If we end up mining four veins at once, maybe half the time we end up mining the Rosary chain and the other half the Rosary bead. If you take the average between the two, then you end up with an average just north of 70 gpt. I think I’ll pencil that in, until the hairless eagle yells at me.
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All things considered, I think 20 is more reasonable/conservative. The high grade veins have been previously reported out as narrow so a lot of lower grade stuff will get mined/mixed in with what goes into the floatation plant when production is ramped up but of course I love to be wrong on this. Certainly, if the initial low grade stuff that goes into the plant to test it is as already north of 20, it will be a good sign.
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Yeah, I’d like to be pleasantly surprised too, but I think that can happen from 70 gpt too (not trying to cause heart attacks). To me, it’s gonna come down to what percentage of time they’re using percussion/jack-leg hammers (more high-grade stuff), versus blasting (more of the surrounding ore and therefore less prolific).
We also need to keep in mind that from early 2023 to early 2024, Auryn was exclusively in “MINING DIRECTLY FROM THE VEIN WITH MINIMAL DILUTION WITH PERCUSSION HAMMERS” mode i.e. no blasting. That’s the 70 gpt GE stuff coming only from the VEIN PROPER. Unfortunately, management never gave us the tonnages associated with that style of mining, but we know it lasted at least 9-months. They made 3 consecutive quarterly updates bragging about how well things were going and how “valuable” the ore is.
Fast forward to just a couple of days ago, Auryn admitted that they had not just the 20,000 tonnes of ore stockpiled as they suggested earlier, but that they had 28,000 Tonnes “ready for the FF plant at start up” plus “over 60,000 Tonnes available to supplement feed over time”. Based on a 330-day work year, that’s 2.66 years’ worth of “feed”. If you add to that all of the new locations that are scheduled to be opening up, you can see that there is already a need to increase the 100 TPD “nominal throughput” of the FF plant.
In a recent quarterly update, management mentioned that they decided to add to the original order for the 100 TPD FF plant by adding what sounded like more “flotation cells” or possibly “flotation columns”, but they did not say how much this would add to the 100 TPD figure.
I’m not sure what the differential is in between the 28,000 Tonnes and the “over 60,000 Tonnes” that were referenced. Is the 28,000 Tonnes already crushed and sorted? Is it in a different location than the “over 60,000 Tonnes material? They have a jaw crusher on site over and above the new gyratory crusher and new 6’ by 8’ ball mill which may or may not be in place right now.
In the most recent photos on “X”, they show a gazillion different stockpiles all over the place. They are sorted by GRADE. Keep in mind that Auryn has had a brand-new geochemical assay lab on-site since January of 2025. This will greatly streamline both PRODUCTION operations and EXPLORATION. Prior to this, samples were sent to 1 of 2 labs in Santiago. There they were put into a queue, first come first served. MANAGEMENT KNOWS WHAT THE GRADES ARE OF THE STOCKPILED ORE AS DOES THE INSTITUTIONAL INVESTOR THAT JUST CUT A CHECK FOR $4 MILLION.
Keep in mind that the new Chilean “Small Mineral Producers Statute” rewards “small producers” with lower taxes and STREAMLINED PERMITTING if they agree to keep each operational adit at a maximum production rate of 100 Tonnes per month. With this being the case, you want to do everything you can to keep the grade as high as possible (via mining with percussion hammers if you can) and leave the less well-mineralized wall rock in place. This suggests to me to keep an eye out for upside surprises when it comes to GRADE. Even the artisanal miners averaged 64 gpt with no technology whatsoever.
With pretty much every E-Mail we exchange, he constantly reminds me “as you know I prefer to under-promise and over-deliver rather than the other way around". You might remember a letter Maurizio wrote to us when Kevin stepped down as CEO of Medinah. He explained his utter disdain for hyper-promotional management tactics like we experienced with Medinah and Les Price. When Maurizio says that he intends to have 20,000 tonnes of ore mined and stockpiled by Day 1 for the commissioning of the FF plant, ALWAYS BET ON THE OVER, 88,000 Tonnes is not 20,000 Tonnes.
It seems to me that Maurizio is paranoid of an investor losing money based on him not meeting guidance. I remember at the “informational meeting” in Las Vegas, Maurizio told us that if we chose to share our notes from the meeting with others to please accompany those notes with a copy of Auryn’s “Forward Looking Statement” warning appended to all press releases.
