Home Commodities Commodities Offer Another Option for Investors Amidst Turbulent Market Conditions

Commodities Offer Another Option for Investors Amidst Turbulent Market Conditions


FinancialBuzz.com News Commentary

NEW YORK, June 16, 2022 /PRNewswire/ — It’s often said that interest rates have a significant impact on the prices of gold and silver. Generally, this would appear to be true. The theory behind the claim makes sense; for example, if interest rates were to increase, that would in turn make the appeal of bonds and savings accounts go up as well, and demand for physical assets go down. In reality, though, there is no real statistical evidence to show any consistency to that claim, mostly because there are numerous factors that also affect the price of these commodities. Reyna Silver Corp. (OTC: RSNVF) (TSX-V: RSLV), First Majestic Silver Corp. (NYSE: AG), Fortuna Silver Mines Inc. (NYSE: FSM), Hecla Mining Company (NYSE: HL), Coeur Mining, Inc. (NYSE: CDE).

In recent years, rising interest rates have also been shown to have a bullish effect on gold and silver, which is a contradiction of what experts have been claiming to expect. For example, last year, the prices of gold and silver spiked after the Federal Reserve announced another quarterly increase in interest rates. One of the reasons for this is that gold and silver markets largely operate on investors’ expectations for the future. Now, as the inflation and supply problems affect the economy negatively, there is a need to hedge against the market with a safe haven asset.

Reyna Silver Corp. (OTCQX: RSNVF) (TSX-V: RSLV) announced last month, “commencement of its 2022 exploration program on the 4,831 hectare Medicine Springs Project (“Medicine Springs”) in Nevada. Medicine Springs is an 80% Earn-In from Northern Lights Resources (CSE: NLR) (“Northern Lights”) and shows many of the earmarks of a significant Carbonate Replacement Deposit (CRD) similar to the Santa Eulalia District in Chihuahua Mexico which hosts Reyna’s Guigui Project.

‘We are excited to kick off our fully-funded, drilling-focused exploration campaign at Medicine Springs, which preliminary work indicates is a fully-preserved CRD system,’ commented Jorge Ramiro Monroy, Reyna Silver’s CEO. ‘Medicine Springs is emerging as the third keystone in our portfolio of district-scale silver projects, and we look forward to uncovering its potential as we keep Guigui and Batopilas moving ahead full steam.’

‘We are very eager to get drills turning on Medicine Springs where we’re seeing 10 out of the 13 hallmarks of a long-lived, multi-phase CRD system even before the rigs show up,’ said Dr. Peter Megaw, Chief Technical Advisor of Reyna Silver, ‘We’re very pleased to see how our fieldwork has complemented the solid foundation Northern Lights put together for the project.’

Medicine Springs hosts Carbonate Replacement Deposit (CRD) mineralization exposed at a very high level marked by a very well-developed swarm of multi-stage NE-SW trending jasperoid-barite veins that cut across the entire property. These veins are inferred to mark the principal hydrothermal fluid pathways, so earlier this year Reyna Silver conducted a Selective Jasperoid Sampling survey focused on them (see Press Release dated Jan.10, 2022). The results show zoning of Copper, Lead-Zinc, and Silver and are interpreted to indicate a CRD mineralization center at depth.

Historic data from Northern Lights for the property cover: small-scale early 20th Century mining; more contemporary shallow reverse-circulation and core drilling primarily focused on near-surface oxide targets; magnetics and CSAMT geophysics; and extensive rock chip and soil sampling. Comparison of the combined Northern Lights and Reyna field data to Reyna’s CRD continuum exploration model supports the idea that the full CRD spectrum is present within the land position….

QUALIFIED PERSON – Dr. Peter Megaw, Ph.D., C.P.G., the Company’s Chief Exploration Advisor and Qualified Person, reviewed the technical aspects of the exploration projects described herein and is responsible for the design and conduct of the exploration program and the verification and quality assurance of analytical results. Dr. Megaw is not independent as he and/or companies with which he is affiliated hold Net Smelter Royalties on the Guigui and Batopilas Projects that predate Reyna Silver acquiring them.”

