CHF WEEKLY ROUND-UP: September 1-8

Markets stumbled a bit in a shortened trading week following the Labour Day long weekend, with Canadian markets down 2% and US markets down 2.3%, in a week. Many of the questions and doubts that plagued markets through the summer hang on as we move toward the end of the third Quarter. Inflation is sticky, slow or no growth in much of the globe, more interest rate increases to come, rates higher for longer, recession expected to be later, China not providing the growth expected. All sorts of concerns. 

On Wednesday, September 6, the Bank of Canada (BoC) held interest rates steady as was largely expected based on weak economic data in Canada. The Bank of Canada Governor Tiff Macklem spoke at the Calgary Chamber of Commerce on Thursday September 7, and said that BoC may have to raise interest rates further, given that inflation may stay high for some time. What will happen in October remains to be seen as Q3 economic data comes in, and any action by the US Fed will need to be considered. If the US moves it is likely Canada will have to follow.

The US Fed is widely expected to hold interest rates steady at its next interest rate announcement at 2:00 pm ET on September 20. Chairman Powell has made no promises either way for another rate increase, though a continued slowing of inflation and weaker economic data may also prompt policymakers to pause. So upcoming economic data, such as CPI inflation report, and the Fed’s other disclosures will help signal at the likelihood of a November interest rate move. Of course, an interest rate hike at the December meeting is possible. 

In precious metals, both Gold and Silver (London Fix) dipped into the start of September on the back of strength in the U.S. dollar which is near its high for the year. Base metals were weaker as well, most in downtrend since February.  Battery Materials prices have not done better, also in downtrend since February. Uranium pricing, at $60.75/lb, has reached highs not seen in more than a year. Crude Oil, at $87.66(WTI) is also at a high for this year as Saudi and Russian production cuts seem to be holding.  

It has been a week of advancement for some of our clients, and we are pleased to present to you our round-up of their news released between September 1-8, 2023. 
 

 
On August 31, 2023 Electric Metals (USA) Limited (TSXV: EML) (OTCQB: EMUSF) announced the appointment of leading metallurgical laboratory, Kemetco Research Inc., of Richmond, BC, Canada, to undertake new metallurgical test work on composites of selected drill core samples from recently completed drilling of high-grade manganese at the Emily Manganese Project. Kemetco is familiar with the high-grade manganese project at Emily, having performed a series of tests in 2013-2014 on samples from the deposit and has since been involved in flowsheet development testwork on other manganese projects which are aimed at producing feedstocks for the burgeoning EV battery industry. 
 
Core samples from the recently completed drilling campaign have been selected by EML’s Chief Technical Officer, and Chair of the Technical Advisory Board, Dr Ian Pringle, in consultation with his technical team to make up two composites for the initial test work. These composites represent the Higher Grade (34% Mn, 21% Fe, 6% SiO₂) and Lower Grade (16% Mn, 21% Fe, 39% SiO₂) zones of the resource. 
 
 A total of 202 kilograms of samples have been delivered to Kemetco. These samples will initially be tested using common beneficiation techniques including gravity concentration, magnetic separation, and flotation, to determine if the manganese grade can be increased while rejecting some of the iron and silica. Samples will also be subjected to reductive acid leaching, purification, and crystallization to determine amenability to hydrometallurgical treatment to produce saleable products for the battery industry. The test program will be performed interactively with the EML technical team, and it is expected to take approximately 14 weeks to complete. 
 
Also announced was the appointment of Mr. Timothy Arnold P.E., BSc (Mining Engineering), to the EML Technical Advisory Board with immediate effect.  Mr. Arnold is a U.S.-based mining engineer with more than 40 years of experience developing and operating open-pit and underground mines across a variety of commodities. Mr. Arnold is skilled in directing mine work including PEAs and feasibility studies, permitting and mine design, project optimization, infrastructure, and all levels of operations from contract miner to Chief Operating Officer (COO). He is currently COO at Integra Resources Corp. and previously held senior executive positions for Pershing Gold Corporation, Nevada Copper Corp., General Moly Inc., Coeur d’Alene Mines Corp., and Hecla Mining Company. 

On September 1, 2023, Nuinsco Resources Limited (CSE: NWI) announced that effective August 31, it has closed a non-brokered private placement offering in two tranches, issuing 17,887,500 units at a subscription price of $0.0064 per Unit for aggregate proceeds of $114,480. Proceeds from the Offering will be used to advance the Company’s large multi-commodity (phosphate, rare earth element, niobium, tantalum) Prairie Lake critical metals project located near Terrace Bay, Ontario. 
 
