Time for another tweet from Auryn
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Iâll be happy with at least a Christmas card from MC that has a nice update in it. We shall see
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Really? Given all the advances on the project this year? They could do nothing the rest of the year and I am still delighted in comparison to 1997 through 2020.
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Considering the price of coal the kid should be smiling. 
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Well said my friend! Thanks for all you contribute to this site.
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I second that. Not just this site, but representing us all as a shareholder advocate. I feel a lot more comfortable having him in this investment along with us. Thanks again Wiz
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The Christmas gift this year are these sub penny prices to load up on. I think we are getting close to the last time we will be able to say that. I firmly believe MDMN pps will be back over .01 in 2022.
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expect nothing less and nothing more than quarterly updates, unless thereâs a tweetable event. Thatâs the established pattern for AUMC. Each update gives the success and failures of the quarter and outlines goals for the next. Itâs good transparency and I for one am thankful that they are hitting 90% of their quarterly goals. AUMC SHARE DISTRIBUTION NOT INCLUDED IN THE OP-ED ABOVE
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Last December 14, 2020, MDMN traded for 0.0005
Today, December 2, 2021, MDMN closed at 0.0032
Up 640% since the low.
My second-favorite year in MDMN so farâŚ
Trailing only next year!
â madmen
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THE AURYN/MEDINAH SCENARIO IS ABOUT THE MOST INTRIGUING YET COMPLEX INVESTMENT SCENARIO IâVE EVER WITNESSED IN INVESTING IN THE MINING SECTOR FOR 41 YEARS
Over the Thanksgiving holiday, I was approached by a couple of very large shareholders in Medinah and to a lesser extent Auryn. They wanted my 2-bits worth on progress to date and some guidance as to where I thought this thing was going. I found myself saying that this thing has so many moving parts that the complexity is beyond comprehension. I did get the opportunity to bore them to tears on the history of developing mesothermal vein deposits in the Western Hemisphere but I was able to revive them with a couple of ampules of ammonium nitrate/smelling salts.
I explained to them that you need to broach this topic from two different angles. First and foremost, thereâs the geology. Even as a card-carrying Geo-dork, I couldnât be happier with the geology. The mesothermal vein system has both âgeological continuityâ and âgrade continuityâ. Itâs kind of like a smorgasbord. With the developments made to date, where in the heck do you start producing from? I would liken the current development efforts within the Antonino Adit to adding more entrees to the smorgasbord spread.
I tried to impress upon them the concept of âcherry pickingâ a new vein deposit. Auryn gets to pick the juiciest and lowest hanging fruit available. I donât know if theyâll do it or not, but I referred them to the NI 43-101 done on the El Penon Mine by a combination of Meridian Gold and Yamana. This deposit was recommended by the head of the Mining Engineering Dept. of a university that Auryn is working with. He has intimate knowledge of both the ADL mesothermal veins and the epithermal veins at El Penon where he had done some consulting. You can find the 43-101 Technical Report at:
In regards to the âcherry pickingâ of a somewhat virgin vein deposit, pay special attention to Figure 6.1. Notice how in 2002, Meridian gold was mining ore with gold grades of 15 gpt which is an excellent grade. In 2020, all of a sudden, the average grade dropped to 4 gpt gold. Meridian made their shareholders a lot of money right from the get-go. They also managed to attract the attention of Yamana who took them out in 2007. The big money is made up front, when you can âcherry pickâ. My read is that Auryn is currently listing out their mining options. Theyâve told us several times that theyâve especially got their eye on two what they refer to as âmassive veinsâ, which averaged over 2-meters in width at surface as well as showed exceptionally strong surface grades. These two veins are located west of, deeper into the mountain, from the apparent intersection with the DL1 Vein.
From a geology point of view, management summed it up pretty well when they recently stated that âall indications are that the primary target, the DL1 Vein, is widening with depth and getting richer with depthâ. This is exactly what mesothermal vein systems are supposed to do.
I promised my 2 friends to put some thoughts onto paper and get back to them on the various share structure and ownership structure complexities. The following is the best I could come up with as a description of those complexities.
