Canadian small/micro-cap roundup

Stockhouse Editorial
0 Comments| December 20, 2013


Stock movers for the week of December 16, 2013:
 
On Monday, Brigus Gold Corp. (TSX: T.BRD, Stock Forum) was up 33% to 84 cents. The stock is reacting to news that Primero Mining Corp. (TSX: T.P, Stock Forum) will acquire all outstanding common shares of the mining company pursuant to a plan of arrangement to create a diversified, Americas based mid-tier gold producer.  Pursuant to the arrangement, Primero will acquire each outstanding Brigus common share for 0.175 of a Primero common share. In addition, Brigus shareholders will receive 0.1 of a common share in a newly incorporated company (SpinCo) for each Brigus common share as part of the arrangement. SpinCo will hold Brigus' interests in the Goldfields project in Saskatchewan and the Ixhuatán and Huizopa projects in Mexico and will be capitalized with approximately $10 million in cash. Upon completion of the arrangement, Brigus shareholders will hold, in aggregate, a 90.1% interest in SpinCo and Primero will hold the remaining 9.9% interest in SpinCo.
 
Iona Energy Inc. (TSX: V.INA, Stock Forum) climbed 4.8% to 66 cents after the exploration and development company announced an operational update related to its Huntington Oil Field located in the UK North Sea. Production at Huntington has returned to full capacity of approximately 30,000 barrels per day of oil and 25 million standard cubic feet per day of natural gas (5,265 barrels per day of oil and 4.4 million standard cubic feet per day of gas net to Iona) following the lifting of gas export restrictions at the BP Operated Central Area Transmission System (CATS). Outside of a brief period of disruption during extreme weather conditions between December 5 and 7, the Huntington reservoir and Floating Production Storage and Offloading vessel have continued to perform steadily. Since coming on stream in April of 2013, thirteen cargos have departed Huntington and been sold at average realized oil prices attracting slight premiums to Brent.
 
 
On Tuesday, GTA Resources and Mining Inc. (TSX: V.GTA, Stock Forum) was up 47.8% to 17 cents. The stock is reacting to news of the commencement of a diamond drill program at the mineral explorer’s  Auden property, located adjacent to Zenyatta Ventures Ltd.'s (TSX: V.ZEN, Stock Forum) Albany graphite project in Northern Ontario. The drill program will initially target electromagnetic anomalies (conductive zones) located in the central part of the property and having geophysical characteristics similar to the geophysical signature associated with Zenyatta's high purity graphite zones. These graphite deposits were discovered while testing electromagnetic (EM) targets and have been described as occurring in breccia pipes (diatremes) with dimensions in the order of 200 metres by 400 metres. GTA's management and geological consultants believe that the graphite breccia pipes that exist on Zenyatta's Albany project are similar to kimberlite pipes (diatremes) and are likely to occur in clusters along structural corridors that may extend onto GTA's Auden property.
 
PMI Gold Corp. (TSX: T.PMV, Stock Forum) climbed 46.4% to 41 cents as investors assessed the news that Asanko Gold Inc. (TSX: T.AKG, Stock Forum) will acquire all of the common shares of the exploration and development company to create an emerging mid-tier gold producer with a clear pathway to 400,000 ounces of annual gold production. Under the arrangement, each PMI shareholder will receive 0.21 Asanko common shares for each PMI common share. This values each PMI share at $0.441 representing a premium of 79% to the 20-day volume weighted average share prices of the PMI common shares on the TSX as of Dec. 16, 2013. Following the completion of the business combination, PMI and Asanko shareholders will hold approximately 50% each of the combined company.
 
On Wednesday, Solvista Gold Corp. (TSX: V.SVV, Stock Forum) rose 31.3% to 10.5 cents after the gold explorer announced that it has entered into an agreement with IAMGOLD Corp. (TSX: T.IMG, Stock Forum) that sets out the major terms of a 70% earn-in option agreement in Solvista’s Caramanta gold project, located in Colombia's Mid- Cauca Belt. IAMGOLD can earn an initial 51% interest in the project by investing a total of US$18 million in qualifying expenditures, which includes US$900,000 of cash payments to Solvista, over a maximum five-year period commencing on Dec. 16, 2013, with IAMGOLD as the project operator. Furthermore, IAMGOLD can earn an additional 19% interest in the project, for a total 70% interest, by investing a further US$18 million in qualifying expenditures over a maximum three-year period following the completion of the initial 51% earn-in.
 
