TSX sees more pain during July 11-15 trading week

July 11-15 was another painful week for metals markets and equities. The S&P/TSX Composite Index slid 628.41 points, or 3.3% to 18,394.45; the S&P/TSX Global Mining Index lost 5.44 points or 5.8% of its value; and the S&P/TSX Global Base Metals Index dropped 9.85 points or 6.6% to 139.75. The S&P/TSX Global Gold Index gave up 14.45 points or 5.6% to 245.45, while spot gold finished the week at US$1706.15, down US$32.05 or 1.8%. 

Signal Gold was the top gainer for the period, jumping 27.8% or 10¢ to 46¢. The Atlantic-focused company, formerly known as Anaconda Gold, released infill drill results from its Goldboro project in Nova Scotia. 

The 3,865-metre, 31-hole drill program, returned highlights including 2.5 metres of 18.71 grams gold per tonne starting from 13.5 metres depth (including 0.5 metres of 85.3 grams gold) in hole BR-22-354; and 3 metres of 11.4 grams gold starting from 34.8 metres depth (including 0.5 metre of 60.5 grams gold) in hole BR-22-345. 

The drilling was conducted to upgrade inferred resources to the indicated category. Under a January 2022 feasibility study, about 975,000 tonnes of inferred resources grading 2.11 grams gold per tonne — mainly in the East Goldboro pit — would be mined with the measured and indicated resource, but are currently considered waste. Upgrading these resources would strengthen Goldboro’s economics. 

The feasibility outlines total production of 1.1 million oz. gold at Goldboro over an 11-year mine life at an average diluted grade of 2.26 grams gold per tonne. The initial capital cost was pegged at $271 million, with life-of-mine sustaining capital of $63.1 million. The study forecast an after-tax net present value (at a 5% discount) of $328 million and an internal rate of return of 25.5%. 

Teck Resources rose 60¢ on the week after reporting on July 7 that it achieved record metallurgical coal prices in its second quarter of US$453 per tonne. The price surpassed the US$357 per tonne it received in the first quarter – which drove a US$1.6-billion increase in gross profits for its steelmaking coal unit.  

Due to coal price reductions at the end of the second quarter, Teck expects to record provisional pricing adjustments of negative $73 million. Its steelmaking coal production for the second quarter was 6.3 million tonnes; it expects to produce 24.5 to 25.5 million tonnes this year from its four coal mines in British Columbia’s Elk Valley. 

Calibre Mining shares rose 9% during the period to end at 97¢ per share. The company announced record consolidated production of 59,723 oz. of gold — a 37% increase from the second quarter of 2021. Calibre has two processing facilities and several gold mines in Nicaragua. It is also advancing a 50,000-metre drill program at its Pan heap-leach gold mine in Nevada. It expects to produce a total of 220,000 to 235,000 oz. gold this year (180,000-190,000 at its Nicaragua operations and 40,000-45,000 oz. at Pan).