LONDON, December 5, 2016 /PRNewswire/ --
OilPrice.com Market Commentary: Global political tensions have not
been this palpable since 9/11, when gold prices jumped 32.87% in a single day, and the amount of uncertainty being ushered in for
2017 promises to be great for the precious metal-our age-hold hedge against chaos and instability. For a fully-funded
junior gold miner backed by heavy hitters in one of the world's hottest venues--Fiore Exploration Ltd (TSX Venture - F.V)
the timing is brilliant, the production costs fantastic, and the future golden. Mining companies in focus today include:
KCG Holdings, Inc. (NYSE: KCG), Newmont Mining Corporation (NYSE: NEM), Barrick Gold Corporation
(NYSE: ABX), IAMGOLD Corporation (NYSE: IAG) and Yamana Gold Inc. (NYSE: AUY)
What we have right now is a situation in which gold prices are stable, but mining and exploration, which has been all but
halted, is very cheap, leaving all kinds of fantastic plays up for grabs.
Combine this with the fact that an unpredictable and inflation-bent Trump is preparing to take office in the U.S., the British
prime minister is set to trigger a 'hard Brexit', China's economic problems are mounting and
most of the world is explosively tense, and you have a situation in which gold is set for a premium.
Gold is the ultimate safe-haven and the ultimate means of payment when all else fails, or when the uncertainty is high enough
to fear this failure.
The transition is where billions are made-and the turning point in this story is upon us.
Here is where you
look for the small-cap that defies all the risky norms of this class of precious metals miner.
This is exactly where you find Fiore, a company that is backed by a miner so big that raising capital is as easy as snapping
your fingers; a company that has chosen
a prime jurisdiction right next to an operating gold mine; a company whose management team knows gold better than anyone.
Here are 5 reasons to keep a close eye on this small-cap, heavy hitter:
- Precious Again: Are you Ready for the Gold Rebound?
Americans are buying gold like never before. U.S. demand for gold bars and coins was up a massive 207% in Q3 2016.
According to the World Gold Council, this surging demand signals a level of interest in gold investment "not seen
since the global financial crisis."
Gold is being rendered even more attractive for Americans amid economic uncertainty most succinctly expressed by billionaire
investor Warren Buffett, of Berkshire Hathaway Inc. (BRK.A), who noted that the U.S. is
"less well equipped to handle a financial crisis today than we were in 2008."
Central Banks the world over have also been stockpiling the precious metal since 2008, at levels not seen since before
1970.
One of the world's biggest legends in mining, Canadian billionaire Frank Giustra, who is also
the founder of Lionsgate Entertainment Corporation (-LGF), is pouncing on gold voraciously, and where his gold money goes,
markets tend to follow. He's also the heavy hitter backing Fiore.
Still, gold is under a bit of pressure, and the U.S. presidential elections certainly didn't help. After climbing back up
during the first three quarters of this year to be one of the best performing assets of the year, gold experienced a volatile few
days, taking a dive on the 'surprise' victory of Trump, with a few unexplained ups and downs, largely because no one could quite
figure out what the President-elect would mean for the precious metal.
Finally, during the last week of November, prices stabilized and are presently up about 10% year to date. It's a solid price for
miners-particularly for Fiore-but it's only the beginning of a new era.
What comes next is what makes billionaires, because gold stocks are still cheap while the fundamentals are fantastic.
Kinross Gold (NYSE:KCG), Newmont Mining (NYSE:NEM), Barrick Gold (NYSE:ABX) and IAMGold (NYSE:IAG) are all trading at less than 10 times cash flow from
operations per share.
Even with the modest recovery in prices this year, we saw TSX Venture gold stocks create millionaires over night by tripling
and quadrupling in value. So imagine what will happen when Trump's inflationary policies set in, and the world reels from a
geopolitical uncertainty that is palpable…
While Election Day and the day after had markets in a state of panicked confusion, the jury now
seems to have deliberated, and the verdict is that Trump will be good for gold in two very specific ways:
- Inflation-gold loves it. More to the point, Trump's build, build, build infrastructure plans and ambitious defense spending
visions are phenomenally inflationary. But it is also possible that these policies will not lead to any long-term sustainable
growth, which would in turn lead to stagflation, which is an even better friend to gold.
- Geopolitics-gold prices feed on risk, and there will be plenty of it. Even just a change in government creates geopolitical
uncertainty, but in this case the situation is more extreme. Trump has indicated he will take an aggressive stance on issues
central to West Asia, and in general, we're looking at a world in which the U.S. may meddle
much less and cooperate much less. The power vacuums that ensue are where the uncertainty lies. From the victory of a very
divisive U.S. president and the rise of right-wing parties in Europe, to Brexit, China's economic challenges and Russia's warmongering, this is the
uncertainty that gold loves. Gold is always put on a premium pedestal in times of geopolitical uncertainty, even when it's not
chaos.
Right now, gold is massively oversold, and historically, these are levels that always lead to a major rally. It's the calm
before the storm. Some analysts believe we could be looking at gold prices of $1600 or higher this
time next year already.
This is the brilliantly timed scenario in which Fiore is diving very aggressively into Latin America's gold bonanza.
- Heavy Hitters Mean Easy Capital, Strong Cash Flow
Fiore breaks the mold when it comes to small-cap gold miners. There's nothing an investor likes more than a company with
positive cash flow and the ability to raise capital with the snap of its fingers.
The company is backed by miner extraordinaire, Giustra, the Canadian business mogul who really needs no introduction as he has
financed countless high-level natural resource deals. Giustra's mining prowess is nothing short of legendary, and capital follows
him around automatically.
