So, it looks like we already have a line of credit which will give us the funds needed to proceed to production. That means no dilution, at least to get started.
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Hi mrb,
Back when Medinah and Auryn Mining Chile (privateco) were negotiating a JV, Medinah made Maurizio prove that he could walk the walk in regards to exploring and developing the ADL. Maurizio/AHC (Auryn Holding Corp.) secured a $10 million line of credit earmarked for ADL exploration and development. He may or may not have had to pledge personal assets against that LOC. Most of us donât know a lot about Maurizioâs personal finances but that bank sure does. Some of my sources say he made a fortune in real estate while others said in mining while still others said it had something to do with Rolex watches of all things while others thought computer software. I have no clue. His personal credit worthiness might be one of our best assets. I wouldnât doubt that the rate on the LOC has been renegotiated many times as interest rates worldwide have gone pretty much to zero and beyond. I have no doubt that AUMC will be refunding the interest payable on that LOC to Maurizio/AHC.
That PR I reposted said that the cash flow from the Caren Mine could fund an aggressive exploration and development campaign on the rest of the ADL. In other venues, Maurizio stated that AUMC will probably enter into several JVs with specialists in the deposit types that the ADL features. He also stated that after the first quarter of production, management would review the possibility of cash dividends. This is coming from Maurizio that is the ultimate underpromise and overdeliver guy. This doesnât sound like a person that could be forced into all kinds of hyper-dilutional death spiral financings that are going to wipe us all out. Iâll take door #3 (cash dividends and let the JV partners pony up the cash to explore) if given an option. I do, however, understand that if Maurizio picks a nice juicy target and funds drilling with AUMC cash then we would be in a position to drive a hard bargain on JV terms.
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This would be an excellent question to ask the company/Maurizio. If anyone believes that he is going to back a line of credit against other, personal, assets, they would be new to the mining industry. Yes, Maurizio owns a majority interest in AUMC but he could just as easily own 95% vs. 60% if he decides to further dilute AUMC with whatever financing mechanism. Alternatively, he could be a saint and look out for MDMN shareholders. Thatâs the basic, unknown, gamble that anyone buying shares in AUMC or MDMN needs to understand in assessing risk. Projects like these always claim to be on the brink of production but the layers of costs in achieving said production are typically, grossly, underestimated. As an example, mining 5000t a month (basically a bulk testing operation) will require 250 monthly round trips for 20t trucks. Have you seen the roads??
Itâs worth adding, that these bulk+ toll mill initiatives are usually breakeven at best. So the next leg of production will require a bigger $$
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Agreed, itâs not legally advisable to encumber oneâs own assets to serve as collateral on a loan for somebody else, not for family or anybody else. However, correct me if I am wrong, but Mr. Maurizio has a horse in this race too - does he not own a large percentage of MDMN, which he purchased at between 5 cents and 8 cents per share? If the latter is the case, wouldnât it hurt HIM just as much as us to further dilute MDMNâs shares? Not being a smart-aleck, just posing the question for the purpose of understanding the depth of his interest in helping this company along - if his interests are pretty much aligned with ours, then it might make a lot of us who have been purchasing shares at .0001 feel better about it.
I like you, Bald Eagle.
I think it was Maurizio family that purchased shares from .04 to .10 range. But Maurizio did by the block of Shares from JJ. I believe in total between the two transactions somewhere over 350 million shares. Correct me if I am wrong
Hard to know how much Maurizio + friends + family actually own in MDMN. I wouldnât be suprised if the friends/family have done what most investors have done over the year (realized losses). Itâs worth considering but given that MDMN shares will soon by AUMC it really boils down to "how much AUMC does Maurizio want to own/control. Itâs certainly within his power to own as much as he wants depending on how he recaps the company, how much financing (and in what form) he needs to get things in production, etc, etcâŠI will admit that Maurizio seems to be a standup guy but the mining space has been a tough sector to invest in and many people are looking for pay days. Iâm not willing to bet/invest on an assumption of his generosity (an attribute that doesnât exist in junior miners).
