IKN #697Premium

The IKN Weekly
Week 697, September 25th 2022
Contents
This Week: In Today’s Edition, The recession narrative takes hold, A link to Denver.
Fundamental Analysis: The turnaround case for Pure Gold Mining (PGM.v).
Stocks to Follow: ATAC Resources (ATC.v), Superior Gold (SGI.v), Electra Battery (ELBM.v),
Chesapeake Gold (CKG.v), QC Copper & Gold (QCCU.v), Minera Alamos (MAI.v), Western
Copper & Gold (WRN.to), Amerigo Resources (ARG.to).
Copper Basket: Overview, Marimaca Copper (MARI.to), Hot Chili (HCH.v), Copper Mountain
(CMMC.to), Regulus Resources (REG.v).
Producer Basket: Overview, Kinross (KGC), Newmont (NEM).
TinyCaps Basket: Overview, Latin Metals (LMS.v).
Regional Politics: Ecuador and China and Leo Dicaprio, Argentina: Mining “well positioned”,
Peru’s Perumin party plus petty polling protests, Brazil: Lula and the “useful vote, Chile’s
economy is hitting the skids.
Market Watching: Altaley Resources (ATLY.v) redux, Bluestone Resources (BSR.to): That
local referendum vote.
I remind subscribers that no part of this newsletter can be copied, reproduced or
given to any third party without the express permission of the author.
This Week
In Today’s Edition
 After watching your portfolio of junior miners get yet another whacking as equities and
metals wilt in front of an all-conquering US Dollar, do you really want an overly
optimistic newsletter writer to start banging on the table about the next best new
opportunity among the penny stock junior miners? No, I didn’t think so but you’re going
to get one all the same. The presentation made by Pure Gold (PGM.v) and its interim
CEO, Mark O’Dea, at Denver last week made a very positive impression on both your
author and the market and in today’s main fundies section, you get to reads why.
 The FOMC came, went and left the market with the growing certainty that the Fed will
do Whatever It Takes™© to bring inflation down and under control, including at least
two more rate rises in the near future that will match last week’s 75 basis points. We
consider the market reaction and what’s likely for the rest of 2022 in the intro.
 Our ‘Stocks to Follow’ took another beating, but I’m almost as annoying in that section
as I am in the Fundies note on PGM. My glass continues to be half-full and while
powder on the sidelines remains dry, I’m still not a seller of anything else.
 Brazil may end up voting in Lula in round one and Chile’s new lefty government is
getting a lesson in economic reality that is stripping its ideology away quickly. That and
more macro-regional stuff in Regional Politics, as usual
1

The recession narrative takes hold
When sorrows come, they come not single spies,
But in battalions.
Claudius in Hamlet, Act 4 Sc5 ll74-75, 1602
“Looks like I picked the wrong week to quit sniffing glue”
Lloyd Bridges in Airplane, 1980
It’s the Dot Plot Wot Got Us, if you don’t mind me alighting a little alliteration on you. In the
end 75bps and a SEP forecast of high inflation continuing deep into 2023, as well as clear
signals of two more sharp rate hikes in what’s left of this year, to see the Dow break 30k to the
downside and finish Friday at YTD lows. In order to grasp the generalist atmosphere I can
hardly think of a better thing to do than quote a little CNBC, here’s a chunk of this report (1)…
The Federal Reserve will raise interest rates as high as 4.6% in 2023 before the
central bank stops its fight against soaring inflation, according to its median forecast
released on Wednesday.
The Fed on Wednesday raised benchmark interest rates by another three-quarters of a
percentage point to a range of 3%-3.25%, the highest since early 2008.
The median forecast also showed that central bank officials expect to hike rates to
4.4% by the end of 2022. With only two policy meetings left in the calendar year,
chances are the central bank could conduct another 75-basis-point rate hike before the
year-end.
…and as for the delayed reaction and Friday’s selling, here’s a piece of this one (2):
“The market has been transitioning clearly and quickly from worries over inflation to
concerns over the aggressive Federal Reserve campaign,” said Quincy Krosby of LPL
Financial. “You see bond yields rising to levels we haven’t seen in years — it’s
changing the mindset to how does the Fed get to price stability without something
breaking.”
At this point we could trout out the inversed yield curve chart (again), I even thought about
featuring some other macro data points such as the continued lows in US unemployment (Jay
Powell wants some of these people to be poorer soon), US household debt ratios (still relatively
low, so Jay Powell wants a few people to pay more for their mortgages soon) and even the
savings rates (Jay Powell wants people to stop spending on consumer durables and pushing
prices higher), but instead let’s go with this simple chart and be done:
You may not like the idea, but the US Dollar (DXY) remains the preferred safe haven for the
world’s money and with its interest rates rising as the world enters recession, its charms are
now too strong for the rest. Also in this chart we see the turmoil of the Wednesday afternoon
FOMC communiqué moment, the negative response and then the hangover response on Friday,
when the Fed’s head made sure we all knew that they really, really…REALLY weren’t joking
about “doing a Volcker” and raising rates no matter what it does the economy and the
unemployment rate until inflation was under control.
It sure sounded convincing too, but what did anyone expect? If you were on-board with the
Fed position already then it didn’t come as much of a surprise, but event those opposing the
Fed hard-line would not have been surprised. Effectively this is one very large game of poker
2

and we haven’t even sent the River card yet, so you cannot expect Jay Powell to admit he’s
bluffing and holding nothing…not yet, anyway.
That moment comes when we see real improvement in macro data and for that, look no further
than the next set of BLS data on Consumer Price Inflation (CPI) and perhaps PPI as well. Above
and beyond the normally #1 dataset on jobs, the next US CPI reading is due out on October
13th and if we see inflation making a meaningful drop, the calls for the fed to moderate its tone
and position will come like a tsunami (not even the most hawkish of hawks want to tank the US
economy, after all. Therefore, we can expect two or three weeks of nervousness as the Fed
narrative remains on top, then we’ll see just how required another 0.75% rates rise will be. In
the meantime, our focus sector of junior miners is likely to remain under pressure and while it’s
not a pleasant thing to predict, it wouldn’t surprise this desk to see gold go under U$1,600/oz
again (with silver under U$18/oz, perhaps). Our GLD tracking charts show the total lack of
interest in gold ownership continues unabated, with the ETF’s holdings dropping to 947.03
metric tonnes, down another 13.8mt on the week as the lows stack upon the lows.
GLD gold holdings, 2022 YTD (metric tonnes)
1140
1120
1100
1080
1060
1040
1020
1000
980
960
940
920
900
As for the mining companies, their problems weren’t restricted to the metals sell-off and got hit
by ratings agency Moody’s as well (kick em while they’re down). In the outlook report “Metals &
Mining – Global: Outlook turns negative as EBITDA weakens with macroeconomic conditions”
published on Thursday September 22nd by Moody’s Investor Service (3), the ratings agency
downgraded the mining sector from Stable to Negative. The call is predicated on the most basic
building block of industry, that of profits as “The
slowing economic growth across the globe is
reducing the demand for metals and mining
commodities.” Moody’s sees margins dropping in
all metals sectors, though the iron ore and steel
manufacturing sector are expected to hold up a
little better than the rest. The reaction is the one
you witnessed, as if the market didn’t have
enough excuses to move to cash already.
The wild card remains copper, as despite the
analyst calls for slack demand in Europe (see
today’s Copper Basket) I can’t help but think that
there are too many end users still keen on
securing supply in a market that remains tight
and at the right seasonal moment to expect demand to ramp up.
A link to Denver
The Denver Gold Forum came and went last week and in the same style as the link offered in
IKN696 last weekend to the Beaver Creek presentation compendium, this link (4) takes you to
the webcast agenda page for the big Denver show with four days of mining people talking up
their own companies in front of a (mostly very quiet) audience. Also in the same style as
IKN696, I haven’t done it for every company possible but dotted around the edition below are
links to some of the more interesting segments from the show.
3
22/1/3 22/1/31 22/1/32 22/2/2 22/2/21 22/2/22 22/3/4 22/3/41 22/3/42 22/4/3 22/4/31 22/4/32 22/5/3 22/5/31 22/5/32 22/6/2 22/6/21 22/6/22 22/7/2 22/7/21 22/7/22 22/8/1 22/8/11 22/8/12 22/8/13 22/9/01 22/9/02
mt 8.20 GLD: Inventory/Price Ratio, 2016 to date
8.00
7.80
7.60
7.40
7.20
7.00
6.80
6.60
6.40
6.20
6.00
5.80
source: SPDR GLD data 5.60
5.40
61/4/1 61/61/3 61/62/5 61/8/8 61/81/01 61/92/21 71/41/3 71/42/5 71/4/8 71/61/01 71/72/21 81/21/3 81/22/5 81/2/8 81/21/01 81/42/21 91/8/3 91/02/5 91/13/7 91/01/01 91/02/21 02/5/3 02/51/5 02/82/7 02/7/01 02/71/21 12/3/3 12/11/5 12/22/7 12/1/01 12/31/21 22/42/2 22/6/5 22/02/7
Source: SPDR data, IKN calcs

Fundamental Analysis of Mining Stocks
The turnaround case for Pure Gold Mining (PGM.v) (in CAD$ unless stated)
Shares out: 728.9m
Options: 53.3m
Warrants: 240.7m (incl 227m at 18c)
RSU/DSU: 5.2m
Fully diluted: 1028.1m
Current share price: C$0.155
Market Cap: C$112.98m
Approx cash per S/O: 1c
All prices are in Canadian Dollars unless stated.
As noted on the open blog on Friday (5) this weekend’s main fundies section is dedicated to
Pure Gold Mining Inc. (TSX-V:PGM.v, PUR.L). One of the better-known juniors in the sector, it
runs the PureGold (ex-Madsen) mine in the Red Lake district of Canada which moved to
commercial production status in Q3 last year only to hit major operational issues and a result,
has failed to live up to its supposed commercial
status. This desk has followed the story since
then, as along with a couple of posts on the
blog when the real damage got done to the
stock, there’s always been the potential for
PGM to go either way as 2022 became 2023.
After previous President/CEO Darin Labrenz was
resigned (also left the board) in early January,
then the company ran a couple of placements
to raise much-needed cash with strategic
backer AngloGold Ashanti moving its position up
to 19.9% ownership during to 53c raise. But
then Labrenz’s replacement as CEO Troy Fierro
(still a board member) also resigned in April as
more problems emerged and Q1 production results made it clear things were getting worse,
rather than better. At that point the red flags were raised high and a new emergency rescue
plan enacted. The financial backers (start with Sprott, add in AngloGold) got company founder
Mark O’Dea of Oxygen Group fame to step up, take control, get a grip on the issues
It’s somewhat banal to condense the issues faced by PGM into a few lines, but here goes
anyway and to cut a very long story short, the company was under pressure from three sides:
High costs, lower than expected production and looming payments on debt and financial
facilities that between them posed an existential threat to the company and most definitely to
its stock price. It was up to O´Dea to turn things around or get shot down in flames while
trying. He had very little time and financial space to play with, but first came another interim
financial agreement with lenders that saw the company boot forward some major payments
and put necessary cash into treasury via a $6m short-term loan (again with Sprott) and a new
and highly dilutive equity raise at 15c (unit = 1 share + warrant at 18c with a 6 month shelf
life). Notably and despite having been hosed by the price paid in previous entries, AngloGold
Ashanti remained onside and participated pro-rata in the dilutive deal, keeping its overall
participation at 19.8% including the warrant participation (an important point, as noted below).
With the emergency financial package done, PGM under interim CEO O’Dea had bought some
time and then went about slashing costs while, at the same time, looking to get production up
to what was originally expected of the mine in these early stages. That’s not an easy trick to
pull off, but recent results as published by the company noting incremental monthly production
improvements for July and August suggested PGM had perhaps turned a corner. The stock price
came off the worst of its lows (it was under 10c in early August) and coming into last week had
picked up a few bids to move it back to 13c or so.
4

And that completes today’s preamble, we now reach O’Dea’s company presentation at Denver
Gold last Tuesday at 5pm link here (6) and well worth using) and I wrote on the blog Friday, it
was “…(w)ithout doubt the most interesting presentation at the Denver conference.” Interim
President and CEO Mark O’Dea was keen to project the long-term future of the mine and
company to his audience from the start (he knew this was going to be an important moment for
the company, it seems to me in hindsight). His introduction referred to the PureGold mine as “A
sunrise asset…decades to go…this is a huge system”, compared it to other local operations by
saying, “This rivals any in the Red Lake camp…the difference is that we’ve only just begun”,
noted that even the deepest exploration hole hit mineable grades and width, so “the system is
wide open” and along with the way the deposit has 1.3m metres of drilling in it (though nearly
a million of that is historic or before PGM arrived, he made special reference to the “8 Zone” of
mineralization with its distinctive mineralization and high grades at depth (more on that in a
moment). There were comments about how “We have remained steadfast” despite the
operational issues and how the location in
the “Heart of Red Lake” is nowadays
surrounded by major mining players. As for
operations, he went as far as to say that
“Last month (August 2022)…we actually
made some money” and that the company
was “on the brink of positive cash flow”,
which is rousing stuff compared to the train
wreck financial statements filed in the first
half of this year.
It was a bullish performance and strong
sales pitch from one of the industry’s better
known names that acknowledged “mistakes
were made” (not many apologies for
bagholders in at higher prices, though) and
overall his slot was well-received, as the price performance last week indicates (right). But
bullish future visions weren’t the main takeaway of CEO O’Dea’s presentation, there was real
substance in the segment from approx minute 7 to minute 10 and for that, you now get a
verbatim transcript (blame your author for any errors).
This part was mainly accompanied by two visual aids, first this one (also Slide 12 of the latest
corporate presentation, but I decided to use a presentation screenshot to show O’Dea’s healthy
tan and a little personal scribbling to note the mineral zones he referred to), then another you’ll
see below right to which he makes direct reference (this one is from the latest corp pres, link
here (7)). We now leave you with the horse’s mouth, as it were, but if you want more on
“MSO” (Mineable Stope Optimiser) please see Appendix 1 at the bottom of today’s edition:
“As we got into production, we ran into some ramp-up issues and the first thing we
asked ourselves…so we went back to first principles, hired SRK and re-ran the whole
thing with a whole new approach which is much more conservative, much more rigorous,
new approach to capping, new approach to how far grade got to run, etc etc. And this is
our new resource base that’s MSO shaped constrained, that forms the foundation for
everything we do here on in, that forms the foundation for our PFS and our new life of
5

