Skeena Resources secures sole access to ‘Eskay Creek’ and MAG Silver raises $ 50 million in the US!

The precious metals have broken out through important technical chart brands. Market experts predict a longer bull market! This eases the situation for precious metal companies, which can now negotiate excellent deals again, such as Skeena Resources and MAG Silver recently.

Bang at Skeena Resources!

Skeena Resources Limited (ISIN: CA83056P8064 / TSX-V: SKE) has negotiated a binding agreement, a so-called term sheet, with a 100% subsidiary of Barrick Gold Corporations, which entitles Skeena to use its option to run the entire gold-silver project ‘Eskay Creek’ in the ‘Golden Triangle’ in Take Northwest British Columbia!

To do this, Skeena Resources only has to transfer 22.5 million units consisting of one Skeena common share and half (non-transferable) warrant to Barrick Gold’s subsidiary. The mining giant is thus waiving its rights to the deposit.

As the exercise price for each entire warrant, the partners agreed on a price of CAD 2.70, which on the signature date corresponded to a surcharge of a good 60% on the 20-day VWAP and a surcharge of 35% on the closing price.

However, the Barrick subsidiary has been granted a 1% ‘NSR’ royalty for the entire land package of ‘Eskay Creek’, which, however, has to be acquired within two years of the transaction at a price of CAD 17.5 million. On top of that, another $ 15 million payment will be made if Skeena sells more than 50% of Eskay Creek within two years of the transaction. Although we don’t believe that Skeena will sell anything!

After the transaction, Barrick will of course indirectly become a significant Skeena shareholder, with approximately 12.4% of the shares outstanding. If you choose to convert the warrants at Barrick Gold and / or the subsidiary, the share will even increase to 17.2% on a partially diluted basis. Due to the high percentage stake in Skeena, the Barrick subsidiary has the right to appoint a director to the Board of Directors of Skeena Resources.

For Skeena Resources, on the other hand, that would of course mean revenues of CAD 30.4 million. As long as Barrick retains its portion of at least 10% on a partially diluted basis, Barrick is granted the right to maintain that portion in future funding rounds.

Such an excellent deal, of course, brings joy to both sides of the company, as was readily apparent from Walter Coles Jr., Skeena’s CEO, and Mark Bristow, Barrick’s President and Chief Executive.

“Skeena is honored to have Barrick as a significant shareholder as we strive to ‘Eskay Creek’ reopen the former gold mine with the highest grades. The recent improvements to the infrastructure in the ‘Golden Triangle’ offer us the opportunity to quickly reopen closed mines in order to contribute to the economic development of the communities in northern Canada. The complete ownership of ‘Eskay Creek’ is an important milestone in the development of our company. We are well funded with nearly $ 50 million in cash and continue to believe that there are significant opportunities to improve the salary and size of this project through aggressive exploration drilling. ”said Walter Coles Jr. of Skeena Resources.

Mark Bristow added:

“The Skeena team did an excellent job developing ‘Eskay Creek’! This is another good example of a transaction that offers everyone involved a value-adding opportunity. ”

With this advantageous agreement, the Canadian mining exploration company, which focuses on the development of the formerly producing gold-silver mine ‘Eskay Creek’, has positioned itself excellently in order to be able to develop its project free of third parties. The potential of the historic mining site is illustrated by the robust preliminary economic assessment published at the end of last year (‘Preliminary Economic Assessment’).

Source: Skeena Resources

Based on these excellent economic figures, Skeena now wants to carry out a feasibility study as quickly as possible through the still necessary infill and exploration drilling. At the same time, the company is also exploring the other previously produced producing gold mine ‘Snip’. Skeena thus has two first-class projects in the best jurisdiction!

MAG Silver issues shares for $ 50 million sold in the US market!

The prospective silver producer active in Mexico MAG Silver Corp. (ISIN: CA55903Q1046 / TSX-V: MAG) on June 29, 2020, led by Raymond James & Associates, in collaboration with Canaccord Genuity, BMO Markets, H.C. Wainwright & Co, Roth Partners and TD Securities signed a sales agreement whereby MAG Silver may, at its discretion, sell up to $ 50 million of common stock of the company over the aforementioned partners for a period of time.