Each Unit consisted of one common share of the Company and one-half of one warrant. Each Warrant entitles the holder thereof to purchase one common share of the Company at an exercise price of $0.05 per share for a period of 36 months from the issue date.  
 
On September 6, 2023, Benton Resources Inc. (TSXV: BEX) and Sokoman Minerals Corp. (TSXV: SIC) (OTCQB: SICNF) together, (the “Alliance“) announced that it has received further results from the Phase 4 diamond drilling program completed at the Kraken Lithium swarm. To date, a total of 10,095 m of drilling has been completed in four phases at the main discovery areas, as well as an additional 522 m in six holes at the Hydra Dyke, 10 km to the northeast. Most of the Phase 4 drilling was completed in the East Dyke and Killick Dyke area. 
 
The latest drill program has expanded the dyke system to the south and has intersected a new dyke to the east of Killick, which requires further testing. Referred to as Killick East, this new dyke was intersected in drill holes GH-23-47, GH-23-56, and GH-23-59 over a 100 m strike length and returned values up to 1.54 m @ 0.68% Li₂O in hole GH-23-56. The Killick Dyke system remains open to the north and at depth. The Alliance is currently planning a Phase 5 program to begin in late September or early fall, 2023. The Phase 5 program will test numerous new targets generated from current mapping and channel sampling as well as the main Kraken Dyke swarm area (including Kraken West and Kraken North) and drilling to expand the East Dyke and Killick Dyke area. 
 
The Alliance has received significant results from the six-hole (522 m) reconnaissance diamond drilling program recently completed on the Hydra (cesium/lithium/tantalum) target 10 km northeast of the Killick Dyke. 
 
Initial drilling on the Hydra Dyke was successful in intersecting cesium-lithium-rubidium-tantalum mineralization in four of the six holes completed. The drilling has confirmed the continuation of mineralization at depth and along strike to the north for approximately 100 m. 
 
Highlights of the Phase 1 drilling include: 

• 13.55 m grading 0.14% Cs₂O from 4.85-18.4 m including 1.22 m grading 0.51% Cs₂O from 13.45 m – 14.17 m (Hole HY-23-01) 

Additional work completed on the Hydra Dyke includes detailed channel sampling at the discovery outcrop (44 samples) and geological mapping. The sections sampled are mineralogically similar to the previous surface sampling and in recent drilling. 

Hydra Drill Plan – Golden Hope JV
The Alliance is continuing to outline significant lithium in soil targets as part of its property-scale program covering the greater than 20 km corridor of prospective geology to the NE and SW. Line spacing ranges from 200 m to 500 m in recon areas to 100 m in detailed areas adjacent to known prospective dykes. Results continue to match those received from the initial discovery area where lithium values ranged from 75 to 200 ppm (Li) and are considered significant. These targets will be subject to field follow-up work including prospecting and till sampling, and where warranted, diamond drilling this fall. 
 Prospecting results from selected soil geochemical anomalies have returned strongly elevated beryllium (Be to 1,476 ppm) and tantalum (Ta to 507 ppm) enriched dykes which are part of the larger family of Lithium/Cesium/Tantalum (LCT Type) dykes. Vectoring within the LCT dyke systems will assist in the discovery of lithium-bearing pegmatites. Partial results have been received from the ongoing prospecting program underway at Golden Hope. Much of the prospecting activity has focused on the follow-up of soil geochemistry results, which have identified pegmatite dykes in each new anomaly area, as described above. The most significant result to date is from the west Kraken area where spodumene-bearing float and outcrop, as yet untested by diamond drilling, have been uncovered and where preliminary assays from grab samples have returned up to 0.64% Li₂O within open-ended soil geochemical anomalies. Large blocks of spodumene bearing float uncovered between the Killick and West Kraken zones, which appear to represent a new dyke(s), have returned values up to 0.58% Li₂O and are untested by diamond drilling.  

Soil Sampling Program – Golden Hope JV
Steve Stares, President and CEO of Benton Resources Inc. said: “Lithium-rich pegmatite dykes are highly variable and complex, but our approach of using multiple exploration techniques continues to expand the target zone of this massive, still early-stage pegmatite field. Prospecting, soil sampling, trenching, channel sampling, and diamond drilling all continue to provide essential data and encourage us to continue to the next phase of the work, including some excellent drill targets for the Phase 5 program.” 