mine plan, and what it illustrates is 1.65m oz of indicated, most of that is anticipated to
convert to reserves, and another 370,000 ounces of inferred.
“Now one of the things that stands out besides the shape and sort of continuity of this
image is the upper left-hand side of this
looks a little different. It’s called the
McVeigh zone and it’s where we started
mining. It’s where we’ve been mining and
mining our way through over the last 20
months. And what we found when we got
in there is that the geometries were a little
bit more complicated, the ore system was
a little wispier and grade was lower than
expected. And y’know, live and learn, we
ended up starting our mine in one of the
most challenging parts of the ore system
geometrically. And that really stands out in
this image (above), here’s a profile of the
plan view of how the geometries of this orebody change along strike and at depth.
McVeigh is in a hinge zone; All of these deposits in Red Lake are deformed, they’ve been
incredibly deformed, smashed up and shredded and that leads to great continuity in the
limb areas, like South Austin and Austin, but great complexity in the hinge zones here at
McVeigh. And we started out, unfortunately, in the McVeigh zone and it’s a big part of
the reason why we, y’know, had some serious challenges here for the past year, getting
the grade up and reconciling with the model, etc. And this illustrates just why that is. It’s
a geometric reality that we realize now reflects our own reality.
“The good thing is that the rest of this ore system, like 90% of this resource, is outside of
the McVeigh. And we are mining our way through McVeigh, right now it’s about 60/40
McVeigh/South Austin in terms of ore to the mill and by the end of the year and into Q1
next year it’s going to be up to 100% South Austin and Austin, so we’re going to get into
higher grade material, more continuity, more predictability and that’ll have a meaningful
impact on our bottom line.”
IKN697 back and all this sounds a lot more positive. What’s more, it’s backed up by the recent
production numbers for the months if July and August (see below) which showed improved
grade and production, all with the same ballpark mine costs mentioned by Interim CEO O’Dea,
who noted that costs that were running at C$15m per quarter in January this year were down
to a sustainable C$9m. Or in his words, here’s a final quote from his presentation as he
wrapped up:
“For the first time since we started up this operation we feel like we have figured out
how to succeed here. And part of it comes back to where we are in the ore system, part
of it comes back to our operating culture and our processes at site.”
We’ve even had more solid fundamental news since last week’s presentation, as on Friday PGM
filed its re-worked 43-101 technical report in which SRK put a fine toothcomb and the new,
more stringent parameters mentioned by O’Dea to the known resource dated as at December
31st 2021. This 43-101 should be regarded as an update only and is bound to be superseded by
by one of the suite of upcoming company catalysts, namely the new Pre-Feasibility Study (PFS)
and new Life Of Mine (LoM) plan scheduled for completion in early November 2022.
While most of the headline information carried by the 43-101 was pre-announced by PGM in
August, including the new indicated resource total of 1.653m oz gold at an average grade of 7.4
g/t and inferred 0.366m oz gold at 6.3 g/t, there are two things worthy of pointing out about
the new resource numbers and for that, here’s the updated table from the 43-101 as published
Friday (below).
6

Overall the 1.653m oz gold indicated resource, which O’Dea expects to be converted nearly 1-1
to reserves, is around 20% lower than the previous total but not new news, nor is it a real issue
for an orebody that still has a lot of exploration left to do and according to one of the more
arm-wavy parts of O’Dea’s presentation last week will end up at between 5m oz and 10m oz
gold. However, I have scribbled a couple of notes on the table:
1) According to O’Dea in his presentation, PGM is now transitioning out of the McVeigh
zone and into the Madsen – South Austin zone. We know that’s easier reliable “less
wispy” mining with better continuity, we also know grade is set to improve as South
Austin moves to 100% of mill tonnages and this backs up both the results from July
and August, as well as new forecasts and the company’s overarching recovery plan.
2) The vast majority of the 20% resource drop is due to a downgrading of tonnage at the
promising 8Zone, mentioned briefly above. Part of the SERK re-work seems to be to
have gone back to baseline on this zone because grades is also up to an interesting 18
g/t gold, even as tonnage drops hard and the overall resource is down from 400k oz to
just over 100k oz I+I. We’re bound to hear more about this, but the best guess at this
point is that PGM will tell us they need to do a lot more exploration and definition work
on this deeper-laying zone. However, the bulk of the resource ounces and therefore the
company’s survival in the near-term are all about South Austin/Austin and the company
needs to show they can make those grades work well before they get any gracvy
upside from a future mining the 8Zone.
The 43-101 resource as published Friday is predicated on a set of criteria that are now probably
out of date, as they use a gold price assumption of U$1,800/oz and a cut-off of 3.38 g/t Au.
The November 43-101 will have to drop that gold price assumption, but on the bright side PGM
is now showing it can operate at more competitive mining costs per tonne (or per ounce) and
that will work in its favour. Overall, Friday’s 43-101 shouldn’t be taken as a new baseline for
mine economics, instead it’s a staging post between the bad assumptions of last year and the
upcoming revised PFS due in November.
Last week’s presentation by Interim CEO O’Dea certainly caught my attention and its content
made me think PGM might indeed escape from its current penalty box. So for a better handle
on that, it was time for spreadsheets and to consider PGM’s financial past and forecast future.
Operational results and what to expect in the quarters ahead
We now dive into PGM’s recent operational results and make some best guesses for the future,
starting with the most basic task performed by any mining company, the amount of rock
7

moved. These charts show how mined ore has remained disappointingly low in the commercial
production quarters with only 3q21 making a reasonable job at 61,534mt ore mined. Clearly, to
feed a mill at the PGM’s envisaged 800ptd (approx 72kmt/qtr) or even the 1,000tpd (approx
90kmt/qtr) they talk about for 2023 and beyond, the company is going to have to improve the
ore mined/milled substantially.
mt PGM: Rock tonnages mined PGM: Waste/Ore ratio (strip rate)
220000 4.00
200000 waste mined 3.50
180000
160000 ore mined 3.00
140000 2.50
120000
2.00
100000
80000 1.50
60000 1.00
40000
0.50
20000
0 0.00
1q21 2q21 3q21 4q21 1q22 2q22 1q21 2q21 3q21 4q21 1q22 2q22
source: company filings source: company filings
However, the good news is the way mined waste has dropped sharply in the commercial
production quarters as access to stopes has improved and now, with Austin South accessed,
there’s reason the expect this to flatten out. The accompanying chart (above right) gives the
waste/ore ratio (the “strip rate” if you like, though this is an underground operation) that
dropped to 0.84X in 2q22 and the early numbers out of 3q22 indicate that is continuing.
The NR dated September 12th (8) gave us information on the monthly production totals at
PureGold and, while the company itself said that these monthly bulletins weren’t going to
become a habit, they are clearly keen to get the production improvement data in front of our
eyes. Not a bad thing and here’s the table from that NR:
Compared to the results data in the charts below, recent numbers and particularly those of
August, as Austin South production ramps up and delivers more consistent grade and tonnage
to the mill, are a considerable improvement on the painful numbers returned in 1q22 and
particularly 2q22. Long story short, PGM has data to support its claim that its operations have
indeed turned the corner and as such, the above data are a reasonable starting point to
extrapolate and estimate both 3q22 production results as well as the quarters to come. With
that in mind, these charts map out the production quarters in 2021 and 2022 to date (including
the non-commercial production quarters of early 2021) as well as IKN Weekly estimates of what
to expect in the next two to three quarters (depending on the chart).
These first two charts show how milled material (as opposed to mined ore/waste above) has
also underwhelmed since PGM went supposedly commercial in 3q21, with 2q22’s total of just
45,420mt through the mill a testament to its near-term troubles and issues with unexpected
mine dilution in the McVeigh zone. The same story in the average milled grade chart below
right, as even the sub-5g/t numbers were disappointing compared to the expected indicated
grade but 2q22 coming in plug-ugly.
PGM: Total material milled
8
40484 21364 82036 92115 29805 02454 00057 00008
00009
100000
80000
60000
40000
20000
0
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4 tse32q1
mt PGM: Avg grade milled, per qtr
source: company filings, IKN ests
80.3 2.4 8.4 8.4 72.4
85.2
9.4 5.5 6
7
6
5
4
3 2
1
0
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4 tse32q1
g/t Au
source: company filings, IKN ests

However, the July and August production data along with O’Dea’s anecdotal evidence of
improved guidance makes for a better figures for the current quarter and, with PGM telling us
that Q3 is just the start of the turnaround, it’s reasonable to expect incremental improvement.
As the weeks go on South Austin will take over as sole feed supplier and the mill should move
through move through the gears to start processing at closer to 1,000tpd. In his presentation,
O’Dea affirmed previous PGM data that the current set-up has a nameplate of 800tpd but is
good to 1,000tpd, at which point they’d add another ball mill to move to 1,200tpd and beyond.
Now for these two charts (above). We leave out the recovery data because one of the
advantages of the PureGold ore is its high recovery rates, which run at 44% on gravity alone
and typically return an excellent overall of 95%. Therefore we get the production and sales
chart plus our forecasts for the next three quarters (above left) and the other tracking chart is
for received price (above right) which takes the USD price and factors in a forex of 1.3/1 for the
current 3q22 and 1.35/1 for the future quarters, in-line with current forex. For the assumed
gold price, I’m using U$1,750/oz for 3q22, U$1,650/oz for 4q22 (darn you, Jay Powell) and
then best-guessing a slight recovery and an average of U$1,700/oz for 1q23 which may or may
not be optimistic. We’ll find that out later.
With PGM set to announce total 3q22 production along with near-term guidance for 4q22 early
next month (October), we’ll soon find out whether the house guesstimates are good or bad. We
now move to the P+L and with CEO O’Dea making a clear statement about the mine now
running readily at an overall cost of around $9m/month, we can combine expected sales and
mine costs data to show the type of improvement expected as from this quarter:
PGM: Revenues vs Costs
9
5.6
1.22
0.51
2.82
9.51
9.12
0.61
1.92
4.81
8.14
5.8
7.62
0.52
0.72
0.03
0.82
5.63
0.03
45
40
35
30
25
20
15
10
5
0
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4 tse32q1
PGM: Gold produced/sold, per qtr
C$m
Revenues COGS
source: company filings
Here are some more details on that costs assumption, via two separate data set that cover
slightly different parameters (the details matter). Below left we have results only of direct
production costs (i.e. things that use real cash dollars) and this close-up shows where and how
PGM has reduced its cash costs. On site labour has remained roughly equal, as has the minor
site admin line item. The savings have come from raw materials but most of all, contract labour
4292
2386 2838 0017 6787
0053 00011 00531
00561
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4 tse32q1
Oz Au PGM: Avg realized gold price (C$/oz)
Au prod
Au sold
source: company filings, IKN ests
8.8212 1122 1622 0622 6.7122 8342 5722 5.7222 0122
3000
2500
2000
1500
1000
500
0
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4 tse32q1
C$/oz Au
source: company filings, IKN ests
C$m PGM: Direct prod costs breakdown, per qtr PGM: Total prod costs breakdown, per qtr
40 site admin 45
contractors
35 raw materials 40
30 labour 35
30
25 25
20 20
15 15
10
10
5
5 0
0
1q21 2q21 3q21 4q21 1q22 2q22
source: company filings
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4
C$m
labour raw materials
contractors site admin
DD&A share paym
source: company filings

which has been slashed mercilessly (and quite right, too). The second chart above right has
results and forecasts for total production costs,
meaning there are two difference to the data sets in PGM: Direct and total production costs, per qtr
these visuals. Firstly, the chart right has forecasts for
the next two quarters (I’m not going to guess on
1q23 yet) and secondly, it includes the two cost
items that don’t use real cash dollars, i.e.
Depreciation, Depletion & Amortization (DD&A) and
share based payments. As you can see, we’re
forecasting along the lines of O’Dea’s
pronouncements at Denver last week that his
“$9m/month is sustainable” while factoring in some
slight increases as production moves up toward
1,000tpd. This chart (right) shows the differences in
the totals for the direct (cash money) costs and total costs, as above. This is useful because it’s
one thing to be “on the brink of positive
free cash flow” and “making money in
August”, as O’Dea told us at Denver, but
another to cover all costs and return an
operating profit to the P+L. On that
subject, here’s the tracking chart with
our forecasts for the next three quarters
(again, 3q22 should be close, 4q22 is
guessy and 1q23 very guessy):
We’ll find out for sure in mid-November
2022 (and by the way, it so happens that
precise dates of catalysts at PGM are
going to be important to any trade in PGM in 2022, we’ll go into that in the discussion and
conclusion below), but our model predicts an
operating loss of C$5m as long as all our
assumptions hit as expected (not least that it
sells all the gold it produces, just that can skew
things bigtime). Then come 4q22 the mine is
probably making a little money overall as grade
improves into South Austin, throughput cranks
up a little more and we subtract the non-cash
cost items. Then further out we expect PGM to
go true FCF+ in 1q23 but by then, we’ll know the
fate of the share price anyway. And while the
above operating earnings is the key financial
metric rather than the official bottom line results or future forecasts, to complete the set here’s
the pre-tax and net earnings numbers sat against operating income:
We move to the balance sheet, starting with the main overview charts that don’t have too much
to offer by way of insights, but before moving on it’s worth considering the way the liabilities
balance swapped and changed through the 1q22 reporting period.
10
619.32 341.42 347.52 931.62 937.61 111.91 586.62
817.03
952.53 996.83
889.32 339.62 4.42 72 52 82
45
40
35
30
25
20
15
10
5
0
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4
C$m
direct prod costs
total prod costs
source: company filings, IKN calcs
PGM: Operating, pre-tax and net earnings
10
5
0
-5
-10
-15
-20
-25
-30
12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4 tse32q1
C$m
Op income
pre-tax income
Net income
source: PGM filings, IKN ests
PGM: Assets
350
300
250
200
150
100
50
0
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4
C$m PGM: Liabilities Breakdown per qtr
fixed 240
other current 220
cash&eq 200
180
160
140
120
100
80
60
40
20
0
source: PGM filings
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4
PGM: Revenues and operating earnings, per qtr
C$m
LT liab
current liab
source: company filings
0.0
5.3-
5.6
8.02-
0.51
1.51-
9.51
4.7-
0.61
6.51-
4.81
5.42-
5.8
6.02-
0.52
0.5-
0.03
0.1-
5.63
5.3
40
35
30
25
20
15
10
5
0
-5 -10
-15
-20
-25
02q4 12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4 tse32q1
C$m
Revenues Op income
source: company filings