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I was planning to lay off posting for a bit but that is too rich to leave unchallenged. You’re saying Maurizio is suddenly worried about “over hyping”??!! Wasn’t this shareholder meeting nearly a decade ago? That was the meeting when he claimed that AUMC was fully funded to prodcution, that produciton was imminent and the company aspired to become a mid-tier producer? A decade ago!
Keeping in mind, over that 10 year period there were at LEAST three periods and a dozen PRs where the company told invetors that they would be in production “imminently.” In the early days it was the Caren and then six months of silence. At least two subsequent updates where they claimed they were already beginning to send ore to Enami (on a regular basis), ie “production” and yet there was never any reporting of cash flows. And then a complete pivot away from Enami and a decision to build their own plant (based on a miraculous discovery of refractory ore and dispersions in grades/metal credits). In the August 23 update they stated that they would be shipping to Enami (the gold was refractory and unsuitable for the previous plans of the scrapped offtake agreement) and in the Octover 23 update (2 months later!) they pivoted “armed with the compelling data” (already known that the ore was refractory) they scrapped Enami and began the year plus journey of landing financing for the plant.
In the Jan 2024 update the company stated: " mining operations at Fortuna are progressing smoothly, in line with the strategic decision made by our Board of Directors in the previous quarter." In the subsequent update: “our mining team is diligently carrying out ore extraction and accumulation directly from the vein on a modest production scale”. (notice the hedge: “modest”). In the April 2024 update the company admitted that the mining was put on care and maintanance so they could focus their efforts (and money) on closing the financing.
In the May 2024 update guidance was for the plant to be built and prodution to begin in the first quarter of 2025, in the Sept 2024 update guidance was for production in May of 2025, in the October 2024 and Jan 2025 and April 2025 updates guidace was for production in Q3 2025 and the most recent update claimed that things were “proceeding as planned” with no guidance on production but hopes to receive permits (to even start prodution) in the “coming months.” My best guess is Feb-April 2026.
No offense, but I’m fairly comforable in saying that, if past is any sort of precedent, Maurizio isn’t losing too much sleep of “investor’s losing money based on him not meeting guidance”!!!
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Hey John, I agree with this statement. A good example was when Medinah went dark and onto the Grey Market without any warning from the BOD. Now let’s say the stock was still trading, who knows with where the stock could be today with the positive developments on the mountain and the price of Gold. Could be over a penny?? This at least maybe would’ve given shareholders an exit point from this nightmare.
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This is just an AI summary for those trying to to catch up: Auryn Resources has been mining high-grade ore directly from the vein using percussion hammers since early 2023. They have 28,000 tonnes of ore ready for processing and over 60,000 tonnes available for future use. This stockpile could support operations for 2.66 years at the current processing rate of 100 tonnes per day (TPD). Auryn is expanding its processing capacity by adding more flotation cells or columns. The company has a new on-site geochemical assay lab, which will improve production and exploration efficiency. Management is known for under-promising and over-delivering, so the actual stockpile and grades could be higher than stated. Auryn benefits from Chile’s “Small Mineral Producers Statute,” which offers lower taxes and streamlined permitting for keeping production rates low. This strategy focuses on maintaining high grades, suggesting potential upside surprises in future grades. The company’s cautious approach aims to avoid investor losses due to unmet guidance.
I haven’t been following this closely enough to comment lately. Actually on vacation but it’s good to see all the recent posts. Welcome back MG! I’m liking the recent DD getting posted.
EZ
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John,
Nice to see you back. You were missed. However, you’ll likely need to update your sour grapes story here before too long. Don’t you have any new material? 
Sounding more like you’re just trying to drum up some business for PPX now that you have a position there. Glad to see in an earlier post you promised to let everyone here know when you decide to take a position. Even though you didn’t state a warning, I won’t be holding my breath waiting for it. 
Hoping to see folks in Santiago next year. 
EZ
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Mike Gold: It’s a pleasant surprise to see you contributing to the Auryn/Medinah thread again.
*You may remember me from the past days of battling the WLD’s/bashers…
Welcome Back!!