A lot of people use âmarket capsâ (share price times the # of shares O/S) to compare two investment options. With similar assets, one would probably opt to buy the shares of the corporation with a lesser market cap. The (MIS-)assumption being made would be that ALL CORPORATE SHARE STRUCTURES AND ALL CORPORATE OWNERSHIP STRUCTURES ARE CREATED EQUAL. The corporate share structures and ownership structures determine how a mining corporationâs assets are âpackagedâ.
The corporate âpackagingâ can be highly determinative of the success of the investment. How many shares does Auryn really have âoutstandingâ from a COMPARATIVE point of view with other mining investment options? I would argue that for all intents and purposes itâs not the 70 million shares that the financials say are TECHNICALLY âoutstandingâ. Itâs also not the 2.9 million share figure representing the miniscule readily sellable âfloatâ of shares. Itâs somewhere in between.
Although they are technically âoutstandingâ, RESTRICTED SECURITIES and CONTROL SECURITIES (as per Rule 144) are not âfree-tradingâ. They are not part of the âsupplyâ variable that interacts with the âdemandâ variable that determine share prices via the âprice discovery processâ. But what about the metaphorical category of âeventually will be SUPPLYâ of AUMC shares like those that Medinah has in its coffers? People that use market cap comparisons ASSUME that all corporations have perhaps 2% of their shares in a RESTRICTED status and that management owns perhaps 3% or so of the shares. How do you deal with a corporation like Auryn in which management owns over 60% of the shares âoutstandingâ (as opposed to 3%) and about 80% of the shares (as opposed to perhaps 3%) are currently RSTRICTED? Obviously, market cap comparisons are not going to work and would only be grossly misleading.
Maybe we need a couple of new terms in our vocabulary. How about âEFFECTIVE number of shares outstandingâ or âEFFECTIVE market capâ. Should we be making an apples-to-apples comparison of shares outstanding with Auryn which TECHNICALLY has 70 million shares o/s with a âfloatâ of only 2.9 million shares and âCompany Xâ with 70 million shares outstanding, ZERO RESTRICTED SHARES and a âfloatâ of 65 million shares? Clearly, the standard measure of âmarket capâ doesnât go far enough in providing the basis for comparing the potential profits associated with an investment in corporation âXâ versus âYâ. But who is going to tell prospective investors in Auryn/Medinah of this extremely favorable corporate share and ownership structure that Auryn features?
In regards to Auryn, if your investment intentions are to be in and out before any of the currently RESTRICTED shares become UNRESTRICTED, then those RESTRICTED shares, for all intents and purposes, donât exist for you. For comparative purposes, is Aurynâs market cap really 90-cents times 70 million shares or about $63 million? Or, for comparative purposes, might it be more like $20 million or so? How do you compare two corporations each with 70 million shares TECHNICALLY OUTSTANDING, the exact same mineral deposit, but one is made up of shareholders needing a 10-bagger to get back to even (like Auryn/Medinah) and the other has most of their shareholders sitting on triples and just waiting for a cue to sell their shares?
From a potential for a successful investment point of view, the two choices differ like night and day. Keep in mind that the old Cerro shareholders, who now own the vast majority of those 2.9 million shares contained in the free-trading âfloatâ of Auryn shares, are down somewhere in between a 5- and a 10-bagger just to get back to even. If it werenât for market makers willing to âinject liquidityâ by selling nonexistent shares into buy orders, there would be pretty much no liquidity whatsoever in Auryn. You may have noticed a recent transaction in the trading of AUMC in which an approximately 200,000 share block was âcrossedâ from one account to another. This may or may not have been a market maker with an existing naked short position ârefreshingâ that short position by âcrossingâ it from his left hand to his right hand. It is not necessarily illegal for a MM to sell fake shares into buy orders in thinly-traded securities. It is, however, very subject to abuse. Market maker are going to be all over any stock with a 30% âspreadâ between the bid and the ask. They live off of the âspreadâ.