That was the moment of peak turmoil at the company, with the financial debt moved to
currents as the company went into technical default on its obligations. That was the March 31st
snapshot and after that, CEO Fierro was replaced by Interim CEO O’Dea, the company came to
agreement with its major creditors (Sprott front and centre) and got hold of enough working
capital to execute its 2022 recovery plan via a new line of credit and that 15c dilutive financing.
That got PGM to end 2q22 in better shape and, as the most important part of the current
balance sheet data is the liquidity levels, here are the cash treasury and working cap charts:
100 PGM: Cash treasury per qtr
90
80
70
60
50
40
30
20
10
0
In both the presentation and most recent company literature, PGM confirmed it has kept its
treasury buoyed up at around C$6m, which is adequate for the time being through this
emergency turnaround phase. It has debt obligations on the horizon (see below) but as long as
it gets through most of 4q22 at this level, it should be okay. Then as at end 4q22 we expect a
boost to the treasury position and to explain that, we steal one of the slides from the latest
corporate presentation.
As I considered the turnaround case for PGM this week, it became clear that the timing of its
newsflow is a critical factor in the upcoming Q4 quarter and in fact, PGM dedicated this slide to
the main points in the latest presentation.
They are clearly looking to deliver incremental good news and all with a view to getting the
share price higher. We expect the two “early October” NRs on Q3 production and Q4 guidance
to be promoted as clear improvements to the early 2022 and will give plenty of reason to
suppose the company is back on track. Then comes the “early November” results of the
updated SRK PFS and LoM plan and with the company by that time well into the South Austin
ore and mining consistent higher grades, all eyes will be on the economic criteria used in the
study, updated to take into account its new lower operating costs levels as well as lower gold
prices.
Then comes the critical moment, the expiry date for the warrants that were emitted as part of
the dilutive 15c emergency placement and the more I thought about them, the more it
becomes clear that the short, six month shelf life of these warrants is an integral part of the
11
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4
source: company filings/IKN ests
srallod
fo
snoillim
100 PGM: Working Capital per qtr
80
60
40
20
0
-20
-40
-60 -80
-100
-120
-140
-160
-180
-200
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4
source company filings
srallod
fo
snoillim

POGM turnaround plan. There are a total of 227m papers and at the 18c strike price, represent
C$40.86m in potential treasury cash. That’s more than enough to cover PGM’s immediate
financial obligations as this table from the 2q22 financials shows…
…but since then the near-term cash liabilities position has improved further. On July 12th PGM
announced further amendments to its credit facilities which takes around C$12m from the near-
term paybacks and now, the only true hurdles to cover are:
1) Around C$5m it is obliged to spend on exploration costs, as per its previous flow-
through placement terms
2) Payback of the near-term U$6m emergency loan with Sprott which was supposed to
mature on September 30th but after the amendment now matures on December 31st
2022. Once interest and the refi consideration is taken into account, that U$6m loan will
cost PGM just under C$9m to pay off and it may even be able to do that from treasury
by that time, but with the warrants cash it becomes easily manageable and leaves cash
over for its growth and consolidation budgets for 2023 (e.,g they could move on that
second ball mill).
With PGM’s share price now moving back up and toward the warrant strike price of 18c, it
becomes more likely that it will get paid on those papers, however the most interesting position
is that of AngloGold Ashanti. When it participated in the 15c financing, the dilutive factor saw its
ownership of shares out drop to 16.5%. However, AngloGold Ashanti made sure it took enough
of the financing to get back to 19.8% assuming it cashed in all its warrants and with that in
mind, it seems clear that was going to happen all along. We know AngloGold Ashanti is the type
of company that takes a long-term view of an asset and its strategic interest at the classic “just
under 20%” position is not about just sitting there indefinitely and cashing in on eventual
dividends. Quite the contrary, the big South African’s true ambitions are to buy out the
company and get its foothold in the Canadian PM sector so the opportunity to up its stake at a
relative discount to previous buy-ins is a virtual no-brainer.
In other words, AngloGold Ashanti is going to exercise its warrants come what may and those
alone are worth C$4.28m to the PGM treasury. With AngloGold Ashanti along for the ride
(expect PGM to pre-announce their interest in exercising) and the likelihood that insiders will
also open their chequebooks, the late November warrant expiry will likely attract more takers
even if the share price remains under the strike. However and considering the way 1) PGM has
seen clear improvement already and is now well
PGM: Shares Out
on its way to delivering on its 2022 turnaround
plan and 2) stacked its newsflow in the weeks
to come to deliver plenty of positives, we may
well see the share price move over the 18c level
well before that time.
On that, PGM is also in the hands of the fickle
gold price (of course) and will surely be lighting
a candle to the Mining Deities in the evenings,
but assuming things don’t completely fall apart
there’s every reason to expect PGM to have a
successful warrants harvest. That will of course
push the share count a lot higher and this chart shows what happens if all 227m of those
derivate papers become fully paid-up shares, but by the same token this would deliver over
12
74.853 32.953 36.383 92.393 84.793 18.004 86.314 16.534 91.144 95.005
39.827
037
759 1100
1000
900
800
700
600
500
400
300
200
100
0
91q4 02q1 02q2 02q3 02q4 12q1 12q2 12q3 12q4 22q1 22q2 tse22q3 tse22q4
source: company filings
serahs
fo
snoillim

C$40m to treasury at a critical time and with operations expected to be at or around FCF
neutral by then, this troubled company will have the worst of things behind it.
Conclusion
Pure Gold Miing Inc (PGM.v) President and CEO Mark O’Dea was keen to promote the long-term
future of the PureGold mine and his company at the Denver conference last week, with phrases
such as “we’ve only just begun”, “tier one potential” and “next chapter” included in his speech
and corporate presentation. That’s the right way to sell the story for sure, because if the
company can get out of its self-imposed financial penalty box and turn itself into a profitable
mine come 2023, its prime geographical position and obvious exploration of high grade ounces
will make it a most attractive proposition. But its share price hasn’t dumped 90%+ to this
weekend’s 15.5c for nothing and until there’s clarity on its near-term, the risk of buying into
PGM will remain high. To that end we end this note by listing the items PGM needs to check off
by the end of 2022 to get out of jail:
1) Deliver a marked improvement in 3q22 production. That’s a near certainty
2) Guide strongly for 4q22. With mining now moving well into South Austin, we can expect
them to do just that and with growing confidence on both grade and continuity.
3) Deliver an updated PFS that shows strong economics at a lower gold price deck. This is
also likely, though the SRK document will probably rely on further capex investment
(new ball mill etc) to improve throughput capacity
4) Show continued exploration success. On this, we’ll probably see an new approach to
the deeper and high grade 8Zone that puts a premium on high grade intercepts
5) Get through the late November warrants expiry period with as many exercised as
possible. This will be a critical moment for the company and probably why it has
stacked so much news flow in the period leading up to November 25th – 27th. This will
be a risky moment if the share price remains where it is this weekend but even so,
there’s reason to believe larger players (eg AngloGold Ashanti) will exercise and take
their cheap paper and go for the long-term.
6) Show that operations are at least running cash flow neutral by the end of 2022. This
will be the proof of the pudding and one of the main risks here is one out of its control,
i.e. the gold price. However, if the improvement we’ve seen in Q3 continues to the end
of the year and the gold price doesn’t collapse completely, PGM should be able to
deliver the type of “we’re back!” NR to please the market around year’s end.
7) Pay back the U$6m Sprott loan in full and on time, which will be easy as long as
most/all the warrants are sprung. But even if PGM only gets a partial take-up, it should
ebb able to cover C$9m from treasury plus some exercises.
If they manage all those, PGM will go into 2023 in much better shape than the way it started
2022 and on balance, I think Mark O’Dea and his team are going to pull this off. If so it would
be an impressive turnaround for a company that was in deep financial problems just six short
months ago and while drawing on his successful track record and deep contacts was certainly
part of the equation, the mine has had to deliver on the new plan and from what we can see in
the preliminary 3q22 numbers, it’s doing just that.
As for the potential prize, without
going too deeply into the type of
equity upside potential for a
company that may have close to one
billion shares out by the start of
2023, this slide also stolen from the
latest corporate presentation at least
gives a framework. Far from me to
start rolling over and taking a junior
mining CEO at his word, but on this
occasion I think these comparatives
are reasonable, particularly the EV
13

chart to the left. If PGM at PureGold can turn its operation to profitability as it moves into 2023,
its debt load really isn’t too onerous and when cash starts flowing to treasury that EV can move
up quickly (again, we must assume the price of gold doesn’t go toxic on the whole sector).
Without projecting too far into the future, as long as PGM gets past its big upcoming moments
in 2022 (warrants exercise goes well, creditors paid in timely fashion, cash flow stops being
negative, etc) it would be no surprise to see this company return to a C$400m market cap.
While the share count means the days of C$1.00+ prices are now much further in the future, it
would suggest something in the order of 40c is possible as long as things go well.
The bottom line: I cannot stress enough that any recommendation for a trade has to take into
account the difficult backdrop for metals prices at the moment. It’s not for nothing that most of
the sector’s share prices are dropping, but equally there’s good reason behind last week’s
improvement in the PGM stock price, which is already up over 50% from its August lows.
However, as long as the company delivers on the promise outlined by CEO O’Dea last week at
Denver and gold doesn’t cave in on us in the meantime, the market has yet to price in the clear
improvement made by PGM in the last quarter. When it does, it’s likely to move above the key
18c line, turn the all-important warrant expiry period from a qualified into a resounding success
and if that happens, PGM’s fortunes could turn up on the virtuous circle of better times ahead
as the market recognizes it is out of the financial penalty box and in position to deliver on the
high grade orebody’s promise. While I am the first to agree that the scenario I’m painting is
that of the optimist (so much for cynical me), the way PGM is apparently delivering the right
type of grade and tonnage for its production improvements in 3q22 as the more reliable South
Austin orebody takes over is exactly what it needed to achieve.
PureGold (PGM.v) will become part of the Stocks to Follow list as from next week and rather
than put it on the Watchlist, after due consideration I’m going to make this company my
exception to the current rule. Some of my dry powder will go into a small starter position in
PGM and while fully aware of the risks of buying a gold mining company as gold drops into the
world recessionary outlook, this company now shapes as a risk worth taking. And hey, I’m a
sucker for a good turnaround story, so backing it with a little of my own money is the right
thing to do. Carpe diem.
Stocks to Follow
With GDX down 6.5% and GDXJ down 7.8% on the week it’s not going to be a pleasant
overview to write, but at least it wasn’t a total washout as six of our 17 covered stocks were
week-over-week winners (RIO.v, ALDE.v, MIRL.cse, ELBM.v, WRN.to, MENE.v) and not all of
the losers were disasters. But that’s the end of the mitigation, as the losses were heavy in many
of the larger personal positions such as Top Pick Minera Alamos (MAI.v down 8.2%), Amerigo
Resources (ARG.to down 12.6%) and Superior Gold (SGI.v down 11.1%), along with other big
percentage losses in Chesapeake (CKG.v down 19.6%), new Watchlist component ATAC (ATC.v
down 18.2%) and other watchlisters Anacortes (XYZ.v down 11.6%) and Goldshore (GSHR.v
down 9.3%).
So overall due to the weakness in the larger holdings, the personal port took a bit of a
shellacking last week, there was no real escape possible from the liquidity suck…even MAI took
a hit this time (at least for a week). We have 17 stocks in the table and only two in the green,
it’s a sign of the times.
14

company Ticker this week Avg Price Reco date Current PPS Gain/Loss% Notes
TOP PICKS
Minera Alamos MAI.v STR BUY C$0.21 13-Oct-19 C$0.45 114.3% $1.14 tgt, #1 idea on FY22 dev
RECOMMENDED STOCKS
Amerigo Res ARG.to STR BUY C$1.36 12-Dec-21 C$0.90 -33.8% CheapCu w/low downside risk
Superior Gold SGI.v STR BUY C$0.95 3-Apr-22 C$0.36 -62.1% Needs to improve by Q4
QC Copper&Gold QCCU.v BUY C$0.275 25-Apr-21 C$0.145 -47.3% Now drilling. Easy hold
Rio2 Ltd. RIO.v HOLD C$0.83 22-Apr-18 C$0.125 -84.9% Cheap on permit probs, appeal
SPECULATIVE TRADES
Chesapeake Gold CKG.v SPEC BUY C$3.07 20-Feb-22 C$1.81 -41.0% Au leverage, small trade so far
Aldebaran Res. ALDE.v BUY C$0.72 16-May-21 C$0.68 -5.6% trying patience
Palamina Corp PA.v SPEC BUY C$0.295 21-Nov-21 C$0.065 -78.0% Au expl in S.Peru
Altiplano Metals APN.v HOLD C$0.31 17-Sep-21 C$0.20 -35.5% Cheap entry, plan on track.
Minera IRL MIRL.cse hold C$0.195 22-Jul-12 C$0.09 -53.8% CEO change will move stock
A WATCHLIST OF POTENTIAL TRADES. NB: I DO NOT OWN
Newcore Gold NCAU.v SPEC BUY C$0.51 20-Mar-22 C$0.22 -56.9% potential gold exploreco trade
ATAC Res ATC.v SPEC BUY C$0.095 11-Sep-22 C$0.09 -5.3% V cheap Yukon neighbour play
Electra Battery ELBM.v WATCH C$5.31 20-Mar-22 C$4.12 -22.4% potential battery metals play
Anacortes Mining XYZ.v WATCH C$0.49 22-Jul-22 C$0.495 0.9% potential gold exploreco trade
Goldshore Res GSHR.v WATCH C$0.33 22-Jul-22 C$0.195 -40.9% potential gold exploreco trade
Western Copper WRN.to SPEC BUY C$2.41 20-Mar-22 C$1.64 -32.0% potential copper trade
LONG-TERM NON-MINING HOLD
Mene Inc. MENE.v adding C$0.66 6-Dec-20 C$0.53 -19.7% LT bet, adding slowly
CLOSED TRADES IN 2022 date closed close price
Great Bear Res GBR.v Jan'22 C$15.83 26-Aug-20 C$28.58 80.5% Bought out by Kinross, print
Copper Mountain CMMC.to Jan'22 C$3.40 18-Jun-21 C$3.78 15.9% Sold 1/2 position in rebalance
Copper Mountain CMMC.to Feb'22 C$3.40 18-Jun-21 C$3.70 8.8% Sold rest on FY22 guidance
Trilogy Metals TMQ Mar'22 U$1.84 15-Sep-19 U$1.04 -41.3% killed by US permit reversal
McEwen Mining MUX Apr'22 U$0.89 2-Jan-22 U$0.82 -7.9% No 2022 turnaround, cut loss
Abrasilver Res. ABRA.v May'22 C$0.42 24-Apr-22 C$0.33 -21.4% sold to reduce Ag exposure
Strategic Metals SMD.v May'22 C$0.42 31-Jan-21 C$0.30 -28.6% trade flatlined 1.5 years
Discovery Silver DSV.v Jun'22 C$1.77 24-Oct-21 C$1.39 -21.5% Cutting Ag exp.& raising cash
Element 29 ECU.v Jul'22 C$0.58 6-Mar-22 C$0.30 -48.3% sold to cut Cu exposure
2015 to 2021 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
Now for a few notes on some of the covered companies:
ATAC Resources (ATC.v): We noted last weekend in IKN696 there was no real reason to
chase this stock higher than 11c on no news and that proved to be the case (right).
While it’s an excellent value proposition, it’s also
one of the stocks that will “remain ignored until it
isn’t” and for that to change, it needs a true
catalyst. I highly doubt ATC could make a
technical breakout without real news to push it on
and put it back in the spotlight. However and by
the same token, this weekend’s 9c is arguably
buyable as long as there’s enough width to get a
decent position in a tinycapper…there are better
things to do in life than huffing and puffing in the
TSXV to make $200 or so.
15

