldfields rose $0.24 to $0.94 as the firm announced that its board of directors had unanimously determined to reject an unsolicited proposal from Gran Columbia Gold to acquire all the issued and outstanding common shares of the company for consideration consisting entirely of Gran Columbia shares. The board of directors said that the proposal was not in the best interests of Guyana Goldfields or its shareholders, and reaffirmed its unanimous support for an arrangement previously announced that has Silvercorp Metals acquiring all of the issued and outstanding shares of Guyana Goldfields. In particular the company says that the Silvercorp deal will see a continued commitment to developing their flagship Aurora gold mine, in Guyana.

First Quantum Minerals closed down $1.04 at $7.57 per share as the company continued to deal with reduced production expectations from its mining operations, which include sites in Panama, Zambia and South Africa. The firm’s Cobre Panama copper and gold mine was temporarily closed last month by the Panamanian Ministry of Health after some workers at the site contracted COVID-19. Maintenance and temporary care of the site is expected to cost First Quantum between US$4 and US$6 million a week.