I guess the message would be to be careful of your ASSUMPTIONS in regards to corporate share and ownership structures. I need to admit that Iâm in uncharted waters in regards to Auryn and its share and ownership structures. Iâve never seen a more favorable share or ownership structure when it comes to the prognosis for the success of a mining investment. It will be interesting to watch how things play out once the world figures out that Aurynâs mineral assets are for real.
Itâs almost like we need a bunch of asterisks when describing Aurynâs share structure and ownership structure. Auryn technically has 70 million shares o/s* âŚâŚâŚâŚ.but the âfloatâ is only 2.9 million shares instead of perhaps 290 million shares for company âYâ. Auryn technically has 70 million shares o/s*âŚâŚbut management owns over 60% of them in a RESTRICTED/CONTROL SHARE format in which they canât sell any without filing a Form 144 warning investors that they want to sell a little bit per quarter. Rule 144 restricts the number of shares an âaffiliateâ can sell in any one quarter.
These RESTRICTED/CONTROL shares held by management arenât part of the SUPPLY of readily sellable shares often referred to as the âfloatâ. Auryn is in the process of going into production*âŚâŚ.but they have bypassed the dilution that other miners face at this time because management advanced the funds necessary to go into production at zero interest rate i.e. Aurynâs âcost of capitalâ is zero. There was zero dilution involved in either the percentage of the asset owned (still at 100%) and the share structure (still at TECHNICALLY 70 million shares o/s). Management even went to the extent of saying that the cash advanced to date need not be repaid unless and until the profits from the operation allow it to be repaid. Who knows how long this zero âcost of capitalâ might continue into the future?
How does one place a âvalueâ on this âzero cost of capitalâ policy or all of these other asterisks? How do you do an apples-to-apples comparison to other potential investment opportunities whose management doesnât circumvent all of that dilution? The answer is simple, you canât. I guess the message should be to just be aware of these realities because youâre not likely to see them again in any future investment.
Note that a teeny tiny âfloatâ, like 2.9 million shares, is wonderful from a potential share price appreciation point of view when positive news is released but when it comes to cash dividend distributions all RESTRICTED SHARES get to participate. The question arises as to how the management team of a corporation with that many âasterisksâ should strategize differently than how the management team of more of a âplain vanillaâ type of mining corporation might when management might own 2% of the shares instead of 62%. I think that the answer lies in providing shareholder rewards through a mixture of share price appreciation and cash dividends.
One fact that people should be aware of is that Medinah is currently holding down the PPS of AUMC. Almost all investors interested in placing a bet on the ADL go to Medinah because of the 200-to-1 ratio and better liquidity and tighter spreads. This morning the spread on the AUMC market is 30%; itâs 3% on the MDMN market. Oddly enough, an insanely tight share structure will temporarily actually PENALIZE AUMCâs share price instead of benefit it.
This is because Medinah offers a different route to invest in the ADL Mining District. When the distribution of Medinahâs 16.1 million AUMC shares occurs, all interest in the ADL Mining District will funnel into the purchase of AUMC shares alone and the âfloatâ will still be plenty tight. Right now, circumstances cause all of the buying attention to be routed to Medinah. The supply of readily sellable AUMC shares will go up with distribution but itâs offset by the funneling of ADL buying interest to AUMC only AND THERE WILL BE MORE INTEREST IN AN ABSOLUTE SENSE AS DEVELOPMENTS ROLL OUT.
I would bet a dime to a donut that some investors are reticent to buy AUMC shares today because of the concern about 16.1 million shares being added to the SUPPLY variable of readily sellable AUMC shares. How about the DEMAND for AUMC shares variable? One would think that the spreads between the bid and the ask for AUMC shares might tighten post-distribution of Medinahâs AUMC shares. Do prospective investors currently on the sidelines know anything about these complexities and all of these âasterisksâ? Of course not. To them, Auryn has 70 million shares outstanding PERIOD. Thereâs a big spread between the bid and the ask and I refuse to pay it PERIOD.
