TSX Venture Exchange, June 17-21

The S&P/TSX Venture Composite Index continued a three-week slide, dropping 4%, or 37.78 points, before closing out the week at 895.79. 

Commodity futures were hit hard by the uncertainty caused by reduced quantitive easing and a possible credit bubble in China, with August contracts for gold leading the way with a 7%, or US$94 loss, en route to a US$1,295.55 per oz. close. August contracts for West Texas Intermediate crude oil lost 4%, or US$4.03, before closing at US$93.89 per barrel, while September contracts for copper dropped 3%, or US9.6¢, en route to a US$3.10 per lb. close.

Guerrero Exploration was the most heavily traded company on the Venture this past week, as 8 million of Guerrero’s 52 million outstanding shares traded hands. On June 19 the company outlined its plans for a 2013 drill program at its Cerro Azul copper property in Guerrero, Mexico.

Guerrero operates Cerro Azul with joint-venture partner Riverside Resources, and identified seven anomalies at the project during fieldwork in 2011. The company has selected three of the targets for drill testing this season, including: Las Trojas, Las Minillas and Loma Coyote. 

According to Guerrero the three anomalies define a northwest-trending zone 5,000 metres long and 600 metres wide, which are hosted in Cretaceous sedimentary rocks. Mineralization mainly holds chalcocite in veinlets and disseminations with minor disseminated pyrite. Guerrero finished the week up 3¢ at 7¢ per share.

Northern Vertex Mining jumped 11¢ before closing the week at 76¢ per share after it amended a preliminary economic assessment (PEA) on its Moss gold-silver project in Arizona. Northern Vertex was forced to review its PEA — after comments from the B.C. Securities Commission — in order to make the report National Instrument 43-101-compliant. The company’s revision included refinements to the initial PEA, with detailed disclosure on prior underground mining activities, more information about oxide and non-oxide recoveries and an updated price-sensitivity analysis as part of its US$1,500 per oz. gold and US$30 per oz. silver price assumptions.

Northern Vertex says the principal conclusions remain “generally consistent” between PEAs, with Moss’ net present value dropping US$5 million to US$105 million, while the internal rate of return declined around 5% to 113%. The PEA recommends the building of a US$7.3-million pilot plant prior to committing to commercial-scale operations.

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