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FYI - I took the opportunity to write a short note to Raul to see if I could get come more information. I impressed upon him the fact that shareholders put their hard-earned money into this stock, that I know shareholders who have put their entire life savings into MDMN, and that I even know of some shareholders who have died waiting on this stock to perform (not because of current management). I told him that I would share his answer with you - and it follows [emphasis supplied by me, some in bold]. I donât think there is anything earth-shattering here, but in my opinion it is valuable to at least be told that these folks are pressing forward. As Bald Eagle says, there are assumptions here (e.g. they actually want to do well and are telling the truth), but I choose to believe they have honorable intentions. God Bless all of you - have a nice day.
Dear ____:
I understand your frustation, however there is work being done that when ready an update will be released, but at this point I cannot provide you with any further information.
Medinah Minerals received Auryn Mining Corporation (AUMC) shares on December 15, 2017. AUMC had a holding period of one year before it could transfer shares to Medinah [that would put us at December, 2018]. As you know Medinah received those shares about a year ago, and only since December 15, 2019 (a few months ago) we are eligible to allocate those shares to the company shareholders. The reason for the additional one year holding period after Medinah received shares from AUMC is that given the amount of shares the company owns in AUMC it is consider and affiliated entity, reason for the additional one year holding period. [this is the second one-year period to which Brecciaboy refers]
We have speak to legal counsel and we can proceed with allocation of AUMC shares since December 15,2019, however, we have not done so given we are waiting for work to be completed. As soon as it is possible I will be updating everybody through our website, please check the news update section. I can only say that any delays on updates with respect to AUMC shares owned by Medinah is with the intention of benefiting the shareholder.
thanks,
Raul del Solar Berckemeyer
One Family Office
President
Lima Tel. (51) 9.9560.5755
E-mail: rsolar@onefao.com
Skype: raul.solar
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Well he went from the appropriate time to we are waiting for work to be completed.
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Thatâs an acceptable and appreciated response. Thanks Mr B.
Some may think Doc overenthusiastic, and perhaps he is⊠I donât know. Some may think Baldy John overly pessimistic. I donât know. There is still more about all of this that I donât know than I do, which again means that the amount I put into this was irresponsible to a level where there isnât a word to accurately represent it. Iâll be fine.
The only thing I know, for myself and my own situation in this âinvestmentâ, is that I only have two choices, and at this point in time it doesnât matter if John is right or Doc is right or anything else in between. I can only hold my position or sell it. I had the opportunity to sell at .19 through .11 back in 2011 and make millions. I didnât because I bought into the bullshit and wanted to make tens of millions. Lesson learned, although learned too late to make any profit or even a loss I was willing to accept. So I wait. Maybe Auryn will eventually bail me out of my stupidity, and maybe it wonât. Regardless, I appreciate all you that stay here and provide perspectives and the occasional nugget.
At least, with the world looking like itâs going absolutely apeshit crazy right before my eyes⊠and more so every day, this place is actually looking very safe and sane!
Take care folks!
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My thesis here remains that with all that the Medinah shareholders have been through including the recent 29-month period in which the process of removing the restrictions on the AUMC shares and distributing them to Medinah shareholders has been playing out, the facts about the true bona fides of Medinahâs/AUMCâs mineral assets has been staring us right in the face.
One of the more informative press releases which was made by AURYN Mining Chile (the private company) was made on 9/17/15. Iâm going to guess that less than 5% of the current Medinah shareholders recall anything about this PR. The following is the critical portion of it: [my comments are in brackets]
AURYN Mining Chile SpA Unveils Weighted Average of 26.9 g/t Gold in 200 Samples ~Bonanza Grades of up to 66.5 g/t Gold~
September 17, 2015 @ 08:16
AURYN Mining Chile SpA (âAURYNâ or âthe Companyâ) today reports recent exploration activities being conducted under the terms of its Option Agreements with Medinah Mining Chile, CDCH and Nuoco. Of particular note are the extraordinary gold assays returned from the Merlin 1 vein, the first vein to be trenched, samples and assayed of five (5) parallel veins that outcrop to surface.