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Easy. I would love to discuss new material. Unfortunately, the board is in a multi decade time warp with the same ridiculous “themes” on rinse and repeat. The notion that Maurizio is under promising, over delivering is simply false (as my PR timeline clearly, for any objective, individual would lay out). I’d much prefer debating the merits of assets or the valuation of the company but, alas, there’s simply no way to do so given how little information has been provided. To be certain, this isn’t part of some grand scheme to keep this little story under the radar of the investment community but rather the result of a rinky dink operation trying to find some direction.
As it relates to PPX, as the second largest shareholder and a director of the company I will not be discussing this company. Maurizio is very familiar with the project. Its not perfect. There are a lot of shares outstanding b/c they didn’t “break the mold” but, by doing things the “normal way” the stock was up 10x this year and recently attracted Glencore as a strategic investor. This new money will allow them to aggressively explore the region. I only referenced them in the past, not by name, as what small a operator, at a similar stage, should be doing while building a plant. If you compare the information flow (and the stock prices) there’s a very clear discrepancy. The last thing I will say: Maurizio would be more than happy to acheive similar grades through the course of minng (this is not speculation).
One thing that amazes me (understatement), given the “rigorous” level of due diligence by some participants: there hasn’t been a single mention of American Sierra Gold Corp (AMNP). Here’s another stock that is up 10x (welcome to the actual bull market in precious metals). There’s not a ton of volume and I have no idea what is going on BUT shareholders in MDMN (the ultimate lock box) own over 11 million shares. While I run the risk of alerting the frothing bulls and inevitable price targets of unattainably higher prices, its certainly worth noting. Ironically, of the three headless horsmen, AMNP has been the one horse worth riding!! Also worth noting, the market cap of AMNP ($35M) is more than 70% of AUMC’s and quickly closing the gap.
I don’t relish being the guy pointing out seemingly obvious good news but there’s not much of an alternative when the Maurizio fan club is asleep at the switch. Unfortunately, because Maurizio decided to literally take MDMN off the radar of the investment community, there’s no “play” here but still worthy of a mention.
USING PPX MINING AS A “COMPARABLE” TO EVALUATE THE CHANCES FOR SUCCESS OF AURYN MINING
Studying “market comps” is critical in evaluating investment opportunities in the junior mining sector and their chances for success. When you’re studying Auryn Mining, it’s nice to finally be able to compare it to another junior miner with a similar deposit type (veins, breccias, and mantos) and more importantly if the “comp” is SLIGHTLY AHEAD (perhaps 2-months) of where Auryn is as both companies transition into PRODUCTION. The idea would be for PPX to serve as a predictive template.
The question wanting to be answered is at what levels might Auryn’s shares be trading at in the next 2-months or so when they catch up with the current stage of development of their “market comp” PPX. In other words, how is “the market” likely to treat Auryn’s share price within the next 2-months?
What got me intrigued with this topic is the fact that PPX with nearly a billion shares outstanding fully diluted, just went up 10-fold in the recent past when they were at Auryn’s current stage of transitioning into production. If they can go up 10-fold with almost a billion shares outstanding just think what Auryn might be able to pull off with only 70 million shares outstanding.
You might remember in the recent analyses of “The Lassonde Curve”, how the sweet spot for investing in the junior miners is when they enter the “construction phase” prior to entering into production. This is when the share price of these juniors tend to go up in an almost parabolic fashion. Is this what happened to PPX?
Studying this “market comp” known as PPX might supply Auryn and Medinah investors with a potential view of the future. A lot can be learned by lining up, in a side-by-side fashion, relevant information regarding two different investment opportunities in the same sector.
THE TIMING FOR BOTH AURYN AND PPX COULDN’T BE BETTER
For those juniors fortunate enough to be transitioning into production at a time in which the metals prices are at or near their all-time highs, it’s critical to be able to evaluate how good of a job the management teams of these “about to become producers” have done in regard to preventing untoward dilution of their share structures during the long journey involved en route to commencing PRODUCTION. We need to keep in mind that individual “SHAREHOLDER REWARDS” are always inversely proportional to the number of “shares outstanding” (shares O/S).
On “TheMiningPlay” forum you’ve been told for years that there is only one way to build a mining company and that involves the miner with a mineral prospect selling as many shares as it takes to raise money in order to fully drill out the mineral prospect, even if it is a vein that has been mined in the past, and then to sell yet another bunch of shares in order to raise enough money to do a series of studies called PEAs, PFSs, and BFSs.