Ordinary shares are sold as defined in the Canadian Securities Administrators National Instrument 44-102-Shelf Distributions through the relevant stock exchanges, including sales that are made directly on NYSE American or on any other recognized marketplace where the common shares are listed or in be traded in the United States.

The sale of common stock under the sales agreement, if any, is through ordinary brokerage on NYSE American at market prices. No offer or sale of common stock in Canada will be made on the Toronto Stock Exchange or any other trading market in Canada under the sales agreement.

MAG Silver intends to use the resulting net income primarily to finance the completion of the mine construction work on the ‘Juanicipio’ project, with the remaining funds then being used to finance further exploration of the project and as working capital and for general corporate purposes.

Best wishes


Jörg Schulte

In accordance with section 34 WpHG, I would like to point out that Jörg Schulte, JS Research UG (limited liability) or company employees can buy or sell their own business in the shares of the companies presented at any time (e.g. long or short positions). This also applies to options and derivatives based on these securities. The resulting transactions may influence the company’s share price. The information, recommendations, interviews and company presentations published on the “websites”, the newsletter or the research reports are paid for by the respective companies or third parties (so-called “third parties”). The “third parties” include e.g. Investor relations and public relations companies, brokers or investors. JS Research UG (limited liability) or its employees can be directly or indirectly compensated for the preparation, electronic distribution and other services by the companies discussed or so-called “third parties” with an allowance. Even if we compile each report to the best of our knowledge and belief, we advise you on other external sources regarding your investment decisions, such as Consult your house bank or a trusted advisor. For this reason, liability for financial loss that may result from using the explanations given here for your own investment decisions is categorically excluded. The custody account shares of individual shares, especially in commodity and exploration stocks and in the case of small capitalized stocks, should only be so much that even if the total portfolio is lost, the total portfolio can only lose marginally in value. Shares with a small market capitalization (so-called “small caps”) and especially exploration stocks as well as all listed securities in general are subject to considerable fluctuations. The liquidity in the securities can be correspondingly low. When investing in the raw materials sector (exploration companies, raw material producers, companies that develop raw material projects), additional risks must be taken into account. Below are some examples of separate risks in the raw materials sector: country risks, currency fluctuations, natural disasters and storms (e.g. floods, storms), changes in the legal situation (e.g. export and import bans, punitive tariffs, prohibition of raw material extraction or exploration, nationalization of projects), environmental regulations (eg higher costs for environmental protection, designation of new environmental protection areas, prohibition of various mining methods), fluctuations in raw material prices and considerable exploration risks.

Disclaimer: All information published in the report is based on careful research. The information does not constitute an offer to sell the shares discussed or a solicitation to buy or sell securities. This report represents only the personal opinion of Jörg Schulte and is in no way to be compared with a financial analysis. Before you make any investments, professional advice from your bank is essential. The statements are based on sources that the publisher and his employees consider to be trustworthy. However, no liability can be accepted for the correctness of the content. No liability is assumed for the correctness of the charts and data shown on the commodity, foreign exchange and stock markets. The source language (usually English) in which the original text is published is the official, authorized and legally valid version. This translation is included for better understanding. The German version can be shortened or summarized. No responsibility or liability is assumed: for the content, correctness, adequacy or accuracy of this translation. From the translator’s point of view, the message does not constitute a buy or sell recommendation! Read here – -. Please also note the original English message, if available.

Note: PERSONAL-FINANCIAL.COM publishes analyzes, columns and news from various sources in this section. PERSONAL-FINANCIAL.COM AG is not responsible for content that has been posted by third parties in the “News” area of ​​this website and does not adopt it as its own. This content is particularly recognizable by a corresponding “von” label below the article title and / or by the link “To read the full article, please click here.”; the named third party is solely responsible for this content.

Related Articles

Back to top button