SolGold (LON:SOLG) 40p, Mkt Cap £573m – Scott Caldwell resigns as a NED at SolGold
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• SolGold have announced the resignation of Scott Caldwell as an NED at SolGold.
• Caldwell was the director nominated by Maxit Capital which put funds into the company last year.
• We have no idea why Caldwell has resigned but wonder if Maxit may have a potential conflict of interest.
• Conflicts of interest may or may not, on occasion, indicate potential for takeover or some over corporate event.
• SolGold announced on Friday the placement of $41m worth of new shares at 41p/s, a significant premium to the price this morning.
• Newcrest are putting another $40m into the company with a further $1.23m of shares placed with Ecuadorian investors.
• Newcrest first put $23m into SolGold at 16p/s on 17 October 2016 to fund further drilling on the Cascabel project.
• To date, Solgold has identified 15 individual targets within a 1.3km long mineralised corridor up to 700m wide within the Cascabel project area, of which it has drilled a total of over 36,000m on 3 of the targets. “an increased understanding of the deposit is now leading to much larger step-outs in drilling”.
• Following the investments by Newcrest and Guyana Goldfields Solgold is also stepping up its drilling activity with a target of drilling 90,000m per year from early 2018. A fourth drilling rig is currently being mobilised and with a further 3 rigs expected to become operational over the next 2 quarters drill testing is expected to be underway at the Alpala East, Alpala West, Trivinio and Aguinaga by mid year and with eight rigs expected to be working by the end of the year, Solgold will also be drilling on the large Tandayama-America prospect, located further to the north.
• SolGold is suggesting that, while “the bounds of the greater Alpala system … remain untested” the company “now believes that several targets clustered within the Alpala area may coalesce.” Based on these comments, it is clear that SolGold is coming to the view that they are investigating a larger mineralised system than had been apparent at earlier stages in the exploration programme.
Conclusion: It is increasingly likely that one or more of the world’s major copper miners will position themselves to acquire a major stake or all of SolGold or the Cascabel project.
We can see a definitive shortage of new larger-scale copper projects to replace the world’s major copper mines as they draw towards the natural end of their economic resources.
*SP Angel acts as broker to SolGold