So how are all of these complexities and âasterisksâ likely to work out in real time when Auryn goes into profitable production? Once it has started, I think itâs going to go fast. Both the share prices of Medinah and Auryn will probably find their new levels rapidly. Aurynâs tiny float could âpullâ on that 200-to-1 STEEL CABLE linking the two share prices or for that matter Medinahâs share price could âpushâ the PPS of Auryn upwards. What I think that the participants of this investment forum might tend to forget is that literally nobody has ever heard of the ADL Mining District, Auryn or Medinah. The number of interested âeyeballsâ watching this scenario should escalate rapidly. Whatâs going to happen when a prospective investor steps up to the plate and decides to buy a couple hundred grand worth of one or the otherâs shares?
Iâm coaching my 4 kids to keep a close eye on the 200-to-1 ratio for now. Take advantage of the âdiscountâ accorded to Medinah. Medinah had corporate governance issues many years ago but that damage has been incorporated into a bloated share structure. The damage has already been absorbed and now theyâre just a boring holding company. Iâm sure there are some people that associate âMedinahâ with corporate governance issues and thatâs just fine. It allows Medinah to trade at a âpast corporate governanceâ discount to reality. The allocation/distribution process will rectify that issue. The discount can be measured by how much the two share prices vary from that 200-to-1 ratio.
What makes sense to me is to buy the Medinah discounted brand of ADL assets and later sell the AUMC brand of ADL ownership with that Lamborghini-like tight share structure. But I warn my kids that soon Medinah WONâT be a lead weight around AUMCâs share price and that Lamborghini-like share structure of AUMC will have its day. The key thing is to think of that 200-to-1 ratio as a STEEL CABLE. It is an eventuality on the dividend Ex-date no matter what that ratio is today.
Itâs not clear to me if Auryn management is going to choose to continue to advance the Antonino Adit NOW so that they can intersect the two massive veins and add them to the smorgasbord spread or to start the dining experience and concentrate on producing from the DL1 Vein intersection or perhaps a combination of the two.
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I donât think either of the donut shops near your office would sell you a doughnut for a dime these days- better to buy 30 shares of MDMN! 
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Some pretty peculiar things have happened in my life.
Some spectacularly good, some spectacularly bad.
Like most people reading this post, Iâve already been through spectacularly bad with this wacky investment, and am still here, still game, still grindingâŚ
Reading brecciaboyâs (yet again) intriguing analysis leaves me thinking, âYou know, it would not be at all inconsistent with the trajectory of my life so far, to see spectacularly good come roaring full speed around that corner I see up ahead, maybe with spectacularly bizarre hot behind or side-by-side, neck-and-neck, maybe even hand-in-hand.â
If I were asked to speculate as to when, I might say, oh, how about January 4-6?
If not soonerâŚ
Tick, tick, tickâŚ
â madmen
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Madmen, I get that sense too - I mean really, it could have only been ONE deviation worse for us and that would have been for us to have lost it ALL (the company having gone bankrupt), right?
And now, all the pieces have just fallen into place, one VERY SLOW step at a time - and the price of gold has cooperated too.
Just ONE more thing needs to happen - announcement of production at the pace history has shown CAN happen. And maybe we get some numbers saying how they think things will go moving forward.
It will happen fast - the news will get out, then people who are VERY knowledgeable of this sector will start buying, then the people who are semi-knowledgeable, etc.
Then we will be âjustifiedâ - maybe.
This one has tested my patience for sure.
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No better way to find patience than to put yourself in a situation where you at least perceive you have no other option! LOL
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BB. I think you make some good points re: the pros and cons of a tight capital structure. Over the short-term there will be a higher degree of volatility (up and down) but over the medium to long-term the amount of shares outstanding (and the associated market cap) is all that matters. There is no âtechnically.â So AUMC currently supports a $65M market cap which, IMO, already discounts some positive developemnts. Obviously if AUMC starts producing 100koz while delineating a few million ounces, there is still plenty of upside but you donât go from one truck and some explosives to 100k ounces while on shoe string budget. The cost to get that type of ramp is substantial. I have no idea if the plans are to self fund the process âorgainicallyâ but that will take a loooong time. With that in mind, an equity raise could make sense at the right time/price. Assuming that one isnât coming is a bit reckless. Discussing the posibility of a dividend while also thinking that the company can self-fund is just wrong. How many early stage gold producers are issuing dividends while trying to scale operations? Crediting Maurizio for funding this early stage is well warranted.