AURYN has focused its efforts on the Merlin Au-Cu±Ag high grade gold veins. Using a team of three (3) geologists and three (3) assistants, they have conducted geological mapping on the property on a 1:10,000 scale representing approximately 15% of the concessions. Over 1.5 km of trenching and over 200 samples of the 25 trenches and adits has been completed to expose the high-grade gold in quartz veins that outcrop to surface. [NOTE: Each trench would have averaged 60 meters in length. An average of 8 samples were taken from each trench and/or adit. THAT IS A VERY THOROUGH SAMPLING. As the pictures have shown us there are âadit openingsâ right at surface where artisanal miners have harvested gold. The key fact is that this Merlin 1 Vein has made it all of the way to the CURRENT surface. It may have been submerged by 100 meters 100 million years ago but due to erosion extremely high grade gold is CURRENTLY right at surface. This means that the âboiling zoneâ where extremely high-grade gold can be deposited due to certain conditions is CURRENTLY right at and below the surface.]
Gold assays have returned grades up to 66.5g/t gold with a weighted average of 26.9g/t gold on a diluted basis over widths of ~1.35 meter, adding high anomalies in Cu, Pb and Zn. [Having 26.9 gpt gold presenting itself RIGHT AT THE CURRENT SURFACE is extraordinary. These averages are âweightedâ to make them statistically more accurate. This means that a 1 meter intersection of 20 gpt gold when added to a 2 meter intersection of 40 gpt gold would equate to a âweightedâ average of 3 meters averaging 33.3 gpt gold. The width of 1.35 meters is CRITICAL. This represents a very favorable âmining widthâ. This might include a central area of much higher gold and peripheral areas of âwallrockâ grading much less. The highest grade of 66.5 gpt with an average grade of 26.9 gpt gold tells us that the vein is fairly homogenous. This would make sense indicating that the metal-bearing hydrothermal fluids had plenty of time to mix while in the molten state prior to cooling and solidifying into a âveinâ.]
These grades are better than expected. [NOTE: If you Google mineral trenching results, you might see a report from âGolden Arrowâ indicating a âHIGHLIGHTâ sample of 89.5 gpt gold. THIS IS NOT A WEIGHTED AVERAGE. An investor does not want to know the âHIGHLIGHTâ figure. She or he wants to know if there is CONTINUITY. A âHIGHLIGHTâ is the best of the best samples. Another article shows âPrime Miningâ reporting an average of .83 gpt gold over a 58-meter swath. THIS IS A WEIGHTED AVERAGE WORTH BRAGGING ABOUT.]
[DOING THE VERY, VERY ROUGH MATH: Veins are like a sheet of plywood that are usually somewhat vertically oriented. They have a length (strike), a depth and an average width. The Merlin 1 Vein has been traced AT SURFACE for over 1.6 Km or 1,600 meters. We know from the IP/IR signature that it has a depth of somewhere around 200 meters. The average width of this sampling was 1.35 meters. The density of Andesite and Granodiorite is about 2.6 tonnes per cubic meter. The VOLUME of this particular sheet of plywood is about 432,000 cubic meters. The weight of this sheet of plywood is about 1,123,200 tonnes. The amount of grams of contained gold is about 30,214,080 grams. There are 31.1 grams in one ounce of gold. In terms of ounces of gold present, it comes in at 971,000 ounces or just short of 1 million ounces. This is just the Merlin 1 Vein which is 1 of 5 veins that made it all of the way to surface. DO NOT FOR A MINUTE THINK THAT ANYBODY IS GOING TO EXTRACT 1 MILLION OUNCES OUT OF THIS VEIN; THEY ARE NOT.
The takeaway should be no more than this is a very, very rich vein which we actually know quite a bit about. Four adits have been either located or drifted by Auryn. These are Adit 1, Adit 2, Adit 2A and the Larrissa Adit which is Adit 3.
When veins donât make it all of the way to surface it takes a lot of drill holes aimed at an angle towards the top edge of the sheet of plywood in order to determine an average width and an average grade. When a vein does make it to surface then a much cheaper and more accurate analysis of widths and average grades can be done.