The message has been that this “traditional approach” needs to be followed in ALL cases no matter how much dilutional damage is done to the share structure in the process. Theoretically, doing it any other way would involve “cutting corners”.
I would proffer that a balance needs to be struck between the acquiring of meaningful and actionable geological and economic information versus share structure dilution and the diminishment of future SHAREHOLDER REWARDS for the average shareholder.
Thankfully, Auryn’s CEO Maurizio Cordoba never bought into this “traditional approach” argument and instead he adapted what many refer to as a “bootstrapping” approach. This involves no sale of shares to outside investors, but instead relying upon a generous management member, himself, to advance all of the cash needed to put the mineral prospect into production.
This “bootstrapping” approach would then bypass the damaging share structure dilution associated with taking the “traditional approach”. Make no mistake, Maurizio’s cash advances still need to be repaid upon demand, but with his approach it is paid out of the profits from PRODUCTION after the company has successfully started cash flowing, and not by the sale of shares trading near zero before a bona fide “discovery” has been confirmed. Getting a project permitted, funded, and into production is the most reliable way to irrefutably confirm a bona fide “discovery”.
Recently a post was made on TheMiningPlay investment forum by “Cabezon” regarding a miner known as “PPX Mining”. They have a property in Peru that is also transitioning into production. It has a lot of geological similarities to Auryn/Medinah’s Alto de Lipangue project which aids tremendously in the comparison process.
I did some research on PPX Mining, and I came to the conclusion that it could serve as an EXCELLENT “test case” in comparing the “traditional approach”, which PPX took, versus the “bootstrapping” approach, taken by Auryn, to building a mining company.
As noted, both companies are currently transitioning into production with PPX being approximately 2 months ahead of Auryn’s current status. This is an ideal arrangement from the point of view of the Auryn/Medinah shareholders wishing to get a glimpse of their near-term future. The TIMING for both corporations is very fortuitous because the prices of the metals being mined are trading at or near all-time highs.
THESE ARE INTERESTING TIMES TO BE TRANSITIONING INTO PRODUCTION BECAUSE OF THE ABILITY TO DIRECTLY BENEFIT FROM THE EXPLODING METALS PRICES
A lot of the active mining investors worldwide are currently sitting on recent doubles, triples, and quadruples in their past mining investments and are looking to roll their profits into PRODUCERS that can DIRECTLY take advantage of the current metals prices.
There are probably tens of thousands of mining investors worldwide that are currently in search of only PRODUCERS whose share prices have NOT moved up yet. Good luck with that concept you might say as almost everybody in the mining sector seems to be sitting on at least a double.
If an investor is already sitting on a quadruple or “4-bagger”, the chances of a “5- or 10- bagger" from current levels forward, in that same stock, are probably somewhat remote. In the midst of a secular bull market in the metals sector it is critical to roll up your sleeves and be active because in a bear market it often doesn’t matter how hard you work because it is extremely difficult to make a buck.
The problem is that there don’t appear to be many PRODUCERS whose share prices haven’t already gone on a run, so perhaps the next best thing is looking for the “about to become PRODUCERS” whose share prices haven’t moved yet probably because nobody has ever heard of them. PPX might be an excellent example.
In my opinion, that’s the new sweet spot in this sector which is currently the hottest sector on the planet. Exactly who are the “ABOUT TO BECOME PRODUCERS WHOSE SHARE PRICE HASN’T GONE UP YET”?
With there being 3,000 junior mineral explorers/developers in existence today, it shouldn’t be difficult to see how a junior miner transitioning into production might get lost in the shuffle UNTIL POSITIVE CASH FLOW IS THOUGHT TO BE IMMINENT.
The price of gold and silver are clearly breaking out to the upside, but the actual PRODUCERS of these metals have a great deal of LEVERAGE over and above the incremental advances in the prices of these metals. This is because the incremental advances in the metals prices tends to drop straight to the bottom line especially when the price of oil is behaving itself, like it is now. Energy prices can be a significant percentage of the “ALL IN SUSTAINING COST” (AISC) needed for a miner to produce each ounce of gold it produces.
Both Auryn and PPX appear to be able to commence production within a couple of months’ time. As noted, PPX appears to be a couple of months ahead of Auryn from a development stage point of view as they have been in the “construction phase” of development for a while now.
