Juniors keep busy as gold slips below US$270

Gold stepped back into the spotlight during the Nov. 1-7 report period, as the Bank of England auctioned another 804,000 oz. (25 tonnes) at an allotment price of US$264.30 per oz.

While the amount offered was oversubscribed by a factor of 3.3 times — slightly higher than during the last auction — gold prices still fell US$1 over the week to US$265.00 per oz. on the London morning fix of Nov. 8. The next 25-tonne auction of British gold will be held Jan. 23, 2001.

Canada’s gold majors were mixed during an uneventful week: Barrick Gold rose 75 to $21; Placer Dome climbed 20 to $12.85; Franco-Nevada Mining fell 15 to $13.85 as it announced record second-quarter earnings; Kinross Gold was up 7 to 69; TVX Gold advanced 5 to $2.39; and Cambior slipped a penny to 46.

In contrast, Canada’s gold juniors generated most of the news over the week.

Ottawa-based Orezone Resources was up 3 to 18 as it announced a $500,000 private placement with two mining institutions, with the money directed towards projects in Burkina Faso and Canada.

Moydow Mines International announced an updated resource estimate at its Ntotoroso project in Ghana of 31.1 million tonnes grading 2.06 grams gold, or 2.1 million contained ounces gold. Moydow closed the period down 28 to $1.05.

Rising 4 to 30, Geomaque Explorations signed an option agreement with CDNX-listed PolyMet Mining to earn a 60% interest in the latter’s Marathon platinum group metals project near Marathon, Ont., where resources are estimated at 37 million tonnes grading 1.1 grams palladium and 0.27 gram platinum plus minor gold, silver, copper and nickel. Geomaque can earn its interest by spending US$1.8 million on the property and paying US$650,000 in cash.

Iamgold remained unchanged at $2.70 as the Ontario courts dismissed the company’s appeal of a decision in favour of CDNX-listed Kinbauri Gold. The issue was a proposed 1990 amalgamation that would have resulted in Kinbauri shareholders holding 458,615 Iamgold shares. Iamgold also announced record quarterly production at its Sadiola gold mine in Mali.

Canada’s nickel producers were down on the week: Inco dropped 70 to $23; Sherritt International eased down 5 to $4.40; Falconbridge fell 25 to $17.85 as it braced for a planned strike from Nov. 15-20 at its Norway refinery (in sympathy with the demands of union members at the company’s Sudbury, Ont., operations, who have been on strike since Aug. 1).

The remaining majors were mixed: Noranda fell 10 to $14.85 as it announced it may buy back up to 5% of its outstanding shares; Teck‘s B shares jumped up $1.05 to $11.65; Cominco was up 50 to $19.40; Boliden shed another 14 to hit $1.06; and Breakwater Resources was off 5 to $1.75.

Base metal junior Manhattan Minerals rose a nickel to $2.10 as it launched a third phase of drilling at the B-5 deposit, 11 km south of the TG-1 deposit at its Tambo Grande polymetallic project in Peru.