The Mining Play

MDMN - 2016-04-11 Weekly Discussion


#122

I have to admit that I’m not waiting around for $50 but I still see the risk/reward in MDMN as exceptional. Partly because the “incompetent” BOD is sidelined and we’re trading under 2 cents. A 10-15 cent exit with a lower risk profile (as long as we don’t face another round of significant dilution) within a 6-12 month timeframe is attractive. Of course I would have preferred selling all of my shares when we rallied to 10 cents in late 2014 but it’s important to evaluate each investment on a real time basis.

Confucius say: “Man with one foot on ‘yesterday’ and one foot on ‘tomorrow’ will end up pissing on ‘today’”


#123

Is it possible Auryn proves up the property with income from early production and mdmn profits used for dividends, identifies multiple porpherys and then sells the whole thing? I.e. sell everything for $1B, Auryn gets $650M plus increased pps from mdmn shares and mdmn gets $350M.


#124

Please, no more bickering. Just straight, constructive conversation w/o name calling. Thank you.


#125

Anything is possible. That’s a HUGE price tag in today’s market. We’d need to be producing over a million ounces annually (if we are using a production metric to determine value).


#126

Confuscius say: “Make faithfulness and truth thy masters: have no friends unlike thyself: be not ashamed to mend thy faults.”


#127

OK, that’s enough… There was a very good conversation going before this started. Let’s get back to it.

One way or the other Confucius say’s the bickering stop’s…


#128

??? So, if AURYN’s annual raw production is in excess of $1B (1 million ounces), we are finally taken out with a 0.20 TO, and AURYN can sell everything for 1B? Is that really the way it works?


#129

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#130

A $billion of raw production annually for at least 30 years. If production costs were 50%, the net cash flow would be $15billion. The present value ( conservatively } at 40% would be $6billion times 25% equals $1.5billion for MDMN. $1.5billion/1.5billion shares equals $1.00/share.


#131

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#132

There is no requirement in the OTC Market that insiders, management or affiliates have to report buys or sells of shares. I would not be looking for that announcement. JMO


#133

This is why 20 cents is still a real possibility with MDMN as long as we stay trading on the otc. Numbers/math/valuations are fuzzy at best. Keep em coming!

Kinross gold is going to produce 3 million ounces this year and is trading at a $5B market cap (up from $2B market cap recently). And they spent billions to get to their production number (which would equate to our current 25% of AMC being whittled down to a very small number). They also have 30M+ ounces in reserves, and 30M in resources. Just to use an actual example.

Either way, we are currently permitted for 4000 tpm (or 40k ounces annually). A thousand mile journey begins with the first step. My reference to a million ounces was only meant to highlight how far we are from supporting a billion dollar valuation using production as a metric.


#134

In the interest of full disclosure we should also point out that Kinross has lost $7.5 billion over the last 4 years. They’ve lost $5billion just getting the minerals out of the ground. They are trading at just a bit over book value.

Yes, things are very difficult for the established legacy mining companies which based on all the factors that Doc has continually highlighted regarding our mountain ( infrastructure, political etc. ), our mountain with its early ( profitable ) production opportunities would seem to be rather attractive to the investing community.

Time will tell.


#135

Fair enough points on KGC and legacy players. I’d encourage you to look at Pretium for a more appropriate comparison on what MDMN could be if we are working with a WCD. Market cap of just under a billion. It’s going to cost them around $700M to get into production (already spent a ton proving up the resource). Considered one of the more exciting plays in the precious metals space in the safest of jurisdictions. Going into production 12-15 months from now.


#136

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#137

Thanks John. Yes, better comparison. We can only hope that Auryn/MDMN will present things with our mountain as professionally as Pretium.

Will be interesting to see how our early production will impact our share price versus Pretium having to wait for a while for production.


#139

AURYN’s short term plan is really quite clear and simple. A plan to move forward on its exploration program and drilling to define resources on the Pegaso Nero and ADL targets with as little debt as possible has been outlined. To accomplish this AMC expects to start production this year on the exposed high grade Caren-Merlin-Fortuna veins. Environmental baseline studies and water monitoring in the Caren-Merlin-Fortuna area and on the Altos de Lipangue Project has already been completed by IAL Ambiental INERCO in the key areas allowing for expanded exploitation permissions and exploration. From the updated Project presentation, prioritization is seen to be focused on those areas within easiest reach of being defined and contributing to early positive cash flow. Moving forward to clearly define the LDM as a resource, with adding an industry standard NPV to the early projects as expeditiously as possible is one of the goals that comes a little later. As boring as it may seem, AURYN’s longer-term plan is specifically designed to avoid running-up multibillion dollar cost overruns and debt that some of the established legacy mining companies mentioned as comparative examples have demonstrated. Market cap will be established through a methodical and thorough exploration program without running into unmanageable debt to prove up resources over the next several years. The foreseeable ADL projects under AURYN are not directly comparable to any of the aforementioned legacy companies when trying to determine where the market cap will be in the future. Those expecting a quick flip or TO in the very near term are likely to be disappointed, IMO.


#140

Read cornhuskers post 77 about Hecla’s bootstrapping roadmap to a mine.Not just the smaller miners looking at this pathway to a revived, healthy industry.
Until things change even the big guy exec’s throwing a few billion into a project is the fast track to the board meeting followed with a severance check.


#141

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#142

OTC Market upon which stocks are quoted on OTC Link is not an exchange. No reporting of insider/management/affiliate buying or selling in its security is required for non-SEC registered companies. The only resticition is how much an insider/management/affiliate can sell. It should be noted that once an insider/manangement/affiliate is no longer associated with a company for a period of 90 days, those restrictions are lifted. Please do the DD and let this issue drop.

I am not just making this up.