An IP/IR survey will tell you about how deep the vein goes. Drilling will do the same. When there are 4 adits in place within this sheet of plywood, a geoscientist known as a âQPâ or âqualified professionalâ can make an accurate estimate of total tonnage when all of the pertinent data is brought together in a âGIS Databaseâ or computerized format.
A QP known as Luciano Bocanegra did a very conservative analysis of 2 of the 5 veins that made it to surface at the ADL. He came up with a minimum of 664,000 ounces of gold in just the top portion of these veins. A drill program is needed to further define and tighten up the statistical veracity of these numbers and to calculate formal Mineral Reserves and Mineral Resources or âMR/MRâ. Unless your source of financing demands it or any potential purchaser demands it, a drill program is not needed to commence mining an epithermal vein deposit that is to be mined via underground techniques.
A porphyry or VMS deposit style pretty much necessitates a drill program because the drill results determine the optimum way to design the open pit if that is the chosen mining methodology. The Pegaso Nero, for example, is probably not going to be put into production very rapidly unless somebody wants to go after the tourmaline or intrusive breccia targets in an underground fashion.
The job of the QP in an epithermal project is to analyze the heck out of that sheet of plywood in 3 dimensions. Regularly spaced trenches are a wonderful way to get a view of the top border of that sheet of plywood. Four adits provide a lot of data also because adits are amenable to âchannel samplingâ of the walls. A lot more data can be collected by âchannel samplingâ the wall of an adit than by studying a 2-inch in diameter drill hole. Drilling is nice because you can space the holes wherever you want and angle the drill holes in any fashion you choose. The difference is youâre going to spend a lot of time and a lot of money if for some reason you need formal MR/MR. Accessing the sheet of plywood (as has already been done) and simply tracing it down wherever it goes is a nice option to have especially if the price of gold is on a run.
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Beware whenever Doc starts a post like this. 
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Noticing more volume coming in on AUMC side past couple days. 45,000 traded yesterday which before the reverse would have been 4.5 million traded.
Hi HR,
Just for that smart Alec comment Iâm going to continue on with this diatribe.
THE IMPORTANCE OF âLAYERING ONâ NEW INFORMATION WITH PREVIOUSLY ACQUIRED INFORMATION
That press release I just cited tells us that the Merlin 1 Vein represents a legitimate DISCOVERY. If we layer upon this fact the fact that NEW DISCOVERIES are at a 32-year low in this industry then the TIMING might seem very fortuitous. If we factor in that the POG is on a run then it becomes more fortuitous. If we factor in that the majors need to replenish the projects in their pipeline in order to survive and the supply of new DISCOVERIES is next to nil then it gets more interesting.
If we layer on the fact that there is a 1-in-1,000 chance of a junior explorer making an economic discovery that makes it all of the way into production then this addresses the probability of many new competing DISCOVERIES being made in the near term is slim. Exploration budgets are down. If we layer upon the fact that the World Gold Council statistics indicate that even for the lucky 1-in-1,000 junior with a bona fide DISCOVERY it currently takes an average of somewhere around 20-plus years to make it into production AND realize that this DISCOVERY would have been in its 3rd year of production by now if SERNAGEOMIN didnât mandate those 3 new ventilation/safety manway raises then that adds a little more to the picture.
What do we know about the 5 epithermal vein systems found to date at the ADL on the central and eastern plateau areas? We know a lot about the Caren Mine/Merlin 1 Vein system due to the extensive trenching program just outlined as well as the sampling done in the 4 adits to date. This is the westernmost of the 5 vein systems.
We know the most about the easternmost of these vein systems i.e. the Fortuna Centro Vein at the historic Fortuna Mine. It was in production from 1940 to 1970. The average grades produced were in between 60- and 90 gpt gold. ACA Howeâs report informs us that nobody to date has even scratched the surface on this vein system. The Fortuna Mine has 7 different levels from which ore of that grade has been mined. This mine is currently being rehabbed and resampled by Auryn.
Keeping in mind the sheet of plywood nature of these veins, the floor and ceiling of these 7 levels is still vein material that can be sampled. I think we already have a good idea of what the numbers might come in at.