Itâs a crazy market in precious metals with most of the juniors down âdramaticallyâ this year. We are in the process of merging one of our private companies (gold miner/early dev stage in Australia) with a public company in Canada. Without getting too specific, the Canadian Co has over 1.5M ounces (mostly in the M&I category) and is trading with a market cap under $10M. They are smack dab in the middle of several major mining projects in a very prolific region.
Point being, every miner has dozens of variables that determine how they are being valued (on a per ounce basis) but the market is not awarding the same multiples of what we saw in the last bull market where many companies were being acquired for $250-$300 per ounce in the ground (circle 2011).
Iâm solidly in the camp of new highs in the price of gold in the coming years but a $65M market cap isnât peanuts. A 10x, or $650M market cap, would be one hellofa an acheivement with several million ounces of reserves (not resources) defined, a pre-feasibility study (at a minumum), and 250k annual production (at a minimum), and an on site processing plant with capacity over well over 1M tonnes per annum. Iâm not basing this on my opinion, but rather, a decent knowledge of the competitive landscape (comp valuations).
One more example, I own Fiore Gold which was just acquired. Fiore has a $100M market cap. Itâs a great company, low grade nevada operations, $20M in cash, producing 50k ounces per annum, good visibility for 100koz annual production in the next two years, several million ounces of defined resources, etc, etcâŚ
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Baldy,
A little unclear, did you just acquire Fiore on this recent pullback, or are you referring to Calibre acquiring Fiore back in October? Interesting that you would tout ownership of another stock on this thread, but never as far as I can recall use our âOther Mining Stocksâ thread for such a thing! I know, itâs all about professionalism. OK, itâs just a comparison, and Iâm sure you wonât do it again. Iâll do the same little breech (just this once: -), as I have a position in Fiore Gold which was âacquiredâ by Calibre, which I also have a position in. They are both reasonable investments with P/E ratios of 4.38 and 4.97 respectively. Personally, I welcome any other stocks you care to mention that you own and would like to compare to this one. The other thread has been available a looong time. 
EZ
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No. Iâve owed it for over a year. I also owned Calibre which I sold b/c holding both positions would have created concentration risk and Fiore is still trading at a 10% discount to the disclosed term of the acquisition.
Iâm certainly not touting an investment but rather trying to provide real world examples of companies that are far along in the development/production phases with market caps similar to AUMC. Not sure if it was lost in my message, but companies like Fiore support my opinion that AUMC is fully valued unless/until they have a lot of wins on the mountain.
I havenât been to the other board you mentioned as Iâm already overwhelmed with my widespread popularity here. Not sure I could handle it
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I like Fiore better of the two also, mostly because I currently heavily favor the potential of mining investments in Nevada, and other US states as well as Canada. CXBMF and F.V are not recent additions to my portfolio either, and I do agree with much of your assessment, even if you fail to see investment goals are not uniformly in the one size fits all category. Do you still fail to see that some investors in MDMN/AUMC(CDCH) hold these equities in retirement portfolios and cannot arbitrage tax loss selling against reinvestment a month later? Many of your posts here are heavily biased with a singular point of view. Your more recent few posts were refreshingly informative. Thankyou for your last few posts, but you really need not weigh in so frequently to let us know how great an investor youâve become since disposing of your MDMN, CDCH (AUMC), stocks. Once a year to fill our stockings with coal will suffice! 
Thanks Easy. I will take your recommendation on my participation on this board under advisement. I certainly donât want to fall under the label as someone who has a singular point of view. Especially given that I was very long, sold for a loss, and am now a passive observer with an opinion. I wouldnât view that more as someone who has adapted their viewpoint as the circumstances have changed.
Can you think of other participants here who might be accused of having a singular point of view as being constantly optimitic (vs. pessimistic) regardles of what is actually occuring? You donât seem to have an issue with those individuals who post a lot more than I. Just saying.