Superior Gold (SGI.v): This stock absolutely cannot
catch a break and was hammered along with the rest of
them, despite the market handing this high-AISC/mostly
fixed cost the bonus of lower costs as the world piles
into the USD, This chart shows how the Australian
Dollar (AUD) is proving a natural hedge against the
drop in USD spot gold prices, so as long as SGI can
deliver on its re-vamped production guidance in Q3 and
Q4, it should be able to return far better financials than
the market is currently pricing.
Electra Battery Materials (ELBM.v): A real pop and drop story and on real, solid and
positive fundamentally good news, talk about having bad timing. On Thursday ELBM won all the
applause and shot up at the open as high as C$5 on news (9) that it had reached a three year
agreement with a branch of the massive South Korean Chaebol LG, specifically LG Energy
Solution. We quote:
“Electra has agreed to supply LGES with 7,000 tonnes of battery grade cobalt from
2023 to 2025. The material will be supplied from the only cobalt sulfate refinery in
North America, located north of Toronto, Ontario.”
The deal is for 1,000mt in the first year, then 3,000mt per year in the next two and all that is
good, as a sizeable contract with a guaranteed buyer of product secured, But far more
important is the endorsement ELBM and its business plan gets from a bona fide sector leader
and no matter how well or badly the commissioning phase of Battery Park goes (or however
much it eventually costs), these are the type of business partners that tell you the company is
not going away and is destined for success.
Which is all good and the stock shot higher at
Thursday’s bell on this news, but market timing could
hardly have been worse and the combination of the
bearish growling in the broad market, the double-bear
sentiment for mining and commodity stories, instos
grabbing at a liquidity event and a near-immediate
drop-off in volume as new money resolutely stayed on
the sidelines of even the most positive of stories
combined to drag ELBM back down. The stock
managed to end Friday still in the green and rightly so,
but another market backdrop would have seen this
news skyrocket ELBM. Trent Mell and his team deserve sincere and warm congratulations for
securing this deal and providing investors with all the proof of concept they could desire at this
early stage, the only thing lacking is a bull market.
Chesapeake Gold (CKG.v): I owe you more thoughts and some ballpark economics on CKLG
at Metates after its recent NR on initial met results. That will come at some point in future
editions (I see little rush in this current drab market) and instead, will simply point you toward
three recent links featuring CKG CEO Alan Pangbourne on the marketing and promotion scene.
First up this 19 minute segment with Swiss Resource Capital AG (10). this 14 minute
presentation at Beaver Creek (11) that also comes with a download link for its latest corporate
presentation (12) and finally, another 56 minutes you can spend in the company of CEO Alan
Pangbourne via this Crux Investor video (13). Busy guy, it seems. Busy online at least.
In other news (of sorts), I swapped ideas with fellow CKG holder, smart sector veteran and
occasional mailpal “MP” (if memory serves, he’s in the same boat as I with a small foothold
position). We concurred that the cash position tiny burn rate means CEO Pangbourne can take
the company into quasi hibernation and get on with the serious met work (it’s good to see they
16

are being thorough on this key point). MP made the point that the recovery cycle proposed for
Metates is long in real calendar days, which means fine-tuning of met will take a long time for
the various scenarios and see any results. He’s right and while he sees that as a problem, this
company does have the luxury of time on its side (especially at the moment. That’s the good
side of the coin, the negative is that the stock trades very thinly and that means it only takes a
single 50k or 100k seller who runs out of patience or needs the cash for something else and the
stock price gets whacked. If the macro background were healthier that would spur bargain
hunters to buy in (or add) but in current market, that ain’t necessarily so.
QC Copper & Gold (QCCU.v): Another good drill assay NR out of QCCU on Monday
September 19th (14), which is seven days ago and feels like a month away. The results
underscore the success of its 2022 drill campaign as it “turns waste into ore” and makes
Opemiska into a larger tonnage open pit project. Here you’re only getting the briefest of
overviews and there are more drill results to consider, here I zero in on these two holes:
The green line you see in the above visual represents the starter pit as proposed in the 2021
Maiden Resource Estimate (MRE) for Opemiska) and the red areas on the drill traces get these
numbers (I add a splash of red here and there):
OPM22-218:
18.8m @ 0.2% Cu & 0.17 gpt Au - 2.2 to 21m
18m @ 0.82% Cu & 0.19 gpt Au - 61.5 to 79.5m
4.5m @ 0.85% Cu & 0.26 gpt Au - 114 to 118.5m
18m @ 0.39% Cu & 0.1 gpt Au - 168 to 186m
OPM22-220:
12m @ 0.36% Cu & 0.13 gpt Au - 56 to 68m
19m @ 1.52% Cu & 0.16 gpt Au - 80 to 99m
35m @ 0.97% Cu & 0.26 gpt Au - 121 to 156m
3.5m @ 0.72% Cu & 0.28 gpt Au - 265.5 to 269m
This small inset also comes from a larger drill map included in
last week’s NR and shows the zone where holes 218 and 220
were cut. This time, the pink dotted line shows the proposed
starter pit and the black dotted line the entire pit. As holes 218
and 220 are bang in the middle of this zone, those high grading
intercepts are bound to help project tonnages and economics
when the resource update appears, now slated for 1q23.
Minera Alamos (MAI.v): Here’s the link to Doug Ramshaw’s Denver presentation (15). We
didn’t get the Cerro de Oro 43-101 announcement last week but we got a clear indication that
it’s now very close and should be out by the end of this month. That means this week (which
should give this desk plenty to chew over in IKN698
next weekend. The other snippet to take away from
the Denver presentation is the strong hint that MAI
will declare formal commercial production on
Santana on January 1st 2023.
As for trading, not even this strongly-held stock
managed to avoid the Friday sell-off and closed at
17

45c. That’s cheap and a true bargain, ladies and gentlemen readers of The IKN Weekly.
Western Copper & Gold (WRN.to): Here’s the link to Paul West-Sells’ presentation at
Denver Gold (16), which was a better one than the company’s Beaver Creek gig and made two
strong takeaway points:
1) WRN has all the cash it needs for the next three years as it enters its permitting track
2) The Standstill agreement with Rio Tinto (RTZ) ends in November, at which point the big
world player can make its next decision regarding Casino.
CEO West-Sells explained to his audience that the
current 7.6% RTZ position was a deliberate decision
to allow a foot in the door and allow them to
examine Casino more closely. WRN cannot second-
guess the position of RTZ this point (not publicly at
least) but reading between the lines, it seems the
JV-like co-operation has gone well and WRN expects
RTZ to make some sort of further commitment when
it can. That’s probably why WRN managed to beat
the copper median and keep most of its gains while
peers sold off on Friday.
Amerigo Resources (ARG.to): We’ve gone over what the ballpark price levels for copper
would mean to the ARG business model now with the operation now running at stable state and
the C-suite focused on returning capital to shareholders. But with copper taking a new leg down
last week it’s worth running a reminder so without considering a total copper price collapse
(e.g. U$2.50/lb) at which point you’d expect any company worth its salt to batten down the
hatches and preserve capital, here are the general house parameters:
 U$3.00/lb (or something below): The CAD 3c/qtr dividend policy can continue for
several quarters (best guess to end 2023)
 U$3.30/lb: The CAD 3c/qtr dividend policy is funded essentially indefinitely
 U$3.50/lb: The CAD 3c/qtr dividend policy is self-funded and there should be money
for share buybacks as from November 2022
 U$3.80/lb and above: Shareholders can expect the bonus “top-up” dividends as well
as share buybacks and the standard CAD 3c/qtr dividend policy
As for the price drop last week, there are few stocks that I can confidently state “buy more”
about in the current market backdrop in the same way as ARG. This was an excellent dividend
payer with low-risk downside at its previously calculated 8% yield but the recent sell-off has
pout this one firmly in the “crazycheap” level required for purchases in those washout/pre-
washout moments. At this weekend’s CAD$0.90, ARG is now a baseline 13.3% dividend payer,
which is an eye-popping level of returns for a junior mining stock and would mean your full
purchase price is returned to account in 30 quarters of operations, or 7.5 years. As raw material
supply and its permits are for all intents and purposes indefinite, this makes ARG an
exceptionally cheap stock for those of you who like to buy, build a solid portfolio and then go
fishing.
The Copper Basket
After thirty-eight weeks of 2022, The Copper Basket shows a loss of 46.41% level stakes:
18

company ticker price 1/1/22 Shares out Market Cap current pps gain/loss%
1 Marimaca Cop MARI.to 3.77 88.118 289.03 3.28 -13.0%
2 Copper Mtn CMMC.to 3.42 210.166 281.62 1.34 -60.8%
3 Western Copper WRN.to 2.00 151.451 248.38 1.64 -18.0%
4 Oroco Res OCO.v 2.04 203.4 168.82 0.83 -59.3%
5 Nevada Copper NCU.to 0.71 448.437 116.59 0.26 -63.4%
6 Regulus Res. REG.v 1.06 101.85 96.76 0.95 -10.4%
7 Aldebaran Res. ALDE.v 0.84 138.401 94.11 0.68 -19.0%
8 Hot Chili HCH.v 1.53 109.223 93.93 0.86 -43.8%
9 Meridian Min MNO.to 1.18 153.735 89.93 0.585 -50.4%
10 C3 Metals CCCM.v 0.16 645.379 32.27 0.05 -68.8%
11 Kutcho Copper KC.v 0.88 103.94 29.62 0.285 -67.6%
12 Doré Copper DCMC.v 0.79 66.123 23.80 0.36 -54.4%
13 Element 29 Res ECU.v 0.58 79.24 23.77 0.30 -48.3%
14 QC Copper QCCU.v 0.34 129.06 18.71 0.145 -57.4%
15 Coast Copper COCO.v 0.13 41.335 2.07 0.05 -61.5%
NB: All stocks in CAD$ Portfolio avg -46.41%
The Copper Basket followed the metal lower last week, but both metal and basket average are
still short of the lows seen in mid-July so we’ll
The Copper Basket 2022, weekly evolution
see if those manage to hold in the days and 10%
weeks ahead. It wasn’t all doom and gloom 0%
either, as despite ten losers (CMMC.to, OCO.v, -10%
NCU.to, MNO.to, HCH.v, REG.v, CCCM.v, ECU.v, -20%
QCCU.v, COCO.v) including biggest losers Hot -30%
Chili (HCH.v down 21.8%), C3 Metals (CCCM.v
-40%
down 16.7%), Copper Mountain (CMMC.to down
-50%
15.7%), Coast Copper (COCO.v down 16.7%)
-60%
and Regulus Resources (REG.v down 12.0%), we
also had a smattering of five week-over-week
winners (MARI.to, WRN.to, ALDE.v, KC.v,
DCMC.v). With a few exceptions, the bigger losers came from the more speculative stocks that
dropped the same way as they recently popped, while the winners were thinner volume stocks
that had already taken a recent pummelling and floated higher on light trading.
In other words, not a particularly healthy sector
at the moment and I hope copper doesn’t do a
waterfall drop on us, as it could cause a real
rush for the doors.
Trading in the stocks was directly influenced by
trading in the metal and while copper didn’t do
much on the Wednesday of FOMC fun, the
delayed reaction on Friday sent everything
lower. This six month chart is chosen for your
consideration this week as it takes in the main
waterfall drops as Jay Powell’s Fed policy was
rolled out and then confirmed, then the
rebound to U$3.60/lb or so over the Northern summer, then most recently the “Jackson Hole
And Beyond” period in which the Fed’s message has taken back control of the macro narrative
and pushed commodity prices of all types lower. Until last week (in fact, until last Friday)
copper had taken less of a beating than other commodity components but the lower low it just
put in, along with the growth of negative sentiment and the way the world is now pricing in a
real, unsoft-landing recession, put a hole in its spot and futures contract prices. Unsoft is a
word, right?
19
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 t6raM ht31 ht02 ht72 dr3rpA ht01 ht71 ht42 1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3yluj ht01 ht71 ht42 ts13 t7gua ht41 ts12 ht82 t4pes ht11 ht81 ht52
source: IKN calcs

This week’s curated copper macro commentary features two Reuters links and I’ve tried and
failed to pick out a representative excerpts, so instead you’re getting large chunks of both (and
the small font saves some room). First up this general market report (17) that has Citi analyst
telling us copper is about to slump due to a demand slump for an unusual quarter:
Shrinking copper demand in Europe due to a manufacturing recession caused by the energy
crisis will dominate market sentiment for some time with prices likely to retreat towards two-year
lows early next year.
Copper prices typically react to the ebb and flow of demand in China, which accounts for half of
global consumption estimated at around 25 million tonnes this year.
But this time the focus is on Europe, accounting for 15%-20% of global demand for copper used
in power and construction.
The region is facing surging gas and power prices after energy supply cuts, which Russia blames
on Western sanctions over the Ukraine conflict. The European Union has made proposals to
impose mandatory targets on member countries to cut power consumption.
“It would be rare to see an outright decline in demand, but I think that’s what we are going to see
in Europe over the next 3-6 months,” said Citi analyst Max Layton.
“There will be a very substantial seasonal surplus between December and March, the
combination of which is going to bring copper down to 6,600.”
The same report than quotes a second analyst who chimes in on the Asia scene:
Macquarie analysts expect a copper market surplus of 691,000 tonnes in 2023 from a 162,000
tonne deficit this year. They expect global refined copper production at more than 26 million
tonnes in 2023.
“The economic outlook ex-China has worsened, particularly in Europe due to the ongoing energy
crisis,” said Macquarie analyst Marcus Garvey.
“We do not think China will be able to offset the slowdown elsewhere. Inventories will build next
year, but how much will be visible is difficult to say.”
Copper stocks in LME and CME Group registered warehouses and in those monitored by the
Shanghai Futures Exchange are visible and total around 189,000 tonnes.
Low stocks in exchange warehouses have supported copper prices, while worries about supplies
on the LME have also created a hefty premium for the cash over the three month contract.
Invisible inventories include those held by producers, traders and state stockpiles such as those
held by China.
Modelling by Citi analysts shows invisible stocks outside China could total around 500,000
tonnes.
“We see an adequate inventory buffer to bridge the gap between now and a more pronounced
demand slowdown as potential recession in Europe plays out over the winter months,” Layton
said.
In so many words, copper sentiment isn’t great according to Citi and Macquarie, but the report
also picks up on the continued tightness in inventories and, however weak, offers that as a
counter. This brings us to the second of today’s lifted content from the inimitable Andy Home
(18) and another long excerpt, as Home only does his usual trick of covering a bunch of bases
in a single piece but in this case, tackles the subject of copper inventories head-on. His
expansion on the potential weakness in the bearish position, as seen above, is well worth
consideration in “Low global copper stocks jar with market’s downbeat mood” and I hope Home
forgives me for the size of this copypaste:
LME inventory remains ultra-low by any historical yardstick, representing just two days’ worth of global usage.
But this is not just an LME phenomenon. Registered inventory with both the CME and Shanghai Futures
Exchange (ShFE) is also super low and between them the three exchanges hold just 200,000 tonnes of metal.
The bullish stocks optics don’t sit well with the market’s bearish humour. Currently trading around $7,715 per
tonne, LME three-month copper is down by 21% on the start of 2022 as the market frets about slow economic
growth in China and potentially no growth in Europe.
The disconnect between visible inventory and price is generating time-spread tightness across all three
exchanges and renewed analyst interest in trying to calculate hidden stocks of copper.
ALL YOU CAN SEE…
Registered tonnage with the big three copper exchanges totalled 195,560 tonnes at the end of August, up by a
marginal 5,450 tonnes on the start of January but down by 185,650 tonnes on August last year.
There has been minimal change so far this month, the slight rise in LME inventory offset by continued draws
from CME warehouses in the United States.
A broader copper stock picture can be created by including two relatively new data series.
In February 2020 the LME introduced a monthly report on “shadow stocks”, denoting metal stored off-market but
with explicit contractual reference to the option of LME delivery.
There were significant amounts of such off-warrant copper in 2020 and early 2021. At their peak of 175,000
tonnes in February last year they dwarfed registered LME copper inventory of 74,000 tonnes. However, they
have since contracted to just 17,000 tonnes as of the end of July.
The Shanghai International Energy Exchange (INE) launched its international copper contract at the start of
2021 and has since published weekly figures for bonded warehouse stocks held against the contract.
20

