MDMN & AUMC have NEVER gone to their shareholders for a Private Placement to raise funds ! This is unheard of in the mining industry, so something is amiss. It’s been 24 years for me , of treating us a MINOR shareholders, giving us carrots on a stick. This may be a major deposit, but the shareholders have ALWAYS been the LAST consideration when it comes to advancing the deposit !
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New pictures published on Twitter(X):
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How about some updated pictures of Don Luis etc! Been alittle over 2 years since we have new pictures! Even little blue must be showing some dirt! Camp looks like an oversized garage. 4 days and it should be finished.
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https://aurynminingcorp.com/auryn-mining-shareholder-notification-oct-30-2024/
October 30th update out.
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While mining grades may vary due to natural dilution factors, we anticipate achieving a plant head grade of at least 10 gpt on average as we advance the project.
BB. You have approximately 5,236 posts asserting that this project would be grading/averaging 60gpt+ . You asserted that folks like myself, forecasting a 10gpt+ operation were planting toxic seeds of negativity b/c of some sort of “agenda.” You screamed from the mountain tops that Enami has been a viable option (even though the cuttoff grade at Caren was 12gpt, meaning 10gpt material would not be profitable). Endless posts elaborating on the $5,000 per ton of direct financial impact of building a FF plant.
I commend MC for finally disclosing the targeted grade (10gpt) which is in line with what I have been referencing and doesn’t negatively impact my view of the project (expensive but making progress).
I trust that you won’t acknowledge the error in the past 10 years of posts/analysis, but you have a lot of editing to do my friend.
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I see that you conveniently left out the immediate preceding sentence with regard to the one ton sample they just sent to Enami grading 57GPT.
“This sample represents vein ore with minimal dilution, providing a solid baseline for grade expectations”
Let’s also emphasize that the 10GPT is minimum!!
I suggest that before we all start the told you so game, we wait for actual production results!!!
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Really Z? So even when the company goes out of their way to specificy 10gpt and emphasizes the point that the 57gpt material sent to Enami represents MINIMAL DILUTION (read: not representative of anticipated head grade) you still feel the need to cling onto preconceived (misplaced) notions of uber high grades? The PRECEDING sentence which I previously left out was made specifically to explain why 10gpt material should be expected.
I’ve been telling MC to put out a grade number for the better part of a year to quell the toxic euphoria of delusional forecasts on this board. I think its a big positive that he finally decided to do so. Investor expectations if/when they begin producing next year needs to be properly grounded.
I would agree that 10gpt is more of a baseline and AUMC has the opportunity to achevie 10-15gpt on a blended basis. Sending ore to Enami, with a 12gpt cutoff (transporation + mining costs) was not an option BUT, with a FF plant, there’s no doubt these guys can generate enough cash flow to keep the lights on and advance exploration. I’m really hoping they get there as it would be fun to see what the mountain has to offer after all of these years.
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Let’s continue this conversation once production begins.
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At last a nice update with some specifics worthy of comment. I recommend the 1999 Howe Fortuna report from which you can make decent sense of most of what Auryn is doing and perhaps navigate some of the differences of opinion regularly voiced here.
Comments:
- Nice grades from the 1 tonne sample sent to Enami. There are numerous historical grade references in the Howe report and of note:
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As given the silver and copper value per tonne put together represent almost a 50% adder to the very good gold grade value per tonne. So that is impressive.
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However, the silver grades in particular are very high compared to any of the historical samples so I would be very suspicious whether they will continue for life of mine.
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The copper grades are quite high compared to historical numbers so they should be viewed with suspicion also.
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Having said that, better recovery methods today could / should improve upon historical results. I just would not take the full silver & copper values given to the bank quite yet. But they are a potential nice bonus.
- Comparing the historical gold grades and vein characteristics to these grades:
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This Auryn report states:
“the DL2 Vein’s width varies significantly, ranging from 0.15 to 1.4 meters.” -
The Howe report states:
"the vein tends to pinch-and-swell, both along strike and down-dip. In places it is reduced to only a few centimetres width, or even a fracture, only identified by the wall rock alteration. In the areas of best mineralization the vein averages about 15 centimetres width (Note: at the time of Kaiser’s report, the workings had not progressed
south of the main N-S fault zone beyond which the width of the vein increases, while the
*grade appears to decrease" [1]
Auryn is currently not at the very north but more toward the northern end of the vein. They don’t say but I assume this 1 tonne sample was taken at their level three workings they were getting ready as reported earlier. So, particulars:
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There will be a lot of variation as Auryn itself reports. There will therefore be good days and bad days, good months and bad months. Sometimes grade will be 50 gpt and sometimes near zero.
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The Howe report says that the unproven historical mining grades farther south in the vein were 17 gpt. Some chip samples were higher than this, some were lower. Howe does not cast doubt on this report but also can not confirm it.