Alexander Energy Ltd. (TSX: V.ALX, Stock Forum) gained 21.7% to 73 cents after the oil and gas junior announced that it has entered into a definitive purchase and sale agreement to acquire a high quality, low decline, crude oil producing asset located in southeast Saskatchewan from an arm's length oil and gas producer. The assets include over 370 barrels of oil per day of primarily light oil production (with a historical annual decline of approximately nine to 10%) producing from the Frobisher and Midale formations. The purchase price for the assets is $32.5 million, subject to normal adjustments based on a Dec.1, 2013 effective date. The closing of the acquisition is subject to customary conditions and is expected to close on or about Feb. 3, 2014.
 
 
In Thursday trading, Taipan Resources Inc. (TSX: V.TPN, Stock Forum) climbed 11.5% to 29 cents as investors assessed the news that through its wholly-owned Kenya-based subsidiary Lion Petroleum Corp., the oil and gas junior has completed the previously announced farm-out agreement with Premier Oil Investments Ltd., a subsidiary of Premier Oil plc (PMOIY, Stock Forum), whereby Premier has acquired a 55% participating interest in Block 2B onshore Kenya. Taipan retains a 45% interest and operatorship during the exploration phase in Block 2B. Under the terms of the farm-out agreement Premier will carry Taipan through the cost of the work program for the first additional exploration period totalling a gross cost of up to $29.5 million. This includes the drilling and testing of the Pearl-1 prospect that is estimated to have gross prospective resources of 200 million barrels of oil. The remaining lead inventory on Block 2B in addition to Pearl-1 is capable of delivering in excess of 500 million barrels of oil gross. Premier will also provide a guarantee for the minimum work and expenditure obligations for the first additional exploration period on Block 2B of US$13 million and will pay Taipan $1.0 million in back costs. Taipan will retain operatorship of Block 2B during the exploration phase with Premier having the right to assume operatorship of any development.
 
True Gold Mining Inc. (TSX: V.TGM, Stock Forum) was up 1.3% to 39 cents. The stock is reacting to news the Burkina Faso Council of Ministers has approved the issuance of the Karma exploitation permit to Riverstone Karma SA, the company's Burkina Faso subsidiary. The Burkina Faso Council of Ministers provided the approval during a meeting on Dec. 18, 2013. The permit awaits final signature by the President of Burkina Faso. The exploitation permit is equivalent to a final mining permit, and will allow True Gold to develop the Karma mine.
 
And, on Friday, Perishimco Resources Inc. (TSX: V.PRO, Stock Forum) gained 16.1% to 32.5 cents after the mineral exploration and development company announced a non-brokered private placement totaling $11.2 million by partners, Agnico Eagle Mines Ltd. (TSX: T.AEM, Stock Forum) and The Sentient Group, a private equity investment firm. Agnico Eagle has entered into a subscription agreement for an investment of $9.3 million into Pershimco at a subscription price of $0.47 per unit. As a result of the transaction, Agnico Eagle will own 9.9% of Pershimco's issued and outstanding shares on a non-diluted basis. Sentient, already a significant shareholder of the company, has entered into a subscription agreement for an additional investment of $1.9 million into Pershimco through the private placement. As a result of the transaction, Sentient will continue to own 16.9% of Pershimco's issued and outstanding shares on a non-diluted basis.
Proceeds of these strategic investments will allow Pershimco to accelerate its exploration efforts, pursue a deep drilling campaign and conclude a pre-feasibility study. Proceeds will also be used for general corporate purposes.
 
Cub Energy Inc. (TSX: V.KUB, Stock Forum) was up 14.3% to 20 cents. The stock is reacting to news the Rusko-Komarovske-22 (RK-22) development well, on the Rusko-Komarovske licence (RK), in western Ukraine has tested gas at a maximum rate flow rate of 2.5 million cubic feet per day. Cub is the owner and operator of the RK-22 well and has a 100% working interest in the RK licence. The oil and gas company expects to have the RK-22 on production before year-end 2013 and anticipates a production exit rate between 1,900 and 2,100 barrels of oil equivalent per day, which is in line with management's previous forecast.


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