As noted, PPX, despite having almost a billion shares outstanding fully diluted, has recently earned their shareholders a “10-bagger” as they moved from the 5-cent level to 50-cents. Auryn’s share price has been flat-lining. The question becomes, can Auryn emulate PPX’s share price performance over the next couple of months as they catch up with where PPX is now.
On the pathway to production, PPX raised money via a long series of “equity raises” involving the sale of shares to outside investors starting at about the 4.5-cent level. Today, PPX has about 921 million shares outstanding fully diluted whereas Auryn has 70 million shares outstanding fully diluted. The ratio is a little bit over 13-to-1.
What you might want to do is to mentally sketch out a current “outstanding share count trajectory” in order to anticipate the potential timing of any further dilution by either company. Past trends have a tendency to stay in place.
Auryn has been “flat-lining” in their outstanding share count trajectory for quite some time. The 70-million shares outstanding figure hasn’t changed in 7 years. I’ve personally never witnessed this before in 45 years of investing in this sector. I think of Maurizio as the “Rudi Fronk” (Seabridge Gold) of South America. Rudi is world famous for keeping the outstanding share count in Seabridge Gold at a minimum.
Whenever Auryn has needed money, a check was always there. There was no need for “dog and pony” shows and no time or resources were wasted in any “capital raising” activities. The “COST OF CAPITAL” was always zero for Auryn. Meanwhile, PPX was handing out lucrative “finder’s fees” right and left, which is basically the norm for this sector.
PPX entered into multiple royalty “streaming” agreements wherein investors gave PPX money early on in their development, in exchange for a later “stream” of gold and silver production, in which the investors could buy ounces of PPX gold production at about $400 per ounce even though gold is currently trading at over $4,000 per ounce. When the deal was consummated, however, gold was trading much lower.
PPX took the “traditional approach” with all of this capital raising and did some diamond drilling and performed a “Pre-feasibility Study” or PFS. It showed that PPX should be able to produce 26,000 ounces per year over a mine life of 7 years. Their AISC was set at $813 per ounce back when the study was done several years ago. It’s not clear what effect inflation has had on that figure.
Auryn has yet to release any OFFICIAL AISC estimations, nor is there any guidance on the number of ounces to be produced annually, nor of any estimated mine life. Maurizio has told me that he prefers to run some tonnage through the new FF plant prior to releasing any “OFFICIAL GUIDANCE”. This will enhance the statistical accuracy of that GUIDANCE.
When completed, PPX’s new plant has a nominal throughput rating of 350 TPD while Auryn’s is rated at 100 TPD. PPX has a significant amount of oxide ore, so they went with a CIL (carbon in leach) plant for the oxides and a froth flotation facility for their sulphides. Auryn is mining predominantly sulphide ore, so they went with a froth flotation plant with the intent to add some gravity concentration equipment for the “coarser” ore later on.
I think the best way to compare and contrast the 2 different “corporation building” approaches that were taken is to assume that both companies are going to dividend out the profits at the end of each quarter. (In reality, at this stage of production usually the profits get rolled back into the project as “retained earnings” in order to ramp up production.)
Let’s assume that at the end of each quarter PPX had a mixture of cash profits and ounces of gold and silver needing to be handed over to those holding the royalty “streaming” agreements. Auryn had all cash because they never took money from any “streamer” and doesn’t owe any ounces of gold to anybody at the end of the quarter.
At the end of each hypothetical quarter, PPX will hand out a certain number of ounces of gold to the “streamer”, and the “streamer” will hand them a check for about $400 for each ounce of gold handed over. This will add slightly to the pile of cash that PPX has to hand over to their shareholders as a cash dividend distribution or to their NSR holders as repayment for their loan. The “streamers” can take their gold and sell it and cash in on the differential between $400 and the current POG of somewhere around $4,200.
The holders of PPX’s “Net Smelter Royalties” will have “first dibs” on PPX’s quarterly profits. With 921 million shares outstanding, my concern is that each PPX shareholder might not be going to get a whole lot of CASH PER SHARE OWNED. They’re the last guy in the “buffet line” after the “streamers”, those holding the “NSRs”, and the creditors, get their fill.
At the end of the quarter, the Auryn/Medinah shareholders will divide up the quarterly cash profits amongst the holders of 70 million shares after any payments to creditors are made. Auryn will not be handing over any of their gold, silver, or copper production to any “streamers” or any cash to any NSR holders.