They currently stand at a substantial 89,000 tonnes and have grown by 23,500 tonnes from the start of January.
Registered exchange stocks combined with LME shadow and INE bonded stocks represent the total statistically
verifiable copper inventory landscape.
Combined holdings were just under 330,000 tonnes at the end of July, a build of 61,000 tonnes over the first
seven months of the year but 159,000 tonnes below where they were in July 2021, and still only equivalent to
five days global usage.
…WHAT YOU CAN’T SEE
There is obviously more copper “out there” in the statistical dark.
Half a million tonnes of it, according to analysts at Citi, who “believe that market-implied convenience yields can
show us what we cannot see”. Futures curves are pricing around 500,000 tonnes of invisible stocks outside of
China, the bank estimates. (“Metals Weekly”, Sep. 16, 2022).
Citi, which expects the copper price to drop to $6,600 in the first quarter of next year, argues there is “an
adequate inventory buffer to bridge the gap between now and a more pronounced demand slowdown as
potential recession in Europe plays out over the winter months”.
There are important caveats to this type of calculation, however, as Citi itself concedes. The LME futures curve
can be pricing in all sorts of hedging flows, including temporary builds in Chilean port stocks, shifts in Chinese
bonded stocks and delays to metal in transit.
The problem is knowing how much of the implied stock is accessible rather than heading directly to a fabricator.
There are two further complications in the current mix.
Russian copper is not officially sanctioned, but self-sanctioning may already be disrupting normal channels for
the flow of physical metal into the European market.
Chinese trader Maike Group meanwhile is now in talks with state-owned companies after running into financial
difficulties.
Maike is one of China’s top copper traders, importing around one million tonnes per year, and the financial
shore-up exercise may generate physical market waves.
Both Russian and Chinese metal events are also likely to be playing out in LME time-spreads, in turn impacting
the convenience curve calculation.
SPREAD TENSION
Time-spreads can also be an extremely volatile barometer, particularly where there’s little stocks cover on
physically deliverable contracts.
The LME premium for cash over three-month delivery CMCU0-3 spiked to $150 per tonne last week and is still
trading around $55 despite Tuesday’s hefty deliveries of copper onto warrant.
The CME curve is also being roiled by a mini-squeeze, the Sep-Dec spread HGU2-Z2 flaring out to over 5.4
cents per lb last week and last trading at 4.4 cents, equivalent to $97 per tonne.
CME inventory, concentrated in Salt Lake City, Tucson and New Orleans, has been sliding steadily since June
and is now down by 31% on the start of the year at 41,471 tonnes.
ShFE-registered stocks are lower still at 35,865 tonnes, which has led to a steep backwardation across the
Shanghai curve through the April 2023 contract.
The current bear thinking is that there is going to be plenty of metal around as Europe falls into recession and
China struggles to escape the drags of rolling lockdowns and foundering property sector.
Until then though, super low stocks across all three exchanges are going to keep generating spread volatility
until such time as what is “out there”, however much it may be, is moved to somewhere it can be counted.
That provided plenty of food for thought this week, Home on top form and I hope you take the
time to read and digest, he’s better than me at this. With no further ado we dovetail into our
weekly check on movements in world copper stocks, data from Cochilco:
 The tide turned last week as inventory landed at warehouses in both Europe and Asia,
mainly LME but the other two official systems offered little friction. The aggregate total
moved up 19,913 metric tonnes (mt) to close Friday at 202,811mt which is still tight,
but another couple of weeks of increases will erase that from the collective market
memory.
 A modest increase at the SHFE, up 1,032mt to close at 36,897mt, after the end of the
holiday period. Another reminder of context required as we continue to bounce around
the sub-50k levels, as before 2021 anything under 100k was considered tight.
 The main move was at the LME, where LME: Cu tonnage under cancelled warrant
stocks jumped on Tuesday by 11k and then
another entry later in the week to close up
19,650mt at 124,725mt. Not only that, but
cancelled warrants dropped to 8,850mt and gave another signal of softening demand.
 The Comex system was the only tonnage
loser for the week, down 769mt to this
weekend’s 41,189mt
21
00142 52074 57334 00714 52045 05205 52027 52418 52926 05694 57332 52271 05761 52511 57471 52581 52862 00642 00743 57924 00914 52975 05174 05803 04441 0588
100000
90000
80000
70000
60000
50000 40000 30000
20000
10000
0
dr3rpa ht01 ht71 ht42 1.yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3yluj ht01 ht71 ht42 ts13 ht7gua ht41 ts12 ht82 ht4pes ht11 ht81 ht52
mt Cu
source: Cochilco

The dedicated SHFE charts show the same “scraping the barrel” story but as the second and
newer tracking chart shows, the 2022 line is about to make contact with 2021’s at the same
stock level we saw in 4q21. If we take a step back, we note that fears of Chinese warehouses
“stocking out” (pace Goldman Sachs) have not materialized and in fact, China’s manufacturing
sector has not ground to a halt this year through a lack of copper raw material. Add that
thought to the bearish signal coming from the LME this week and there’s fundamental
justification for the selling we saw on Friday, it wasn’t just instos following Citi off a cliff.
Shanghai Futures Exchange Warehouse Stocks, 2014 to date
400000
350000
300000
250000
200000
150000
100000
50000
0
22
31'13ceD dr32 ht02 ht51 ht01 ht5tco ht03 ht52 dn22 ht71 ht21 ht6pes ts1von 5102ht72ced ts12 ht71 ht21 ht7guA dn2tcO ht4ceD ht92 ht62 ts12 ht61 ht01 7102
ht5von
ts13 ht52 dn22 ht42 ht91 ht41 ht9 9102
dr3bef
ts13 ht62 ts12 ht51 ht01 0202ht5naj 0202ts1ram ht62 ts12 ht61 ht11 0202ht6ced ts13 ht82 dr32 ht81 ht21 ht7 2202dn2naj ht72 ht42 ht91 ht41
Mt Cu
|
source: Cochilco
SHFE copper inventory levels, 2018 to 2022
400000
350000
300000
250000
200000
150000
100000
50000
0
1 2 3 4 5 6 7 8 9 01 11 21 31 41 51 61 71 81 91 02 12 22 32 42 52 62 72 82 92 03 13 23 33 43 53 63 73 83 93 04 14 24 34 44 54 64 74 84 94 05 15 25
MT Cu 2022
2021
2020
2019
2018
source: Cochilco data
Now for a couple of notes on basket stocks:
Marimaca Copper (MARI.to): It wasn’t exactly
show-stopping levels of volume, with just over 32k
traded on Tuesday and 21k on Wednesday, but the
concentrated way in which the trades went through
MARI in the brief period as seen on this five-day chart
suggests that someone (with an emphasis on the
singular) suddenly had the urge to buy in an wasn’t
feeling particularly patient about it.
Once the buying burst was done, the stock fell back to
its previous level in bits’n’pieces trading. Odd yes, but
oddities do happen in thinly traded junior stocks.
Hot Chili (HCH.v): For the sake of homogeneity and
convenience we follow HCH via its newly minted
Canadian ticker, but its original and high volume
Australia listing still drives the stock and last week, its
recent Oz buying spree came to an end (with a bump).
Driven by those high grade cuts in satellite deposits, we
noted the minimal effect they would have on any

eventual and collective “Costa Fuego” mine. What matters here is costs and until we know
those, including the ticket price of that coastal water pipeline, this is a speculative vehicle at
best. MARI is the better option if you’re into Chilean copper explorecos.
Copper Mountain (CMMC.to): Here’s a screenshot from IKN658, dated Janaury 2nd 2022
when we unveiled this year’s new Copper Basket list:
How the mighty have fallen, as from holding a massive market cap advantage over the field
CMMC has this weekend lost top spot in the market cap list (to Marimaca, which gets another
mention this weekend).
In other news, the recently fired CFO Rod Shier has decided to take CMMC to court for the way
he was dismissed with cause and he’s claiming nearly C$1.6m in unpaid severances. Here’s an
excerpt from this Stockwatch Mike Caswell note (19) on the subject:
According to Mr. Shier's suit, the departure was not an amicable one. He says that his
troubles began a week earlier, on Aug. 16, 2022, when the B.C. Securities
Commission advised him that he was behind on his insider trading filings. As an officer
of the company, he was required to report any shares that he purchased or sold. A
review by the BCSC determined that his reports were incomplete.
Mr. Shier claims that his failure to file the reports was an inadvertent one, arising from
"serious adverse personal circumstances." According to the suit, Mr. Shier updated his
filings within days and advised the BCSC that he had done so. The regulator closed
the matter, and said he should consider it a "strong caution."
Two days later, Copper Mountain fired Mr. Shier. According to the suit, the company
said that it was terminating him for cause (meaning for a good reason), with that cause
being his failure to file insider trading reports in a timely manner. As Mr. Shier sees
things, the company used that as an excuse. In reality, it was looking to remove him
without having to pay the amounts specified in his employment agreement, he says.
Once again, your author is reminded of the depths mining sector people will go to for money.
It’s fair to say that whatever happens in this legal action and no matter whether Mr. Shier gets
his payout, CMMC is better off without him. We move on.
Regulus Resources (REG.v): Tomorrow Monday September 26th sees REG in a live webinar
and corporate update, here’s the blurb…
Join CEO & Director John Black and Chief Geological Officer Dr. Kevin B. Heather for
a Corporate update on Regulus Resources. They'll discuss their projects, upcoming
catalysts and take audience questions.
…and here’s the link for those of you so inclined to
join me and others for the show (20). In trading,
REG traded in-line with the rest of the copper
market on low volumes, which in effect means it
did well and managed to hold onto the sharp gain
it put in the week before last. Even though REG
has basically flat-lined since the Covid-crisis and
missed out on all the copper sector gains in
2020/21, there are worse near-term charts than
that one.
23

The Producer Basket
After thirty-eight weeks of 2022, the Producer Basket shows a loss of 25.57% to level stakes:
company ticker price 1/1/22 Shares out MktCap(U$Bn) current pps gain/loss%
1 Newmont NEM 62.02 797.44 32.89 41.25 -33.5%
2 Barrick GOLD 19.00 1779 25.76 14.48 -23.8%
3 Franco-Nevada FNV 138.29 191.192 21.82 114.13 -17.5%
4 Agnico Eagle AEM 53.14 454.904 17.77 39.07 -26.5%
5 Wheaton PM WPM 42.93 450.3 13.53 30.04 -30.0%
6 Gold Fields GFI 10.99 887.72 6.35 7.15 -34.9%
7 Kinross Gold KGC 5.81 1296.5 4.29 3.31 -43.0%
8 B2Gold BTG 3.93 1055.6 3.15 2.98 -24.2%
9 Alamos Gold AGI 7.69 392.503 2.64 6.73 -12.5%
10 Sandstorm SAND 6.20 191.4 1.07 5.59 -9.8%
All prices and stock quotes in U$ Port. avg -25.57%
All basket stocks were whacked hard by the Friday sell-off but somehow, we managed to get
one week-over-week winner from our ten choices as Kinross (KGC) clung on to a 0.6%
improvement and have Paul Singer to thank. See below for that, but the rest were all losers
with the royalty streamers doing slightly less worse than the Tier 1 players who did slightly less
worse than the Tier 2 players. B2Gold had the worst performance, down 9.7%.
The 2022 Producer Basket: Percentage difference
5.0% between GDX benchmark & basket (negative = IKN ahead)
4.0%
3.0%
2.0%
1.0%
0.0%
-1.0%
-2.0%
-3.0%
-4.0%
However, we did manage to do less worse than the ETF benchmarks (GDX down 6.5%, GDXJ
down 7.8%) and despite at the worst level of the year, we also have the largest lead over the
main benchmark.
Kinross (KGC) (K.to): The major move of the week came from Kinross and the news Monday
(21) (22). Following “constructive discussions” with Paul Singer’s Elliott empire, via its Ellliott
Investment Management arm, Special K announced an “enhanced buyback program” and here’s
the segment of the NR with the bare bones:
Under the new program Kinross will:
 Buy back $300 million in shares over the remainder of 2022.
 In 2023 and 2024, allocate 75% of its excess cash (defined as free cash flow after paying interest
and dividends) to share buybacks.
Kinross’ approach to the enhanced buyback program will ensure the buyback is affordable and
sustainable, protecting Kinross’ strong balance sheet and capacity to continue investing in its
business.
 Buybacks in 2023 and 2024 will only take place if net leverage is below the current LTM (last
twelve months) net leverage ratio of 1.7:1.
 In addition, the Company would intend to temporarily pause buybacks in case of a ratings
downgrade, major operational disruptions or a significant drop in gold price.
There followed CEO comments and a segment quoting the Elliott people, the two sides reaching
24
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 t6ram ht31 ht02 ht72 dr3rpa ht01 ht71 ht42 1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3luj ht01 ht71 ht42 ts13 ht7 ht41 ts12 ht82 t4pes ht11 ht81 ht52
The 2022 Producer Basket: Weekly performance and
40% comparative to GDX control
30%
20%
10%
0%
-10%
-20%
-30%
source: IKN calcs, NYSE data
-40%
ts1naJ ht9naJ ht61 dr32 ht03 ht6bef ht31 ht02 ht72 t6ram ht31 ht02 ht72 dr3rpa ht01 ht71 ht42 1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3luj ht01 ht71 ht42 ts13 ht7 ht41 ts12 ht82 t4pes ht11 ht81 ht52
ikn
gdx control
source: NYSE, IKN Calcs

