Category: Canada

Nouveau Monde Graphite (NMG) has announced a $50m (C$71.64m) equity investment from Canada Growth Fund (CGF) and the Government of Québec, through Investissement Québec (IQ), to support its phase two ore-to-battery-material graphite operations.

This investment aims to facilitate the progress of NMG’s detailed engineering and critical path activities as the company approaches an FID.

It will help advance NMG’s phase two Matawinie Mine and Bécancour Battery Material Plant, enable the procurement of key long-lead items and support necessary activities.

The investment will also support detailed engineering, procurement and critical-path activities, as well as cover general expenses and financing costs.

NMG is preparing for FID by finalising an updated feasibility study for its phase two operations, expected early in the first quarter of 2025.

NMG founder president and CEO Eric Desaulniers said: “As a project developer, NMG requires credible financial partners to share risks and unlock value in this strategic and geopolitically important sector. Rounding up 2024 marked by significant progress in our business plan, we are setting our sights on the remaining milestones to reach FID.

“This investment by the Canada Growth Fund and the Government of Québec will enable our team to make tangible advancements and place strategic orders in preparation for our project execution.

“We are committed to delivering high-performing and reliable active anode materials to the North American battery and electric vehicle markets, contributing to a local, sustainable and reliable supply chain.”

The backing from IQ and the addition of CGF, a C$15bn public fund, strengthens NMG’s institutional investor support and provides a favourable path to project financing upon a positive FID.

Both CGF and IQ have agreed to subscribe for common shares in NMG, with the offering set to generate gross proceeds of $50m.

NMG will issue 39,682,538 common shares at $1.26 per share. Each share will include a warrant, allowing the holder to acquire an additional share at $2.38, subject to certain ownership limitations.

The common shares and warrants will be subject to a four-month hold period under Canadian securities laws.

This strike price aligns with warrants previously issued to General Motors, Panasonic Energy and Mitsui in February 2024.

NMG will enter into investor rights and registration rights agreements with CGF and IQ, restricting the sale of securities until 28 August 2025. These agreements grant CGF and IQ certain board nomination and anti-dilution rights.

CGFIM president and CEO Patrick Charbonneau said: “Investors and policymakers alike recognise the strategic importance of securing a stable supply of critical minerals, which are indispensable and essential for high-tech industries, from defence to renewable energy and batteries.

“CGF is pleased to invest in NMG and looks forward to supporting the company in its journey to create the largest fully integrated natural graphite production facility in North America.”

NMG is also working on an Impact and Benefit Agreement with the Atikamekw First Nation of Manawan and engaging with potential customers and lenders.

The investments from CGF and IQ are expected to close on or about 19 December 2024, pending standard conditions and regulatory approvals from the TSX Venture Exchange and the New York Stock Exchange.

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In this issue I try and guess what this year in finance will be remembered for in the history books and later discuss a compelling way up, then way down forecast for equities in 2025. I’ll also look back to the biggest technology blunders of the past year and look ahead to new data releases.

Lookback

2024 in the history books

This year I’ve tried to follow Morgan Housel’s advice on media consumption – namely, to first ask whether I’m still going to care about the subject in 12 months. If not, ignore. With year end approaching I’m going to try a similar exercise with the events of 2024 by identifying the market-related developments of the past 12 months that we are most likely to care about most in one, two, or five years’ time.

It’s been a year of renewable power confusion. Economics professors were writing credible guidelines to the end of oil while the IEA and OPEC were constantly revising crude demand forecasts lower. At the same time, the S&P/TSX Renewable Energy and Clean Technology index underperformed the S&P/TSX Composite by 34 percentage points.

EV demand evaporated in some areas as Ford Motor Co. cut production of its F-150 Lightning truck and Tesla Inc., according to predictions, will sell 30,000 fewer cars in the U.S. and Europe. Copper, the metal that decarbonization requires in abundance, is down about 17 per cent from its mid-May high.

2024 was also the year of AI, to the point many readers are tired of hearing about it according to our web traffic monitoring. Nvidia Corp. is up about 163 per cent so far this year on GPU demand (the semiconductors needed most for AI-related data centers) and – for a period of time – became the largest company in the world by market cap.