If the westernmost and easternmost of these veins that have been sampled somewhat thoroughly have stellar grades then what can we safely infer about the 3 veins systems in between? The trenching program done not just at the Merlin 1 Vein but all across the plateau tells us that over 5,000 meters of veins have made it all of the way to surface. This means that the top edge of this sheet of plywood can be accurately sampled quickly and inexpensively. The surface trenching program of these in between veins have also had very good results but perhaps not quite as stellar as the extremely high-grade ore found at the Merlin 1 and Fortuna Centro Veins. These âin betweenâ veins do not have the prior tunneling work done on the other veins so we donât know as much about all 3 dimensions of those sheets of plywood.
Recently, Auryn management reported that all of these epithermal veins from west to east are ârelatedâ. What does this imply? It implies that there is a common underlying magma chamber that fed all of them. So what? The ultra-hot metal bearing hydrothermal fluids and gases contained in these behemoth magma chambers get mixed up pretty well while in the liquid and gaseous phases. This makes them somewhat âhomogenousâ. When the pressure builds up to a critical level within these chambers the roof/carapace of the chamber will rupture and the metal-bearing fluids and gases will rise through the existing cracks and faults within the overlying rocks. These fluids and veins will cool as they approach the much cooler surface and they will solidify into âveinsâ. To my knowledge, there is no reason why these in-between veins would have much higher or lower grades than the âoff the chartâ grades found in the Merlin 1 or Fortuna Veins. It will take further work to verify this.
The key to finding these ultra-high gold ores is to find the vertical levels at which the hydrothermal fluids were allowed to âboilâ. Why is this? Within a magma chamber, gold tends to be carried attached to sulfur in what are called âthiosulfate complexesâ. These fluids are so hot that oddly enough they have to cool in order to boil. The energy released in the boiling process severs the bond between the gold and the sulfur atoms so that gold can be deposited in these vertical strata in very high concentrations.
These boiling zones are usually located somewhat in the middle of the vertical extent of vein systems. If the historical erosion process was favorable, then these âboiling zonesâ containing extremely high-grade gold ore can be located near the surface where a trenching program could detect them. The cost to mine high-grade ore located close to surface is vastly cheaper than mining deep ore. Instead of the typical 1 gpt gold found in the bottom of a trench the numbers can be many times that figure like we see at the Merlin 1 and Fortuna Centro Veins. As mentioned, the key is that the trenching results are given in a âweighted averageâ format instead of a âhighlight gradeâ format.
As far as the âlayering onâ of new information over old information, we also know that as these once ultra-hot hydrothermal fluids RAPIDLY COOL near these âboiling zonesâ the quartz contained in these fluids appears as âaphanaticâ or âcryptocrystallineâ or âmilk quartzâ in which the naked eye canât make out individual crystals like in other forms of quartz. The RAPID COOLINGâ doesnât allow the time to form these nice crystals that you may have made in your high school chemistry class. If a geologist finds veins containing this âmilk quartzâ then the prospects for high-grade gold ore nearby increases. This is exactly what we have at the ADL. The extremely high-grade gold ore hangs out with the âmilk quartzâ and the lower grade ore hangs out with quartz in which individual crystals are readily apparent. In other words, we know the vertical levels at which the high-grade gold ore hangs out at the ADL. YOU ASKED FOR IT HR!
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This will be an attempt to bring the knowledge/positions of Baldy and Brecciaboy into something quantifiable.
Baldy has mentioned that it will take $30milion to get our Gold into production. If we were to sell shares at todays price ( .20 ) we would need to issue 150 million shares. This would triple the outstanding of AUMC to 210million shares.
To quote Brecciaboy :
âA QP known as Luciano Bocanegra did a very conservative analysis of 2 of the 5 veins that made it to surface at the ADL. He came up with a minimum of 664,000 ounces of gold in just the top portion of these veins.â
Lets assume that this is all we get out of the entire ADL. No PN no Hochschild.
Lets also assume a Gold price of $1,700 per ounce and a profit margin of $850 per ounce.