this agreement after several rounds of talks. There are several implications to draw, including
the fact that Elliott did not previously have a declared position in K and the likelihood that a
non-agreement on this new and shareholder-friendly strategy would have triggered a proxy
slate headed by one of the world’s most powerful and activist funds (e.g. ask Argentina about
Paul Singer). But with the deal and the tacit announcement of Singer’s financial interest in K
(the firm declined to talk specific numbers) pleased the market as seen in this ten-day chart
and even provided enough margin to peers to return a positive week, despite Kinross being hit
along with the rest of them on Friday.
Bottom line: Wall St likes buybacks and KGC/Elliott provided a sharp reminder of that, so this
may not be the last one announced by cashed-up Tier 1 and Tier 2 producers.
Newmont Corp (NEM): Staying with stocks compared to GDX, this five day chart shows how
NEM was under-performing the GDX by around 2% until
Friday, but ended up with a very slight advantage on
the week thanks to this news on Friday (23):
DENVER--(BUSINESS WIRE)-- Today, Glencore
International AG (GIAG) and Newmont Corporation
(NYSE: NEM, TSX: NGT) announced they have
reached an agreement in which Glencore will acquire
Newmont’s 18.75% shareholding in the MARA
Project (MARA). Following completion of the
transaction, Glencore will own 43.75% of MARA.
Under the terms of the agreement, Glencore will pay
$124.9 million upon closing and a $30 million
deferred payment upon commercial production
subject to an annual interest charge of 6%. Total
deferred consideration is capped at $50 million.
The deal is for U$124.9m cash, then a deferred payment once MARA goes into
production of between U$30m and a maximum of U$50m, depending on timing and
interest (see NR for the minutiae).
This deal makes sense all round. For NEM, it raises cash on a non-core asset in one of its riskier
jurisdictions and also on a controversial project, as MARA (the extension project to the now-
depleted Agua Rica) is strongly opposed by locals in the region. This leaves MARA in the hands
of Yamana (56.25%) which may soon become Gold Fields (GFI) and newly larger minority
Glencore 43.75%, which now has a larger bargaining chip it can play with Argentina on the
timing and development of its Pachón copper project (GLEN has dragged its heels for years and
probably wants to continue doing so).
Finally, two notes about NEM CEO Tom Palmer’s keynote speech at the Denver Gold
conference. Firstly, it was boring, secondly it was telling that even though the subject matter
was somewhat soporific the single largest public PM miner in the world couldn’t fill the room at
one of the year’s major industry platform events, there were empty seats and even completely
empty tables around the room.
25

The TinyCaps List
After thirty-eight weeks of 2022, the TinyCaps show a loss of 36.90% to level stakes:
company ticker price 1/1/22 Shares out Mkt Cap current pps gain/loss%
Aurelius Min AUL.v 0.24 45.836 5.73 0.125 -47.9%
Golden Pursuit GDP.v 0.13 34.638 5.89 0.17 30.8%
Infield Min INFD.v 0.06 48.445 1.45 0.03 -50.0%
Kingfisher Met KFR.v 0.30 103.007 16.48 0.16 -46.7%
Latin Metals LMS.v 0.12 57.686 4.90 0.085 -29.2%
Manitou Gold MTU.v 0.06 344.57 12.06 0.035 -41.7%
Melkior Res MKR.v 0.295 24.011 5.16 0.215 -27.1%
Precipitate Gold PRG.v 0.105 129.322 8.41 0.065 -38.1%
Signature Res SGU.v 0.07 238.4 4.77 0.02 -71.4%
Winshear Gold WINS.v 0.08 61.585 2.77 0.045 -43.8%
Prices in CAD$, data from TSXV basket avg -36.90%
This section attempts to track the tinycap mining sub-sector of the market, our ten companies
chosen under the following criteria to put together a list representing the state of play in the
sub-sector of tinycap exploration company stocks. At least, that’s the plan.
 Market capitalization of under $20m. They have to be tiny. In two cases I’ve stretched the window a
little and allowed sub-U$20m market capper in that are just over the C$20m level, but the spirit is unaltered.
 A “non broken” stock price and project story. There are literally hundreds of tinycap juniors of the right
size, but it was a particularly depressing exercise to trawl through the whole of the TSXV and find companies
that are small enough, but with life in them. The vast majority of sub-$20m stocks are broken stocks, either
traded to death on the exchange or with projects that are a bust or with entrenched management more
interested in their monthly paycheck than anything else.
 Likelihood of meaningful newsflow in 2022. This connects to the company’s “unbroken” status, as we
want news and potential catalysts from companies with projects that can work.
 Decent management if possible. When you are down among the little guys it doesn’t pay to be too
choosy, but still I preferred companies that have teams or people with good peer reputations.
Another new low for the TinyCaps tracking list, 15% TinyCaps, 2022 weekly tracker
10%
with only one stock recording gains on the week
5%
(LMS.v), four UNCH stocks (INFD.v, MTU.v, 0%
SGU.v, WINS.v) and five losers (AUL.v, GDP.v, -5%
-10%
KFR.v, MKR.v, PRG.v) but while the headcount is -15%
clearly negative, four of those five losers were -20%
-25%
literally half cent moves. The exception is the
-30%
larger 16.7% loss taken by Aurelius (AUL.v). -35%
-40%
Latin Metals (LMS.v): The only riser of the
week put a prop under its price by opening a
small raising in this NR (24) which was as much
sales pitch as placement announcement. Insiders are taking $475k of the proposed $1m raising,
which means there’s not much left to cover and this stock is unlikely to see the same sort of
price action seen in the larger raises such as LIO and NMOZ recently. The terms of the deal are
1m units selling at 10c, unit = share + ½ warrant priced at 20c with a two year shelf life.
That’s not a bad deal and after making a case for this stock last week at the current prices,
there’s the same story here today. No I’m not on commish and no I’m not going in myself but
for those of you with the required risk tolerance for risk required, the price chart suggests that
with some patience, you’d be unlucky not to be able to clip the warrant at 10c. There are worse
deals out there.
NB: Please be clear that The Tiny Dogs is NOT a list of recommended tinycap stocks. It is a list of companies with
market caps of under $20m offering a reasonable representation of the wider tinycaps market. It’s possible in the future
I may buy shares in one or several of these stocks, at the moment both my opinion and wallet are strictly neutral.
26
dn2naJ ht9
naJ
ht61naJ dr32 ht03 ht6bef ht31 ht02 ht72 ht6ram ht31 ht02 ht72 dr3rpa ht01 ht71 ht42 ts1yam ht8 ht51 dn22 ht92 ht5nuj ht21 ht91 ht62 dr3yluj ht01 ht71 ht42 ts13 ht7gua ht41 ts12 ht82 ht4pes ht11 ht81 ht52
source: IKN calcs, TSX data

Regional politics
Ecuador and China and Leo Dicaprio
Last week the world’s business and finance eyes were trained
on The USA and the Fed, then Europe’s ECB responses, then
perhaps the UK as its new Truss government combined with
the Bank of England made mincemeat of the GBP. But away
from the main business headlines, China continues to make
inroads into LatAm. Here’s an excerpt from this (25):
Sept 19 (Reuters) - Ecuador has reached an agreement to
restructure its debt with Chinese banks, the government said
in a statement on Monday, providing relief worth some $1.4
billion until 2025.
This is not a playbook invented by China, instead a straight copy of the strategy used by no end
of USA big business concerns in the late 1990’s: Offer to build large civil works projects
(electricity generation or distribution, industrial growth funds, mining projects etc) for a
developing nation and offer to fund the project via the purchase emission of sovereign bonds.
When the country then overpays, overspends or hits harder economic times, be friendly and
renegotiate the deals while getting further hold on the country’s valuable supply of natural
resources. In the case of Ecuador the main prize is crude oil, but readers of these pages are
aware of China’s designs on the country’s hard rock mining endowment as well. This is the type
of high-level political influence that keeps national governments siding with the companies and
against the Antis and social protest movements. The report continues:
"As a result of these agreements, the maturities are extended to 2027 for China
Development Bank and 2032 for Eximbank, allowing the cash-flow relief to support
government priorities," the president's media office said in the statement.
Ecuador also managed to reduce certain applicable interest rates and suspend all
amortizations with China Eximbank for a six-month grace period, the government said.
The loans were agreed during the government of former President Rafael Correa,
while several were linked to long-term oil sales contracts with Chinese companies.
The agreements also involve freeing up certain amounts of exports to Chinese oil
company CNPC under oil-backed contracts, allowing Ecuador to sell an unspecified
quantity of oil at market prices, the statement said.
As for Ecuador mining news, the only story to pass this desk last week must have done so two
dozen times on a variety of Spanish language media and links, as Leonardo Dicaprio once again
took to social media to speak up for the environmental protection of the Intag region and
against the Codelco-owned Llurimagua copper project (one example of many here (26)). That’s
the one opposed by locals for at least 25 years and is now centre of the ICSID/CIADI
international tribunal case Codelco has brough against Ecuador, for not allowing them to move
forward on the project. The case is expected to continue into 2023, but it’s telling that the only
time the world hears about the mining sector in Ecuador is when a famous celebrity speaks out
against it. Compare that to today’s improving image for mining in Argentina.
Argentina: Mining “well positioned”
Ernesto Cussianovich comes with the job title of “Associate Director of Energy, Natural
Resources and Environment” at the establish Argentine consultancy/opinion pollster firm
Poliarquía Consultores. The standard rule of thumb as regards job titles applies (the longer it is,
the less important you are) but that aside, his comments during last week’s conference
organized by Argentina’s business daily newspaper Ámbito Financiero as regards mining were
perceptive and ring true to this desk (27), so I’ve put together a translation of the report that
came after his appearance:
“The specialist highlighted the fact that Argentina is a country with great potential in
mining. With the possibility of generating jobs as well as attracting foreign currency (i.e
US Dollars). He noted that at the moment mining is enjoying “one of its best moments
in public perception in the sector.”
“It’s has been difficult for mining in Argentina to have managed to position itself well
27

and is very important. I’d say in general terms that this is the best moment ever for the
mining industry (in Argentina) because every week we see political leaders talking
more and more about mining”, Cussianovich said.
Specifically, when going into detail about the public perception about the word “mining”
and based on several studies made by the consultancy firm, Cussianovich said, “Ten
years ago, the first thing that used to come to mind in people when talking about
mining were “exploitation, minerals, contamination” and then long after, “jobs”. Without
any sort of publicity or specific work studies, ten years later when we asked the general
public the same question in August this year, 32% associated mining with “work” and
27% with “contamination”. That’s a big change, there’s still work to be done, but for the
first time in a decade when you mention mining in Argentina, work and jobs appear as
part of the association. This is to do with what mining is and you have to keep in mind
that pollution is still high on the agenda and is an issue that requires effort.”
Cussianovich finished by saying, “The general public has very little specific information on the
debate around the sector. There’s work to be done that would be useful (to the industry).” That
last part is probably as much a pitch for his own services as anything else, but his comments
certainly do take the pulse of the mining sector and its improving image in the country. For this
desk, the key moment came with the advent of the current Alberto Fernández government and
its decision to support development of the mining industry, but instead of trying to lump the
whole country in a get a nationwide agreement (as attempted and failed by Macri), they
decided to promote only those provinces that already welcome mining (e.g. San Juna, Salta,
Santa Cruz) and leave the others (e.g. Chubut, Mendoza, Rio Negro) to their collective fate.
Peru’s Perumin party plus petty polling protests
Alliteration: An author affliction and
awful addiction, avoiding any
actual artistic achievement
(Author Anon)
A quick line to note that the September mining conference season didn’t die in Colorado, as the
city of Arequipa in South Peru this week hosts the biannual Perumin, generally regarded as the
biggest mining gig in Latin America (and the organizers like to fudge the numbers over the four
days of the conference and claim it as the world’s biggest). Despite the billing, Perumin is
essentially a trade show driven by mine suppliers and widget makers setting out their stalls and
selling to mine operators large and small. The centre of Perumin is a true conference however,
with keynote speeches from local mining dignitaries that will capture headlines (and normally
when they bemoan the state of play in the sector, so there should be plenty of grist for that mill
next week). Top of the agenda (aside the general hatred that Peruvian mining’s great’n’good
are bound to show toward President Castillo) is likely to be the recent decision by Newmont
(NEM) to defer the green-lighting of the U$2Bn+ Yanacocha Sulfides project and depriving the
country of important dollar investments. The inference is that other large-scale mining
companies may now follow suit, thereby slowing the mining sector even further.
Staying with Peru for a quick round of pure politics, there’s a round of regional and municipal
elections in Peru in two weeks’ time on October 2nd with jobs up for grabs including the
powerful and coveted Mayor of Lima position (one of the classic springboards to the Presidency,
even though recent history has mostly seen provincial politicians get the big job). Meanwhile in
the provinces, mining issues have taken a front seat, for one purely rhetorical example Arequipa
will likely see the winner take a “No Tia Maria” stance. However, there have been several
reports of roadblocks and protests against mining company activities in the lead-up to this
election and at least three companies have seen their operations affected. No names on those
because this is the type of purely opportunistic blockade that happens in the lead-up to
elections in Peru, political parties trying to make a point and so forth. Unless the stoppages last
for more than two or three days, you’re unlikely to hear of anything in the outside world.
Brazil: Lula and the “useful vote”
But we’re not here to talk about Peruvian regional elections, as the same date also sees a
massive election when Brazil go to the polls to elect its new President, as well as its next
Congress. This is by far the biggest electoral even in South America’s democratic cycle and from
28

our coverage this year, we know challenger Lula da Silva is leading incumbent Jair Bolsonaro by
a handy margin. Here’s more English language coverage of the event, from LADB (28):
Recent polling shows a growing lead for Lula ahead of Brazil’s presidential election
next Sunday, October 2. A new Datafolha poll shows Lula rising to 47% (from 45% last
poll) versus 33% for Bolsonaro (no change). Ciro Gomes and Simone Tebet come in a
distant third and fourth with 7% and 5%, respectively.
That same report goes on to note that Goldman Sachs expect a closer vote than those polling
numbers suggest. It also reports that one of the Datafolha pollster people was violently
attacked by a Bolsonaro supporter, probably connected to the President’s constant assertions
that the polling is fixed and the election day will also see ballot rigging (a.k.a. Trump Part Two).
Meanwhile, this report (29) talks about Lula’s late state strategy as he goes after what they call
in Brazil the “Useful Vote”, i.e. tactical voting. The plan is to target likely voters of the also-ran
candidates (Ciro Gomes, Simone Tebet, etc) and get them to vote Lula because 1) in that way,
they’ll have more say in his eventual government and 2) according to the strategy, they explain
that as Lula is almost certain to win in the second round, let’s get him to 50% +1 vote in round
one and stop all the messing and fussing. The move is being spearheaded by famous names in
the music and celebrity worlds via a campaign spot called “Vira Voto” (change your vote) which
urges Lula supporters to get out and get their friends, loved ones, neighbours etc to change
their vote to Lula in order to get the job done in Round One. All this may sound cynical as an
election strategy but it might just work, as Brazilians have an established history of tactical
voting at times like these. And the tune used to push the campaign is very catchy.
Chile’s economy is hitting the skids
It won’t come as a surprise to learn that local currencies mostly dropped against the USD last
week but as this screenshot from Bloomie shows, one currency got hit harder than most.
The Chilean Peso (CLP) has had a hard time this year and is now down 14% YTD, with all that
happening in the period since Boric took over the reins. The currency his a spike low in mid-
July, a move that coincided with the worst of
the copper sell-off at that time but was
certainly exacerbated by the new left-leaning
political scene as well as widespread forecasts
of country recession as from 2023. The
weakness last week was spurred on by the
announcement from the country’s FinMin (30)
that they would sell a new U$12Bn tranche of
US denominated sovereign bonds and the
timing of the move didn’t impress the market.
29