A video highlighting recent activities has been released, view it HERE

On September 6, 2023 Canadian Overseas Petroleum Limited (XOP: CSE) (COPL: LSE) announced $3.5 million of committed common share financing and certain amendments to the outstanding Bonds of the Company.

Highlights

• c. $8.5 million of liquidity ensures the Company is fully financed in to the first quarter of 2024 with the intention of reaching possible third party strategic Joint Venture (as defined below) agreement
  • $3.5 million equity injection at 4p per share from Anavio
  • c. US$5.0 million liquidity released from hedge restructuring
  • $0.5 million cash saving from Directors agreeing to waive all cash compensation for 2023
  • $2.0 million of G&A reductions achieved to date in 2023 and a further $1.0 million identified to be reduced prior to year-end 2023
• John Cowan appointed as new CEO
• Tom Richardson appointed as Chairman
• Important waivers and amendments agreed to both Senior Credit Facility and Bonds from an aligned and supportive pair of stakeholders and key capital providers to the Company
• Company to appoint one additional non-executive director
• Barron Flats Unit gas gathering infrastructure improvement completed ahead of schedule and under budget

Arthur Millholland has agreed to move from Chief Executive Officer and a director of the Company with immediate effect, to President of the Company’s affiliate, COPL America Inc. Mr. Millholland’s technical expertise was instrumental in understanding the long-term value of the Barron Flats Unit miscible flood and acquiring it for such a relatively low cost. Through further geological study, he and his team have revealed a vast area of bypassed oil pay in the Cole Creek area, adjacent to the BFU. The prospective horizons are currently under joint venture negotiation with a respected industry leader. The BFU and the potential joint venture requires the singular focus of Mr. Millholland and the technical team. As President of COPL America Inc., he will be well positioned to continue to add value and success to COPL, where his strengths in upstream hydrocarbon exploration and development will focus on completing the joint- venture discussions. 

Mr. Millholland is replaced as CEO by Mr. Cowan, a COPL director since 2015 with more than 40 years of experience as a founder, CEO, and/or director of several private and publicly traded upstream oil and gas corporations. Mr. Cowan will be focused on overseeing the Company’s administration and the development of the Barron Flats Unit Miscible Flood. 

In Q2 2023, the Company began its initiative to significantly reduce G&A expenses. To date, $2.0 million of annualized G&A has been reduced, mostly through the termination of a few contracts. The Company has identified a further $1.0 million to be reduced prior to year-end 2023. 

On September 8, 2023, Canadian Overseas Petroleum Limited (XOP: CSE) (COPL: LSE),announced the issuance of 9,995,428 common shares pursuant to the share settlement option exercised by Bondholders for settlement of $0.5 million of Conversion Payment amounts due pursuant to previously converted 2028 Bonds. The number of Shares issued for settlement of these Conversion Payments is based on the lowest 5-day VWAP following election of the share settlement option for the Conversion Payments. Following these issuances of Shares, the Company has a total of 708,984,316 common shares issued and outstanding.

In accordance with the usual practice, applications will be made for these Shares to be listed for trading on the London Stock Exchange’s main market for listed securities within the next 12 months.  

On August 30, 2023, Visionstate Corp. (TSXV: VIS) released details of the Company’s third Quarter financial results, for the three and nine months ended June 30, 2023. These can be found in the Unaudited Condensed Interim Consolidated Financial Statements and Management’s Discussion and Analysis (MD&A), which should be read together. 

On September 8, 2023, Tenet Fintech Group Inc. (CSE: PKK) (OTC Pink: PKKFF)announced that it has issued and completed a third tranche closing of the Financing (with the sale of 710 units (the “Units”) to insiders of the Company by way of non-brokered private placement financing at a price of $1,000 per Unit for gross proceeds of CAD$710,000.

Each Unit sold in the Third Tranche is comprised of: one 10.0% non-secured convertible debenture of the Company in the principal amount of $1,000 and 4,0000 warrants to purchase common shares of the Company. The Convertible Debentures will mature thirty-six (36) months from the date of issuance and, subject to prior conversion in accordance with their terms, will be repaid in cash at the Maturity Date. Each Warrant will be exercisable to acquire one Common Share at an exercise price of $0.50 per Warrant Share for a period of twenty-four (24) months from the date of issuance thereof. All three subscribers of the 710 Units for aggregate proceeds of CAD$710,000 were officers of Tenet 

Tenet plans to use the proceeds of the Third Tranche Closing to help complete the remaining pillars of its Cubeler® Business Hub in Canada and working capital purposes as part of its normal operations.