This is what most everyone in the industry refers to as the "Giustra Premium", which is exactly why Fiore has a higher market
capitalization than one would expect for a company at this stage.
And the company is nicely cashed-up, with $13.5 million in the treasury, thanks to $11 million in financing, in part from its two major shareholders, Giustra and Brian
Paes-Braga.
The dream team here extends beyond Giustra, to include some major players with very serious track records:
- Brian Paes-Braga, another heavy hitter
- Advisor Paul Matysek, who has created shareholder value of well over $2 billion in gold, lithium, potash and uranium
- CEO Tim Warman, a sought-after geologist with a string of successful, high-grade gold
projects behind him
Fiore, then, is not your average drill play. It can raise, and has raised, capital easily so it can drill at will. And it's
also positioned itself in the sweet spot of the gold world, which brings us to Chile …
- Welcome to a Prolifically Golden Opportunity
Fiore's property in Latin America is the right in the heart of Chile's main mining center. There is absolutely no better location right now.
Here, at the Pampas El Penon project, Fiore has been drilling on an 8,000-meter RC drill program since October, and it's right
next to Yamana Gold's (NYSE:AUY) producing El Penon gold mine. Which we already know is a sweet spot.
What they're looking for-and on track to find very quickly-is the high-grade gold veins that Yamana is already mining next door.
In the industry, this is called 'closeology', and it doesn't get any closer than this.
Or does it? Well, in fact, it does. The five-year bear market for gold has led to some amazingly low production costs. This
means that Fiore is drilling for less than $100 a meter. Even better, the infrastructure is already
in place, and drilling can continue year round.
- The Gold Deal of 2016
As soon as Fiore sees drilling success, it can expand its drilling program without going back to the market. It's brilliantly
financed for this. That means that when it wants to earn in to 100% of Pampas El Penon, it will take $1.8
million worth of work, and one payment of a half million dollars-all of which the company is already set up to handle.
And it won't stop with Pampas. The plan is to add at least one new asset before the end of this year, maybe more.
These are first-movers parked right next to a major producing gold mine, and they're ready to take on more-Pampas is just a
starter project, but a big one backed by heavy hitters.
Backed by big money, Fiore is taking advantage of a huge exploration vacuum in Latin America.
Exploration has almost completely come to a standstill, and exploration budgets are down by 60% over the past five years. There
are massive projects out there that have been orphaned, and Fiore has stepped in with the money and expertise at a time when
things are about to change.
- Gold Mining Stocks Have the Advantage, Fiore Has Even More
Owning gold mining stocks is a brilliant move right now. Gold mining stocks are leveraged to the price of gold, while
production costs are way below market price. This means that any small increase in the market price is a bonanza for the mining
stock holder.
Here's where Fiore rules the first-mover day in Latin America. While some gold miners are
drowning in debt, Fiore has none and it's managed by a dream team of value-creators who know geology, know gold and are hungry to
drill and expand.
The bear market is playing into Fiore's hands in a big way. Majors are still divesting, and Fiore is still shopping. This is
where to be when the first drilling news comes in.
By. James Burgess of Oilprice.com
Legal Disclaimer/Disclosure from OilPrice.com: This piece is an advertorial and has been paid for. This document is not
and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. No
information in this Report should be construed as individualized investment advice. A licensed financial advisor should be
consulted prior to making any investment decision. We make no guarantee, representation or warranty and accept no responsibility
or liability as to its accuracy or completeness. Expressions of opinion are those of Oilprice.com only and are subject to change
without notice. Oilprice.com assumes no warranty, liability or guarantee for the current relevance, correctness or completeness
of any information provided within this Report and will not be held liable for the consequence of reliance upon any opinion or
statement contained herein or any omission. Furthermore, we assume no liability for any direct or indirect loss or damage or, in
particular, for lost profit, which you may incur as a result of the use and existence of the information, provided within this
Report.
DISCLAIMER: OilPrice.com is Source of all content listed above. FN Media Group, LLC (FNM), is a third party publisher
and news dissemination service provider, which disseminates electronic information through multiple online media channels. FNM is
NOT affiliated in any manner with OilPrice.com or any company mentioned herein. The commentary, views and opinions
expressed in this release by OilPrice.com are solely those of OilPrice.com and are not shared by and do not reflect in any manner
the views or opinions of FNM. The companies that are discussed herein may or may not have approved the statements made in
this release. FNM is not liable for any investment decisions by its readers or subscribers. FNM and its affiliated
companies are a news dissemination and financial marketing solutions provider and are NOT a registered
broker/dealer/analyst/adviser, holds no investment licenses and may NOT sell, offer to sell or offer to buy any security.
FNM was not compensated by any public company mentioned herein to disseminate this press release.
FNM HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.
This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. "Forward-looking statements" describe future
expectations, plans, results, or strategies and are generally preceded by words such as "may", "future", "plan" or "planned",
"will" or "should", "expected," "anticipates", "draft", "eventually" or "projected". You are cautioned that such statements are
subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially
from those projected in the forward-looking statements, including the risks that actual results may differ materially from those
projected in the forward-looking statements as a result of various factors, and other risks identified in a company's annual
report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should
consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such
statements. The forward-looking statements in this release are made as of the date hereof and FNM undertakes no obligation to
update such statements.
Contact Information:
Media Contact e-mail: editor@financialnewsmedia.com
, U.S. Phone: +1(954)345-0611
SOURCE Oilprice.com