I started using AI almost exclusively for search purposes. I think we’re only at the very beginning for the AI proliferation trend that can potentially make all knowledge a commodity. News that 25 per cent of new code at Google is written by AI highlight how quickly some industries are adapting the technology, and how many workers may be displaced. Investment-wise, I’m looking for the next, software stage of AI to push companies like Atlassian Corp. and UiPath Inc. to greater heights.

Demand for obesity treatment Ozempic rose so sharply this year that there is a production shortage. New, similar treatments are on the way, notably an oral application from Eli Lilly. It’s possible we’ll remember that 2024 was the year the developed world obesity epidemic peaked, at least in countries where the drugs are available.

Betting markets were more accurate than pollsters ahead of the U.S. presidential election. Prediction markets like these could begin to dominate forecasts in political and other fields if the trend continues.

Ok, now we get to the touchy one. Last week I asked the following question to a colleague: “What are the odds that in five years, 2024 will be known as the year a CEO assassination kicked off the class war?”

I’m not suggesting the odds are 50 per cent or even 30 per cent that this will be the case and more class-related violence erupts. However, the widespread cheering of suspect Luigi Mangione on Reddit and other forums is to me indicative of the same frustrated rage that animated Donald Trump voters.

I do believe the U.S. health-care system is simultaneously broken and inhumane (although given some of the news domestically I will be careful at throwing this stone from a glass house), even if it subsidizes drug development for the rest of the world. Even so, I don’t think the social contract can allow for vigilantes waxing executives on New York streets.

I don’t think former UnitedHealthcare CEO Brian Thompson’s name will go down in history with Archduke Franz Ferdinand but that won’t stop me from worrying about it for a bit.

And on that note, I’d like to thank all readers who followed along in 2024 and wish you happy holidays and a lucrative 2025 in the market.

Equities in ‘25: Up, then down

Richard Bernstein Advisors (RBA) argued that the first half of next year will be great for U.S. equity markets but the second half might be very unpleasant.

The report identified five reasons for a fast start to 2025: the Atlanta Fed’s GDPNow indicates an economy currently growing at more than 3.0 per cent which provides momentum; likely Fed rate cuts; accelerating profits; tariffs spurring domestic activity; and onshoring. (The last two are almost related enough to be the same thing but five is a rounder number I guess).

The potential for inflation has RB Advisors recommending shorter-term bonds. Higher prices for consumers and businesses that increase inflation expectations will also push long-term bond yields higher – which is historically inconsistent with a risk-on backdrop for equities. The team projects peak profits for the S&P 500 in the second quarter and decelerating earnings is likely to cause volatility thereafter.

Sentiment is an issue because investors are extremely bullish. The report emphasizes that investors are the most bullish they’ve been in the 40-year history of the Conference Board’s consumer confidence expectations for stock price Increases. Once everyone’s bullish, there’s no one left to buy stocks.

The full report is here

Diversions

Biggest tech disasters of 2024

The MIT Technology Review outlined the eight biggest technology failures of 2024 (soft paywall), a nostalgic trip down the memory lane of nerdy screw-ups. Boeing features heavily thanks to its misadventures in space and AI’s failure to adhere to social norms is also front and center. In hindsight the Crowdstrike Holdings Inc.-related outage was likely the most important story.

The essentials

Looking for our updates on market movers, analyst actions, stock technicals, insider trades and other daily, weekly and monthly insight? Click here to visit our Inside the Market page.

Globe Investor highlights

Rob Carrick reports on how investors lost millions of potential gains in the postal strike, and it’s not just Canada Post’s fault

High on hope, much of Wall Street is only hearing what it wants from Trump, reports the New York Times

David Rosenberg thinks the loonie may have finally bottomed out

Looking for inspiration on what to do with the additional $7,000 TFSA contribution limit in 2025? Here’s a profile of one investor sitting on $1.2-million in his account thanks to growth stocks

What’s up next

There’s still some important domestic data before the big day on the 25th, starting with retail sales for October on Friday. Economists forecast a topline month-over-month increase of 0.7 per cent and 0.4 per cent ex-autos for a release that could provide insight into how well Canadians are dealing with high debt loads.

GDP growth for October will be out next Monday along with industrial production for November.

Thursday will see the release of U.S. GDP growth for the third quarter – 2.8 per cent annualized is forecast. On the same day, the (mis)Leading Economic Index (MEI) is expected to show a 0.1 per cent decline for November (misleading because it keeps predicting a slowdown that never happens) and personal spending for November is expected to increase by an inflation-adjusted 0.3 per cent when it’s out on Friday.

