Canadian Mining Companies Consolidating Assets To Reap Benefits Of Growing Demand For Critical Metals

Canada is one of the world leaders in the mining industry and it produces various metals and minerals. The Canadian mining sector has been a world leader setting mining standards and practices. The Mining Association of Canada’s Towards Sustainable Mining program has been influential across the globe with at least seven mining associations adopting the practices. The objective of TSM is to enable miners to meet the needs of communities for metals, minerals, and energy in the most economical and sustainable way.

Canada to capitalize on US demand for critical metals

The industry is full of potential and recently MAC announced that the country’s recent commitment to mining especially the Joint Action Plan with the US on Critical Minerals presents significant opportunities for the industry. The President of MAC, Pierre Gratton indicated that the US was looking for Canada for the supply of critical metals. The metals are increasingly becoming essential in advanced and new tech in various segments in North America. As a result, Canada is committed to meeting the US demand.

Canada is rich in natural resources and its mining industry is one of the most established globally. The country is uniquely positioned to meet US demand for critical minerals which represents a significant investment and growth opportunity for the industry.

Kirkland Gold to benefit from the increase in gold prices

In the past year, various mining companies have completed M&A deals as most companies seek to consolidate resources to better compete. For the gold miners, 2020 is full of prospects with the price of gold going to continue with the impressive performance registered last year. There are indications that gold could rally this year and break the $1,600 barrier for the first time in nine years. Gold miners such as Kirkland Lake Gold (NYSE: KL) are expected to receive a significant boost.

Gold mining companies have been brokering deals as they reconfigure their assets and portfolio. For instance, Kirkland Lake shareholders have approved the $4.9 billion acquisition of Detour Gold Corporation (OTCMKTS: DRGDF). The shareholders overwhelmingly voted in favor of the transaction of issuing around 77.4 million shares of the company in connection to the acquisition. Equally, Detour Gold stockholders approved the transaction that will see a combination of Kirkland Mines with those of Detour in Ontario, Canada.

Kirkland CEO and President Tony Makuch said that the new combination will be an industry leader in cash resources, cash flow generation and profitability. He added that considering the company has deep pockets it will become aggressive in share repurchases as well as growing its quarterly dividends.

Continental Gold approve the transaction with Zijin Mining Group

Equally Continental Gold Inc. (OTCMKTS: CGOOF) shareholders have also approved a buyout by Chinese mining company Zijin Mining Group (OTCMKTS: ZIJMF). The CA$1.3 billion transactions will see Continental Shareholders receive CA$5.50 per share for their shares. On the other hand, Zijin will get the Buritica gold project in Columbia. The project has indicated gold reserves of around 165.47t as well as an inferred reserve of 187.24t.

This article by Money News National is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Money News National has no position in the stocks mentioned. Thank you for reading.


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