In order to attract the capital from their “equity raises” and from their “streaming” and NSR royalty providers, PPX was pretty much “FORCED” to drill out some of their deposit and do a PFS (Pre-Feasibility Study) in order to “DE-RISK” the providers of capital. The providers of capital are nearly always in a position to get the junior miner with a mineral prospect to do whatever is needed to “DE-RISK” the provider of capital.
Even though they took a “bootstrapping approach”, Auryn also had to gather up a tremendous amount of geological and economic information prior to the Board of Directors and Maurizio coming to a “POSITIVE PRODUCTION DECISION”. They did not have to gather any further information, over and above this amount, in order to “DE-RISK” any willing financier.
Instead, Auryn had to gather enough information to “DE-RISK” Maurizio which would allow him to be willing to cut the necessary checks.
Since Maurizio already owns 62% of the outstanding shares of Auryn and is the largest shareholder of Medinah Minerals which owns 23.56% of Auryn’s shares, then he would be the largest victim of any untoward share structure dilution. As it stands now, Maurizio’s financial interests are closely aligned with those of the average Auryn/Medinah shareholder which is exactly what the smaller shareholders want but rarely get.
PPX sold an awful lot of shares way back when at the 4.5-cent level. The question that arises is are the holders of any of these inexpensive shares looking for an exit sign leading to a “liquidity event”? The share price of Auryn has been pretty much flat as there has been absolutely zero promotional activities undertaken by management. Maurizio wants to finish the story before he tells it. PPX has made 34 press releases to date in 2025, Auryn makes 1 quarterly update every 3 months.
Auryn wasn’t FORCED to sell any shares at lower levels. Further, Maurizio’s huge block of both Auryn and Medinah shares are semi-restricted from resale due to Rule 144 of the 1933 “Securities Act”. There is a “quantitative” aspect to Auryn’s tiny number of shares outstanding, but there is also a “qualitative” aspect due to the “restrictions” from resale involved. It sounds corny, but I look upon Auryn’s share structure as a “work of art”.
These “quantitative” and ”qualitative” aspects of Auryn’s share structure result in the “float” of readily sellable Auryn shares being de minimis. The ratio of PPX’s outstanding shares count to Auryn’s might be over 13-to-1, but the ratio of the “float” of readily sellable securities between the two is much, much higher.
It is the “float” of readily sellable securities that serves as the “SUPPLY” variable that interacts with the “DEMAND” variable to determine share prices through the “price discovery” process. I think the most important financial metric in the mining industry is actually “EARNINGS PER SHARE CONTAINED IN THE ‘FLOAT” OF READILY SELLABLE SECURITIES”.
In fact, Auryn’s share structure is actually “too tight”. People like myself, are having a terrible time establishing a decent-sized long position without chasing the share price upwards. I’ve never seen anything like this before. In the junior mining sector, there always seems to be plenty of shares available for sale. Medinah’s 16.4 million Auryn shares are held in their corporate coffers and are not currently part of the “float”. They are awaiting permission from the securities regulators to allocate and distribute those 16.4 million Auryn shares in a pro-rata fashion to their shareholders.
The question becomes, from the point of view of the AVERAGE shareholder of each company, PPX and Auryn, which approach is likely to work out best in the long run. We can’t answer that question in a definitive manner quite yet. Time will tell, but I think you might be able to appreciate that maybe, just maybe, there is more than one legitimate way to build a mining company especially when you’re dealing with a vein deposit that has already been in production and is not in need of being fully drilled out.
If the choice at some day is to fully drill out the deposit, then it would be much better to fund that drill program with the profits from mining rather than the sale of shares. If Auryn were trading at $10 per share, then I might favor selling shares to fund the drilling.
Part of the problem is that, in my opinion, the clearly superior way, “Bootstrapping”, is ultra-rare because of the obvious lack of many CEOs being willing to bankroll the corporation, while charging no interest, all of the way up until production.
Due to its rarity, not many potential investors even recognize what’s going on. This might explain why Auryn’s share price is in the doldrums or it might be related to Auryn’s management team holding off on any promotional activities. Auryn probably appears to many like any other junior miner with “liquidity” issues. Yes, there indeed is a “liquidity” issue, but it’s not the typical “liquidity” issue associated with not being able to drum up buyers of your shares. It’s just the opposite, the “DEMAND” variable is present, but the “SUPPLY” variable is so tight that, as mentioned, a buyer, like myself, wishing to establish a significant long position can’t do so without chasing the share price into the stratosphere. When is the last time a junior miner had a share structure that was “too tight”?
