Gold bulls are calling for higher highs. Citi analysts, for example, say gold could run to $3,000 over the next year. All thanks to a combination of strong physical demand, central bank purchases, and macroeconomic factor that continue to support elevated gold prices. Even TD Securities’ managing director, Bart Melek says gold prices could rise “materially” in the next year, noting that higher unemployment numbers will lead to lower interest rates and a new bull market for gold, as noted by CNBC. UBS analysts also say gold could hit $2,600 by the end of this year on the expectation of interest rate cuts from the Federal Reserve.
All of which could fuel big upside for gold stocks such as U.S. Gold Corp. (NASDAQ: USAU), Barrick Gold Corporation (NYSE: GOLD) (TSX: ABX), Royal Gold Inc. (NASDAQ: RGLD), Franco Nevada Corp. (NYSE: FNV) (TSX: FNV), and Newmont Corp. (NYSE: NEM) (TSX: NGT).
Look at U.S. Gold Corp. (NASDAQ: USAU), For Example
U.S. Gold Corp. announced that its wholly owned subsidiary, Gold King Corp., has received formal acceptance of the previously submitted reclamation bond, from the Director of the Wyoming Department of Environmental Quality. With this acceptance, two of the three conditions associated with the recently granted Surface Gold Mine Permit (the “Mine Operating Permit”) for the CK Gold Project have been met.
In commenting on the acceptance, George Bee, President, CEO and Director of U.S. Gold said, “WDEQ acceptance of the reclamation bond, along with the Issuance of the Water Discharge Permit announced last week, satisfies two of the three conditions associated with the Mine Operating Permit, further cementing that major milestone, as U.S. Gold moves along the pathway toward development. Work to complete the remaining condition, receipt of the Air Quality Permit, is anticipated shortly. We believe that the Air Quality Permit submission is technically complete having been through rigorous review. The application is with the WDEQ Air Quality Division following the remaining statutory steps prior to consideration for approval. We remain on track to receive unconditional approval of the Mine Operating Plan in hand, around mid-year, as per prior guidance.”
Luke Norman, Executive Chairman of U.S. Gold, added, “The CK Gold Project continues to advance with the major permitting almost complete. The U.S. Gold team are finalizing updates to project economic forecasts, taking into consideration updates to pricing on both the cost and revenue side of the equation. We see that holding a permitted project that can leverage upon the rising gold and copper prices will be a boon for our investors, with the opportunity to catch the benefits of the current resource cycle. It remains for the company to show the pathway to project financing without unwarranted dilution to our equity shareholders.”
Background
U.S. Gold Corp. pivoted from a purely exploration focus on its highly prospective assets in Nevada and Idaho to development of the CK Gold Project in 2020, representing a significant and achievable value creation opportunity for the Company.
In August 2020, U.S. Gold’s management team started along the development path for the CK Gold Project, previously known as Copper King, which had lain dormant for several years. While Copper King has been known about and explored on multiple occasions, following limited underground mining around 100 years ago, the last study on the project was a Preliminary Economic Assessment authored by Mine Development Associates Inc. in 2012.
The Mine Reclamation Bond, a requirement under WDEQ statutes, involved posting $5.1million in acceptable surety to the State to cover the first phase of operational disturbance. Details of the coverage was submitted to WDEQ on April 29, 2024 and formal acceptance of the bond was received on May 31, 2024.
With approval of the Mine Operating Permit, Water Discharge Permit and acceptance of the Mine Reclamation Bond, work on a prefeasibility study update and completion of the feasibility study has been restarted. The feasibility study work, awarded to Samuel Engineering Inc. in April 2022, was suspended in March 2023. The decision to suspend Samuel’s work on a feasibility study was made for three reasons: first, the Company did not want a “stale dated” study in relation to the permit approval timeframe; second, there was still price and supply disruption following the COVID-19 pandemic; and third, there was a need to recognize some of the changes and additions that came about as a consequence of WDEQ’s review of the project. Engineering work is well advanced with the process plant design largely complete, and updated bids for major equipment now being solicited. We are on track to update the prefeasibility study by the third quarter of 2024 and finalize the feasibility study sometime thereafter. We are also working to understand and include project upside opportunities in the feasibility study.
Other related developments from around the markets include:
Barrick Gold announced that its subsidiary Barrick Gold (International Holdings) Ltd. has entered into an exploration earn-in agreement with Geophysx Jamaica Ltd. with respect to certain properties located in Jamaica. The Agreement initially provides Barrick with access to approximately 4,000 square kilometers of consolidated land positions throughout the country, with a favorable geological setting comparable to the Dominican Republic, where Barrick operates the Pueblo Viejo mine. Barrick will have the right to work with Geophysx to earn up to an 80% joint-venture interest in designated properties upon fulfillment of certain spending obligations and study-deliverable milestones. Barrick will act as the operator, in partnership with Geophysx, leveraging Geophysx’s existing personnel, knowledge, facilities and equipment.
Royal Gold announced that its Board of Directors has declared its third quarter dividend of $0.40 per share of common stock. The dividend is payable on Friday, July 19, 2024 to shareholders of record at the close of business on Friday, July 5, 2024.
Franco Nevada recently noted, “In late 2023, we were challenged by the unprecedented production halt at Cobre Panama. We are hopeful that the issues can be resolved, although we have taken a prudent approach for the carrying value of the asset”, stated Paul Brink, CEO. “Despite the issue at Cobre Panama, our business remains robust and we continue to benefit from a long- duration, diversified portfolio. We finished the year with no debt and $1.4 billion in cash and cash equivalents. The balance of our business performed well in 2023 and is expected to grow in 2024 with contributions from the completion of the Tocantinzinho, Greenstone and Salares Norte gold mines. Our growth outlook through 2028 is driven by numerous new mines and mine expansions. $2.4 billion of available capital positions us well for attractive acquisitions in an environment where many project developers are capital constrained.”
Newmont Corp. announced first quarter 2024 results and declared a first quarter dividend of $0.25 per share. "Newmont delivered a strong first quarter operational performance, producing 2.2 million gold equivalent ounces and generating over $1.4 billion in cash from operations before working capital changes," said Tom Palmer, Newmont's President and Chief Executive Officer. "Underpinned by the gold industry's leading portfolio of Tier 1 gold and copper operations, we remain well-positioned to achieve our full-year guidance and deliver meaningful synergies and productivity improvements from the combined portfolio. We remain focused on delivering on the commitments we laid out at the beginning of this year, creating an attractive value proposition for new and existing investors during this unique time in the gold industry."
Legal Disclaimer / Except for the historical information presented herein, matters discussed in this article contains forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Winning Media is not registered with any financial or securities regulatory authority and does not provide nor claims to provide investment advice or recommendations to readers of this release. For making specific investment decisions, readers should seek their own advice. Winning Media is only compensated for its services in the form of cash-based compensation. Pursuant to an agreement Winning Media has been paid three thousand five hundred dollars for advertising and marketing services for U.S. Gold Corp. by U.S. Gold Corp. We own ZERO shares of U.S. Gold Corp. Please click here for disclaimer.
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