Canadian markets performed over the last week

Profit Taking seen dominating the base metals space last week, but rare earth metals continued to shine and a copper-molybdenum deal kept the merger speculation percolating through. Once all the trading was done the TSX Ventures Exchange, home to more junior exploration companies than anywhere else in the world, had dropped 4.1 per cent, while the TSX Gold Index had fared slightly better having fallen 2.4 per cent.

Deals first.

Mercator Minerals went shopping and elected to buy Creston Moly in a deal valued at around C$195 million. Under the proposal, shareholders of Creston will receive 0.15 of a Mercator share and C$0.08 in cash for each Creston share held. Of interest to Mercator is Creston’s advanced stage El Creston project in Mexico. El Creston has a measured and indicated resource of 336 million pounds of molybdenum and 281 million pounds of copper. Mercator closed out the week down C$0.13 at C$3.39, while Creston closed up C$0.135 at C$0.56.

Elsewhere, Gran Colombia Gold and Medoro Resources have agreed to merge in a move that would create a large Colombia-focused gold miner. Under the deal, each Medoro share will fetch 1.2 shares of Gran Colombia and 0.5 of a warrant. A full warrant is exercisable at a price of C$2.60 until August 24th 2015. Gran Colombia ended the week down C$0.42 at C$1.38, while Medoro closed at C$2.02 for a C$0.08 loss.

At the project level, Iamgold sold its 18.9 per cent interest in the Tarkwa and Damang gold mines in Ghana to Gold Fields for a cool C$667 million. Last year, gold production attributable to Iamgold from the Tarkwa mine was 139,000 ounces, while attributable production from the Damang mine was 43,000 ounces. Iamgold ended the week down C$2.88 at C$19.27.

Any action in silver, given the price strength?

Great Panther Silver failed to rally despite reporting improved production from its Guanjuato and Topia operations in Mexico. In the first quarter gold production came in at 2,310 ounces and silver production tallied 410,640 ounces. Great Panther closed down C$0.19 at C$3.91.

And SilverCrest tabled a preliminary economic assessment on the expansion of the Santa Elena project. Investors responded by bidding up the shares by C$0.04 to C41.83. The overall results indicate the potential to increase the production to 39,000 ounces of gold and 1.6 million ounces of silver per year.

Meanwhile, Fortuna Silver Mines lost C$0.23 to close at C$6.20 despite announcing that high grade ore shoots have been sampled on the Bateas Vein at its Caylloma mine in Peru. Highlights included 1,225 grams silver, 0.06 gram gold, 0.89 per cent lead, 1.23 per cent zinc and 0.6 per cent copper over a width of 0.86 metres and a length of 160 metres. The company also announced a boost in the resources at Caylloma.

In rare earths, Quest Rare Minerals got a boost after reporting a resource estimate for the B-Zone rare earth deposit in Quebec. The base-case resource utilized total rare earth oxides (TREO) cut off of 0.95 per cent and yielded an indicated resource of 36.4 million tonnes grading 1.16% TREO. Quest ended the week up C$1.43 at C$7.95.

Any exploration news?

Well, shares of Nautilus Minerals lost C$0.17 to close at C$3.00 after the company announced that it has formed a partnership with German shipping company Harren & Partner for a vessel that will serve as the operational base for its seafloor resource development. The company has been a granted mining lease for the development of Solwara 1 copper-gold project in the Bismarck Sea of Papua New Guinea.

And shares of Allana Potash sold off even after the Ethiopia focused explorer, tagged one metre running 47.81% KCL in the Sylvinite zone on the Dallol project. Allana ended the week down C$0.09 at C$1.85.

Hathor Exploration reported the completion of its 2011 winter drill program at the Roughrider uranium project in Saskatchewan’s Athabasca Basin and the results confirmed a third mineral zone dubbed Far East. Hathor ended the week down C$0.12 at C$1.95.

Finally, Bolivian exploration plays went on a wild ride after news came out that the government is looking to recover operatorship of certain state-owned mines. South American Silver stated that its Malku Khota project has never had any involvement with the Bolivian State mining company and that its concessions are in good standing. Even so, South American Silver closed down C$0.76 at C$2.39.

The global economic data continues to favour high commodity prices but several investment houses came out with statements that the commodity market has now topped out. We will see what next week has in store.

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