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There is decent gold even in the modest amount of old tailings (1000 tonnes) at around 3 - 5.25 gpt. So some of this can probably be recovered with modern equipment, helping the grade. The Howe report states 50% of the gold was ‘fine gold’ and almost certainly modern equipment will capture this better than 75 years ago.
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Mining reports from 1941 to 1955 of very modest tonnage (entire years being barely above what Auryn intends to do in a few days) show grades of 50 to 75 gpt, and an overall proven/probable reserve estimate was about 10,600 tonnes at 17 gpt. [2]
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As you move south, the vein widens but the grade falls off.
If you put all this together you can see the 10 gpt, which is a very nice grade if not spectacular, is a reasonable lower average bound for some decent time period of 6 months or so. It is a ‘safe’ estimate that Auryn has decent confidence in with some upside hope to 15 to 20 gpt and occasionally higher.
Looking at the numbers you can see that the 10 gpt probably just was not enough of a grade to feel confident putting too much money into the mine if you had to ship truck by truck to Enami, esp. with rising inflation (fuel costs - esp. during and right after COVID) and a stuck gold price (we were stuck around $1700 - $1800 for quite a while). Now that fuel is a cheaper than the COVID year and gold is $2700, perhaps the risk is reduced but one can see why they decided to reduce their all in production cost via concentration (lower transport costs) at the expense of up front capital. It was a trade off. But it was a risk reduction and an improvement-in-confidence move given the volatility of our age. They also needed to improve ongoing cash flow because they are going to need plenty of cash to advance “mine development across the entire project area” in the years to come. 10 gpt and trucking 20 or 30 tonnes at a time was a operations model with too much risk of failure.
All the upside for silver, copper, higher grades, all remain in the current scenario. The cost is delay of ramp up of production and the need for more up front capital.
There is a lot of variation in this property and the various deposit/mineralization types. There are going to be ups and downs and I expect Auryn will be cautious not to get out over their skis too far and get over extended. Like it or not the company is tied to patient local family interests of decent but not billionaire level resources. This has pros and cons. They will probably be working parts of this mountain for many many years and it may be beyond the life times of most of us if and when it becomes a truly large operation.
The current model looks like 3300 Oz / yr production (to go up with higher grades). And becoming a 10 or 20 or 30 KOz producer over a number of years would be a pretty nice outcome for Auryn, imo, and seems doable once they get off the ground and if they have a little luck and the market does not give up all its recent gains. I would expect them to be very cautious about giving up control of the property or even significant portions of it.
All imo,
chg
================
- p. 23.
- p.29
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Thank you for pointing that out, zotron. I can’t imagine any jr miner with very high gpt samples/averages would announce that they are targeting as much. Keeping the official communication at a base 10gpt estimate makes good business sense. The potential for a much higher gpt is very likely. After production begins, Auryn’s higher results will draw far more attention at that time. When BB, EZ (and even Auryn) explained, in detail, how the FF Plant will facilitate a dramatic gpt increase, that claim has never been logically refuted. Not that I know of.
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Under promise/over perform.
We shall soon see.
Also, at 10GPT that 20,000 tons that will be waiting for processing will have a value of $18million at $2,800 an ounce.
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Jaded. We finally agree on something.
The potenial for higher or lower gpt is always very likely. Mining, as per CHG just noted, is a highly variable business. Now that the “official communication” of 10gpt targeted mining is finally out in the open we can finally, hopefully, close the book on allllll of the misplaced speculation on 60pgt+ material, stockpiled ore worth 100’s of million of dollars, cash flow dividend machines, $5,000 per ton of direct financial impact, the option of sending ore to Enami, low transportation costs, the analysis of 200lbs of ore taken directly from the vein, alternatives to drawing down the current debt facility, average grades of artisenal mining have any semblance to larger scale mining, etc. etc. I’m sure there are several others I’ve missed BUT the fiddle has been “played”. I welcome a more constructive dialogue, grounded in reality, going forward.
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MC states that our permit allows for 1,000 tons of production per month and that this aligns well with the FF plant. So, if the GPT prior to the FF process is 10 then let’s assume that after the FF process we’re at 20 GPT.
20GPT X 1000 TPM = 20,000 GPM X 12 = 240,000 GPY
240,000GPY/31GPO = 7,742 ounces per year
7,742 ounces X $1,700 per ounce profit ($2,800 - $1,100) = $13million profit per year
$13million/70million shares = .186 earnings per share
.186/.50 (todays stock price) = 37% ROI. And that’s at 10GPT!!
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Z. You need to get up to speed with the basic concept of “concentration.” If you are processing 1000 tonnes of 10gpt material in a month (a big assumption) that is equivalent to ~300 ounces of gold. Yes, the FF plant will concentrate the grade of the material but that doesn’t mean you magically double the grade with the same volume. In other words, if you process 2 tonnes of ore at 10gpt, you will end up with 1 ton of 20gpt material. Considering that the permit allows for 1000tpm of “maximum mining production capacity” they can process up to 1000 tonnes of mined ore at 10gpt while shipping 500 tonnes of 20gpt FF concentrate, or 100 tonnes of 200gpt material. The grades go higher based on concentration but the ounces produced do not change. This being said, the more concentrated the material, the less trucks going down the mountain, less transportation costs, better margins.
