Metals and Mining Sector
The metals & mining sector is one of the primary sectors and a significant contributor to the Australian economy. It is the largest sector on the ASX with more than six hundred companies engaged in mineral exploration & production, and development.
Investment in gold stocks
Gold investments are the safest investments for investors in times of market instability. Investment in gold stocks can be made by buying stocks in gold miners, ETFs, or buying a physical product. Investments in the gold stocks can also add diversification to an investor’s portfolio and are more attractive for growth investors. A small increment in the gold prices can result in a huge gain for the investors.
On 16 January 2020, the S&P/ASX 300 Metals and Mining (Industry) index is trading at 4656.3 points, with a fall of 0.01 percent (as at AEDT 3:54 PM). At the same time, S&P/ASX 200 Index was trading at 7036 points, up by 0.6 per cent from its previous close.
Horizon Minerals Limited (ASX: HRZ)
Horizon Minerals Limited is a gold producer with a strong presence in Western Australia where it has multiple gold projects. The company has a highly experienced management team led by the non-executive chairman, Mr Peter Bilbe. Horizon has large tenement holdings in Western Australia that host more than one million ounces of gold in resources.
Horizon Resets Growth Strategy
On 07 January 2020, the company shared an update on its growth plan and summarized major production and resource growth objectives for 2020. Key highlights of the announcement are as follows:
- Strategic plan being executed with an emphasis on cash generation from gold production in the near-term.
- The main aim remains the same – build a long-term production profile revolving around the Boorara gold project
- The grade control model will be optimised to create an initial mining inventory through three starter pits. The objective is to begin mining in the quarter ending June 2020 and toll milling in the quarter ending September 2020.
- Availability of early cash flow and improved geological confidence will be driven by Boorara project development. Large scale development of the project will also be assessed
- Horizon will continue evaluating consolidation prospects and look for additional value from other mineral projects and JVs.
The company’s Managing Director commented:
Horizon completes Tenement agreement with Northern Star Resources
On 20 December 2019, the company announced the completion of a tenement exchange agreement with Northern Star Resources. Under the agreement, Horizon agreed to divest its 100 per cent interest in the New Mexico, Anthill, White Flag, Blister Dam, and Kanowna North tenements and acquire 100 per cent interest in Northern Star’s Brilliant North, Rosehill, and Gunga West projects.
The company finished a detailed review of all projects to feed into the 2020 plans relating to exploration, mine development and resource growth. Horizon Minerals would conduct an independent and Internal review of the geological models for these projects.
Horizon Mineral Provides update on Crake Project
On 10 December 2019, the company announced an update on the Crake project located within the 100% owned Binduli gold project. The company made a total of 43 RC holes for 3,534m of resource drilling at Crake in 2019.
A few highlights from the results are as follows:
- 3m @ 7.41g/t Au from 81m and 10m @ 1.78g/t Au from 102m (BRC19021)
- 5m @ 4.91g/t Au from 36m and 9m @ 1.58g/t Au from 65m (BRC19025)
- 3m @ 3.18g/t Au from 14m and 4m @ 2.47g/t Au from 55m (BRC19031)
- 3m @ 1.28g/t Au from 10m, 1m @ 2.91g/t Au from 17m, 1m @ 2.13g/t Au from 25m, 1m @ 5.19g/t Au from 32m and 14m @ 1.75g/t Au from 44m (BRC19012)
- 12m @ 1.65g/t Au from 32m (BRC19010)
- 10m @ 1.46g/t Au from 77m (BRC19029)
- 1m @ 3.00g/t Au from 57m and 7m @ 2.78g/t Au from 97m (BRC19027)
- Internal mine optimisation has delivered a positive result and the d independent Mineral Resource estimate complied at 1.27Mt grading 1.81g/t Au for 74,000oz at a 1g/t Au lower grade cut-off 2.
- Initial metallurgical test results showed that for the oxide and fresh composites, gold recoveries of 98.6% and 96.5% respectively.
Results of Annual General Meeting
On 29 November 2019, the company declared the results of the Annual General Meeting. Below are the resolutions passed during the AGM:
- Resolution 1 - Adoption of Remuneration Report
- Resolution 2 - Re-election of Director – Peter Bilbe
- Resolution 3 - Approval of Employee Incentive Scheme
- Resolution 4 - Approval of Additional Placement Capacity
- Resolution 5 - Amendment to the Company’s Constitution
September Quarterly Activities Report
On 24 October 2019, the company announced the September Quarterly Activities Reports. Key highlights from the report are as follows:
- The company continues to progress the potential acquisition of Focus’ 2.1Moz Coolgardie Gold Project.
- The exclusivity period with Focus has been extended by the company to enable finalisation of required approvals and formal documentation.
- The company has reached a pact with Northern Star Resources to swap tenure in Western Australia goldfields region.
- Cash in hand of the company stood at $4.2 million.
- The documentation of the formal transaction and necessary approvals for the probable purchase of the Coolgardie gold project.
- Mining studies on all core development projects is expected to be completed by June Quarter 2020.
The stock of HRZ was trading at $0.105 on ASX on 16 January 2020 (at 03:03 PM AEDT), in line with its previous close. The company has approximately 427.98 million outstanding shares and a market cap of $44.94 million. HRZ’s 52 weeks low and high value are $0.079 and $0.165 respectively. The stock has generated a negative return of 4.55 per cent in the last six months.
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