This is a mining publication and it’s not the place for too much macroeconomic commentary,
but we take this subject a little further today because it’s looking more likely that the
overwhelming recent shift back toward the political centre . Last month, Wells Fargo analyst
Brendan McKenna published a report on what to expect from the Chilean Peso and his bearish
view caused enough ripples in the local market to see him interviewed last week by Chile’s
major business daily, Diario Financiero (31). The title line was (translated), “We Have a
Downward Perspective For The Chilean Peso in the Next 18 months” and the sub-header noted
that he was calling for the CLP to go back under 1,000 to the USD even before the “Reject”
option won the Constitutional Referendum early in September. Mr McKenna listed his reasons
why the Chilean Peso was currently weak:
 The CLP is moving with the Fed decision of this week, particularly the S.E.P. “Dot Plot”
that now predicts a longer term of inflationary pressure in The USA.
 The win for “Reject” at the start of September was positive (for the forex pair) in the
near-term, but creates uncertainty in the longer-term and that is now starting to weigh
on the CLP.
 Chile’s internal economy fundamentals point to the country going into recession.
Moody’s has downgraded its sovereign debt rating and the other credit ratings agencies
will likely follow suit.
 When the CLP dropped to 1,000+ earlier this year the Chilean Central Bank (BCh)
moved to prop up the forex with a buying program, using some of its foreign reserves
(i.e. USD) to buy Pesos on the open market. That program was successful, but it has a
planned time limit and as that approaches, the market will likely sell the CLP down
again. It will then be up to the BCh to decide whether to roll over the program and set
up a de facto crawling peg. With around U$50Bn in international reserves, the analyst
estimates Chile has wriggle room for another four to five months of the current policy,
but not much more.
 Copper is (by far) Chile’s biggest export and foreign currency generator. The price of
copper weighs heavily on the CLP and their moves are traditionally correlated, so the
downturn in copper prices last week did the currency no favours
Market Watching
Altaley Resources (ATLY.v) redux
I didn’t overtly mention it in last week’s main Fundamentals note and after receiving a mail on
the subject, here’s a brief update on last week’s note with a clear statement: I like ATLY and its
potential, but until I see how 3q22 comes before adding it to the formal Stocks to Follow, even
as a Watchlist component. The cash and liquidity situation is the main concern and as I don’t
see how the company avoids having to raise some more money, even if it’s just a modest sum,
that process could sink the equity price even further or if
that’s too dramatic, it would place the current price in the
freezer until the raising process is done. Also, by leaving
ATLY off the Watchlist for the moment it sends the right
signal about the other stock recently added, as ATAC
Resources (ATC.v) is a better candidate at the moment
and would only take a new sparkling drill assay from its
neighbour, or serious talk of a road driven into the zone,
for its less financially encumbered structure to pop
higher.
As for trading, ATLY did roughly what I expected it to do
during most of the week, i.e. nothing. As with most of its
peers, it couldn’t avoid the Friday selling and closed at a cheap looking 12c, we’ll find out how
cheap that really is when the 3q22 financials are posted.
30

Bluestone Resources (BSR.to): That local referendum vote
We’ve followed the trials and tribulations of Bluestone Resources over the months and weeks
and sure enough the local referendum vote happened on Sunday on schedule, despite a pro-
mining concern (via a private citizen) lodging a blocking order against the vote with a local
judge. The municipality said it wasn’t informed of that order, went ahead and the result was
also largely as expected (32):
 Valid votes: 8,503 (27.91% of registered voters
 Votes for “No” (i.e. against mining development): 7,481 (87.98% of valid votes)
 Vote for “Yes” (i.e. for mining development): 904 (10.63% of valid votes)
 105 annulled votes
 13 unmarked ballots
The result is easily spotted in this ten-day chart, with Monday morning’s waterfall followed by a
distinct lack of buyers willing to pick up the pieces. That’s a 37% drop over two weeks and
while GDXJ is down 15% in the same period and
didn’t help the cause at all it could have been
worse, as took a couple of small tape-painters late
Friday to get BSR from 47c to its 49.5c close.
As for reaction BSR published one of the worst and
most heavy-handed NRs I’ve read in a long time
(33), full of descriptive adjectives and passive voice
verbs that tried to make itself look whiter than
white and up against “illegal groups” opposed to
mining (they didn’t mention that the main players
of those groups are the local municipal government
and the Catholic Church (34)). They also played
hard on the Guatemala national government’s line
that the referendum was not officially sanctioned and they may be so at a national level, but
the municipality replied in the national press to point out that its actions were legally in order at
the local level (despite the actual referendum question being clearly biased toward the anti
camp). What’s more, neither mining company nor national government remembered that locals
in the Asuncion Mita locality have asked for years on end for exactly the type of officially
sanctioned prior consultancy and eventual vote that the OIT169 rules give them, only to have
been denied all this time by authorities who then say their own vote was irregular. And on that
subject, while BSR also talked of “vote irregularities” in its NR, it didn’t go into much detail and
that may be because according to local reports the dirty tricks were coming from the pro-
mining side. According to the local Catholic priest interviewed by reporters in the days around
the vote, pro-mining groups staged a threatening counter-rally on the same evening as the last
anti-mine rally in the town, during which they tried to goad opponents into violence. Then local
transport services were paid by pro-mining groups to stay off the roads on Sunday to stop rural
dwelling voters from reaching voting stations, vote observers had their hotel rooms suddenly
cancelled without warning and the priest also heard reports of pro-mining groups offering cash
if locals voted for their side. So irregularities, yes there probably were. And yes indeed my
Canadian readership friends, your domiciled companies do indeed get up to this sort of thing
down LatAm way, apologies if that offends anyone’s sensibilities or national pride.
However, the share price action doesn’t lie and the market wasn’t fooled by the obfuscation and
official lies from those who will not recognize the vote. No matter whether Guatemala or any
other locality, this is 2022 and if you don’t have the locals on your side these days, your project
is screwed. Expect the BSR Cerro Blanco story to limp on in the same style as Almaden at
Ixtaca in Mexico, so if you shorted this and made money, consider uncovering on any price pop.
This project will never happen.
31

Conclusion
IKN697 is done, we end with bullet points:
 Dean R. Koontz once said, “Alliteration seems to offend people”. An extremely under-
rated author, read Odd Thomas if you get the chance as it’s way better than the movie
it spawned.
 I’m keenly aware that by buying a few Pure Gold (PGM.v) shares in the days to come
I’m breaking my own “KEEP POWDER DRY” edict. Do as I say, not as I do? Signs of
mining stock addiction? It’s difficult to justify opening a new position in any gold stock
with gold already well off its highs and threatening to go lower, but this time the
temptation is too great (and yes, I really am a sucker for a turnaround story). It will
only be a few shares, though. To begin with, anyway.
 The copper market continues to be the one to watch most closely, with renewed
bearish calls from analyst desks now predicting a return to sub-U$3.00/lb levels. But for
the time being, the tremendous fundamental value offered by Amerigo (ARG.to) and its
juicy dividend is impossible to ignore.
 By this time next week we should have the long-awaited 43-101 on Top Pick Minera
Alamos’s (MAI.v) exciting Cerro de Oro project and I’m champing at the bit to crunch
those numbers. That’s likely the main note in IKN698.
I thank you in advance for any feedback. Our Top Pick stock is Minera Alamos (MAI.v). Flash
updates will be sent if required by events.
I wish you good trading fortune, ladies and gentlemen.
Best wishes, Mark
Footnotes, appendices, references, disclaimer
(1) https://www.cnbc.com/2022/09/21/the-fed-forecasts-hiking-rates-as-high-as-4point6percent-before-ending-inflation-
fight.html
(2) https://www.cnbc.com/2022/09/22/futures-inch-higher-following-another-day-of-losses-after-fed-rate-hike-sell-
offs.html
(3) https://www.investmentexecutive.com/news/research-and-markets/global-mining-sector-outlook-turns-negative-
moodys/
(4) https://www.goldforumamericas.com/program-agenda-gold-forum-americas/
(5) https://iknnews.com/running-the-numbers-on-pure-gold-pgm-v/
(6) https://www.puregoldmining.ca/wp-content/uploads/2022/09/Puregold-Corp-Deck-Sep-23-2022.pdf
(7) https://www.goldforum.live/DGG/Pure-Gold-Mining-Inc-c334ba9b39bd94a7b45fd0ea
(8) https://www.puregoldmining.ca/puregold-announces-record-gold-production-in-august-reaffirms-q3-2022-guidance/
(9) https://electrabmc.com/electra-and-lg-energy-solution-sign-three-year-cobalt-supply-agreement/
(10) https://www.youtube.com/watch?v=dinUyzlk36E
(11) https://www.gowebcasting.com/events/precious-metals-summit-conferences-llc/2022/09/14/chesapeake-gold-
corp/play/stream/34752
(12) https://staticcdn1.gowebcasting.com/documents/files/events/event_00003416_F31glyv9.pdf
(13) https://www.youtube.com/watch?v=NhO4kiryCng
32

(14) https://qccopper.com/news/qc-copper-reports-several-wide-high-grade-copper-and-gold-intersections/
(15) https://www.goldforum.live/DGG/Minera-Alamos-a3e3f260e5fddf00692388eb
(16) https://www.goldforum.live/DGG/Western-Copper-Gold-4fd74fad7d4097e94b4679db
(17) https://www.hellenicshippingnews.com/europe-upstages-china-as-main-driver-for-copper-outlook/
(18) https://www.reuters.com/markets/commodities/low-global-copper-stocks-jar-with-markets-downbeat-mood-2022-09-
21/
(19) https://www.stockwatch.com/News/Item?bid=Z-C:CMMC-3308810&symbol=CMMC&region=C
(20) https://webinars.6ix.com/6ix/Regulus-Presents-Corporate-Update
(21) https://www.kinross.com/news-and-investors/news-releases/press-release-details/2022/Kinross-announces-
enhanced-share-buyback-program/default.aspx
(22) https://s2.q4cdn.com/496390694/files/doc_presentations/2022/09/Kinross-September-2022.pdf
(23) https://newmont.com/investors/news-release/news-details/2022/Glencore-to-Acquire-Newmonts-Stake-In-MARA-
Project/default.aspx
(24) https://finance.yahoo.com/news/latin-metals-provides-corporate-124500383.html
(25) https://www.reuters.com/world/americas/ecuador-reaches-deal-with-china-restructure-debt-2022-09-20/
(26) https://efeverde.com/dicaprio-proteger-mineria-valle-intag-ecuador/
(27) https://www.ambito.com/ambito-debate/ambito-debate/ernesto-cussianovich-en-cuanto-la-percepcion-publica-la-
mineria-esta-uno-sus-mejores-momentos-n5542493
(28) https://latinamericadailybriefing.substack.com/p/brazilian-polls-show-growing-lead
(29) https://es-us.noticias.yahoo.com/lula-aumenta-ventaja-ampl%C3%ADa-posibilidades-000614694.html
(30) https://www.reuters.com/markets/europe/chile-issue-12-bln-debt-2023-2022-09-22/
(31) https://www.df.cl/mercados/bolsa-monedas/brendan-mckenna-estratega-de-divisas-de-wells-fargo-tenemos-una
(32) https://es-us.noticias.yahoo.com/cerro-blanco-proyecto-minero-conflictivo-134046862.html
(33) https://www.newswire.ca/news-releases/bluestone-provides-an-update-on-cerro-blanco-864752151.html
(34) https://republica.gt/analisis/iglesia-catolica-oeneges-y-activistas-se-oponen-a-fuentes-de-empleo-para-los-
pobladores-de-asuncion-mita-202291211260
(35) https://es-us.noticias.yahoo.com/cerro-blanco-proyecto-minero-conflictivo-134046862.html
(36) https://www.srk.com/en/publications/mineable-stope-optimiser
Appendix 1: Mineable Stope Optimiser (MSO)
The following is an extract from this (36) longer and most informative explainer of MSO, its
origins and how the technology has improved over the last ten years or so to provide (UG)
mining companies with a powerful tool to forecast future mine production:
Mineable Stope Optimiser (MSO) is widely recognised as the industry-standard
software tool for generating stope optimisation shapes. SRK has been an early adopter
of MSO and successfully uses the software in a variety of projects across many
commodities and alternative mining methods, for all development stages of mining
projects. The software is currently distributed through Datamine, Deswik and Maptek
mining software providers. Its origins however are in the Stope Shape Optimiser
algorithm developed by Alford Mining Systems (AMS) who first commercialised the
software in 2011. AMS describes MSO as “a strategic mine planning tool that
automates the design of stope shapes for a range of stoping methods for underground
mines. Using constraints detailing mining method and design parameters MSO
provides the optimal stope shape design to maximise the value of an orebody.” MSO
has made an impressive impact on the underground mine planning process by
providing significant opportunities for improving project value, enabling profitability with
marginal projects and identifying future mining areas to target for exploration and
development.
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Stocks To Follow Closed Positions 2021
Closed in 2021 closed close price
Fiore Gold F.v jan'21 C$0.98 21-May-20 C$1.17 19.4% closed as part of rebalance
Norsemont Min NOM.cse feb'21 C$1.55 6-Set-20 C$0.70 -54.8% Cut loser to reduce Au exp.
Element 29 Res ECU.v feb'21 C$0.49 7-Feb-21 C$0.54 10.2% Cut Peru exposure
Kuya Silver KUYA.cse feb'21 C$1.66 8-Nov-20 C$2.51 51.2% Cut Peru exposure
Pucara Gold TORO.v apr'21 C$0.65 4-Oct-20 C$0.26 -60.0% Cut loser, Peru risk call
Copper Mountain CMMC.to apr'21 C$1.40 22-Nov-20 C$4.18 198.6% tgt hit, profit taken
New Gold NGD may'21 U$0.76 9-Feb-20 U$2.14 181.6% Sold to buy AGC, nice win
Orezone Gold ORE.v jun'21 C$0.79 21-Jun-20 C$1.61 103.8% sold on pop, leaky boat
Wolfden Res. WLF.v sep'21 C$0.30 11-Abr-21 C$0.19 -36.7% Failed spec trade, cut loss
Cartier Res ECR.v sep'21 C$0.32 21-Mar-21 C$0.235 -26.6% Failed spec trade, cut loss
Amarillo Gold AGC.v sep'21 C$0.31 30-May-21 C$0.30 -3.2% Capex story changed: Out
Excelsior Mining MIN.to oct'21 C$0.93 10-Mar-19 C$0.53 -43.0% May return in 2022
Royal Road Min. RYR.v nov'21 C$0.155 17-Mar-19 C$0.275 77.4% Closed on Nica pol risk
Aurelius Min. AUL.v dec'21 C$0.75 28-Jun-20 0.24 -68.0% cut end 2021, failed trade
Argonaut Gold AR.to dec'21 C$2.95 25-Jun-21 C$2.15 -27.1% cut on capex blowout
Stocks To Follow Closed Positions 2020
Closed in 2020 closed close price
TMAC Resources TMR.to Jan'20 C$3.41 20-Dec-19 C$3.61 5.9% TLS flip play, sold new year
Regulus Res REG.v Jan'20 C$1.10 20-Dec-19 C$1.30 18.2% TLS flip play, profit taken
Bonterra Res BTR.v Jan'20 C$1.90 9-Dec-19 C$1.66 -12.6% TLS flip play, loss taken
McEwen Mining MUX Jan'20 U$1.12 2-Dec-19 U$1.18 5.4% TLS flip play, profit taken
Core Gold CGLD.v Jan'20 C$0.255 7-Apr-19 C$0.305 19.6% arb trade, profit taken
HudBay Min HBM Jan'20 U$3.56 9-Dec-19 U$3.36 -5.6% TLS flip play, loss taken
Midas Gold MAX.to Feb'20 C$0.71 5-Jan-20 C$0.57 -19.7% sm & silly trade
Warrior Gold WAR.v Feb'20 C$0.08 3-Aug-18 C$0.05 -31.3% clean out non-perf sm stocks
Contact Gold C.v Feb'20 C$0.40 19-Aug-18 C$0.18 -55.0% clean out non-perf sm stocks
Sandstorm Gold SAND Feb'20 U$3.73 17-Apr-16 U$7.21 93.3% Sold during port rebalance
NexGen Energy NXE Feb'20 U$1.20 2-Dec-19 U$1.06 -11.7% TLS flip play, loss taken
MAG Silver MAG Apr'20 U$8.95 1-Mar-20 U$10.07 12.5% Sold to cut silver exposure
Alexco Res AXU Apr'20 U$1.69 7-Sep-17 U$1.69 0.0% sold to close Ag exp. in FY20
Bonterra Res BTR.v Jun'20 C$1.62 2-Feb-20 C$1.10 -32.1% under-performer cash moved
Regulus Res REG.v Jun'20 C$0.64 6-Apr-15 C$0.79 23.4% moved $ TMQ/MIN & Au stocks
Great Panther GPR.to Aug'20 C$0.60 21-Jun-20 C$1.10 83.3% Profit taken, good trade
Jaguar Mining JAG.v Aug'20 C$0.42 21-Jun-20 C$0.65 54.8% Profit taken, good trade
Sandstorm Gold SAND Aug'20 U$7.76 10-May-20 U$9.37 20.7% Profit taken, good trade
Integra Resources ITR.v Aug'20 C$2.23 13-Aug-18 C$5.40 142.2% Profit taken, good trade
Wesdome Gold WDO.to Aug'20 C$2.37 14-Oct-17 C$14.82 525.3% last 1/2 of big win closed
INV Metals INV.to Sep'20 C$0.40 17-May-20 C$0.45 12.5% Cut all Ecuador exposure
Cartier Resources ECR.v Nov'20 C$0.155 3-Aug-18 C$0.25 67.7% Exact close price TBA
Tinka Res TK.v Dec'20 C$0.195 19-Apr-16 C$0.195 0.0% Closed on a round trip fail
2015 to 2019 annual closed positions in appendices below, 2009 to 2014 closed positions in editions IKN553 or earlier
34

