Ground Breakers: Silver Lake moves in on Canada's Harte Gold

Silver Lake Resources (ASX:SLR) is engaging in some black magic, moving in on struggling Canadian gold miner Harte Gold by acquiring its US$63.2 million debt facilites from BNP Paribas.

The facilities are secured by secured by a first lien on Harte Gold’s present and future assets, and Harte Gold has already “committed various events of default under the Credit Agreement, including non-payment of certain principal and interest payments.”

Silver Lake will have the option to exercise its rights under the facilities at the end of the forebearance period on November 30.

It puts Australian mid-tier goldie Silver Lake into the box seat to secure its Sugar Zone gold mine and associated land package.

Sugar Zone is a high ground underground mine in Ontario, Canada, with an ore reserve of 797,000oz at 7.18g/t, similar in nature to the Rothsay and Mt Monger mines already operated by Silver Lake in Australia, where it produces around 250,000ozpa.

“Silver Lake intends to work cooperatively with Harte Gold and its stakeholders to deliver an outcome which will provide the best opportunity to realise the full potential of the Sugar Zone mine and the associated land package,” the ASX-listed miner said in a statement today.

Silver Lake’s Canadian adventure is the latest foray into North America for Australia’s mid and large cap gold miners, a journey that has not been smooth sailing by any means.

Northern Star (ASX:NST) sparked the rush a few years ago when it bought the Pogo mine in Alaska from Sumitomo.

Newcrest (ASX:NCM) secured the Red Chris mine in British Columbia for $1.1b in 2019 before doubling down with the takeover of producer Pretium Resources this month for US$2.8 billion.

Evolution Mining (ASX:EVN) and St Barbara (ASX:SBM) have also spent much of the past two years trying to bed down big ticket purchases in Canada.

Silver Lake Resources share price today:

Regis builds case to add to reserves, resources at Duketon and Tropicana

Fellow mid-tier Regis Resources (ASX:RRL) looked onshore for its big expansion, buying 30% of AngloGold’s Tropicana gold mine in WA this year from IGO (ASX:IGO) for ~$900 million.

Many of the questions around Regis include concerns about mine life at its flagship Duketon operations and the price paid for the Tropicana stake.

While IGO is now trading at record highs on its narrative shift into battery metals, Regis Resources has been listless in 2021.

Its shares fell amid broader negative sentiment in gold this morning, but does look to have identified some opportunities to extend the life of some of its Duketon mines and head further underground both at Duketon and Tropicana.

Best results in a dump of drilling data today included hits of 10m at 13.2g/t, 26m at 7.6g/t and 19m at 5.7g/t at Moolart Well, where its reserve life is around three years, some of the best in 11 years in fresh rock at the project which has a measured and indicated resource grade of just 0.7g/t.

The Commonwealth prospect at Duketon North also returned an early stage hit of 16m at 7.6g/t. Results have also firmed the potential for new underground mines at Garden Well at Duketon South and beneath the Havana pit at Tropicana.

“Our investment in organic growth continues to return positive results at both Duketon and Tropicana. This supports our view that these operations will have mine lives well in excess of the current reserves,” Regis MD Jim Beyer said.

RBC mining analyst Alexander Barkley said the results were a “positive” for Regis.

“We consider the potential for new underground mines at Garden Well Main and Havana have firmed,” he wrote in a client note.

“However, we consider the price paid for acquiring Tropicana presumed additional underground production.”

“Therefore all underground extension drilling could have high expectations, in our view. Key upcoming catalysts in the April-2022 Reserve and Resource update and 2022 Havana Underground PFS.”