First Majestic Silver Corp. (NYSE: AG) announced on May 24th, that it has entered into a definitive agreement dated May 24, 2022 to sell its 100% owned past producing La Guitarra Silver Mine located in the Temascaltepec mining district, Mexico State to Sierra Madre Gold & Silver Ltd. (“Sierra Madre“) for total consideration of US$35 million (the “Transaction”). It is a condition to closing of the Transaction that Sierra Madre raise a minimum of CDN$10 million in a private placement concurrent with or prior to closing of the Transaction.  Total consideration consists of 69,063,076 Sierra Madre shares at a deemed price of $0.65 per Sierra Madre Share, having an aggregate value of US$35 million. Upon closing, First Majestic will also be granted a 2% net smelter return royalty (“NSR”) on all mineral production from the La Guitarra concessions, with the NSR subject to a 1% buy-back option for US$2 million. The equity component of the consideration will be paid upon closing of the Transaction.

Fortuna Silver Mines Inc. (NYSE: FSM) has provided an update on June 7th, of its Sunbird exploration program at the Séguéla gold Project located in Côte d’Ivoire.  Paul Weedon, Senior Vice President of Exploration, commented, “Following the release of Sunbird´s maiden Inferred Mineral Resource containing 350,000 gold ounces in March 2022, expansion drilling has continued to grow the high grade mineralized footprint at depth and beyond the initial maiden resource envelope.” Mr. Weedon continued, “Results such as 28.2 g/t gold over 3.5 meters from drill hole SGRD1408 and 12.6 g/t gold over 7.7 meters from drill hole SGRD1422 highlight the open nature of the deposit´s mineralization.” Mr. Weedon added, “Further drilling is underway to test these extensions, with drill hole SGRD1423, a further 100 meters down plunge, intersecting several points of visible gold.” Mr. Weedon concluded, “In addition to the exploration success at Sunbird this field season, target generation elsewhere on the Séguéla property has continued to grow the portfolio with several new very encouraging prospects identified.”

Hecla Mining Company (NYSE: HL) reported on February 17th, the second highest silver reserves in its 130-year history and provided an update on its exploration programs during the fourth quarter of 2021 and plans for 2022.  “Hecla’s silver reserves are near our all time high with Greens Creek reaching 125 million ounces, that mine’s second highest since 2002, and Lucky Friday’s 75 million ounces giving it a reserve mine life in excess of 15 years,” said Phillips S. Baker, Jr., President and CEO. “Since 2008, Hecla has, through exploration, added 239 million silver ounces in reserves, replacing production while also growing resources. We see further growth in reserves, resources, and production from our exciting exploration program. With the increasing need for silver to contribute to the transition to cleaner energy, Hecla has both the largest silver reserve and production in the United States which positions us to meet demand long into the future.” 

Coeur Mining, Inc. (NYSE: CDE) provided an update on April 28th, on the exploration programs at its Silvertip, Kensington and Palmarejo mines. The Company plans to invest approximately $40 million1 in exploration this year, split evenly between capitalized infill and resource expansion drilling.  “Recent assays from the newly discovered Camp Creek West zone of Silvertip are among the best results ever returned at the property and underscore the potential of what we believe is a truly world-class deposit,” said Mitchell J. Krebs, President and Chief Executive Officer. “In addition to the impressive grade and thickness of the Camp Creek West discovery, its location across a fault zone not previously known to contain ore-grade material has the potential to significantly expand the extent of this deposit. Airborne geophysical models also suggest that these zones may extend an additional mile and a quarter (two kilometers) from current drilling positions. In addition, Kensington has recently returned strong grade thicknesses in Kensington Zone 30 as we prioritize further mine life extensions, and new assay results at Palmarejo are among the best grade-thicknesses in several years. These results highlight the compelling opportunities for growth within Coeur’s portfolio and the success of our multi-year exploration investment.”

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