For U.S. earnings reports there’s Accenture PLC (US$3.41 per share expected), FedEx Corp (US$3.95) and Nike Inc. (US$0.63), all on Thursday.

See our full economic and earnings calendar here (You can bookmark the page – it gets updated weekly)

(MENAFN– GlobeNewsWire – Nasdaq) Highlights:

Strategic Acquisition : The Stella Property hosts the high-grade Lacoma Gold zone discovered in 1925 and is strategically located between our Croinor (323,600 ounces in measured & indicated and 34,300 ounces in inferred category) and Megiscane properties. We are continuing our strategy of consolidating highly prospective exploration land in this vastly underexplored belt.

Prime Location : The Lacoma gold zone lies along the Manneville Fault, which also hosts our McKenzie Break gold resource (1.45Moz in inferred category), approximately 55 km to the northwest.

Exploration Upside : The Lacoma gold zone is hosted in a diorite intrusive that has seen very little follow-up exploration. The Stella property has strong potential to host additional high-grade gold mineralization and has significant upside for new discoveries.

Low-cost for 30 square kilometres of underexplored land along a prolific gold structure.

TORONTO, Dec. 18, 2024 (GLOBE NEWSWIRE) — PROBE GOLD INC. (TSX: PRB) (OTCQB: PROBF) (“Probe” or the“Company”) Probe Gold Inc. is pleased to announce that it has entered into a definitive purchase agreement (the ” Agreement “) with Leopard Lake Gold Corp. (” Leopard “) to acquire a 100% interest in the Stella Property (the “Property”). The Property is strategically located to the east of the Company’s Novador Development Project, between Probe’s Croinor and Megiscane properties, lying approximately 9 km northeast of the former Croinor Mine. It spans 52 contiguous claims covering a total of 2,987 hectares and is situated within a NW-SE-oriented volcano-sedimentary corridor. This corridor extends from Timmins in the west to the Grenville Front in the east and includes the Manneville Fault and associated splay systems, which are interpreted as extensions of the prolific Destor-Porcupine Gold Break. The Company’s McKenzie Break property, which hosts 1.45Moz of gold resource, is located along the same fault system, approximately 55 km to the northwest.

David Palmer, President and CEO of Probe, states:“This tuck-in acquisition is a highly strategic addition to our portfolio. It aligns perfectly with our goal of consolidating the underexplored Val-d’Or East region and significantly enhances the high-grade exploration potential of our Novador Development Project. The acquisition also brings strong operational synergies with our Croinor and Megiscane properties, where recent geophysical and soil surveys have identified promising exploration targets that appear to extend onto the Stella property. Our exploration success in the Val-d’Or East area has been exceptional-growing our gold resources more than 14-fold to surpass the 10Moz mark, while uncovering new discoveries in this largely untapped part of the Val-d’Or Camp. For a relatively low cost, this acquisition strengthens our position in Val-d’Or and opens up new opportunities for high-grade gold discoveries.”

The acquisition will strengthen Probe’s land position in the Val-d’Or region by adding to its holdings immediately east of the flagship Novador Project (” Novador “) (see Figure 1). Following the acquisition and the recent map staking at Val-d’Or East, Probe’s total land package in Val-d’Or will expand to 832 square kilometres, further consolidating its position as a leading explorer in the area. The transaction is expected to close in the coming weeks, subject to the receipt of all necessary regulatory and Toronto Stock Exchange (” TSX “) approvals, along with the fulfillment of other customary closing conditions.

Figure 1 – Probe Gold Val-d’Or properties with the Stella Property

Transaction details
Pursuant to the Agreement, Probe will acquire a 100% interest in the Property, subject to a 3% net smelter returns royalty, for consideration of 149,066 common shares of the Company (the“ Shares ”), equal to $250,000 based on the 15-day volume weighted average price per Share on the TSX ended the last trading day immediately prior to the date hereof. The closing of the transaction is subject to receipt of approval of the TSX and the satisfaction or waiver of other customary closing conditions. The Shares will be subject to a hold period of four months and one day from the date of issuance under applicable Canadian securities laws.

About the Stella Property
The history of the Stella Property dates back to approximately 1925, with the discovery of a gold showing. By 1931, Lacoma Gold Mines Ltd. was established to explore the area south of Senneterre. Between 1931 and 1938, the company conducted surface drilling, sank a 79-meter shaft, and developed two underground levels to investigate four mineralized veins, with notable results of up to 39 g/t Au over 1.1 meters. However, exploration activities ceased in 1939.