With lowered transportation costs, considering the scale of production, and complexities of chasing a vein, my best guess would be $1400-$1500oz AISC.
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“Chile’s small miner law, which allows for a maximum mining production capacity of up to 1,000 tonnes per month.”
I interpret this to mean you can send 1,000 tons down the mountain per month. If true, then i am correct. If not true then you are correct.
You seem to be putting a pretty heavy foot on AISC costs! My best guess would be $1,100 per ounce.
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Its an exploitation permit (as referenced in the original PR) not a “production permit”, as in your intrepretation. I’m not even sure how a permit, specific to truckloads could even be defined. If you mine 1,000,000 tonnes of material but only “produce” 1,000 tonnes it would defeat the whole purpose of the small miner exemptions. As a side note, b/c AUMC will be operating under the exploitation permit they aren’t, as a public company, allowed to claim that they are “in production.” This is a rule up in Canada on the TSX but there might be exceptions on the OTC.
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Might this be it? Page #2, right column, mid page
JONES DAY, ONE FIRM WORLDWIDE (White paper)
“CHILES NEW MINING ROYALTY LAW: WHAT IT MEANS FOR FOREIGN INVESTORS” JULY 2023
For those mining operators that are not deemed “large” mining
operators, the Mining Royalty Law provides as follows:
• • Mining operators whose annual sales are less than 12,000
MT of fine copper are exempt from the payment of a
Mining Royalty.
•
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We agree … partially. But I do not agree with your addendum trying to refute the “speculations” of others. Nobody is projecting higher results as an outright fact, and it’s everybody’s right to speculate here. Your projections are no better than others’ at this point. We’re all sure to see what actually happens as time goes on, no reason to get distraught about it.
Since this forum is for all members, systematically dismissing what other members present as possibilites is bad form. Especially those based on detailed factual data and their own specific knowledge of mining-related minerals & geology. You have a different point of view, which is good. I may be wrong about this, but you seem to believe that ‘constructive dialog’ means everyone must agree with only your perspective. Perhaps you’d rather create a forum (or a thread) all your own. We could agree on that.
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Hi Zotron,
What is the one piece of information that we desire but don’t have at this time? For me, it would have to be the average grade of the ore stockpiled to date during that 200-day period when Auryn was “mining and stockpiling” ore taken “directly from the vein with minimal dilution” from the nonmineralized wall rock. The “minimal dilution” comes from the revelation that they secured this ore without blasting but instead by mining with “jack-leg” pneumatic percussion drills that, unlike blasting, could carefully avoid the nonmineralized wall rock. Management and the funders obviously know this figure as well as an approximation of the tonnage involved.
What did management just say in this press release, about the reliability of the 70 gpt “gold equivalent” grade Enami found in the “experimental batch” of ore they smelted which was also secured with “jack-legs” without blasting? They said that this 70 gpt gold equivalent grade “provides a solid baseline for grade expectations”. In other words, management basically said that they are in possession of evidence suggesting that 70 gpt is a somewhat reliable for making “grade expectations”. No BOD would unanimously sign off on that text without irrefutable information in hand that would back up their assertion. This had to come from the average grades sampled in those stockpiles. It didn’t come from a couple of groupings of channel samples coming in at 164 gpt gold and 150 gpt gold. It didn’t come from a smelting test done at the Plenge lab coming in at 128 gpt gold just for the gold component of that ore no counting the extremely high-grade silver and copper grades found. Management needed some “sample size” in order to go out on that limb.
It’s true that management also implied that their OFFICIAL GUIDANCE was that they expected grades to be “at least 10 gpt gold”. That’s as far out on a limb as they are willing to go for now until a significant amount of tonnage is run through the plant. That’s smart of them. They need to cover all of their bases. If they suggested “at least 10 gpt gold” only and the real numbers came in at many, many times that and a bunch of their shareholders sold their shares in the interim because of that 10 gpt guidance then they’re going to be in deep doo-doo with those shareholders. THEY KNOW THE GRADES OF THE STOCKPILED ORE, THEY HAVE TO COVER BOTH OF THESE BASES, THE WORSE CASE SCENARIO AND THE ANTICIPATED SCENARIO. Providing a 70 gpt grade as a “solid baseline for grade expectations” has repercussions if it is bogus.
Management has shouted from the mountaintops the channel sample grades of 164 gpt gold, 150 gpt gold and the 128 gpt gold smelter results for just the gold component of that ore which comes to about 157 gpt when you add in the silver and copper. They cut these more than in half when they suggested 70 gpt gold equivalent as “a solid baseline for grade expectations”. Whatever the stockpiled ore assays came in at gave them the confidence to make their assertion.
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