The big winners on the PPX deal will no doubt be the early investors that bought the cheap shares and the royalty “streamers” and the holders of the “Net Smelter Royalties” (NSRs). They’re first in line at the quarterly “buffet line”. PPX’s current market cap is about 921 million shares times 30-cents USD or about $276 million. Auryn’s current market cap is about 70 million shares times $0.73 or about $51.1 million. Both mining firms are likely to do quite well in this current mining environment. But are the average shareholders in the 2 companies likely to do equally well?
The reality is that not very many companies are going to have a CEO willing to advance all of the cash needed to put a project into production, especially while charging zero interest. This is how Auryn circumvented all of that SHARE STRUCTURE DILUTION. They were able to arrive at a “POSITIVE PRODUCTION DECISION”, just like PPX did, but they did it without all of that dilution. The CEO voluntarily bore all of the risk on his shoulders early on in development. For me, the question arises as to what he knows that “the market” doesn’t?
SUMMARY
In reality, 99% of mining companies are FORCED to take the “traditional approach” to building a mining company and endure the concomitant share structure dilution. It’s always been this way. After all, where are you going to find a CEO willing to put up over $10 million in order to advance a mining project into production while charging no interest?
What is interesting is that this ability to circumvent all of that share structure dilution early on, will actually last for the entire life of the corporation. The investors that come to the party late still get to partake. The benefits are PERMANENT.
The key is to get through those early years, when the share price is low, and quite frankly deserves to be low, without trashing the share structure. Once the cash starts flowing, the need to raise money via the sale of shares, “streams”, or “NSRs”, drops precipitously.
Investors in mining stocks buy these things called “SHARES”. What investors need to do is to start thinking in terms of “PER SHARE” metrics. For example, what are the earnings on a “PER SHARE” basis? Every shareholder’s shares must carry their own weight and earn the cash dividends going to that block of shares
For me, an important metric is how many gold ounces will each company produce “PER SHARE” owned? If PPX and Auryn make the same Net Income from operations per quarter, the EARNINGS PER SHARE for Auryn will be approximately 13-times that of PPX.
In retrospect, both companies did exactly what they had to do in order to arrive at a “POSITIVE PRODUCTION DECISION”. It’s just that only one company got a helping hand at just the right stage of development from their CEO.
PPX’s PFS says that it is scheduled to soon be producing 26,000 ounces of gold per year. When you divide that number of ounces by nearly a billion shares, the gold production “PER SHARE” or the earnings derived from that production, when measured on a “PER SHARE” basis, is going to be de minimis. This share structure dilution is the NORM in this sector because almost all junior miners are FORCED into taking the “traditional approach”. Auryn is the outlier.
Damage to the share structure through time is CUMULATIVE. If a junior miner went through a rough patch early on and they were forced to execute an extremely dilutive “streaming” or NSR agreement or an extremely dilutive “equity raise”, then the damages sustained will be PERMANENT. If a junior miner sold a bunch of shares and raised a bunch of money for a drill campaign with terrible results, that share structure damage does not go away. It might not seem like it, but taking the “traditional approach” is actually very risky.
If Auryn can also produce 26,000 ounces of gold with the same AISC as PPX, their “EARNINGS PER SHARE” will be about 13-times that of PPX. Mining stocks trade at prices based on a “multiple” of about 30-times EARNINGS PER SHARE.
In this scenario, Auryn’s share price should theoretically be about 13-times that of PPX. This is why it might be worth it for investors to do some hunting around for a company run by a CEO that, during the early years when the RISK was the highest, was willing to personally make the sacrifice needed to bypass all of that dilution early on.
To be clear, I bear no ill will against PPX or their shareholders; I hope they all do well with their investment. When reading their story, I just thought it would provide an excellent learning tool for comparing these two approaches for building a mining company.
