CHF WEEKLY ROUND-UP: November 13-17, 2023

There is nothing I love more than the start of a Christmas/New Year’s rally.
 
Canadian markets continued to hold onto the gains of last week, at the highest level in two months. The US markets are nearing a new high for the year, and on a three-week winning streak. Things continue to look up.
 
Another US Government shutdown was looming, but Congress managed to avoid that by passing a stopgap funding deal, buying more time, just in time. The President looks poised to approve the deal today. This may become an issue again if no funding resolution can be passed before February 2024.
 
Then, on Tuesday, US CPI results came in better than expected as consumer prices rose 3.2 percent in October, down from 3.7 percent in September on an annual basis. Widespread expectations are now that the Fed is done with interest rate increases. Chairman Powell and his governors are not admitting to that as Powell said last week that Fed officials were “not confident” that rates were high enough to tame inflation. A rate hold in December is expected, and first cuts are now being called for by Spring by some observers.
 
At their four-hour meeting Wednesday, U.S. President Joe Biden and his Chinese counterpart Xi Jinping didn’t resolve any of the vital geopolitical issues dividing the world’s two largest economies and chief rivals for global influence, but they struck a conciliatory tone that came as a relief to other countries. Is China back?
 
The US dollar stayed somewhat weak on the back of CPI numbers. Gold had tailed off to $1,930/oz but popped to $1,975 early in the week, rising to $1,986. Silver has run up to $23.80/oz. Base metals continued to be flat on the week. Battery materials continued to drop, with Lithium going to a new low below $20/kg. Uranium pricing remained strong at $74/lb. Oil became confused with conflicting supply/demand expectations, even though demand has not fallen, and supply is not increasing. Oil (WTI) was as low as $72/bbl. rising back toward $75.00 today. Saudi Arabia and Russia are said to be considering further production cuts to hold the price.
 
The excess volatility continues distorting any predictable trends, and shares show wild swings on any given day. Be careful playing in this market. Some interesting things are happening in the gold sector, with more &A (merger and acquisition) activity in midsized issuers. This could bode well for the struggling junior miners as they struggle to raise funds at this time of year. The period from late in the year through to late spring is commonly a time when precious metals outperform.
 
It has been a productive week for our clients, and we are pleased to present to you our round-up of their news released between November 13-17, 2023.
 
 
 
On November 14, 2023, Sokoman Minerals Corp. (TSXV: SIC) (OTCQB: SICNF) had an article published on the Innovation News Network website. The story titled “Making key discoveries in the mining landscape” describes Sokoman’s discoveries on its main properties and projects as Sokoman Minerals is well on its way to becoming a significant player in the Newfoundland mining industry.
 
Link to the INN web post Here.
 
On November 15, 2023, Nuinsco Resources Limited (CSE: NWI) announced further results of a review of higher-grade niobium target areas at its Prairie Lake Critical Minerals and phosphate project located near Terrace Bay, Ontario. With the incorporation of historic diamond drill hole data into the analysis, the known niobium-bearing domain has now been extended in inclined drillholes to a vertical depth of 175m.
 
Strongly anomalous niobium mineralization extending to depth is recognized as the extension of the widespread anomalous niobium identified at surface. At surface the anomalous niobium mineralization occurs in a 500m long domain in the southwest part of the Prairie Lake Complex, although strongly anomalous niobium mineralization is known to occur at numerous other sites on the Project.
 
 
 
On November 15, 2023, Canadian Overseas Petroleum (XOP: CSE) (COPL: LSE), announced the publication of its Financial Statements and Management Discussion and Analysis for the three and nine months ended September 30, 2023, and provided an operations update.
 
Third Quarter 2023 Financial Highlights:

• Petroleum sales, net of royalties was $5.8 million as compared to $5.6 million in the second quarter of 2023. The increase is due mainly to the rise in the realized sales price of oil of $78.34/bbl as compared to $71.75/bbl in the second quarter of 2023, partially offset by a reduction in oil production.
• The Company incurred a net realized hedging loss of $2.2 million on crude oil and butane hedge contracts ($NIL in the first half of 2023 due to a hedge restructuring executed in December 2022). In October 2023, the Company terminated its commodity swap contracts and the outstanding obligations in respect of these contracts, were replaced with a loan (“Swap Loan“), with an initial principal amount of $11.9 million and a maturity of March 2025. The Company also negotiated a capitalization of interest for both the senior credit facility and the new Swap Loan from October 2023 to January 2024.
• The operating netback was $20.83/bbl before the net realized loss on hedge contracts as compared to $20.93/bbl in the second quarter of 2023. The increase in the realized sales price of oil of $6.59/bbl was offset by an increase in royalties and production taxes of $1.38/bbl and an increase in operating expenses of $5.31/bbl in the third quarter of 2023. Operating costs were impacted by certain one-off costs related to landowner payments, repairs and maintenance following severe and abnormal weather conditions in the first half of 2023 and increased workovers at specific well sites in the Barron Flats Shannon Unit (“BFSU“) to prepare for increased enriched Natural Gas Liquids (NGL) injection.
• The Company initiated G&A reductions in the quarter as costs were $1.7 million as compared to $1.9 million in the second quarter of 2023. Further G&A reductions to remove more than $2.5 million of annualized costs will be completed prior to the 2023 year-end.
• A cash position of $2.2 million as of September 30, 2023, compared to $4.0 million as of December 31, 2022.
• The Company initiated G&A reductions in the quarter as costs were $1.7 million as compared to $1.9 million in the second quarter of 2023. Further G&A reductions to remove more than $2.5 million of annualized costs will be completed prior to 2023 year-end.
• A cash position of $2.2 million on September 30, 2023, as compared to $4.0 million on December 31, 2022.

