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Pretium investigating 'unusual' share price drop

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Pretium investigating 'unusual' share price drop

Pretium Resources Inc. hired legal counsel to investigate "unusual" trading activity after its shares dropped 11.1% ahead of its release of disappointing fourth-quarter production results at the Brucejack gold mine.

Pretium's share price closed Jan. 9 down C$1.29 at C$10.33 on spiking volume before it released its production figures later the same day.

The share price movement coming ahead of the news release points to the possibility one or more shareholders knew about the fourth quarter results and sold shares before the news came out.

It is not known if that was the case, but hiring legal counsel to investigate the "unusual" trading activity suggests Pretium may be considering the possibility.

Pretium President and CEO Joseph Ovsenek could not be reached for comment as of press time.

The company missed its annual guidance in the fourth quarter and reported a quarter-on-quarter drop in gold grade.

Production in 2018 totaled 376,012 ounces of gold compared to guidance of 387,000 ounces, while the mill feed grade was 11.5 g/t, down from 12.4 g/t in the previous quarter and well below Brucejack's proven and probable reserve grade of 16.1 g/t.

Grade at Brucejack, which reached commercial production in mid-2017, has so far missed expectations.

The deposit is known to be extremely nuggety with pockets of very high gold grade amid much lower grade ore. Pretium has said the nuggety nature of the deposit will lead to grade being variable quarter to quarter.