From 1939 to 1983, minimal exploration occurred, with limited drilling. Renewed efforts in 1983-1984 included magnetic, gradient, and geological surveys, alongside 17 drill holes primarily targeting the quartz diorite hosting the Lacoma gold zones. Further exploration in 1987-1988 included EMH and magnetic surveys, followed by five diamond drill holes.

More recently, in 2011, 23 drill holes were completed near the historical Lacoma shaft. Notably, hole STE-10 intersected 1.6 g/t Au over 14.8 meters in a quartz-veined and pyrite-rich diorite stockwork. The property is predominantly underlain by intermediate volcanic rocks and finely laminated tuffs, with the mineralized zones concentrated near a central diabase dyke and dioritic intrusion close to the Lacoma shaft. Exploration outside the Lacoma area remains limited.

Qualified Person
The scientific and technical content of this press release has been prepared, reviewed, and approved by Mr. Marc Ducharme, P.Geo, Vice President Exploration, who is a“Qualified Person” as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”).

About Probe’s Novador Project
Since 2016, Probe Gold has been consolidating its land position in the highly prospective Val-d’Or East area in the province of Quebec with a district-scale land package of 832 square kilometres that represents one of the largest land holdings in the Val-d’Or mining camp. The Novador project represents one property block of 202 square kilometres that hosts four past producing mines (Beliveau Mine, Bussiere Mine, Monique Mine and Beaufor Mine) and contains 80% of the Company’s gold resources in Val-d’Or East. Novador is situated in a politically stable and low-cost mining environment that hosts numerous active producers and mills.

About Probe Gold:
Probe Gold Inc. is a leading Canadian company focused on the acquisition, exploration, and development of highly prospective gold properties. The Company is well-funded and dedicated to exploring and developing high-quality gold projects. Notably, it owns 100% of its flagship asset, the multimillion-ounce Novador Gold Project in Quebec, as well as an early-stage Detour Gold Quebec project. Probe controls a large land package of approximately 1832-square-kilometres of exploration ground within some of the most prolific gold belts in Quebec. The Company’s recent Novador updated Preliminary Economic Assessment outlines a robust mining plan with an average annual gold production of 255,000 ounces over a mine life.

Val-d’Or properties include gold resources totaling 6,728,600 ounces in the Measured and Indicated category and 3,277,100 ounces in the Inferred category along all trends and deposits.

On behalf of Probe Gold Inc.,

Dr. David Palmer,
President & Chief Executive Officer

For further information:

Please visit our website at or contact:

Seema Sindwani
Vice-President of Investor Relations
…

Forward-Looking Statements

Neither TSX Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Exchange) accepts responsibility for the adequacy or accuracy of this release. This News Release includes certain “forward-looking statements” which are not comprised of historical facts. Forward-looking statements include estimates and statements that describe the Company’s future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as“believes”,“anticipates”,“expects”,“estimates”,“may”,“could”,“would”,“will”, or“plan”. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Although these statements are based on information currently available to the Company, the Company provides no assurance that actual results will meet management’s expectations. Risks, uncertainties, and other factors involved with forward-looking information could cause actual events, results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but is not limited to, the terms and conditions of the acquisition of the Property and the closing of such acquisition, the potential to define high-quality drill targets, particularly in the Lacoma area and beyond, the expectation of operational synergies with the Croinor and Megiscane-Tavernier properties, the Company’s objectives, goals or future plans, statements, exploration results, potential mineralization, the estimation of mineral resources, exploration and mine development plans, timing of the commencement of operations and estimates of market conditions. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to the timely receipt of all regulatory and third party approvals for the acquisition of the Property, failure to identify mineral resources, failure to convert estimated mineral resources to reserves, the inability to complete a feasibility study which recommends a production decision, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, inability to fulfill the duty to accommodate First Nations and other indigenous peoples, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects, capital and operating costs varying significantly from estimates and the other risks involved in the mineral exploration and development industry, an inability to predict and counteract the effects of COVID-19 on the business of the Company, including but not limited to the effects of COVID-19 on the price of commodities, capital market conditions, restriction on labour and international travel and supply chains, and those risks set out in the Company’s public documents filed on SEDAR. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.

A photo accompanying this announcement is available at

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