The Company encourages interested parties to read the Interim Financial Statements and the Management’s Discussion and Analysis for the quarter ending September 30, 2023, together.

Third Quarter 2023 Operational Highlights:

• The Company interest average crude oil sales before royalties averaged 1,029 bbls/d (1,193 bbls/d gross lease) as compared to 1,103 bbls/d (1,267 bbls/d gross lease) in the second quarter of 2023. Production was lower primarily due to downtime at high productivity wells due to field work undertaken to repair and dome access roads and numerous required inspections and repair program to all low-pressure heater-treater-separator units to prepare the upgraded gas gathering system for the resumption of enriched NGL injection.

 Completing work to prevent flow up the 41-22V well so that the injection of enriched NGL could resume at the offsetting 28-38V injection well.

• The Company completed upgrades to its gas gathering system in the third quarter of 2023 to debottleneck restrictions at certain well locations, to recover produced gas back to the gas injection plant for recycle.
• With the system commissioned, the company concluded its gas flaring program permitted since October 2022.
• The Company commenced increased enriched NGL injection to the Shannon miscible flood in mid-October and early responses to oil production are being monitored closely.
• October 2023 average gross lease oil production: 1,110 bbls/d.
• November 2023 average gross lease oil production: [1,150] bbls/d.
• The Company is focused on delivering its strategic objectives for the further development of its Wyoming Assets and plans to provide forward production guidance for 2024 prior to the end of 2023.

The negotiations regarding a possible joint venture announced by the company in July 2023 are continuing and the parties are working to agree all outstanding matters.
 


On November 16, 2023, Tenet Fintech Group Inc. (CSE: PKK) (OTC Pink: PKKFF) announced that the Company’s data science subsidiary Tenoris3 Inc. launched its long-awaited website, which provides previews of its upcoming “ie-Pulse” and “Equity Insider” product offerings, both expected to be available commercially in the summer of 2024.
 
Tenoris3 leverages data gathered through the Cubeler® Business Hub to develop and commercialize a series of AI and analytics-based products aimed at capital markets professionals, the average stock trader, economists, governments, and anyone with an interest in global economic activity, macroeconomic indicators, and the capital markets. Once the Business Hub is at full capacity Tenoris3 expects to have more than a million indices to offer potential clients through its ie-Pulse offering More details about Tenoris3 and its product offerings are available on the Tenoris3 website at www.tenoris3.com.
 

 
On November 13, 2023, Visionstate Corp. (TSXV: VIS) filed Notice of Annual and Special meeting of the Shareholders to be held Tuesday, December 5, 2023 at 10:00 a.m. for the following purposes:

1. to receive the audited financial statements of the Corporation for the financial years ended September 30, 2022, together with the auditors’ report thereon;
2. to appoint Kenway Mack Slusarchuk and Stewart LLP, (KMSS LLP) Chartered Accountants, as auditors and to authorize the board of directors to fix the auditors’ remuneration;
3. to fix the size of the board of directors at five (5) members;
4. to elect the board of directors to serve until the next annual meeting of the Shareholders or until their successors are duly elected or appointed;
5. to consider and, if thought advisable, to pass, with or without amendment, an ordinary resolution to approve a stock option plan attached as Schedule B to this Information Circular whereby a maximum of ten (10%) percent of the Corporation’s issued and outstanding Shares will be reserved for issuance from time to time;
6. to transact such other business as may properly be brought before the Meeting, or any adjournment or adjournments thereof.

Specific details of the matters proposed to be put before the Meeting are set forth in the Management Information Circular.
 

November 14, 2023: We hope you enjoy the inaugural edition of CHF’s Byte-sized Reviews written by our own Steve Mlot, P.Eng. featuring Sokoman Minerals Corp. Read here.

November 16, 2023: Our favourite reviewer, Steve Mlot, P.Eng., unpacks the Piedmont Lithium Inc. partnership with Sokoman Minerals Corp. & Benton Resources Inc. in our latest CHF’s Byte-sized Review! Read here.