A Weekly Recap of All Things Resources to Friday, September 16th
‘That’s a Wrap’
By Rod Blake
Resource investors began the week somewhat encouraged not only because of the previous week’s overall positive action, but also because the dominant U.S. dollar – as tracked by the DXY- seemed to have peaked last week at over 110 and was now about to start the new week down about 2% at 108. Most commodities are priced in U.S dollars so a drop in the greenback tends to give a lift to resource issues.
Equinox Gold Corp. ‘EQX-T & N’ saw its share price rebound back up by $0.24 or 5.16% to $4.89 after the company reported a full resumption of operations at its Mexican Los Filos Mine after meeting with Mezcala local leaders of the illegal blockade.
Tamarack Valley Energy Ltd. ‘TVE-T’ announced it was acquiring privately held Deltastream Energy Corp. and its key Clearwater heavy oil ground in Northern Alberta in a cash & stock deal valued at some $1.425 billion.
If a greener world is going to require more uranium, then Fission Uranium Corp. ‘FCU-T’ may be a key supplier as the Vancouver based mineral developer announced a 21% increase in the resource estimate and a 12.3% increase in contained U3O8 for its flagship Triple R uranium deposit in Northern Saskatchewan.
The way I see it – While modern mining methods and safety regulations have greatly improved miners’ working environment – at times mining can still be a very risky business – as witnessed by Sierra Metals Inc. ‘SMT-T’ that sadly announced the death of three contract miners due to an underground mudslide at its Yauricocha Copper Mine in Peru.
Cardinal Energy Ltd. ‘CJ-T’ shares’ rose by $0.43 or 5.59% to $8.12 after the company joined a growing list of petroleum companies to increase returns to stakeholders by announcing a 20% increase in its monthly dividend to $0.06.
While on a related note – the price of Calfrac Well Services Ltd. ‘CFW-T’ stock gained $0.36 or 6.94% to $5.55 after the Calgary based oil services company said it anticipates significant 3rd-quarter revenue and year-over-year growth.
The International Energy Agency (IEA) predicted that Chinese oil demand will drop by 2.7% this year due to Covid lockdown and falling real estate issues. This will mark the world’s second largest economy’s first drop in oil demand since 1990.
Just as silver did one week ago – Gold bullion fell in one day by $33.80 or 1.99% to a new 21/2-year low of US$1,664.
Agnico Eagle Mines Ltd. ‘AEM-T & N’ breaks from its pure gold play image by announcing the Canadian gold mining giant was acquiring a phased in US$580-million 50% interest in Teck Resources Ltd. ‘TECK.B-T’ & ‘TECK-N’ Minas de San Nicolás copper/zinc project located in Zacatecas, Mexico.
The Canadian dollar sank to a new 2-year low of US$0.7535.
For the Week – The closely followed Baker Hughes Petroleum Rig Count reported the number of active American drilling rigs rose by 4-rigs to 763, an increase of 251 from this time last year. On the Canadian side – the number of active Canadian rigs rose by 6-rigs to 211, an increase of 57 in the past year.
The DJI lost 4.14% to 30,822 with the S&P 500 down by 4.77% to 3,873 and the NASDAQ off by 5.48% to 11,448. Up north – the TSX fell by 1.96% to 19,386 and the TSX Venture lost 2.32% to 631. The CBOE Volatility Index or VIX rose by 14.30% to 26.30.
Gold bullion lost 2.45% to US$1,674 while silver gained 3.99% to US$19.55 and copper improved by 0.56% to US$3.58. With petroleum – crude oil lost 1.09% to US$85.31 and natural gas lost 2.74% to US$7.82. The Canadian dollar fell by 1.86% to 0.7535 and the U.S. dollar ‘DXY’ rose by 0.54% to 109.67. Overall – the CRB Commodities Index dropped by 1.31% to 301.
And Finally – You know the future is flying right at you when you see Air Canada Inc. ‘AC-T’ announcing that Canada’s flagship air carrier had agreed to purchase thirty ES-30 electric-hybrid aircraft from Sweden’s Heat Aerospace. Depending on flight parameters – The 30-seat planes are estimated to have a flight range of 200 – 800 kms and are expected to be in service in six short years.