Stocks To Follow Closed Positions 2019
Closed in 2019 closed close price
Atico Mining ATY.v jan'19 C$0.55 24-Jul-16 C$0.32 41.8% patience ran out, made room
Candente Copper DNT.to jan'19 C$0.075 3-Ago-18 C$0.05 -33.3% tiny trade, made room for new
B2Gold BTO.to feb'19 C$2.11 12-Set-14 C$4.05 91.9% Took 1/2 profits, reduce size
Western Copper WRN.to mar'19 C$0.80 20-Ene-19 C$0.81 1.3% Spec trade that didn't work
B2Gold BTO.to mar'19 C$2.11 12-Set-14 C$4.15 96.7% Took rest of profit.
GT Gold GTT.v mar'19 C$1.17 10-Oct-18 C$0.90 -23.1% Took loss. Story changed
NovaGold NG apr'19 U$3.84 13-Ene-19 U$4.15 -8.1% Short that didn't work, sm loss
Zinc One Z.v jun'19 C$0.47 14-Set-17 C$0.025 -94.7% clearing out dead trade
Amarillo Gold AGC.v jun'19 C$0.24 22-Ago-18 C$0.20 -16.7% clearing out dead trade
New Gold NGD aug'19 U$1.44 31-Jul-19 U$1.23 14.6% ST short win thru Q2 earnings
IMPACT Silver IPT.v aug'19 C$0.39 21-Jul-19 C$0.46 18.0% took a quick profit
Fiore Gold F.v aug'19 C$0.34 26-May-19 C$0.56 64.7% Took profit, 2q19 avg
Chakana Copper PERU.v oct'19 C$0.84 22-Mar-18 C$0.16 -81.0% Exploreco trade fail. Want space
Wesdome Gold WDO.to oct'19 C$2.37 14-Oct-17 C$7.57 219.4% Sold half, profit taking
Superior Gold SGI.v oct'19 C$1.46 8-Abr-18 C$0.47 -67.8% Failed sm spec on Au. Moved on
Amerigo Res ARG.to nov'19 C$0.91 23-Set-18 C$0.50 -45.1% worst trade of year, hefty loss
Guyana Goldfields GUY.to dec'19 C$0.94 14-Abr-19 C$0.56 -40.4% taking the loss, financials weak
Tethyan Res TETH.v dec'19 C$0.30 8-Set-19 C$0.16 -46.7% tiny trade, word of probs in co
Stocks To Follow Closed Positions 2018
Closed in 2018 closed close price
Amarillo Gold AGC.v jan'18 C$0.38 24-Mar-17 C$0.31 -18.4% Cut away losing trade
Riverside Res RRI.v jan'18 C$0.39 27-Jun-16 C$0.31 -20.5% Cut away losing trade
Eros Res ERC.v jan'18 C$0.175 1-Mar-17 C$0.16 -8.6% CEO sudden exit, not good
Excellon Res EXN.to jan'18 C$1.54 9-Oct-16 C$1.66 7.8% 4q17 poor, one too many bad qtrs
Wesdome Gold WDO.to jan'18 C$1.68 15-Dec-17 C$2.06 22.6% Near-term trade block, took profit
Sabina G&S SBB.to apr'18 C$2.06 17-Dec-17 C$1.77 -14.1% Near-term trade, bad timing, small
B2Gold BTO.to May'18 C$2.11 12-Sep-14 C$3.67 73.9% sold 25% to reduce exposure
Lara Expl. LRA.v May'18 C$0.65 11-Feb-18 C$0.58 -13.8% Spec on Brazil didn't work
Solitario XPL June'18 U$0.72 19-Mar-17 U$0.41 -43.1% Failed trade, may return in 4q18
SolGold plc SOLG.to July'18 C$0.475 19-Nov-17 C$0.415 -12.6% cut, trade didn't perform
Pan American PAAS July'18 U$17.90 1-Jun-18 U$16.30 8.9% modest win on short position
NGEx Res NGQ.to Sep'18 C$1.01 22-Oct-17 C$1.00 -1.0% Closed to reduce Argentina exp
Sandstorm Gold SAND Oct'18 U$3.73 17-Apr-16 U$4.13 10.7% partial sale to raise cash for GTT
Aldebaran Res ALDE.v Nov'18 n/a n/a n/a n/a liquidate spin out of REG
Stocks To Follow Closed Positions 2017
Closed in 2017 closed close price
Continental Gold CNL.to Jan'17 C$2.68 22-May-16 C$4.17 55.6% trade closed, profit taken
Focus Ventures FCV.v Jan'17 C$0.23 1-Jul-12 C$0.05 -78.3% Give up, a disaster trade
Wesdome Gold WDO.to Feb'17 C$1.72 28-Aug-16 C$3.00 74.4% Target hit, sold, good trade
Belo Sun BSX.to Mar'17 C$0.90 30-Jan-17 C$0.90 0.0% failed near-term flip trade
Lara Expl. LRA.v Mar'17 C$1.15 8-Apr-12 C$1.05 -8.7% cut to make room for new trade
Rye Patch Gold RPM.v Apr'17 C$0.31 2-Sep-16 C$0.32 3.2% cut for doubts & new stock
Cordoba Min. CDB.v Jun'17 C$0.75 15-Sep-16 C$0.63 -16.0% closed
Constantine Metal CEM.v Aug'17 C$0.135 9-Apr-17 C$0.28 107.4% spec trade closed, good win
Red Eagle Min. R.to Sep'17 C$0.67 13-Dec-16 C$0.27 -59.7% IKN's biggest failure in years
Starcore Intl SAM.to Sep'17 C$0.61 10-Jan-15 C$0.31 -49.2% Patience ran out
B2Gold BTO.to Dec'17 C$2.11 12-Sep-14 C$3.39 60.7% sold small portion for liquidity
35

Stocks To Follow Closed Positions 2016
Closed in 2016 closed close price
Phoscan Chem FOS.to jan16 C$0.28 29-mar-15 C$0.265 -5.4% Buyout trade, bot but poor deal
True Gold TGM.v jan16 C$0.18 23-ago-15 C$0.25 38.9% okay trade, sold on pol risk
McEwen Mining MUX jan16 U$1.09 25-ene-15 U$1.20 10.1% sold due to lack of value
Lake Shore Gold LSG.to feb-16 C$1.10 07-abr-15 C$1.69 53.6% bot out, sold early in process
Atacama Pacific ATM.v feb-16 C$0.19 26-abr-15 C$0.40 110.5% sold for a double on big pop
New Gold NGD feb-16 U$2.06 24-ene-16 U$2.96 43.7% closed good near-term trade
Sandspring Res SSP.v mar-16 C$0.195 18-oct-15 C$0.32 64.1% Hit tgt, took profit
Teranga Gold TGZ.to mar-16 C$0.54 15-feb-15 C$0.60 11.1% disappointing trade
B2Gold BTG mar-16 U$0.85 13-ene-16 U$1.30 52.9% Separate trade on B2, hit tgt
Dalradian Res DNA.to mar-16 C$0.67 27-oct-13 C$1.00 49.3% Hit target, sold, good win
HudBay Min. HBM may-16 U$4.10 03-abr-16 U$4.36 -6.3% Short trade, poor timing
Nevada Sunrise NEV.v may-16 C$0.185 28-feb-16 C$0.23 24.3% V. small, no big deal either way
Richmont RIC jun-16 U$7.60 01-may-16 U$9.30 22.4% near-term trade, profit taken
INV Metals INV.to jul-16 C$0.25 03-abr-16 C$0.95 280.0% Trade closed on time
HudBay Min. HBM aug16 U$4.98 09-jun-16 U$4.80 3.6% short trade covered, no big deal
Miranda Gold MAD.v oct-16 C$0.125 03-jul-16 C$0.10 -20.0% tiny spec trade, didn't work
Avino G & S ASM nov-16 U$2.00 21-oct-16 U$1.40 -30.0% Abandon trade on bad bot deal
Stocks To Follow Closed Positions 2015
Closed in 2015 closed close price
Argonaut Gold AR.to jan'15 C$1.47 14-dec-14 C$2.53 72.1% Big gain small time, profit taken
Amerigo Res ARG.to jan'15 C$0.405 20-jul-14 C$0.285 -29.6% Given up on weak Cu prices
Reservoir Min. RMC.v jan'15 C$6.05 18-jun-14 C$4.12 -31.9% sold on Cu downturn
Coro Mining COP.to jan'15 C$0.075 26-jan-14 C$0.035 -53.3% sm, sold on Cu downturn
Fortuna Silver FSM mar'15 U$4.12 10-nov-14 U$3.75 9.0% Short used as hedge
GoldQuest Min. GQC.v mar'15 C$0.26 27-oct-13 C$0.085 -67.3% given up ghost
Rio Alto Mining RIO.to apr'15 C$2.30 07-apr-11 C$3.57 55.2% Top pick, bot out, big win
Timmins Gold TGD jun'15 U$0.60 19-apr-15 U$0.62 3.3% near-term trade, out of time
First Majestic AG jul'15 U$10.51 10-aug-14 U$4.55 56.7% horrible failed trade
NovaCopper NCQ.to jul'15 C$1.05 09-apr-14 C$0.50 -52.4% no more Cu exposure, sm sell
McEwen Mining MUX aug'15 U$0.695 21-jul-15 U$0.92 32.4% Closed nearterm flip for win
Midas Gold MAX.to sep'15 C$0.39 21-sep-15 C$0.35 -10.3% Sm. trade idea that didn't work
New Gold NGD oct'15 U$2.18 23-aug-15 U$3.05 39.9% trade closed, profit taken
Legend Gold LGN.v nov'15 C$0.085 01-mar-15 C$0.035 -58.8% tiny "land grab" idea, failed
Timmins Gold TGD nov'15 U$0.245 20-sep-15 U$0.15 -38.8% small near-term loser
Please note that due to space considerations closed positions 2009 to 2014 are now
available on request, or were published in any edition to IKN553 (end 2019).
Important Disclosure
The information and opinions contained within this report reflect the personal views of the author and therefore all
material within should not be construed as accurate or reliable or be utilized as advice for investment or business
purposes. Independent due diligence and discussions with ones own investment and business advisor is strongly
recommended. Accordingly, nothing in this report should be construed as offering a guarantee of the accuracy or
completeness of the information contained herein, as an offer or solicitation with respect to the purchase or sale of any
security or as an endorsement of any product or service. All opinions and estimates included in this report are subject to
change without notice. It is prohibited to copy or redistribute this report to any type of third party without the express
permission of the author.
36