It will take approx. 26 years to pull 664,000 ounces out of the ground at 25,000 ounces per year.
Total profit is $564million divided by 210million shares equals $2.69 per share. The present value of this at a 6% discount rate with quarterly distributions ( $5.4million/qtr ) is $1.36 per AUMC share.
.0076 per MDMN share. ( one share of AUMC equals 179 shares of MDMN )
Obviously this is very simplified but it gives us an idea of what we are looking at based on combining Baldy and Brecciaboys data points.
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The bigger struggle for me is not the ultimate prospects of the âmountainâ but rather the capital structure that any investor must deal with if they want to own a fractional ownership of the âmountain.â
We can jump up and down all day about this possibly being the next World Class Deposit but the undeniably reality is that BB is still talking about âgrab samplesâ/ trenching assays which carry very little weight in this industry. Yes, the numbers are impressive and, if everyone understood that this was essentially an exploration stage company that still needed to go through the normal waves of dilution to reach production (weâd mostly all be on the same page).
However, dressing this up as a late stage development miner with access to traditional lines of financing is grossly misleading. There is no defined resource nor feasibility study to determine the economics of the asset. In other words, we are still one of the 1 in 1000 projects vying for a seat a the table.
We can assume and rely on hunches (as many have for decades) but financiers donât play those games. Financing needs to come from somewhere and equity is the only option. Unfortunately, the equity carries little to no value and the project wonât advance pro bono. This would be the crux of the current issue facing AUMC/MDMN shareholders.
IMHO
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Wow TR. Starting to get a little emotional. That doesnât seem to jive with your whole gig.
âWeâ is rhetorical. Iâve made my position (or lack thereof) crystal clear.
If you donât like my opinions feel free to ignore them, as I do your âtechnical analysis.â Is there really any difference between you sharing your charts for âentertainment valueâ and with the purpose of giving your opinion on if the squiggly line goes up, down, or sideways or are you trying to make a business out of it? Iâd hope itâs not the latter. Similarly, anyone who relies on my or, God forbid BBoyâs posts to make an investment decision here vs. for entertainment value, is violating every pillar of investing.
Can participants on this board help make informed decisions via their reading of the groupâs opinion? Sure, not unlike reading an article in the Journal to plant a seed for an investment thesis. Sadly, I read the Journal for entertainment purposes, similar to why I post here. Iâm happy to change my tune and re-establish a position in AUMC if things evolve to that point but Iâm also going to challenge the broken record, semi-delusional, posts when I read them.
TraderRich: Right on. I have had the same thoughts about Baldy. Thanks for posting your thoughts.
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There you go again. Touchy.
I use technical analysis in everything I do (trading, investing). Just like anything else in the markets its imperative for each person to use TA that works for them. Looking at someone elseâs analysis, technical or fundamental, can be dangerous. I have no way to gauge if you have a better knack than others b/c I donât follow nor would I know when you actually get in or out of whatever charts you reference.
I follow a lot of stocks that I donât have a position in. When it comes to MDMN, where I have a long and mostly painful history, the only way to follow the stock is through this BOD and/or reaching out to Maurizio. I also have a few pour souls who remain stuckhodlers and feel an obligation to keep them informed, to the best of my ability.
Iâll just chalk up your âcuriosityâ to ignorance as Iâm not sure what sort of agenda anyone can have here. They are either long or not. There certainly isnât the need for any bashing to knock the stock to more attractive levels for vultures. It canât go any lower.
Have a nice evening. Make a smoothie and relax.
MikeGold, I sincerely apologize for being the SUPREME ASSHOLE I was to you during all those years. Itâs been a long time coming and I would prefer to say this to you in person. I would hope that you would refrain from bashing my head in, as much as I may have deserved it. Iâm also sorry that it took me so long to realize and express this, but as has become increasingly apparent to me over the years, I have indeed been an ignorant, touchy, asshole at times. I find sometimes itâs very difficult to see in myself what can be so obvious to see in others. At least in this case I see it in myself and will do something about it.
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I went out today and got some perspective that makes all this look very petty and stupid. Iâm sorry I participated in any of this. Do your thing John.
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