Below is a link to PPX’s most recent quarterly filings:
PPX Mining Corp. - FS June 30, 2025 (Draft 8-22-2025).pdf
Notice how complicated it is to follow the historical funding measures and their effect on the prognosis for a new investor to make a buck at the quarterly “buffet line”. It is imperative for prospective investors to carefully study the “CORPORATE STACK”. This includes the terms for all prior fundings. What you’re looking for are any “fatal flaws”. For the average investor, without an MBA in Mineral Economics (if there was such a thing), there really is something to be said for SIMPLICITY.
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Thank you for doing a detailed comparison of the development strategies!
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This is inexcusable and I cant believe Kevin is just sitting idlely by. Its disgraceful after everything MDMN shareholders have been through to let the stock go dark. What a kick in the balls. I’ll ask again, why hasn’t Greg Chapin been held accountable or has he? What happened to Les Price’s estate? Did he ever make good on the legal damages owed?
Kevin come out of your shell and contribute to the board please. It would be appreciated.
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Hey Jimmy, Kevin will be just fine. His compensation for his services is 1 million shares of AUMC once it gets converted or at a later date. Someone correct me if I’m wrong with that amount.
AMNP has 878,611,686 shares outstanding. Baldy states that MDMN owns 11million shares. That’s 1.25 percent of the outstanding. At.04 per share, that’s a value of $440,000. MDMN has 2.82billion shares outstanding. The value of AMNP adds .0002 to each share of MDMN.
The value of your AUMC shares adds .004 to each share of MDMN. 20 times the value of your AMNP ownership.
Keeping it in perspective.
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BB. I think you’d be better served sticking to analysis of the AUMC story, it almost feels awkward when reading your attempt to analyze a “real mining Co.” Based on your analysis one could almost feel regret in not owning AUMC vs PPX. Two companies at the exact same stage in the cycle. Thankfully, there is a score board (share price) that allows some of us suckers, stuck in PPX to keep one foot in reality. Worst case, an investor in PPX could sell their shares today and buy 10x more in AUMC vs 4 months ago. Opportunity cost is a real thing.
If AUMC is able to land a deal with Glencore, without any resources, I’ll change my tune but, until then, keeping a 70M share count does not equate to viable investment thesis.
To be clear, PPX is not a few months ahead in terms of production (unless you are admitting that AUMC is even further behind than their “conservative guidance). I referenced a Peruvian co (purposefully NOT by name) as an example of how “normal” CO’s were keeping their investors informed and being rewarded with significantly higher prices. It’s a bit disingenuous to try to compare the two companies. One company is fully transparent with financials and a resource. The other company is completely dark. If it were only as easy as “one company had more shares outstanding.” Unfortunately, in the real world there are a few more variables to consider. I can’t wait to read the excuses for a sideways share price in the coming months. The “market just doesn’t get it” !!
Can you guess who owns the streams and royalties?
I’m not claiming that MDMN’s position in AMNP is Earth shattering but I do find it amusing that a shell company with a few tenements might exceed the value of AUMC.
I don’t know what his share compensation is but what I will say is MC was very smart to have someone like Kevin in place to quell the pitchforked MDMN natives down while he put our money to sleep for 12 years. The MDMN gray listing is an atrocity, especially given they are silent about the timing of the conversion.
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Given how many shares Maurizio owns you would have thought/ hoped that he might have allocated a portion of the $10M he’s lent to AUMC to pay for the conversion. This assumes that the costs of this conversion is the main, gating, factor.
Given the “ferocious” nature of this bull market you want to have the shares trading. Remember when the stock ripped higher a few years ago on no news (just a social media mention)? That’s the kind of stuff that goes on in this type of tape. AMNP is another example. As is PPX which essentially “traded by appointment” until May of this year. Nobody had even heard of the name (they have no PR efforts).
Unlike AUMC, MDMN offers the liquidity for anyone looking to make a bet. Unfortunately, when you have a shareholder base, representing a vocal minority, that praises and/or justifies every move Maurizio makes, things like moving to the “gray market” go unchallenged. This REALLY needs to be a priority and it would be great to watch it trade. More importantly, don’t long-term, suffering shareholders deserve the right to add to or sell their shares? I still own a few million in a stale brokerage account, well over 15 years old, where I’d like to, ar a minimum, have the opportunity to realize losses for tax purposes. The position is prob valued at $50 but the loss work be immensely helpful to offset other gains before the end of the year .
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Hey Bald Eagle, if having 50.00 of capital losses to offset against capital gains would be immensely helpful to you, I’m starting to feel sorry for ya!