Rising Inflation Sends Gold Demand Soaring 34% As Investors Scramble For A Safe Haven

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NEW YORK, May 17, 2022  /PRNewswire/ -- Investors once again looked to gold as a safe haven to protect their hard-earned cash in Q1 2022 as record inflation pummeled other investment vehicles. Physical demand for gold jumped 34% year-over-year to 1,234 tonnes in the first three months of 2022, according to the World Gold Council, marking the highest quarterly demand increase the gold market has seen since 2018. Demand for physical gold climbed even higher in April to a 10-month high, as global bond prices and stock markets dropped on expectations of higher interest rates. According to BullionVault's Head of Research Adrian Ash, "devaluation continues to push investors to diversify into gold as inflation hits currencies, bonds and stocks," creating an opportunity for gold companies like New Pacific Metals Corp. (NYSE:NEWP) (TSX:NUAG), AngloGold Ashanti Limited (NYSE:AU), Yamana Gold Inc. (NYSE:AUY), SSR Mining (NASDAQ:SSRM) (TSX:SSRM) and Filo Mining Corp. (OTCQX:FLMMF) (TSX:FIL).

On May 17, New Pacific Metals and its local Bolivian partner announced the assay results of the last ten drill holes from the 2021 discovery drill program at the Carangas Silver-Gold Project, Bolivia. Assay results of all 35 holes drilled in 2021 have now been received and released. Highlights from the last ten holes include Hole DCAr0031 intersecting 595.7 m (from 161.55m to 757.25m) grading 1.25 grams per tonne (g/t) gold (Au) and 7 g/t silver (Ag), including 98.9 m (from 457.3m to 556.2m) grading 2.58 g/t Au, 6 g/t Ag and 42.11m grading 3.51 g/t Au, 2 g/t Ag and 0.1% copper (Cu) (from 711.0m to 753.11m). This broad gold zone occurs beneath a silver horizon of 41.63 m grading 41 g/t Ag, 1% lead (Pb) and 1.72% zinc (Zn) from 62.37m to 104m.

Drilling is underway on the 2022 drilling program of up to an additional 40,000 meters (m), with four drill rigs turning at the Carangas Project. Of the four drill rigs, two rigs are testing the shallow silver horizon and the other two rigs are testing the gold mineralization at depth. So far, approximately 10,000 m have been completed in 15 holes. Assay results of 15 drill holes completed in 2022 are pending.

This isn't the first time New Pacific has achieved promising assay results from the Carangas Project. On February 10, New Pacific Metals received the assay results from six drill holes from the 2021 discovery drill program, revealing an expansive, near-surface silver-rich zone of mineralization stacked above a broad zone of gold mineralization. Highlights include silver mineralization of 148m interval grading 78 g/t Ag and 2.07% Pb+Zn and a higher grade gold mineralization interval of 95m (from 35.35m to 630.35m) grading 1.14 g/t Ag, 0.77% Pb and 1.13% Zn.

Then on February 23, New Pacific Metals announced the assay results of eight more drill holes coming from the 2021 discovery drill program, revealing that all 25 drill holes intersected silver-rich polymetallic mineralization near surface with a few deep holes intersecting a broad area of gold mineralization. Highlights from the results include broad gold mineralization of 323m interval grading 1.03 g/t gold and 12 g/t silver and a high-grade interval of 173.17m (from 9.67m to 182.84m) grading 102 g/t Ag, 0.77% Pb and 1.13% Zn for a silver equivalent of 166 g/t.

For more information about New Pacific Metals Corp. (TSX:NUAG) (NYSE:NEWP), click here.

Gold Miners Reports Q1 2022 Results

On May 9, global gold mining company AngloGold Ashanti Limited (NYSE:AU) reported a Q1 2022 production of 588,000 ounces, unchanged from Q1 2021, including 41,000 oz at the company's Argentina-based Cerro Vanguardia mine. Total cash costs for the three months were $1,041/ounce, up 4% year-over-year, while free cash flow increased to $268 million from an outflow of $92 million in Q1 2021. The company's balance sheet remained strong after AngloGold financed the $365 million cash acquisition of Corvus Gold in January 2022 and paid of the 2021 year-end dividend, with approximately $2.5 billion in cash, including $1.0 billion in cash at end of March 2022.

In April, Yamana Gold Inc. (NYSE:AUY) reported a Q1 total production of 238,617 gold equivalent ounces (GEO) at total cost of sales, cash costs and all-in sustaining costs (AISC) of $1,212, $734 and $1,084 per GEO, respectively.  According to the company, standout production results combined with the low-cost performance underpinned the strong cash flow generation including $151.7 million in cash flows from operating activities and $197.3 million in cash flows from operating activities prior to net change in working capital. Yamana Gold expects free cash flow to increase quarter-over-quarter. First quarter net earnings came in at $57.8 million ($0.06 per basic and diluted share), while adjusted net earnings were $83.6 million ($0.09 per basic and diluted share). Cash and cash equivalents totaled $516.4 million. Yamana Gold has $750 million of available credit.

SSR Mining (NASDAQ:SSRM) (TSX:SSRM) also just reported its first-quarter production, producing 173,675 gold equivalent ounces at AISC of $1,093/oz. The company's previously announced full year forecast of 700,000 to 780,000 gold equivalent ounces at AISC from $1,120 to $1,180 per ounce of gold equivalent is unchanged and remains weighted in the second half of the year. SSR Mining generated cash flow from operating activities of $62.2 million and free cash flow of $27.7 million in the first quarter. Attributable net income came in at $67.6 million, while attributable adjusted net income was $65.9 million. The board declared a cash dividend of $0.07 per share, a 40% increase over the prior quarter, which was paid on April 4, 2022. At the end of the first quarter, the company had a cash equivalent balance of $999.0 million. On April 14, 2022, SSR Mining completed the acquisition of Taiga Gold Corp.

On May 4, Filo Mining Corp. (TSX:FIL) (OTCQX:FLMMF) reported its first quarter 2022 results and provided an update on its 2021/2022 drill campaign. As of March 31, 2022, the company had cash of $111.4 million and net working capital of $100.1 million, compared to cash of $19.4 million and net working capital of net working capital of $13.05 million as of December 31, 2021. Filo Mining president and CEO Jamie Beck said in the release that the 2021/2022 program at Filo del Sol has already produced the best silver intersection ever on the project, extended the high-grade Breccia 41 zone and demonstrated the continuity of strong mineralization within the Aurora Zone. Several holes are currently in progress, and four holes have now been completed with pending assays. Filon Mining completed a $100 million non-brokered private placement to BHP earlier this year.

New Pacific Metals is well financed to carry out its activities in its properties. The company can count on a team of experts with many years of experience in exploration, project development and production in multiple jurisdictions.

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